FORM 10-Q

                 SECURITIES AND EXCHANGE COMMISSION

                      Washington, D.C. 20549


[x]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
               SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 1996

                              OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
               SECURITIES EXCHANGE ACT OF 1934


Commission file number: 33-47245


              ALLSTATE  LIFE  INSURANCE  COMPANY  OF NEW  YORK
          (Exact name of registrant as specified in its charter)

        NEW YORK                                     36-2608394
(State or other jurisdiction of                  (I.R.S. Employer
 incorporation or organization)                   Identification No.)

                      One Allstate Drive
                        P.O. Box 9095
                  Farmingville, New York 11738
            (Address of principal executive offices)
                          (Zip Code)

                         516/451-5300
        (Registrant's telephone number, including area code)

                       Not Applicable
        (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

     Indicate  the  number of shares of each of the  issuer's  classes of common
stock,  as of September  30, 1996;  there were 80,000  shares of common  capital
stock  outstanding,  par value $25 per  share  all of which  shares  are held by
Allstate Life Insurance Company.


<PAGE>


                        PART I - FINANCIAL INFORMATION


Item  1.   Financial Statements

            Statements of Financial Position As Of
            September 30, 1996(Unaudited)and December 31, 1995       3

            Statements of Operations
            Three Months Ended September 30, 1996
            and September 30, 1995 (Unaudited)
            Nine Months Ended September 30, 1996
            and September 30, 1995 (Unaudited)                        4

            Statements of Cash Flows
            Nine Months Ended September 30, 1996
            and September 30, 1995(Unaudited)                         5

            Notes to Financial Statements                             6

Item  2.   Management's Discussion and Analysis of
           Financial Condition and Results of Operations              7


                          PART II - OTHER INFORMATION


Item 1.   Legal Proceedings                                          11

Item 2.   Changes in Securities                                      11

Item 3.   Defaults Upon Senior Securities                            11

Item 4.   Submission of Matters to a Vote of Security Holders        11

Item 5.   Other Information                                          11

Item 6.   Exhibits and Reports on Form 8-K                           11

Signature Page

<PAGE>
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

STATEMENTS OF FINANCIAL POSITION
<TABLE>
<CAPTION>

                                                                            September 30,                  December 31,
($ in thousands)                                                                1996                           1995
                                                                             (Unaudited)
<S>                                                                             <C>                         <C>
Assets
  Investments
     Fixed income securities available for sale, at
       fair value (amortized cost $1,286,435 and
       $1,219,418)                                                               $ 1,363,625                  $1,424,893
     Mortgage loans                                                                   81,116                      86,394
     Policy loans                                                                     24,557                      22,785
     Short-term                                                                       39,289                       7,257

          Total investments                                                        1,508,587                   1,541,329

  Deferred acquisition costs                                                          59,908                      53,944
  Accrued investment income                                                           17,248                      18,828
  Reinsurance recoverables                                                             2,911                       3,331
  Deferred income taxes                                                                5,305
  Cash                                                                                 2,262                       1,472
  Other assets                                                                         3,552                       3,924
  Separate Accounts                                                                  243,863                     220,141

                   Total assets                                                   $1,843,636                 $ 1,842,969

  Liabilities
     Reserve for life insurance policy benefits                                  $   855,141                 $   838,739
     Contractholder funds                                                            516,144                     499,548
     Deferred income taxes                                                                                        23,659
     Other liabilities and accrued expenses                                           10,211                       8,950
     Net payable to affiliates                                                           959                       1,865
     Separate Accounts                                                               243,863                     220,141

                   Total liabilities                                               1,626,318                   1,592,902

  Shareholder's equity
     Common stock, $25 par value, 80,000 shares
       authorized, issued and outstanding                                              2,000                       2,000
     Additional capital paid-in                                                       45,787                      45,787
     Unrealized net capital gains                                                     26,585                      74,413
     Retained income                                                                 142,946                     127,867

                  Total shareholder's equity                                         217,318                     250,067


                  Total liabilities and shareholder's equity                      $1,843,636                  $1,842,969



</TABLE>

See notes to financial statements.



                                             3

<PAGE>
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                             Three Months Ended                  Nine Months Ended
                                                                September 30,                      September 30,

($ in thousands)                                           1996                 1995              1996             1995

                                                                 (Unaudited)                        (Unaudited)

<S>                                                         <C>                 <C>               <C>               <C>
Revenues
  Premium income (net of reinsurance
   ceded of $626 and $692; $1,820 and
   $1,758)                                                   $ 20,990           $  23,519         $  65,906         $100,126
  Contract charges                                              6,567               5,676            18,872           15,514
  Net investment income                                        28,528              26,622            83,952           77,304
  Realized capital gains and (losses)                         (2,575)                 324           (2,224)           (1,809)

                                                               53,510              56,141           166,506           191,135

Costs and expenses
  Provision for policy benefits (net of
    reinsurance  recoveries of $523 and
    $503; $2,693 and $681)                                     40,298              43,061           125,687           152,832
  Amortization of deferred acquisition costs                    1,498               1,740             4,463             3,500
  Operating costs and expenses                                  4,265               4,060            12,679            13,981

                                                               46,061              48,861           142,829           170,313

Income from operations before
income tax expense                                              7,449               7,280            23,677            20,822

Income tax expense                                              2,609               2,696             8,599             7,543

Net income                                                   $  4,840            $  4,584           $15,078           $13,279
                                                             --------            ---------          --------          -------





</TABLE>



See notes to financial statements.



                                              4

<PAGE>
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>

                                                                                          Nine Months Ended
                                                                                            September 30,

                                                                                  1996                       1995
($ in thousands)                                                                             (Unaudited)

<S>                                                                               <C>                         <C>
Cash flows from operating activities
  Net income                                                                       $   15,078                  $  13,279
  Adjustments to reconcile net income to net cash
    provided by operating activities
     Depreciation, amortization and other
        non-cash items                                                               (19,375)                   (16,430)
     Realized capital gains and losses                                                  2,224                      1,809
     Interest credited to contractholder funds                                         18,178                     19,798
     Increase in reserve for policy benefits and
        contractholder funds                                                           53,962                     88,166
     Increase in deferred policy acquisition costs                                    (4,957)                    (4,429)
     Change in accrued investment income                                                1,580                      (456)
     Change in deferred income taxes                                                  (3,212)                    (5,078)
        Change in other operating assets and
         liabilities                                                                    1,879                      2,799

           Net cash provided by operating activities                                   65,357                     99,458

Cash flows from investing activities
  Proceeds from sales
     Fixed income securities available for sale                                        20,810                     13,526
  Investment collections
     Fixed income securities available for sale                                        50,223                     21,582
     Fixed income securities held to maturity                                                                      2,404
     Mortgage loans                                                                     7,702                      2,890
  Investment purchases
     Fixed income securities available for sale                                     (122,232)                   (84,910)
     Fixed income securities held to maturity                                                                   (32,046)
     Mortgage loans                                                                   (1,825)                    (3,074)
  Change in short-term investments, net                                              (32,032)                   (20,614)
  Change in other investments, net                                                    (1,772)                      (215)
         Net cash used in investing activities                                       (79,126)                  (100,457)

Cash flows from financing activities
  Contractholder fund deposits                                                         49,254                     56,807
  Contractholder fund withdrawals                                                    (34,695)                   (57,052)
         Net cash provided by (used in)
          financing activities                                                         14,559                      (245)

Net increase (decrease) in cash                                                           790                    (1,244)
Cash at beginning of period                                                             1,472                      1,763
                                                                                 ------------                -----------
Cash at end of period                                                            $      2,262               $        519
                                                                                 ------------                -----------
</TABLE>

See notes to financial statements.


                                           5

<PAGE>
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

NOTES TO FINANCIAL STATEMENTS
(Unaudited)


1.      Basis of Presentation

               Allstate Life  Insurance  Company of New York (the  "Company") is
wholly  owned by a  wholly-owned  subsidiary  ("Parent")  of Allstate  Insurance
Company ("Allstate"), a wholly-owned subsidiary of The Allstate Corporation (the
"Corporation").

               The financial  statements  and notes as of September 30, 1996 and
for the three-month and nine-month periods ended September 30, 1996 and 1995 are
unaudited.   These  interim   financial   statements   reflect  all  adjustments
(consisting  only of normal  recurring  accruals)  which are,  in the opinion of
management,  necessary  for the fair  presentation  of the  financial  position,
results of operations and cash flows for the interim  periods.  These  financial
statements should be read in conjunction with the financial statements and notes
thereto  included  in the  Allstate  Life  Insurance  Company of New York Annual
Report on Form 10K for 1995. The results of operations  for the interim  periods
should not be considered indicative of results to be expected for the full year.

               To conform with the 1996 presentation, certain items in the prior
year's financial statements have been reclassified.





                                        6


<PAGE>
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS



GENERAL

     The following discussion highlights significant factors influencing results
of  operations  and changes in  financial  position of Allstate  Life  Insurance
Company of New York (the  "Company").  It should be read in conjunction with the
discussion  and analysis and financial  statements and notes thereto found under
Items 7 and 8 of Part II of the  Allstate  Life  Insurance  Company  of New York
Annual Report on Form 10-K for the year ended December 31, 1995.

     The Company, which is wholly owned by a wholly-owned  subsidiary ("Parent")
of Allstate Insurance Company ("Allstate"), markets life insurance and group and
individual  annuities  in  the  state  of New  York,  with  products  consisting
predominately  of  structured  settlement  annuities  sold  through  independent
brokers.  The Company also utilizes  Allstate  agencies and direct  marketing to
distribute  its  traditional  and  universal  life and accident  and  disability
insurance  products.  Certain single and flexible premium annuities are marketed
to individuals  through the account  executives of Dean Witter Reynolds Inc. The
Company issues flexible premium deferred variable annuity  contracts,  also sold
through the account  executives  of Dean Witter  Reynolds  Inc.,  the assets and
liabilities of which are legally  segregated  and reflected in the  accompanying
statements of financial  position as the assets and  liabilities of the Separate
Accounts. Dean Witter InterCapital Inc. manages the funds in which the assets of
the Separate Accounts are invested.

        Separate Account assets and liabilities are carried at fair value in the
statements  of financial  position.  Investment  income and  realized  gains and
losses  of  the   Separate   Account   investments   accrue   directly   to  the
contractholders  (net of fees) and,  therefore are not included in the Company's
statements of operations.



                                        7


<PAGE>
RESULTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                       Three Months                             Nine Months
                                                    Ended September 30,                     Ended September 30,


($ in thousands)                                 1996                 1995                  1996                1995
<S>                                              <C>                  <C>                   <C>                 <C>

Statutory premiums and
   deposits                                      $     44,523         $     45,982          $    133,882        $   164,732

Invested assets (1)                              $  1,431,397         $  1,299,304          $  1,431,397        $ 1,299,304
Separate Account assets (1)                           243,863              208,430               243,863            208,430

Invested assets including
   Separate Account assets                       $  1,675,260         $  1,507,734          $  1,675,260        $ 1,507,734

Premium income and contract
   charges                                       $     27,557         $     29,195          $     84,778        $   115,640
Net investment income                                  28,528               26,622                83,952             77,304
Policy benefits                                        40,298               43,061               125,687            152,832
Operating expenses                                      5,763                5,800                17,142             17,481

Income from operations                                 10,024                6,956                25,901             22,631
Income tax on operations                                3,510                2,583                 9,377              8,176

Net operating income                                    6,514                4,373                16,524             14,455
Realized capital gains and
   losses, after tax                                  (1,674)                  211               (1,446)            (1,176)

Net income                                      $       4,840        $       4,584          $     15,078       $     13,279
                                                -------------        -------------          -------------      -------------

</TABLE>

(1) Fixed income  securities are included in invested assets in the table
above at amortized  cost and are carried at fair value in the  statements
of financial position. Separate Account assets are included at fair value
in both the table above and the statements of financial position.


 STATUTORY PREMIUMS AND DEPOSITS

        Statutory  premiums,   which  include  premiums  and  deposits  for  all
products,  decreased  3.2% and 18.7% for the third quarter and first nine months
of 1996 compared  with the same periods of 1995.  The decreases for both periods
are primarily due to lower sales of structured settlement  annuities,  partially
offset by increased sales of variable annuity and life products.



                                        8

<PAGE>

PREMIUM INCOME, CONTRACT CHARGES AND PROVISION FOR POLICY BENEFITS

        Premium income and contract charges under generally accepted  accounting
principles  ("GAAP") decreased 5.6% and 26.7% for the three-month and nine-month
periods  ended  September  30, 1996 from the same  periods in 1995.  Under GAAP,
revenues  vary with the mix of  products  sold  during the period  because  they
exclude  deposits on most  annuities  and premiums on universal  life  insurance
policies. The decrease is due to decreased sales of life contingent annuities as
a result of  maintaining  margins on new business  throughout  the year.  Policy
benefits decreased $2.76 million,  or 6.4% during the third quarter of 1996, and
decreased $27.15 million, or 17.8% for the nine months ended September 30, 1996,
also  reflecting the decrease in sales of structured  settlement  annuities with
life  contingencies,  partially  offset by higher mortality costs resulting from
growth in the life insurance block of business.

NET INVESTMENT INCOME

        Pre-tax net  investment  income  increased  7.2% in the third quarter of
1996 and 8.6% for the nine months ended September 30, 1996, compared to the same
periods in 1995. The increases  were  primarily  related to the 10.2% or $132.09
million  increase  in invested  assets.  The overall  portfolio  yield  declined
slightly,  as proceeds  from calls and  maturities  as well as new  premiums and
deposits were invested in  securities  yielding less than the average  portfolio
rate.

 OPERATING EXPENSES

        Operating  expenses  decreased slightly in the third quarter of 1996 and
decreased $339 thousand,  or 1.9%, for the nine months ended September 30, 1996,
compared to the same periods in 1995. The decreases were primarily  attributable
to  reduced  acquisition  costs  due to  lower  sales of  structured  settlement
annuities.

NET OPERATING INCOME

        Net operating  income  increased  49.0% during the third quarter of 1996
and  increased  14.3% for the first  nine  months of 1996  compared  to the same
periods  in  1995.  The  increases were due to  growth  in  assets  as well as
favorable mortality margins on existing business.

REALIZED CAPITAL GAINS AND LOSSES

        Net realized  capital  losses  after-tax  were $1.67 million  during the
third  quarter of 1996 compared to after-tax  gains of $211 thousand  during the
same period in 1995.  Fixed income  securities  were sold at losses in the third
quarter of 1996 to reposition a portion of the  investment  portfolio to improve
overall  investment  yield. Net realized  capital losses after-tax  increased to
$1.45 million for the first nine months of 1996 compared to after-tax  losses of
$1.18  million for the same  period in 1995.  The  increased  losses were due to
higher losses on fixed income  securities  partially  offset by reduced mortgage
losses.


                                         9


<PAGE>

INVESTMENTS

FIXED INCOME SECURITIES

        The  Company  monitors  the  quality  of  its  fixed  income  securities
portfolio, in part, by categorizing certain investments as problem, restructured
or potential problem investments. Problem fixed income securities are securities
in default  with  respect to  principal  or  interest  or  securities  issued by
companies that went into  bankruptcy  subsequent to acquisition of the security.
Restructured  fixed income  securities  have modified terms and conditions  that
were not at  current  market  rates  or terms at the time of the  restructuring.
Potential   problem  fixed  income   securities  are  current  with  respect  to
contractual principal or interest, but because of other facts and circumstances,
management  has serious doubts  regarding the  borrower's  ability to pay future
interest and principal,  which causes management to believe these securities may
be classified as problem or restructured  in the future.  At September 30, 1996,
problem,  restructured  and potential  problem fixed income  securities  totaled
$3.74 million. There were no problem,  restructured,  or potential problem fixed
income securities at December 31, 1995.


COMMERCIAL MORTGAGE LOANS

        The Company  monitors the quality of its mortgage loans by  categorizing
certain loans as problem,  restructured or potential problem. Problem commercial
mortgage loans are loans that are in foreclosure, loans for which a principal or
interest  payment  is over 60 days past due,  or are  current  with  respect  to
interest  payments,  but  considered   in-substance   foreclosed.   Restructured
commercial  mortgage loans have modified  terms and conditions  that were not at
current  market  rates  or terms  at the  time of the  restructuring.  Potential
problem  commercial  mortgage loans include loans which are current with respect
to  interest  payments,  or  less  than  60 days  delinquent  as to  contractual
principal or interest  payments,  but because of other facts and  circumstances,
management  has serious doubts  regarding the  borrower's  ability to pay future
interest and  principal  which causes  management  to believe these loans may be
classified as problem or restructured in the future. Total problem, restructured
and potential  problem loans,  net of valuation  allowances of $1.52 million and
$1.95  million,  were $6.41  million and $9.65 million at September 30, 1996 and
December 31, 1995, respectively.

        The carrying value of impaired loans was $4.35 million and $9.65 million
as of September 30, 1996 and December 31, 1995, respectively.


LIQUIDITY AND CAPITAL RESOURCES

        The Company's  principal source of funds consists  primarily of premiums
and annuity deposits and collections of principal and income from the investment
portfolio.  The Company generates substantial positive cash flows from operating
activities.  The major uses of these funds are policyholder claims and benefits,
acquisition of investments,  contract maturities, surrenders and other operating
costs.



                                       10

<PAGE>

                        PART II - Other Information

Item 1.  Legal Proceedings

         The  Company  and its  Board of  Directors  know of no  material  legal
proceedings  pending to which the Company is a party or which  would  materially
affect the Company.

Item 2.  Changes in Securities

         Not applicable.

Item 3.  Defaults Upon Senior Securities

         Not applicable.

Item 4.  Submission of Matters to a Vote of Security Holders

         Not applicable.

Item 5.  Other Information

         Not applicable.

Item 6. Exhibits and Reports on Form 8-K

        (a) Exhibits required by Item 601 of Regulation S-K

              (2)    None
              (3)(i) Articles of Incorporation*
                (ii) By-laws*
              (4)    Allstate Life Insurance Company of New York
                     Single Premium Deferred Annuity Contract**
                      Allstate Life Insurance Company of New York Flexible
                     Premium Deferred Annuity Contract*
              (10)   None
              (11)   None
              (15)   None
              (18)   None
              (19)   None
              (22)   None
              (23)(a)Consent of Independent Public Accountants***
                  (b)Consent of Attorneys****
              (24) None
              (27) Financial Data Schedule
              (99) None

       (b)  Reports on 8-K

             No reports on Form 8-K were filed during the third quarter of
             1996.


*  Previously  filed  in  Form  N-4  Registration  Statement  No.33-65381  dated
September 20, 1996 and incorporated by reference.


                                         11

<PAGE>

**  Previously  filed  in Form  S-1  Registration  Statement  No.33-47245  dated
November 13, 1992 and incorporated by reference.

*** Previously filed in Form S-1 Registration  Statement No.33-47245 dated April
16, 1996 and incorporated by reference.

****  Previously  filed in Form S-1  Registration  Statement  No.33-47245  dated
November 13, 1992 and incorporated by reference.







                                        12

<PAGE>

                                 SIGNATURES


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



                           Allstate Life Insurance Company of New York
                                      (Registrant)



November 13, 1996                  /s/ LOUIS G. LOWER, II
------------------                 -----------------------
DATE                               LOUIS G.  LOWER, II
                                   CHAIRMAN OF THE BOARD OF DIRECTORS
                                      and PRESIDENT
                                   (Principal Executive Officer)



November 13, 1996                   /s/ KEVIN R. SLAWIN
-----------------                   --------------------
DATE                                KEVIN R. SLAWIN
                                    Director and Vice President
                                    (Chief Accounting Officer)