SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 1997

                               OR

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

For the transition period from            to 

Commission file number 33-46620

FORTIS BENEFITS INSURANCE COMPANY            
(Exact name of registrant as specified in its charter)


MINNESOTA      
(State or other jurisdiction of 
 incorporation or organization)

81-0170040
(IRS Identification No.)


500 BIELENBERG DRIVE, WOODBURY, MN           55125              
(Address of principal executive offices)     (Zip code)

Registrant's telephone number, including area code: 612-738-5590

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   
<PAGE>
   
FORTIS BENEFITS INSURANCE COMPANY
BALANCE SHEETS
(In thousands)
(Unaudited)

<TABLE>

<S>                                          <C>            <C>
                                              June 30,      December 31,
                                               1997            1996
                                             (unaudited)
ASSETS

Investments
Fixed maturities, at fair value (amortized
  cost: $2,200,595 at June 30, 1997,
  $2,078,438 at December 31, 1996)                $   2,227,705  $  2,115,499
Equity securities, at fair value (cost:
  $84,659 at June 30, 1997, $84,144 at
  December 31, 1996)                                        104,976       
106,290
Mortgage loans on real estate                          579,901        582,869
Policy loans                                        64,132        60,722
Short-term investments                                 142,798        182,817
Real estate and other investments                             38,969       
29,628
                                              $  3,158,481   $ 3,077,825


Cash                                              (28,696)       20,474
Receivables:
  Uncollected premium                                   68,374        71,386
  Reinsurance recoverable on paid and unpaid losses          13,655        
12,939
  Other                                             11,226         9,045
                                                   93,255        93,370


Accrued investment income                               43,485        39,519
Deferred policy acquisition costs                      281,509        268,075
Property and equipment, at cost, less
  accumulated depreciation                              48,567        52,882
Deferred federal income taxes                           26,836        17,008
Other assets                                        3,993         8,005 
Assets held in separate accounts                      2,689,262     2,374,718
                                             $   6,316,692  $  5,951,876

See accompanying notes.

<PAGE>
FORTIS BENEFITS INSURANCE COMPANY
RESERVES, LIABILITIES AND SHAREHOLDER'S EQUITY
(In thousands)
(Unaudited)
                                               June 30,          December 31,
                                               1997           1996
                                              (unaudited)
POLICY RESERVES AND LIABILITIES

Future policy benefit reserves:
  Traditional life insurance                      $  441,319          $
434,378
  Interest sensitive and investment products       1,250,900          
1,175,480
  Accident and health                                 841,457           
834,119
                                              2,533,676          2,443,977

Unearned premiums                                     12,230            
12,622
Other policy claims and benefits payable                  208,916           
191,940
Policyholder dividends payable                          9,173            
8,783
                                              2,763,995          2,657,322

Accrued expenses                                           37,368           
 42,223
Current income taxes payable                           9,759        17,424
Other liabilities                                     37,962           
104,834
Due to Affiliates                                      3,459             
4,926
Liabilities related to separate accounts                2,659,217          
2,344,474
                                              5,511,760          5,171,203

SHAREHOLDER'S EQUITY
Common stock, $5 par value, 1,000,000
  shares authorized, issued and outstanding            5,000             
5,000
Additional paid-in capital                           468,000           
468,000
Retained earnings                                    300,127           
265,613
Unrealized gain (loss) on available-for-sale
  securities, net of deferred taxes of
  $14,623 at June 30, 1997 and $19,535 at 
  December 31, 1996                              27,168             36,290
Unrealized gain on assets held in separate
  accounts, net of deferred taxes of $2,387 at
  June 30, 1997 and $1,454 at December 31, 1996              4,637       
5,770
Total Shareholder's equity                            804,932      780,673
Total policy reserves, liabilities & 
  Shareholder's equity                            $ 6,316,692    $5,951,876

See accompanying notes.<PAGE>
FORTIS BENEFITS INSURANCE COMPANY
STATEMENTS OF INCOME
(In thousands)
(Unaudited)

                                                  Six months ended
                                                  June 30,
                                                  1997           1996

REVENUES

Insurance operations:
  Traditional life insurance premiums                  $  130,461          $
129,268
  Interest sensitive and investment product
   policy charges                                          37,832           
 30,949
  Accident and health premiums                            441,911           
504,799
     Total Insurance Revenue                              610,204           
665,016
Net investment income                                     111,958           
100,383
Realized gains (losses) on investments                          17,093     
         5,692
Other income                                          16,752            
17,028
TOTAL REVENUES                                       756,007           
788,119

BENEFITS AND EXPENSES
Benefits to policyholders:
  Traditional life insurance                              104,167           
116,433
  Interest sensitive and investment products               51,936           
 47,084
  Accident and health                                     348,380           
410,068
                                                     504,483           
573,585
Policyholder dividends                                      2,214           
  1,888
Amortization of deferred policy acquisition 
  costs                                               19,330        20,160
Insurance commissions                                      50,852           
 48,603
General and administrative expenses                            126,029     
       124,122
TOTAL BENEFITS AND EXPENSES                               702,908           
768,358

INCOME BEFORE INCOME TAXES                                      53,099     
        19,761 

INCOME TAX EXPENSE (BENEFITS) 
Current                                                24,434            
7,422
Deferred                                              (5,849)          ( 
506)
                                                      18,585              
6,916 
NET INCOME                                             $   34,514          $ 
12,845 

See accompanying notes.
<PAGE>
FORTIS BENEFITS INSURANCE COMPANY
STATEMENTS OF INCOME
(In thousands)
(Unaudited)

                                                  Three months ended
                                                  June 30,
                                                  1997           1996

REVENUES

Insurance operations:
  Traditional life insurance premiums                  $   67,433          $ 
67,524
  Interest sensitive and investment product
   policy charges                                          19,587           
 17,374
  Accident and health premiums                            220,611           
253,222
     Total Insurance Revenue                              307,631           
338,120
Net investment income                                      57,044           
 49,844
Realized gains (losses) on investments                           3,781     
        (1,174)
Other income                                           8,911             
8,584
TOTAL REVENUES                                       377,367           
395,374

BENEFITS AND EXPENSES
Benefits to policyholders:
  Traditional life insurance                               52,519           
 57,175
  Interest sensitive and investment products               26,313           
 23,578
  Accident and health                                     175,188           
199,892
                                                     254,020           
280,645
Policyholder dividends                                        995           
    754
Amortization of deferred policy acquisition 
  costs                                                9,607         9,219
Insurance commissions                                      26,788           
 23,122
General and administrative expenses                             65,540     
        61,000
TOTAL BENEFITS AND EXPENSES                               356,950           
374,740

INCOME BEFORE INCOME TAXES                                      20,417     
        20,634 

INCOME TAX EXPENSE (BENEFITS) 
Current                                                12,479            
4,577
Deferred                                              (5,332)           2,763

                                                       7,147              
7,340 
NET INCOME                                             $   13,270          $ 
13,294 



See accompanying notes.<PAGE>
FORTIS BENEFITS INSURANCE COMPANY
STATEMENTS OF CASH FLOW
(In thousands)
(Unaudited)

                                                     Six months ended
                                                        June 30,
                                                  1997           1996

OPERATING ACTIVITIES
Net income                                        $     34,514    $   12,847 
Adjustments to reconcile net income to net
  cash provided by operating activities:
  Increase (decrease)in future policy benefit reserves 
   for traditional and interest sensitive products            26,977    
(71,803)
  Increase (decrease)in other policy claims, benefits
   and policyholder dividends payable                    17,366       (5,540)
  Provision for deferred federal income taxes                 (5,849)       
 707 
  (Decrease) in income taxes payable                     (7,666)     (23,880)
  Amortization of policy acquisition costs               19,330       20,160
  Policy acquisition costs deferred                          (35,035)   
(34,802)
  Provision for depreciation                              1,127          703
  Amortization of investment premiums, net                  133        1,134
  Change in uncollected premiums, accrued investment
   income, other receivables, unearned premiums,
   accrued expenses, and other liabilities             ( 81,793)     (11,323)
  Realized gains on investments                              (17,093)    (
5,692)
  Other                                                 20      (4,978)
NET CASH PROVIDED BY OPERATING ACTIVITIES                    (47,969)       
(122,467)

INVESTING ACTIVITIES
Purchases of fixed maturity investments               (2,446,316) (1,084,818)
Sales or maturities of fixed maturity investments      2,325,418   1,060,351
Increase in short-term investments                        40,019      26,115 
Purchase of other investments                            (93,090)   ( 71,879)
Sales or maturities of other investments                      106,859      
38,698
Sale (purchase) of property and equipment                      3,187      
1,825 
Other                                                         -       ( 156) 
NET CASH USED BY INVESTING ACTIVITIES                   (63,923)    ( 29,864)

FINANCING ACTIVITIES
Activities related to investment products:
  Considerations received                               112,162        90,087
  Surrenders and death benefits                         (75,513)     
(16,493)
  Interest credited to policyholders                     26,073        30,821
NET CASH PROVIDED BY FINANCING ACTIVITIES                     62,722       
104,415
DECREASE IN CASH                                        (49,170)     
(47,916)
Cash and cash equivalents at beginning of period         20,474            
1
CASH AND CASH EQUIVALENTS AT END OF PERIOD             $(28,696)  $  
(47,915)

See accompanying notes.

/TABLE
<PAGE>
FORTIS BENEFITS INSURANCE COMPANY
Notes to Financial Statements
June 30, 1997
(unaudited)

General:  The accompanying unaudited financial statements
of Fortis Benefits Insurance Company contain all
adjustments necessary to present fairly the balance sheet
as of June 30, 1997 and the related statement of income
for the six months ended June 30, 1997 and 1996, and cash
flows for the six months ended June 30,1997 and 1996.

Income tax payments for the six months ended June 30,1997
and June 30, 1996 were $32,115,000 and $32,194,224,
respectively.

The classification of fixed maturity investments is to be
made at the time of purchase and, prospectively, that
classification is expected to be reevaluated as of each
balance sheet date.  At June 30, 1997, all fixed maturity
and equity securities are classified as available-for-
sale and carried at fair value.

The amortized cost and fair values of investments
available-for-sale were as follows at June 30, 1997 (in
thousands):
<TABLE>

<S>                 <C>            <C>            <C>          <C>
                              Gross          Gross
               Amortized      Unrealized     Unrealized           Fair
               Cost           Gain      Loss                Value
Fixed Income Securities:
  Governments       $ 190,222 $    2,059     $      552           $ 191,729
  Public Utilities    128,014      2,388            499                
129,903
  Industrial and
    miscellaneous        1,840,964     29,408           6,295         
1,864,077
  Other                41,395        728             127             41,996
Total                    2,200,595     34,583           7,473         
2,227,705
Equity Securities           84,659     23,911           3,594          
104,976 
                    $2,285,254     $   58,494     $    11,067         
$2,332,681
</TABLE>

The amortized cost and fair value of fixed maturities at
June 30, 1997, by contractual maturity, are shown below
(in thousands). Expected maturities will differ from
 <PAGE>
FORTIS BENEFITS INSURANCE COMPANY
Notes to Financial Statements
June 30, 1997
(unaudited)

contractual maturities because borrowers may have the
right to call or prepay obligations with or without call
or prepayment penalties.

<TABLE>

<S>                                <C>            <C>
                                   Amortized      Fair
                                   Cost           Value

Due in one year or less                 $    31,262         $   
31,582
Due after one year through 
  five years                           821,108             829,742
Due after five years through 
  ten years                                 551,716            
557,742
Due after ten years                    796,509             808,639
                                   $ 2,200,595         $ 2,227,705
</TABLE>

Proceeds from sales and maturities of investments in
fixed maturities in the six-month period ended June
30,1997 were $2,318,817,026, and $6,601,000 respectively.

Gross gains of $15,092,024 and gross losses of
$13,694,179 were realized on sales.

Mortgage Loans: The Company has issued commercial
mortgage loans on properties located throughout the
country.  Currently, approximately 36% of outstanding
principal is concentrated in the states of Florida,
California and New York.  The Company has a diversified
loan portfolio with a small average size, which greatly
reduces any loss exposure. The Company has established a
reserve for mortgage loans.


<PAGE>
FORTIS BENEFITS INSURANCE COMPANY
Notes to Financial Statements
June 30, 1997
(unaudited)



Net Investment Income and Realized Gains (Losses) on
Investments: Major categories of net investment income
and realized gains and losses on investments for the
first six months of each year were as follows (in
thousands):

<TABLE>


<S>                      <C>                      <C>
                              Investment               Realized Gain (Loss)
                              Income              on Investments
                         1997      1996             1997       1996
Fixed maturities              $ 78,255  $ 69,732       $  1,398   $     480
Preferred stocks                    154       94            359         250
Common stocks               4,495     2,673         15,282     5,049
Mortgage loans on 
  real estate              26,692    26,440           (  8)     (144)
Policy loans                  522         8             0         0
Short-term investments           3,470     4,704             0           57
Real estate and other
   investments              2,053     1,290             62          0
                          115,641   104,941       $ 17,093  $   5,692 
Expenses                   (3,682)   (4,559)
                         $111,959  $100,382
</TABLE>   
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations June 30, 1997
Compared to June 30, 1996

Revenues
Traditional life insurance premiums of Fortis Benefits
(the "Company"), principally composed of group life
coverages, increased in the first half of 1997 over the
same period in 1996 due to increased sales. Interest
sensitive and investment product policy charges, which
consist primarily of cost of insurance charges,
increased 22% in the first half of 1997 compared to the
same period in 1996. Continued sales of interest
sensitive and investment products has steadily
increased the policy base on which these charges are
assessed.  

Total accident and health premiums decreased in the
first half of 1997 compared to the same period in 1996
primarily due to: 1) a decision made in 1996 to
discontinue new sales of certain medical products; and,
2) sales of the remaining group medical business has
decreased 8%.  The decreases above are partially offset
by a 10% increase in group disability and dental
product sales.

The Company continues to match investment portfolio
composition to liquidity needs and capital
requirements.  Changes in interest rates during 1997
and 1996 resulted in recognition of realized gains and
losses.

Benefits
The Company's group life benefits which are included in
the traditional life benefits were lower in the first
two quarters of 1997 compared to the same period in
1996 as a result of improved mortality in the first
half of 1997.  Interest sensitive and investment
product benefits for the six month period ended June
30, 1997 increased 10% from the same period in 1996. 
This increase was the result of higher mortality
experience and higher interest crediting on the
Company's steadily increasing policy base in 1997
compared to 1996.

The accident and health claims to premium ratio
improved from six months ended June 30, 1996 to the
same period in 1997 primarily due to the improved claim
experience.

Expenses
The commission rates have increased from the levels at
June 30, 1996.  This is primarily due to the change in
the mix of business by product line as well as the
change in first year versus renewal premiums.  Interest
sensitive and investment products commission increased
10% as a result of increased sales,in the first six
months in 1997 compared to the same period in 1996. The
Company deferred $32.6 million of these commissions in
the first half of 1997, compared to $31.1 million in
the same period in 1996. 

The Company's expenses in the first half of 1997 have
increased over the same period in 1996.  Contributing
to this increase are expenses associated with enabling
the application systems to be year 2000 compliant.
Group dental operations are beginning managed dental
initiatives that have also contributed to the expense
increases.  Expense reductions relating to the
discontinued group medical business have continued but
the expense decreases have slowed in comparison to the
premium decreases.

Liquidity and Capital Resources

The liquidity requirements of the Company have been met
by funds provided from  operations, investment income
and additional paid in capital from the Company's
parent and sole shareholder.  Funds are principally
used to provide for policy benefits, operating
expenses, commissions and investment purchases.  The
impact of the declining inforce medical business has
been considered in evaluating the Company's future
liquidity needs.  The Company expects its operating
activities and additional paid in capital from the
Company's parent to generate sufficient funds.

The NAIC has implemented risk-based capital standards
to determine the capital requirements of a life
insurance company based upon the risks inherent in its
operations.  These standards require the computation of
risk-based capital amount which is then compared to a
company's actual total adjusted capital.  Based upon
current calculation using these risk-based capital
standards, the <PAGE>
Company's percentage of total adjusted capital is in
excess of ratios which would require regulatory
attention.

The Company has no long or short term debt.  The
Company's fixed maturity investments consisted of 97%
investment grade bonds as of June 30, 1997 and the
Company does not expect this percentage to change 
significantly in the future.


<PAGE>
PART II.  OTHER INFORMATION


Item 1.  Legal Proceedings

     None

Item 2.  Changes in Securities

     None

Item 3.  Defaults Upon Senior Securities

     None

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

     None

Item 5.  Other Information

     None

Item 6.  Exhibits and Reports on Form 8-K

a.   None

b.   No Forms 8-K have been filed during the quarter
     for which this report is filed.

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.

Fortis Benefits Insurance Company  
(Registrant)
Date: August 14, 1997
/s/ Michael J. Peninger 
Senior Vice President, Controller and Treasurer (on
behalf of the Registrant and as its principal financial
and chief accounting officer)