UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Registrant meets the conditions set forth in General Instruction H (1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format.

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED ~~MARCH 31,~~JUNE 30, 2005

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 333-100029

ALLSTATE LIFE INSURANCE COMPANY
OF
NEW YORK

(Exact name of registrant as specified in its charter)

New York		~~36—2608394~~36-2608394
(State of Incorporation)		(I.R.S. Employer Identification No.)

100 Motor Parkway, Suite 132
Hauppauge, New York		11788
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 631-357-8920

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 ý No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes o No ý

As of ~~April~~July 29, 2005 the Registrant had 100,000 common shares, $25 par value, outstanding, all of which are held by Allstate Life Insurance Company.

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

INDEX TO QUARTERLY REPORT ON FORM 10-Q

March 31,June 30, 2005

PART 1.	FINANCIAL INFORMATION	Page

Item 1.	Financial Statements

	Condensed Statements of Operations for the Three-Month and Six-Month Periods Ended ~~March 31,~~June 30, 2005 and 2004 (unaudited)	3

	Condensed Statements of Financial Position as of ~~March 31, 2004~~June 30, 2005 (unaudited) and December 31, 2004	4

	Condensed Statements of Cash Flows for the ~~Three-Month~~Six-Month Periods Ended ~~March 31,~~June 30, 2005 and 2004 (unaudited)	5

	Notes to Condensed Financial Statements (unaudited)	6

	Report of Independent Registered Public Accounting Firm	1110

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1211

Item 4.	Controls and Procedures	2324

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	2324

Item 6.	Exhibits	23
		24

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

CONDENSED STATEMENTS OF OP~~ERATIONS~~OPERATIONS

	Three Months Ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004
	(unaudited)						(unaudited)						(unaudited)
Revenues
Premiums (net of reinsurance ceded of $4,468 and $3,912)	$	19,993		$	16,651
Premiums							$	16,174		$	19,969		$	36,167		$	36,620
Contract charges	15,259			14,112			15,976			14,576			31,235			28,688
Net investment income	86,492			70,395			88,503			72,676			174,995			143,071
Realized capital gains and losses	(5,877		)	(653		)	(2,632		)	(2,886		)	(8,509		)	(3,539		)
	115,867			100,505			118,021			104,335			233,888			204,840

Costs and expenses
Contract benefits	47,083			42,924			42,901			44,916			89,984			87,840
Interest credited to contractholder funds	36,226			27,651			39,438			30,535			75,664			58,186
Amortization of deferred policy acquisition costs	931			(109		)	11,157			8,817			12,088			8,708
Operating costs and expenses	9,192			9,958			13,078			10,300			22,270			20,258
	93,432			80,424			106,574			94,568			200,006			174,992

Gain on disposition of operations	—			1,058			1			—			1			1,058

Income from operations before income tax expense and cumulative effect of change in accounting principle, after-tax	22,435			21,139			11,448			9,767			33,883			30,906

Income tax expense	8,550			7,502			4,508			3,592			13,058			11,094

Income before cumulative effect of change in accounting principle, after-tax	13,885			13,637			6,940			6,175			20,825			19,812

Cumulative effect of change in accounting principle, after-tax	—			(7,586		)	—			—			—			(7,586		)

Net income	$	13,885		$	6,051		$	6,940		$	6,175		$	20,825		$	12,226

See notes to condensed financial statements.

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

CONDENSED STATEMENTS OF FINANCIAL ~~POSITI~~ONPOSITION

								June 30,		December 31,
(in thousands, except par value data)	March 31, 2005			December 31, 2004				2005		2004
	(unaudited)							(unaudited)
Assets
Investments
Fixed income securities, at fair value (amortized cost $5,303,672 and $5,012,977)	$		5,755,899	$	5,545,647
Fixed income securities, at fair value (amortized cost $5,451,437 and $5,012,977)								$	6,111,363	$	5,545,647
Mortgage loans	520,218			480,280				536,908		480,280
Short-term	133,443			111,509				66,059		111,509
Policy loans	35,488			34,948				35,806		34,948
Other	4,818			4,638				2,399		4,638
Total investments	6,449,866			6,177,022				6,752,535		6,177,022

Cash	16,141			8,624				2,841		8,624
Deferred policy acquisition costs	294,745			238,173				254,462		238,173
Accrued investment income	59,822			55,821				59,460		55,821
Reinsurance recoverables	9,047			8,422				10,930		8,422
Current income taxes receivable	—			367				2,684		367
Other assets	58,965			17,665				22,647		17,665
Separate Accounts	809,274			792,550				851,253		792,550
Total assets	$	7,697,860		$		7,298,644		$	7,956,812	$	7,298,644

Liabilities
Reserve for life-contingent contract benefits	$	1,804,604		$			1,782,451	$	1,911,139	$	1,782,451
Contractholder funds	4,033,796			3,802,846				4,135,238		3,802,846
Deferred income taxes	73,555			90,760				94,191		90,760
Current income taxes payable	8,360			—
Other liabilities and accrued expenses	335,941			180,904				277,354		180,904
Payable to affiliates, net	7,484			8,831				10,741		8,831
Reinsurance payable to parent	1,015			1,067				963		1,067
Separate Accounts	809,274			792,550				851,253		792,550
Total liabilities	7,074,029			6,659,409				7,280,879		6,659,409

Commitments and Contingent Liabilities (Note 3)

Shareholder’s equity
Common stock, $25 par value, 100 thousand shares authorized and outstanding	2,500			2,500				2,500		2,500
Additional capital paid-in	120,000			120,000				120,000		120,000
Retained income	375,329			361,480				382,269		361,480
Accumulated other comprehensive income:
Unrealized net capital gains and losses	126,002			155,255				171,164		155,255
Total accumulated other comprehensive income	126,002			155,255				171,164		155,255
Total shareholder’s equity	623,831			639,235				675,933		639,235
Total liabilities and shareholder’s equity	$	7,697,860		$			7,298,644	$	7,956,812	$	7,298,644

See notes to condensed financial statements.

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

CONDENSED STATEMENTS OF CASH FLOWS

	Three Months Ended March 31,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004
	(unaudited)						(unaudited)
Cash flows from operating activities
Net income	$	13,885		$	6,051		$	20,825		$	12,226
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization and other non-cash items	(14,281		)	(12,004		)	(28,457		)	(24,511		)
Realized capital gains and losses	5,877			653			8,509			3,539
Gain on disposition of operations	—			(1,058		)	(1		)	(1,058		)
Cumulative effect of change in accounting principle	—			7,586			—			7,586
Interest credited to contractholder funds	36,226			27,651			75,664			58,186
Changes in:
Life-contingent contract benefits and contractholder funds	11,203			6,809			17,867			15,929
Deferred policy acquisition costs	(19,933		)	(14,546		)	(25,822		)	(28,212		)
Income taxes payable	7,293			6,252			(7,434		)	3,938
Other operating assets and liabilities	(4,566		)	5,584			(4,438		)	11,026
Net cash provided by operating activities	35,704			32,978			56,713			58,649

Cash flows from investing activities
Proceeds from sales of fixed income securities	109,133			90,702			303,080			233,910
Investment collections
Fixed income securities	33,124			46,547			84,532			102,448
Mortgage loans	12,531			3,237			38,902			6,403
Investment purchases
Fixed income securities	(362,866		)	(267,897		)	(687,867		)	(763,912		)
Mortgage loans	(51,932		)	(3,000		)	(93,054		)	(24,474		)
Change in short-term investments, net	27,097			(39,594		)	37,382			4,884
Change in other investments, net	2,295			(163		)	(969		)	379
Net cash used in investing activities	(230,618		)	(170,168		)	(317,994		)	(440,362		)

Cash flows from financing activities
Contractholder fund deposits	286,595			195,768			500,093			510,088
Contractholder fund withdrawals	(84,164		)	(58,987		)	(244,595		)	(124,958		)
Net cash provided by financing activities	202,431			136,781			255,498			385,130

Net increase (decrease) in cash	7,517			(409		)
Net (decrease) increase in cash							(5,783		)	3,417
Cash at beginning of period	8,624			10,731			8,624			10,731
Cash at end of period	$	16,141		$	10,322		$	2,841		$	14,148

See notes to condensed financial statements.

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

1. Basis of Presentation

The accompanying condensed financial statements include the accounts of Allstate Life Insurance Company of New York (the “Company”), a wholly owned subsidiary of Allstate Life Insurance Company (“ALIC”), which is ~~wholly-owned~~wholly owned by Allstate Insurance Company (“AIC”), a ~~wholly-owned~~wholly owned subsidiary of The Allstate Corporation (the “Corporation”).

The condensed financial statements and notes as of ~~March 31,~~June 30, 2005 and for the three-month and six-month periods ended ~~March 31,~~June 30, 2005 and 2004 are unaudited. The condensed 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 condensed financial statements and notes should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004. The results of operations for the interim periods should not be considered indicative of results to be expected for the full year.

To conform to the 2005 presentation, certain amounts in the prior year’s condensed financial statements and notes have been reclassified.

Pending accounting standard

Financial Accounting Standards Board Staff Position re. Emerging Issues Task Force Issue 03-1-a, Implementation Guidance for the Application of Paragraph 16 of EITF Issue No. 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments” (“FSP EITF Issue 03-1-a”).

In September 2004, the Financial Accounting Standards Board (“FASB”) issued proposed FSP EITF 03-1-a to address the application of paragraph 16 of Emerging Issues Task Force Issue No. 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments” (“EITF Issue 03-1”) to debt securities that are impaired because of increases in interest rates, and/or sector spreads. Thereafter, in connection with its decision to defer the effective date of paragraphs 10–20 of EITF 03-1 through the issuance of FSP EITF Issue 03-1-1, “Effective Date of Paragraphs 10-20 of EITF Issue No. 03-1, The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments” (“FSP EITF Issue 03-1-1”), the FASB requested from its constituents comments on the issues set forth in FSP EITF 03-1-a and the issues that arose during the comment letter process for FSP EITF 03-1-b, “Effective Date of Paragraph 16 of EITF Issue No. 03-1, The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments”.

Due to the uncertainty as to how the outstanding issues will be resolved, the Company is unable to determine the impact of adopting paragraphs 10-20 of EITF 03-1 until final implementation guidance is issued. Adoption of paragraphs 10-20 of EITF 03-1 may have a material impact on the Company’s Condensed Statements of Operations but is not expected to have a material impact on the Company’s Condensed Statements of Financial Position as fluctuations in fair value are already recorded in accumulated other comprehensive income.

2. Reinsurance

The effects of reinsurance on premiums and contract charges are as follows:

	Three months ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004
Premiums and contract charges
Direct	$	39,670		$	34,490		$	36,185		$	38,677		$	75,855		$	73,167
Assumed – non-affiliate	212			185			290			117			502			302
Ceded
Affiliate	(1,180		)	(1,097		)	(1,172		)	(1,086		)	(2,352		)	(2,183		)
Non-affiliate	(3,450		)	(2,815		)	(3,153		)	(3,163		)	(6,603		)	(5,978		)
Premiums and contract charges, net of reinsurance	$	35,252		$	30,763		$	32,150		$	34,545		$	67,402		$	65,308

The effects of reinsurance on contract benefits are as follows:

	Three months ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004
Contract benefits
Direct	$	49,041		$	44,358		$	45,829		$	46,370		$	94,870		$	90,728
Assumed – non-affiliate	60			33			96			45			156			78
Ceded
Affiliate	(462		)	1,051			(726		)	(1,034		)	(1,188		)	17
Non–affiliate	(1,556		)	(2,518		)
Non-affiliate							(2,298		)	(465		)	(3,854		)	(2,983		)
Contract benefits, net of reinsurance	$	47,083		$	42,924		$	42,901		$	44,916		$	89,984		$	87,840

In addition to amounts included in the table above are ~~aggregate~~ reinsurance premiums ceded to ALIC of ~~$701~~$722 thousand and ~~$671~~$682 thousand for second quarter of 2005 and 2004, respectively and $1.42 million and $1.35 million for the ~~three~~first six months ~~ended March 31,~~of 2005 and 2004, respectively, under the terms of the structured settlement annuity reinsurance agreement. These amounts are reflected as a component of realized capital gains and losses on the Condensed Statements of Operations as the treaty is recorded as a derivative instrument pursuant to the requirements of Statement of Financial Accounting Standard No. 133, “Accounting for Derivative Instruments and Hedging Activities.”

3. Guarantees and Contingent Liabilities

Guarantees

In the normal course of business, the Company provides standard indemnifications to counterparties in contracts in connection with numerous transactions, including acquisitions and divestures. The types of indemnifications typically provided include indemnifications for breaches of representations and warranties, taxes and certain other liabilities, such as third party lawsuits. The indemnification clauses are often standard contractual terms and were entered into in the normal course of business based on an assessment that the risk of loss would be remote. The terms of the indemnifications vary in duration and nature. In many cases, the maximum obligation is not explicitly stated and the contingencies triggering the obligation to indemnify have not occurred and are not expected to occur. Consequently, the maximum amount of the obligation under such indemnifications is not determinable. Historically, the Company has not made any material payments pursuant to these obligations.

The aggregate liability balance related to all guarantees was not material as of ~~March 31,~~June 30, 2005.

Regulation

The Company is subject to changing social, economic and regulatory conditions. Recent state and federal regulatory initiatives and proceedings have included efforts to impose additional regulations regarding agent and broker compensation and otherwise expand overall regulation of insurance products and the insurance industry. The ultimate changes and eventual effects of these initiatives on the Company’s business, if any, are uncertain.

Legal and Regulatory Proceedings and Inquiries

Background

The Company and certain of its affiliates are named as defendants in a number of lawsuits and other legal proceedings arising out of various aspects of its business. In addition, from time to time regulatory examinations or inquiries are pending involving the Company. As background to the “Proceedings” sub-section below, please note the following:

• These matters raise difficult and complicated factual and legal issues and are subject to many uncertainties and complexities, including but not limited to, the underlying facts of each matter, novel legal issues, variations between jurisdictions in which matters are being litigated, differences in applicable laws and judicial interpretations, the length of time before many of these matters might be resolved by settlement or through litigation and, in some cases, the timing of their resolutions relative to other similar cases brought against other companies, the fact that some of these matters are putative class actions in which a class has not been certified and in which the purported class may not be clearly defined, the fact that some of these matters involve multi-state class actions in which the applicable law(s) for the claims at issue is in dispute and therefore unclear, and the current challenging legal environment faced by large corporations and insurance companies.

• In these matters, plaintiffs seek a variety of remedies including equitable relief in the form of injunctive and other remedies and monetary relief in the form of contractual and extra-contractual damages. In some cases, the monetary damages sought include punitive damages or are not specified. Often more specific information beyond the type of relief sought is not available because plaintiffs have not requested more specific relief in their court pleadings. In our experience, monetary demands in plaintiffs’ court pleadings bear little relation to the ultimate loss, if any, to the Company.

• For the reasons specified above, it is not possible to make meaningful estimates of the amount or range of loss that could result from these matters at this time. The Company reviews these matters on an on-going basis and follows the provisions of Statement of Financial Accounting ~~Standards~~Standard No. 5, “Accounting for Contingencies” when making accrual and disclosure decisions. When assessing

reasonably possible and probable outcomes, the Company bases its decisions on its assessment of the ultimate outcome following all appeals.

• In the opinion of the Company’s management, while the ultimate liability in some of these matters in excess of amounts currently reserved may be material to the Company’s operating results for any particular period if an unfavorable outcome results, none will have a material adverse effect on the financial condition of the Company.

Proceedings

Legal proceedings involving Allstate agencies and AIC may impact the Company, even when the Company is not directly involved, because the Company sells its products through a variety of distribution channels including Allstate agencies. Consequently, information about the more significant of these proceedings is provided ~~below.~~ in the following paragraph.

AIC is defending various lawsuits involving worker classification issues. A putative nationwide class action filed by former employee agents includes a worker classification issue; these agents are challenging certain amendments to the Agents Pension Plan and are seeking to have exclusive agent independent contractors treated as employees for benefit purposes. This matter was dismissed with prejudice by the trial court, was the subject of further proceedings on appeal, and has been reversed and remanded to the trial court in April 2005. AIC has been vigorously defending this and various other worker classification lawsuits. The outcome of these disputes is currently uncertain.

AIC is defending certain matters relating to its agency program reorganization announced in 1999. These matters include a lawsuit filed in December 2001 by the U.S. Equal Employment Opportunity Commission (“EEOC”) alleging retaliation under federal civil rights laws, a class action filed in August 2001 by former employee agents alleging retaliation and age discrimination under the Age Discrimination in Employment Act, breach of contract and ERISA violations, and a lawsuit filed in October 2004 by the EEOC alleging age discrimination with respect to a policy limiting the rehire of agents affected by the agency program reorganization. AIC is also defending another action, in which a class was certified, ~~in June 2004,~~ filed by former employee agents who terminated their employment prior to the agency program reorganization. These plaintiffs have asserted breach of contract and ERISA claims ~~under ERISA,~~ and are seeking actual damages including benefits under Allstate employee benefit plans and payments provided in connection with the ~~reorganization.~~reorganization, as well as punitive damages. In late March 2004, in the first EEOC lawsuit and class action lawsuit, the trial court issued a memorandum and order that, among other things, certified classes of agents, including a mandatory class of agents who had signed a release, for purposes of effecting the court’s declaratory judgment that the release is voidable at the option of the release signer. The court also ordered that an agent who voids the release must return to AIC “any and all benefits received by the [agent] in exchange for signing the release.” The court also “concluded that, on the undisputed facts of record, there is no basis for claims of age discrimination.” The EEOC and plaintiffs have asked the court to clarify and/or reconsider its memorandum and order. The case otherwise remains pending. A putative nationwide class action has also been filed by former employee agents alleging various violations of ~~ERISA.~~ERISA, including a worker classification issue. These plaintiffs are challenging certain amendments to the Agents Pension Plan and are seeking to have exclusive agent independent contractors treated as employees for benefit purposes. This matter was dismissed with prejudice by the trial court, was the subject of further proceedings on appeal, and has been reversed and remanded to the trial court in April 2005. In these matters, plaintiffs seek compensatory and punitive damages, and equitable relief. AIC has been vigorously defending these lawsuits and other matters related to its agency program reorganization. The outcome of these disputes is currently uncertain.

The Company is currently undergoing a periodic market conduct examination by state insurance regulators. Regulators are focusing, as they have with other insurers, on the Company’s compliance with the state’s replacement sales and record-keeping processes with regard to life insurance and annuities among other issues. The ultimate outcome of this examination is currently uncertain.

Other Matters

The Corporation and some of its subsidiaries, including the Company, have received interrogatories and demands for information from regulatory and enforcement authorities relating to various insurance products and practices. The areas of inquiry include variable annuity market timing and late trading. The Corporation and some of its subsidiaries, including the Company, have also received interrogatories and demands for information from authorities seeking information relevant to on-going investigations into the possible violation of antitrust or insurance laws by unnamed parties and, in particular, seeking information as to whether any person engaged in activities for the purpose of price fixing, market allocation, or bid rigging. The Company believes that these inquiries are similar to those made to many financial services companies as part of industry-wide investigations by various authorities into the practices, policies and procedures relating to

insurance and financial services products. The Corporation and its subsidiaries have responded and will continue to respond to these ~~inquiries.~~inquiries

Various other legal and regulatory actions are currently pending that involve the Company and specific aspects of its conduct of business. Like other members of the insurance industry, the Company is the target of a number of lawsuits and proceedings, some of which involve claims for substantial or indeterminate amounts. These actions are based on a variety of issues and target a range of the Company’s practices. The outcome of these disputes is currently unpredictable.

However, at this time, based on their present status, it is the opinion of management that the ultimate liability, if any, in one or more of the actions described in this “Other Matters” subsection in excess of amounts currently reserved is not expected to have a material effect on the results of operations, liquidity or financial condition of the Company.

4. Other Comprehensive Income

The components of other comprehensive income on a pretax and after-tax basis are as follows:

Three months ended March 31,

2005

2004

(in thousands)

Pretax

Tax

After-
tax

Pretax

Tax

After-
tax

Unrealized holding (losses) gains arising during the period

$
(53,830
)
$
18,840

$
(34,990
)
$
35,782

$
(12,523
)
$
23,259

Less: reclassification adjustments

(8,826
)
3,089

(5,737
)
(652
)
229

(423
)
Unrealized net capital (losses) gains

(45,004
)
15,751

(29,253
)
36,434

(12,752
)
23,682

Other comprehensive (loss) income

$
(45,004
)
$
15,751

(29,253
)
$
36,434

$
(12,752
)
23,682

Net income

13,885

6,051

Comprehensive (loss) income

$
(15,368
)

$
29,733

	Three months ended June 30,
(in thousands)	2005							2004
	Pretax		Tax			After- tax		Pretax			Tax		After- tax

Unrealized holding gains (losses) arising during the period, net of related offsets	$	71,377	$	(24,982	)	$	46,395	$	(87,752	)	$	30,712	$	(57,040	)
Less: reclassification adjustments	1,898		(665		)	1,233		(2,631		)	919		(1,712		)

Other comprehensive income (loss)	$	69,479	$	(24,317	)	45,162		$	(85,121	)	$	29,793	(55,328		)

Net income						6,940							6,175
Comprehensive income (loss)						$	52,102						$	(49,153	)

	Six months ended June 30,
(in thousands)	2005									2004
	Pretax			Tax			After- tax			Pretax			Tax		After- tax

Unrealized holding gains (losses) arising during the period, net of related offsets	$	17,361		$	(6,076	)	$	11,285		$	(51,087	)	$	17,881	$	(33,206	)
Less: reclassification adjustments	(7,114		)	2,490			(4,624		)	(2,400		)	840		(1,560		)

Other comprehensive income (loss)	$	24,475		$	(8,566	)	15,909			$	(48,687	)	$	17,041	(31,646		)

Net income							20,825								12,226
Comprehensive income (loss)							$	36,734							$	(19,420	)

109

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholder of

Allstate Life Insurance Company of New York:

We have reviewed the accompanying condensed statement of financial position of Allstate Life Insurance Company of New York (the “Company”, an affiliate of The Allstate Corporation) as of ~~March 31,~~June 30, 2005, and the related condensed statements of operations for the three-month and six-month periods ended June 30, 2005 and 2004, and the condensed statements of cash flows for the ~~three-month~~six-month periods ended ~~March 31,~~June 30, 2005 and 2004. These interim financial statements are the responsibility of the Company’s management.

We conducted our reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to such condensed interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the statement of financial position of Allstate Life Insurance Company of New York as of December 31, 2004, and the related statements of operations and comprehensive income, shareholder’s equity, and cash flows for the year then ended, not presented herein. In our report dated February 24, 2005, which report includes an explanatory paragraph relating to a change in the Company’s method of accounting for certain nontraditional long-duration contracts and for separate accounts in 2004, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying condensed statement of financial position as of December 31, 2004 is fairly stated, in all material respects, in relation to the statement of financial position from which it has been derived.

/s/ Deloitte & Touche LLP

Chicago, Illinois
~~May 6,~~August 8, 2005

1110

Item 2.2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED ~~MARCH 31,~~JUNE 30, 2005 AND 2004

OVERVIEW

The following discussion highlights significant factors influencing the financial position and results of operations of Allstate Life Insurance Company of New York (referred to in this document as “we”, “our”, “us” or the “Company”). It should be read in conjunction with the condensed financial statements and notes thereto found under Part I. Item 1. contained herein, and with the discussion, analysis, financial statements and notes thereto in Part I. Item 1. and Part II. Item 7. and Item 8. of the Allstate Life Insurance Company of New York Annual Report on Form 10-K for 2004. We operate as a single segment entity, based on the manner in which financial information is used internally to evaluate performance and determine the allocation of resources.

RESULTS OF OPERATIONS

We will pursue the following to improve return on equity: maintain and develop focused top-tier products, deepen distribution partner relationships, improve our cost structure, advance our enterprise risk management program and leverage the strength of the Allstate brand name across products and distribution channels. The execution of our business strategies has and may continue to involve simplifying our business model by changing the number and selection of products being marketed, for example, the sale of substantially all of our direct response distribution business in 2004; terminating underperforming distribution relationships; reducing policy administration software systems; and other actions that we may determine are appropriate to successfully execute our business strategies.

Premiums represent revenues generated from traditional life, immediate annuities with life contingencies and other insurance products that have significant mortality or morbidity risk.

Contract charges are revenues generated from interest-sensitive life products and variable and fixed annuities ~~and other investment products~~ for which deposits are classified as contractholder funds or separate accounts liabilities. Contract charges are assessed against the contractholder account values for maintenance, administration, cost of insurance and surrender prior to the contractually specified dates. As a result, changes in contractholder funds and separate accounts liabilities are considered in the evaluation of growth and as indicators of future levels of revenues.

The following table summarizes premiums and contract charges by product.

	Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2005		2004		2005		2004		2005		2004

Premiums
Traditional life	$	5,860	$	5,455	$	6,245	$	5,746	$	12,105	$	11,201
Immediate annuities with life contingencies	13,219		10,444		8,823		13,597		22,042		24,041
Accident and health and other	914		752		1,106		626		2,020		1,378
Total premiums	19,993		16,651		16,174		19,969		36,167		36,620

Contract charges
Interest-sensitive life	9,945		9,428		10,524		9,982		20,469		19,410
Fixed annuities	1,793		1,537		1,634		1,495		3,427		3,032
Variable annuities	3,521		3,147		3,818		3,099		7,339		6,246
Total contract charges	15,259		14,112		15,976		14,576		31,235		28,688

Premiums and contract charges	$	35,252	$	30,763	$	32,150	$	34,545	$	67,402	$	65,308

1211

The following table summarizes premiums and contract charges by distribution channel.

	Three Months Ended March 31,				Three Months Ended June 30,					Six Months Ended June 30,
(in thousands)	2005		2004		2005		2004			2005		2004

Premiums
Allstate agencies	$	5,738	$	5,357	$	6,171	$	5,654		$	11,909	$	11,011
Broker dealers	36		107		—		—			36		107
Specialized brokers	13,182		10,337		8,823		13,597			22,005		23,934
Independent agents	1,037		699		1,180		786			2,217		1,485
Direct marketing	—		151		—		(68		)	—		83
Total premiums	19,993		16,651		16,174		19,969			36,167		36,620

Contract charges
Allstate agencies	9,706		9,483		10,218		10,073			19,924		19,556
Broker dealers	2,743		2,718		2,845		2,611			5,588		5,329
Banks	1,800		715		2,308		902			4,108		1,617
Specialized brokers	911		1,128		487		934			1,398		2,062
Independent agents	99		68		118		56			217		124
Total contract charges	15,259		14,112		15,976		14,576			31,235		28,688

Premiums and contract charges	$	35,252	$	30,763	$	32,150	$	34,545		$	67,402	$	65,308

Total premiums ~~increased 20.1% to $20.0 million~~declined 19.0% and 1.2% in the second quarter and first ~~quarter~~six months of 2005, respectively, compared to the same ~~period~~periods of 2004. ~~The increase was primarily the result of~~In both periods, increased traditional life and accident and health premiums were more than offset by lower premiums on immediate annuities with life contingencies sold through specialized brokers.

Contract charges increased ~~8.1% to $15.3 million~~9.6% and 8.9% in the second quarter and first ~~quarter~~six months of 2005, respectively, compared to the same periods of 2004. The increases were primarily due to higher contract charges on variable annuities and interest-sensitive life products and, to a lesser extent, fixed annuities. Higher variable annuity contract charges were the result of increased average account values during the current periods of 2005 compared to the same ~~period~~periods of ~~2004. The increase was due to higher contract charges~~2004, reflecting positive investment results and net deposits on ~~interest-sensitive~~variable annuity and life ~~products, variable annuities and, to a lesser extent, fixed annuities~~.contracts. The increase in the interest-sensitive life ~~contracts was~~contract charges were attributable to in-force business growth resulting from deposits and credited interest more than offsetting surrenders and benefits. ~~Higher variable annuity contract charges were the result of increased average account values during the first quarter of 2005 compared to the first quarter of 2004.~~ Fixed annuity contract charges for the second quarter and first ~~quarter~~six months of 2005 reflect higher surrender charges compared with the ~~first quarter of 2004.~~same periods in the prior year.

1312

Contractholder funds represent interest-bearing liabilities arising from the sale of fixed annuities, interest-sensitive life and variable annuity and life deposits allocated to fixed accounts. The balance of contractholder funds is equal to the cumulative deposits received and interest credited to the contractholder less cumulative contract maturities, benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses.

The following table shows the changes in contractholder funds.

	Three Months Ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004
Contractholder funds, beginning balance	$	3,802,846		$	2,658,325		$	4,033,796		$	2,814,594		$	3,802,846		$	2,658,325

Impact of adoption of SOP 03-1(1)	—			2,031			—			—			—			2,031

Deposits:
Fixed annuities (immediate and deferred)	243,944			145,387			187,430			257,012			431,374			402,399
Interest-sensitive life	22,187			24,822			26,639			26,210			48,826			51,032
Variable annuity and life deposits allocated to fixed accounts	19,111			25,559			14,870			31,098			33,981			56,657
Total deposits	285,242			195,768			228,939			314,320			514,181			510,088

Interest credited	39,664			27,716			42,956			30,235			82,620			57,951

Benefits, withdrawals and other adjustments
Benefits	(16,597		)	(8,745		)	(17,900		)	(11,149		)	(34,497		)	(19,894		)
Surrenders and partial withdrawals	(58,316		)	(39,243		)	(132,973		)	(45,056		)	(191,289		)	(84,299		)
Contract charges	(10,112		)	(9,882		)	(10,335		)	(10,446		)	(20,447		)	(20,328		)
Net transfers to separate accounts	(9,215		)	(11,467		)	(9,524		)	(9,927		)	(18,739		)	(21,394		)
Other adjustments	284			91			279			1,515			563			1,606
Total benefits, withdrawals and other adjustments	(93,956		)	(69,246		)	(170,453		)	(75,063		)	(264,409		)	(144,309		)

Contractholder funds, ending balance	$	4,033,796		$	2,814,594		$	4,135,238		$	3,084,086		$	4,135,238		$	3,084,086

(1)The increase in contractholder funds due to the adoption of SOP 03-1 reflects the establishment of reserves for certain liabilities that are primarily related to income benefit guarantees provided under variable annuities and the reclassification of deferred sales inducements (“DSI”) from contractholder funds to other assets.

Contractholder funds deposits decreased 27.2% in the second quarter and increased ~~45.7%~~slightly in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods in 2004. The decline in the second quarter was due primarily to lower deposits on fixed annuities as a result of ~~2004~~increased competition from certificates of deposit. The slight increase in the first six months was due primarily to ~~greater~~higher deposits ofon deferred fixed ~~annuities.~~annuities resulting from strong competitive position, almost entirely offset by lower variable annuity and life deposits allocated to fixed accounts and, to a lesser extent, decreased deposits on interest-sensitive life products. Average contractholder funds, excluding the impact of adopting SOP 03-1, increased ~~43.1%~~38.5% in the second quarter and 38.2% in the first ~~quarter~~six months of 2005 compared to the same ~~period of~~periods in 2004. Fixed annuity deposits declined 27.1% in the second quarter and increased ~~67.8%~~7.2% in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods in the prior ~~year due~~year. Increases in short-term interest rates without corresponding increases in longer term rates has generally reduced the competitiveness of fixed annuity products relative to ~~strong consumer demand, competitive pricing~~shorter term deposit products such as money market funds and ~~effective distribution efforts in our bank channel.~~certificates of deposit. A continuation of this environment could reduce the level of expected fixed annuity deposits.

~~Benefits, surrenders~~Surrenders and partial withdrawals increased ~~56.1%~~195.1% in the second quarter and 126.9% in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods of 2004 reflecting an annualized withdrawal rate of ~~7.9% for~~13.2% in the second quarter and 10.1% in the first ~~quarter~~six months of 2005 based on the beginning of period contractholder funds balance. This compares to an annualized withdrawal rate of ~~7.2% for~~6.4% in second quarter and 6.3% in the first ~~quarter~~six months of 2004. The increases in the annualized withdrawal rates were primarily attributable to higher surrenders on the fixed account option on certain variable annuity contracts. The

funds subject to these surrenders were invested in prior years when the crediting rate on our fixed investment option was attractive relative to short-term market interest rates. Contractholders withdrew their funds at an increased rate due to the rise in short-term market interest rates, which were not accompanied by a structural rise in crediting rates. Fixed annuity surrenders and withdrawals are also contributing to the increase due to the growth and aging of our in-force business. Surrenders and withdrawals may vary with changes in interest rates and equity market conditions and the aging of our in-force contracts.

Separate accounts liabilities represent contractholders’ claims to the related separate accounts assets. Separate accounts liabilities primarily arise from the sale of variable annuity contracts and variable life insurance policies.

The following table shows the changes in separate accounts liabilities.

	Three Months Ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004
Separate accounts liabilities, beginning balance	$	792,550		$	665,875		$	809,274		$	686,639		$	792,550		$	665,875

Variable annuity and life deposits	56,831			51,289			49,397			59,943			106,228			111,232
Variable annuity and life deposits allocated to fixed accounts	(19,111		)	(25,559		)	(14,870		)	(31,098		)	(33,981		)	(56,657		)
Net deposits	37,720			25,730			34,527			28,845			72,247			54,575

Investment results	(11,802		)	15,380			18,081			2,223			6,279			17,603
Contract charges	(2,986		)	(2,386		)	(3,234		)	(2,466		)	(6,220		)	(4,852		)
Net transfers from fixed accounts	9,215			11,467			9,524			9,927			18,739			21,394
Surrenders and benefits	(15,423		)	(29,427		)	(16,919		)	(14,805		)	(32,342		)	(44,232		)

Separate accounts liabilities, ending balance	$	809,274		$	686,639		$	851,253		$	710,363		$	851,253		$	710,363

Separate accounts liabilities increased ~~$16.7~~$58.7 million as of ~~March 31,~~June 30, 2005 compared to December 31, 2004. ~~The increase was attributable~~Variable annuity and life deposits in the second quarter and first six months of 2005 decreased 17.6% and 4.5%, respectively, compared to the same periods in the prior year. However, net deposits increased 19.7% and ~~transfers from fixed accounts, partially~~32.4% in the second quarter and first six months of 2005, respectively, as the decline in the variable and life deposits was more than offset by ~~surrenders and benefits, unfavorable investment results and contract charges since December 31, 2004.~~a lower percentage of deposits being allocated to fixed accounts. Variable annuity contractholders often allocate a significant portion of their initial variable annuity contract deposit into a fixed rate investment option. The level of this activity is reflected above in the deposits allocated to the fixed accounts, while all other transfer activity between the fixed and separate accounts investments options is reflected in net transfers from fixed accounts. The liability for the fixed portion of variable annuity contracts is reflected in contractholder funds.

Net investment income increased ~~22.9%~~21.8% in the three months ended June 30, 2005 and 22.3% in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods in ~~2004,~~2004. The increases in both periods were primarily due to the effect of higher portfolio balances, partially offset by lower portfolio yields. Higher portfolio balances resulted from the investment of cash flows from operating and financing ~~activities. Investment balances~~activities related primarily to deposits from fixed annuities and interest-sensitive life policies. Investments as of ~~March 31,~~June 30, 2005 increased ~~4.4%~~9.3% from December 31, 2004. The lower portfolio yields were primarily due to purchases, including reinvestments, of fixed income securities with yields lower than the current portfolio average.

1514

Net income analysis is presented in the following table.

	Three Months Ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004

Premiums	$	19,993		$	16,651		$	16,174		$	19,969		$	36,167		$	36,620
Contract charges(1)	15,259			14,105			15,976			14,573			31,235			28,678
Net investment income	86,492			70,395			88,503			72,676			174,995			143,071
Periodic settlements and accruals on non-hedge derivative instruments(2)	214			7
Periodic settlements and accruals on non-hedge derivative instruments (2)							270			69			484			76
Contract benefits	(47,083		)	(42,924		)	(42,901		)	(44,916		)	(89,984		)	(87,840		)
Interest credited to contractholder funds(3)	(35,994		)	(27,647		)	(38,733		)	(30,155		)	(74,727		)	(57,802		)
Gross margin	38,881			30,587			39,289			32,216			78,170			62,803

Amortization of DAC and DSI	(3,503		)	1,549			(10,390		)	(8,401		)	(13,893		)	(6,852		)
Operating costs and expenses	(9,192		)	(9,958		)	(13,078		)	(10,300		)	(22,270		)	(20,258		)
Income tax expense	(9,919		)	(7,839		)	(6,218		)	(5,046		)	(16,137		)	(12,885		)
Realized capital gains and losses, after-tax	(3,735		)	(434		)	(1,550		)	(1,797		)	(5,285		)	(2,231		)
DAC and DSI amortization expense related to realized capital gains and losses, after-tax	1,489			(952		)
DAC and DSI amortization expense on realized capital gains and losses, after-tax							(950		)	(454		)	539			(1,406		)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax	(136		)	(4		)	(164		)	(43		)	(300		)	(47		)
Gain on disposition of operations, after-tax	—			688			1			—			1			688
Cumulative effect of change in accounting principle, after-tax	—			(7,586		)	—			—			—			(7,586		)
Net income	$	13,885		$	6,051		$	6,940		$	6,175		$	20,825		$	12,226

(1)Amortization of deferred loads on interest-sensitive life products related to realized capital gains and losses is excluded from contract charges for purposes of calculating gross margin. Amortization of deferred loads related to realized capital gains and losses totaled $7$3 thousand in the second quarter of 2004 and $10 thousand in the first ~~quarter~~six months of 2004. There was no amortization of deferred loads related to realized capital gains and losses in the second quarter and the first ~~quarter~~six months of 2005.

(2)Periodic settlements and accruals on non-hedge derivative instruments are reflected as a component of realized capital gains and losses on the Condensed Statements of Operations.

(3)Amortization of DSI is excluded from interest credited to contractholder funds for purposes of calculating gross margin. Amortization of DSI totaled ~~$232~~$705 thousand and $4$380 thousand in the three months ended June 30, 2005 and 2004, respectively, and $937 thousand and $384 thousand in the first ~~quarter~~six months of 2005 and 2004, respectively.

Gross margin, a non-GAAP measure, represents premiums, contract charges, ~~and~~ net investment income and periodic settlements and accruals on non-hedge derivative instruments, less contract benefits and interest credited to contractholder funds excluding amortization of DSI. We reclassify periodic settlements and accruals on non-hedge derivative instruments into gross margin to report them in a manner consistent with the economically hedged investments, replicated assets or product attributes (e.g. net investment income or interest credited to contractholder funds) and by doing so, appropriately reflect trends in product performance. We use gross margin as a component of our evaluation of the profitability of our life insurance and financial product portfolio. Additionally, for many of our products, including fixed annuities, variable life and annuities, and interest-sensitive life insurance, the amortization of DAC and DSI is determined based on actual and expected gross margin. Gross margin is comprised of three components that are utilized to further analyze the business: investment margin, benefit margin, and contract charges and fees. We believe gross margin and its components are useful to investors because they allow for the evaluation of income components separately and in the aggregate when reviewing performance. Gross margin, investment margin and benefit margin should not be considered as a substitute for net income and do not reflect the overall profitability of the business. Net income is the GAAP measure that is most directly comparable to these margins. Gross margin is reconciled to GAAP net income in the table above.

1615

The components of gross margin are reconciled to the corresponding financial statement line items in the following table.

	Three Months Ended March 31,																						Three Months Ended June 30,
	Investment Margin						Benefit Margin						Contract Charges and Fees				Gross Margin						Investment Margin						Benefit Margin						Contract Charges and Fees				Gross Margin
(in thousands)	2005			2004(4)			2005			2004(4)			2005		2004(4)		2005			2004			2005			2004 (4)			2005			2004(4)			2005		2004 (4)		2005			2004
Premiums	$	—		$	—		$	19,993		$	16,651		$	—	$	—	$	19,993		$	16,651		$	—		$	—		$	16,174		$	19,969		$	—	$	—	$	16,174		$	19,969
Contract charges(1)	—			—			7,845			7,479			7,414		6,626		15,259			14,105			—			—			8,185			7,701			7,791		6,872		15,976			14,573
Net investment income	86,492			70,395			—			—			—		—		86,492			70,395			88,503			72,676			—			—			—		—		88,503			72,676
Periodic settlements and accruals on non-hedge derivative instruments (2)	214			7			—			—			—		—		214			7			270			69			—			—			—		—		270			69
Contract benefits	(25,407		)	(24,676		)	(21,676		)	(18,248		)	—		—		(47,083		)	(42,924		)	(24,754		)	(23,905		)	(18,147		)	(21,011		)	—		—		(42,901		)	(44,916		)
Interest credited to contractholder funds(3)	(35,994		)	(27,647		)	—			—			—		—		(35,994		)	(27,647		)
Interest credited to
contractholder funds(3)																							(38,733		)	(30,155		)	—			—			—		—		(38,733		)	(30,155		)
																							$	25,286		$	18,685		$	6,212		$	6,659		$	7,791	$	6,872	$	39,289		$	32,216
	$	25,305		$	18,079		$	6,162		$	5,882		$	7,414	$	6,626	$	38,881		$	30,587

	Six Months Ended June 30,
	Investment Margin						Benefit Margin						Contract Charges and Fees				Gross Margin
(in thousands)	2005			2004(4)			2005			2004(4)			2005		2004(4)		2005			2004
Premiums	$	—		$	—		$	36,167		$	36,620		$	—	$	—	$	36,167		$	36,620
Contract charges(1)	—			—			16,030			15,180			15,205		13,498		31,235			28,678
Net investment income	174,995			143,071			—			—			—		—		174,995			143,071
Periodic settlements and accruals on non-hedge derivative instruments(2)	484			76			—			—			—		—		484			76
Contract benefits	(50,161		)	(48,581		)	(39,823		)	(39,259		)	—		—		(89,984		)	(87,840		)
Interest credited to
contractholder funds(3)	(74,727		)	(57,802		)	—			—			—		—		(74,727		)	(57,802		)
	$	50,591		$	36,764		$	12,374		$	12,541		$	15,205	$	13,498	$	78,170		$	62,803

(1)Amortization of deferred loads on interest-sensitive life products related to realized capital gains and losses is excluded from contract charges for purposes of calculating gross margin. Amortization of deferred loads related to realized capital gains and losses totaled $7$3 thousand in the second quarter of 2004 and $10 thousand in the first ~~quarter~~six month of 2004. There was no amortization of deferred loads related to realized capital gains and losses in the second quarter and the first ~~quarter~~six months of 2005.

(2)Periodic settlements and accruals on non-hedge derivative instruments are reflected as a component of realized capital gains and losses on the Condensed Statements of Operations.

(4)The prior period has been restated to conform to the current period presentation. In connection therewith, contract charges related to guaranteed minimum death, income, accumulation and withdrawal benefits on variable annuities have been reclassified to benefit margin from maintenance charges. Additionally, amounts previously presented as maintenance charges and surrender charges are now presented in the aggregate as contract charges and fees. These reclassifications did not result in a change in gross margin.

Gross margin increased ~~27.1% during~~22.0% in the second quarter of 2005 and 24.5% in the first ~~quarter~~six months of 2005 compared to the same period of ~~2004 as growth from new business resulted~~2004. The increases in ~~increased~~both periods were mostly due to higher investment ~~margin, benefit margin and contract charges and fees.~~margin.

Investment margin is a component of gross margin, both of which are non-GAAP measures. Investment margin represents the excess of net investment income and periodic settlements and accruals on non-hedge derivative instruments over interest credited to contractholder funds ~~excluding amortization of DSI~~ and the implied interest on life-contingent immediate annuities included in the reserve for life-contingent contract benefits. Amortization of DSI is excluded from interest credited to contractholder funds for purposes of calculating gross margin. We use investment margin to evaluate our profitability related to the difference between investment returns on assets supporting certain products and amounts credited to customers (“spread”) during the fiscal period.

Investment margin by product group is shown in the following table.

	Three Months Ended March 31,				Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2005		2004		2005		2004		2005		2004
Annuities					$	22,998	$	15,903	$	46,009	$	31,082
Life insurance	$	2,294	$	2,900	2,288		2,782		4,582		5,682
Annuities	23,011		15,179
Total investment margin	$	25,305	$	18,079	$	25,286	$	18,685	$	50,591	$	36,764

Investment margin increased ~~40.0%~~35.3% in the second quarter of 2005 and 37.6% in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods of 2004 due to ~~the 43.1% increase in~~increased average contractholder ~~funds. Our fixed annuity~~funds, slightly higher investment spreads ~~showed a modest improvement over the prior year as favorable spreads~~ on investments supporting deferred fixed ~~annuity contracts issued during the~~

~~past 12 months~~annuities and ~~crediting rate actions were effective in offsetting the investment yield decline. We were unable to offset the effects of declining~~increased yields on ~~investment portfolios~~investments supporting capital, traditional life and other ~~products and slightly lower investment spreads on interest-sensitive life products compared to prior year.~~ products.

The following table summarizes the weighted average investment yield, interest crediting rates and investment spreads for the three months ended ~~March 31.~~June 30.

	Weighted Average Investment Yield				Weighted Average Interest Crediting Rate				Weighted Average Investment Spread				Weighted Average Investment Yield				Weighted Average Interest Crediting Rate				Weighted Average Investment Spread
	2005		2004		2005		2004		2005		2004		2005		2004		2005		2004		2005		2004
Interest-sensitive life	5.7	%	6.3	%	4.4	%	4.9	%	1.3	%	1.4	%	5.8	%	6.1	%	4.6	%	4.8	%	1.2	%	1.3	%
Fixed annuities – deferred annuities	5.5		5.7		3.1		3.4		2.4		2.3		5.5		5.6		3.2		3.4		2.3		2.2
Fixed annuities – immediate annuities with and without life contingencies	7.5		7.6		6.7		6.8		0.8		0.8		7.6		7.6		6.8		6.8		0.8		0.8
Investments supporting capital, traditional life and other products	6.1		6.2		N/A		N/A		N/A		N/A		6.2		5.9		N/A		N/A		N/A		N/A

The following table summarizes the weighted average investment yield, interest crediting rates and investment spreads for the six months ended June 30.

	Weighted Average Investment Yield				Weighted Average Interest Crediting Rate				Weighted Average Investment Spread
	2005		2004		2005		2004		2005		2004
Interest-sensitive life	5.7	%	6.2	%	4.5	%	4.8	%	1.2	%	1.4	%
Fixed annuities – deferred annuities	5.5		5.6		3.2		3.4		2.3		2.2
Fixed annuities – immediate annuities with and without life contingencies	7.5		7.6		6.7		6.8		0.8		0.8
Investments supporting capital, traditional life and other products	6.2		6.0		N/A		N/A		N/A		N/A

The following table summarizes the liabilities for these contracts and policies.

	Three Months Ended March 31,					Six Months Ended June 30,
(in thousands)	2005			2004		2005		2004
Fixed annuities – immediate annuities with life contingencies	$	1,702,412		$	1,659,670	$	1,806,477	$	1,564,347
Other life contingent contracts and other	102,192			94,737		104,662		95,106
Reserve for life-contingent contract benefits	$	1,804,604		$	1,754,407	$	1,911,139	$	1,659,453

Interest-sensitive life	$	381,824		$	324,623	$	397,691	$	342,817
Fixed annuities – deferred annuities	3,089,790			1,985,925		3,218,620		2,227,589
Fixed annuities – immediate annuities without life contingencies	562,408			503,983		518,584		513,609
Other	(226		)	63		343		71
Contractholder funds	$	4,033,796		$	2,814,594	$	4,135,238	$	3,084,086

Benefit margin is a component of gross margin, both of which are non-GAAP measures. Benefit margin represents life and life-contingent immediate annuity premiums, cost of insurance contract charges and variable annuity contract charges for contract guarantees less contract benefits. Benefit margin excludes the implied interest on life-contingent immediate annuities, which is included in the calculation of investment margin. We use the benefit margin to evaluate our underwriting performance, as it reflects the profitability of our products with respect to mortality or morbidity risk during a fiscal period.

Benefit margin by product group is shown in the following table.

	Three Months Ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004 (1)			2005			2004(1)			2005			2004(1)
Life insurance	$	7,191		$	7,218		$	8,333		$	7,851		$	15,524		$	15,069
Annuities	(1,029		)	(1,336		)	(2,121		)	(1,192		)	(3,150		)	(2,528		)
Total benefit margin	$	6,162		$	5,882		$	6,212		$	6,659		$	12,374		$	12,541

(1)The prior period has been restated to conform to the current period presentation.

Benefit margin ~~increased 4.8%~~declined 6.7% in the second quarter of 2005 and 1.3% in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods of 2004. The ~~increase~~decline in both periods was ~~primarily the result of growth,~~mostly due to unfavorable mortality experience on immediate annuities with life contingencies, partially offset by ~~higher~~growth of our in-force life benefits and an increase in the reserve for variable contract guarantees related to variable contracts of $174 thousand. This increase resulted from our annual comprehensive evaluation of the assumptions used in our valuation models which resulted in a refined measurement of exposure, partially offset by better than anticipated equity market performance. There was no comparable 2004 adjustment to reserves for variable contract guarantees, because the reserves were established in the first quarter of 2004 as part of the cumulative effect of the change in accounting for such guarantees.business.

Upon the adoption of Statement of Position No. 03-1, “Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts”, on January 1, 2004, reserves were established for death and income benefits provided under variable annuities and other secondary ~~guarantees. In prior periods, death benefits were expensed as paid and no expense was recognizable for the other~~ guarantees. Annuity benefit margin will continue to be adversely impacted by certain closed blocks of life-contingent immediate annuities whose benefit payments are anticipated to extend beyond their original pricing expectations. The annuity benefit margin in future periods will fluctuate based on the timing of annuitant deaths on these life-contingent immediate annuities and the annual evaluation of assumptions used in our valuation models for variable annuity guarantees.

Amortization of DAC and DSI, excluding amortization related to realized capital gains and losses, increased ~~$5.1~~23.7% or $1.99 million in the three months ended June 30, 2005 and 102.8% or $7.04 million in the first ~~quarter~~six months of 2005 compared to the same ~~period~~periods of 2004. The increases in ~~2004 as a~~both periods were primarily the result of higher gross margins on deferred fixed annuities. For the six-month period, this impact was partially offset by adjustments recorded in connection with our annual comprehensive evaluation of the assumptions used in our valuation models for all investment products, including variable and fixed annuities and interest-sensitive and variable life products. DAC and DSI amortization related to realized capital gains and losses, after-tax, was $1.5 million, favorable to net income, for the first quarter of 2005 compared to $952 thousand, unfavorable to net income, for the same period in the prior year. The change was due to increased realized capital losses on investments supporting our investment products.

In the first quarter of 2005, as a result of our annual evaluation of assumptions, we recorded DAC and DSI deceleration (commonly referred to as “DAC and DSI unlocking”) of $7.3 million, which included deceleration of $2.8 million on interest-sensitive and variable life products and deceleration of $4.5 million for variable annuities. The amortization deceleration on variable annuities was mostly attributable to better than anticipated equity market performance and persistency.

In the ~~first quarter of 2004,~~prior year, the comparable DAC and DSI unlocking was a net deceleration of amortization of $10.2 million. This deceleration of amortization was the result of favorable projected mortality on our interest-sensitive life products and resulted in the total DAC and DSI amortization being favorable relative to net income.

Operating costs and expenses ~~decreased 7.7%~~increased 27.0% in the three months ended June 30, 2005 and 9.9% in the first six months of 2005 compared to the same periods of 2004. The increases were primarily attributable to higher technology, distribution and administrative expenses, which were incurred to support growth in the Company’s in-force business. For the six-month period, these increases were partially offset by lower guaranty fund assessments and expenses related to taxes, licenses and fees in the first quarter of 2005 compared to the first quarter of 2004. ~~The decline was primarily attributable to lower guaranty fund assessments and expenses related to taxes, licenses and fees.~~

INVESTMENTS

An important component of our financial results is the return on our investment portfolio. The composition of the investment portfolio at ~~March 31,~~June 30, 2005 is presented in the table below.

					Carrying		Percent
(in thousands)	Carrying value		Percent of total		value		of total

Fixed income securities (1)	$	5,755,899	89.2	%	$	6,111,363	90.5	%
Mortgage loans	520,218		8.1		536,908		8.0
Short-term	133,443		2.1		66,059		1.0
Policy loans	35,488		0.5		35,806		0.5
Other	4,818		0.1		2,399		—
Total	$	6,449,866	100.0	%	$	6,752,535	100.0	%

(1)Fixed income securities are carried at fair value. Amortized cost basis for these securities was ~~$5.3~~$5.5 billion.

Total investments increased to ~~$6.45~~$6.75 billion at ~~March 31,~~June 30, 2005 from $6.18 billion at December 31, 2004 due to positive cash flows from operating and financing activities, higher unrealized capital gains on fixed income securities and increased funds associated with securities lending ~~transactions, partially offset by decreased net unrealized gains on fixed income securities.~~transactions.

Total investments at amortized cost related to collateral, due to securities lending transactions, increased to ~~$244~~$246 million at ~~March 31,~~June 30, 2005 from $133 million at December 31, 2004.

At ~~March 31,~~June 30, 2005, ~~96.4%~~96.3% of the fixed income securities portfolio was rated investment grade, which is defined as a security having a rating from the National Association of Insurance Commissioners (“NAIC”) of 1 or 2, a rating of Aaa, Aa, A or Baa from Moody’s or a rating of AAA, AA, A or BBB from S&P, Fitch or Dominion; or a comparable internal rating if an externally provided rating is not available.

The unrealized net capital gains on fixed income securities at ~~March 31,~~June 30, 2005 were ~~$452.2~~$659.9 million, ~~a decrease~~an increase of ~~$80.4~~$127.3 million or ~~15.1%~~23.9% since December 31, 2004. The net unrealized gain was comprised of ~~$486.6~~$668.1 million of unrealized gains and ~~$34.4~~$8.2 million of unrealized losses at ~~March 31,~~June 30, 2005. This is compared to a net unrealized gain ~~for the fixed income portfolio~~ totaling $532.7 million at December 31, 2004, comprised of $545.5 million of unrealized gains and $12.8 million of unrealized losses.

Of the gross unrealized losses in the fixed income portfolio at ~~March 31,~~June 30, 2005, ~~$30.6~~$6.0 million or ~~89.1%~~73.5% were related to investment grade securities and are believed to be primarily a result of a rising interest rate environment. Of the remaining ~~$3.8~~$2.2 million of losses in the fixed income portfolio, ~~$3.2~~$2.0 million or ~~84.9%~~94.5% were in the corporate fixed income portfolio. The ~~$3.2~~$2.0 million of corporate fixed income gross unrealized losses were primarily comprised of securities in the communications, utilities, ~~communications~~financial services and transportation sectors. The gross unrealized losses in these sectors were primarily company specific and interest rate related. Approximately $919 thousand of the total gross unrealized losses in the corporate fixed income portfolio were associated with the automobile industry, which includes direct debt issuances of automobile manufacturers, captive automotive financing companies and automobile parts and equipment sellers. Values in the automobile industry were primarily depressed due to company specific conditions. We expect eventual recovery of these securities. Every security was included in our portfolio monitoring process.

Our portfolio monitoring process identifies and evaluates fixed income securities whose carrying value may be other than temporarily impaired. The process includes a quarterly review of all securities using a screening process to identify those securities whose fair value compared to amortized cost is below established thresholds for certain time periods, or which are identified through other monitoring criteria such as ratings downgrades or payment defaults. We also recognize impairment on securities in an unrealized loss position for which we do not have the intent and ability to hold until recovery.

We also monitor the quality of our fixed income portfolio by categorizing certain investments as “problem”, “restructured” or “potential problem.” Problem fixed income securities are securities in default with respect to principal or interest and/or securities issued by companies that have gone into bankruptcy subsequent to our acquisition of the security. Restructured fixed income securities have rates and terms that are not consistent with market rates or terms prevailing at the time of the restructuring. Potential problem fixed

income securities are current with respect to contractual principal and/or interest, but because of other facts and circumstances, we have concerns regarding the borrower’s ability to pay future principal and interest, which causes us to believe these securities may be classified as problem or restructured in the future.

The following table summarizes problem, restructured and potential problem fixed income securities.

(in thousands)													June 30, 2005					December 31, 2004
	March 31, 2005						December 31, 2004						Amortized cost		Fair value	Percent of total Fixed Income portfolio		Amortized cost		Fair value		Percent of total Fixed Income portfolio
(in thousands)	Amortized cost		Fair value		Percent of total Fixed Income portfolio		Amortized cost		Fair value		Percent of total Fixed Income portfolio
Problem	$	10,613	$	11,508	0.2	%	$	10,637	$	10,813	0.2	%	$	10,609	11,538	0.2	%	$	10,637	$	10,813	0.2	%
Restructured	5,387		4,505		0.1		5,396		6,151		0.1		—		—	—		5,396		6,151		0.1
Potential problem	11,013		10,845		0.2		11,231		10,539		0.2		15,192		15,428	0.2		11,231		10,539		0.2
Total net carrying value	$	27,013	$	26,858	0.5	%	$	27,264	$	27,503	0.5	%	$	25,801	26,966	0.4	%	$	27,264	$	27,503	0.5	%
Cumulative write-downs recognized	$	4,606					$	4,606					$	5,682				$	4,606

We ~~have experienced a slight decrease in the amortized cost of fixed income securities categorized as problem, restructured and potential problem as of March 31, 2005 compared to December 31, 2004.~~

~~We also~~ evaluated each of these securities through our portfolio monitoring process at ~~March 31,~~June 30, 2005 and recorded write-downs when appropriate. We further concluded that any remaining unrealized losses on these securities were temporary in ~~nature.~~nature and that we have the intent and ability to hold until recovery. While these balances may increase in the future, particularly if economic conditions are unfavorable, management expects that the total amount of securities in these categories will remain low relative to the total fixed income securities portfolio.

Net Realized Capital Gains and Losses The following table presents the components of realized capital gains and losses and the related tax effect.

	Three Months Ended March 31,						Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2005			2004			2005			2004			2005			2004

Write-downs	$	(393	)	$	(639	)
Anticipated disposition write-downs	(5,566		)	—
Investment write-downs							$	(1,076	)	$	(245	)	$	(1,469	)	$	(884	)
Dispositions	(2,457		)	1,827			4,979			(5,866		)	(3,044		)	(4,039		)
Valuation of derivative instruments	241			(1,184		)	(3,719		)	2,563			(3,478		)	708
Settlement of derivative instruments	2,298			(657		)	(2,816		)	662			(518		)	676
Realized capital gains and losses, pretax	(5,877		)	(653		)	(2,632		)	(2,886		)	(8,509		)	(3,539		)
Income tax benefit	2,142			219			1,082			1,089			3,224			1,308
Realized capital gains and losses, after-tax	$	(3,735	)	$	(434	)	$	(1,550	)	$	(1,797	)	$	(5,285	)	$	(2,231	)

Dispositions in the above table include sales, losses recognized in anticipation of sales and other transactions such as calls and prepayments. We may sell securities during the period in which fair value has declined below amortized cost. In certain situations new factors such as negative developments, subsequent credit deterioration, relative value opportunities, market liquidity concerns and portfolio reallocations can subsequently change our previous intent to continue holding a security.

A changing interest rate environment will also drive changes in our portfolio duration targets at a tactical level. A duration target and range is established with an economic view of liabilities relative to a long-term portfolio view. Tactical duration adjustments within management’s approved ranges are accomplished through both cash market transactions and derivative activities that generate realized gains and losses and through new purchases. As a component of our approach to managing portfolio duration, realized gains and losses on derivative instruments are most appropriately considered in conjunction with

the unrealized gains and losses on the fixed income portfolio. This approach mitigates the impacts of general interest rate changes to the overall financial condition of the ~~corporation.~~Company.

~~Because~~21

In the first quarter of ~~rising~~2005, because of an anticipated rise in interest rates as well as changes in existing market conditions and long-term asset return assumptions, certain changes were planned within various portfolios. They included continued asset-liability management ~~strategies and~~strategies; on-going comprehensive reviews of our ~~portfolios,~~portfolios; and changes ~~were~~being made ~~in the first quarter of 2005~~ to our ~~duration. In addition, we also pursued~~strategic asset allocation, including a decision to pursue yield enhancement strategies. ~~These changes primarily resulted~~At that time we identified, in ~~anticipated disposition write-downs~~total, approximately $216 million of ~~certain~~ securities, ~~with~~all of which were in an unrealized loss ~~positions~~position, which we would consider selling to achieve these objectives. As a result, we recognized $5.6 million of write-downs due to a change in intent to hold these securities until recovery. Securities related to $1.2 million of the write-downs were sold during the second quarter, and we continue to consider selling securities with a carrying value of approximately $0.3 million having write-downs of $0.1 million. The remaining securities with $4.3 million of write-downs recognized in the first quarter have been re-designated as being held to recovery within the available-for-sale category, primarily as a consequence of the lower than expected interest rate environment. Of this amount, $3.7 million of write-downs relates to $158 million of affected securities that were identified in connection with yield enhancement strategies. The difference between the current carrying value and par value of the re-designated securities will be recognized in net investment income over the remaining life of the securities, pursuant to the guidance in Statement of Position 03-3, “Accounting for Certain Loans or Debt Securities Acquired in a Transfer”.

CAPITAL RESOURCES AND LIQUIDITY

Capital Resources consist of shareholder’s equity, representing funds deployed or available to be deployed to support business operations. The following table summarizes our capital resources.

(in thousands)	March 31, 2005		December 31, 2004		June 30, 2005			December 31, 2004

Common stock, retained earnings and other shareholder’s equity items	$	497,829	$	483,980	$	504,769		$	483,980

Accumulated other comprehensive income	126,002		155,255		171,164			155,255
Total shareholder’s equity	$	623,831	$	639,235	$		675,933	$	639,235

Shareholder’s equity ~~declined~~increased in the first ~~quarter~~six months of 2005 when compared to December 31, 2004 ~~primarily~~ as a result of ~~lower~~net income and higher unrealized net capital ~~gains, partially offset by net income.~~gains.

Financial Ratings and Strength Our ratings are influenced by many factors including our operating and financial performance, asset quality, liquidity, asset/liability management, overall portfolio mix, financial leverage (i.e., debt), exposure to risks and the current level of operating leverage. There have been no changes to our insurance financial strength ratings since December 31, 2004.

Liquidity Sources and Uses As reflected in our Condensed Statements of Cash Flows, ~~higher~~lower operating cash flows in the first ~~quarter~~six months of 2005 when compared to the first ~~quarter~~six months of 2004 primarily relate to ~~increased interest received and premium collections, partially offset by~~higher policy benefits and acquisition costs ~~paid.~~paid and lower premiums, partially offset by increased investment income. Cash flows used in investing activities ~~increased~~decreased in the first ~~quarter~~six months of 2005 due to the investment of ~~higher~~lower financing and operating cash flows.

~~Higher~~Lower cash flow from financing activities during the first ~~quarter~~six months of 2005 when compared to the first ~~quarter~~six months of 2004 reflect ~~increased~~lower variable annuity and life deposits ofallocated to fixed ~~annuities,~~accounts and higher fixed annuity withdrawals, partially offset by higher deposits on fixed ~~annuity withdrawals.~~annuities. For quantification of the changes in contractholder funds, see the ~~Results of~~ Operations section of the MD&A.

We have entered into an inter-company loan agreement with the Corporation. The amount of inter-company loans available to us is at the discretion of the Corporation. The maximum amount of loans the Corporation will have outstanding to all its eligible subsidiaries at any given point in time is limited to $1.00 billion. We had no amounts outstanding under the inter-company loan agreement at ~~March 31,~~June 30, 2005 or December 31, 2004. The Corporation uses commercial paper borrowings and bank lines of credit to fund intercompany borrowings.

FORWARD-LOOKING STATEMENTS AND RISK FACTORS

This document contains “forward-looking statements” that anticipate results based on our estimates, assumptions and plans that are subject to uncertainty. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. We assume no obligation to update any forward-looking statements as a result of new information or future events or developments.

These forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words like “plans,” “seeks,” “expects,” “will,” “should,” “anticipates,” “estimates,” “intends,” “believes,” “likely,” “targets” and other words with similar meanings. These statements may address, among other things, our strategy for growth, product development, regulatory approvals, market position, expenses, financial results, litigation and reserves. We believe that these statements are based on reasonable estimates, assumptions and plans. However, if the estimates, assumptions or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from those communicated in these forward-looking statements. Factors which could cause actual results to differ materially from those suggested by such forward-looking statements include but are not limited to those discussed or identified in this document (including the risks described below) and are incorporated in this Part I, Item 2 by reference to the information set forth in our Annual Report on Form 10-K, Part II, Item 7, under the caption “Forward-Looking Statements and Risk Factors”.

Actions taken to simplify our business model and improve profitability may not be successful and may result in losses and costs

We are pursuing strategies intended to improve our return on equity. Actions that we have taken and may continue to take include changing the number and selection of products being marketed, terminating underperforming distribution relationships, reducing policy administration software systems, and other actions that we may determine are appropriate to successfully execute our business strategies. The actions that we have taken and may take in the future may not achieve their intended outcome and could result in lower premiums and contract charges, restructuring costs, losses on disposition or losses related to the discontinuance of individual products or distribution relationships.

Changes in market interest rates may lead to a significant decrease in the sales and profitability of spread-based products

Our ability to manage the investment margin for spread-based products is dependent upon maintaining profitable spreads between investment yields and interest crediting rates. As interest rates decrease or remain at low levels, proceeds from investments that have matured, prepaid or sold may be reinvested at lower yields, reducing investment margin. Lowering interest-crediting rates can offset decreases in investment margin on some products. However, these changes could be limited by market conditions, regulatory or contractual minimum rate guarantees on many contracts and may not match the timing or magnitude of changes in asset yields. Decreases in the rates offered on products could make those products less attractive, leading to lower sales and/or changes in the level of surrenders and withdrawals for these products. Non-parallel shifts in interest rates, such as increases in short-term rates without accompanying increases in medium- and long-term rates, can influence customer demand for fixed annuities, which could impact the level and profitability of new customer deposits. Increases in market interest rates can also have negative effects, for example by increasing the attractiveness of other investments, which can lead to higher surrenders at a time when the investment asset values are lower as a result of the increase in interest rates. For certain products, principally fixed annuity and interest-sensitive life products, the earned rate on assets could lag behind market yields. We may react to market conditions by increasing crediting rates, which could narrow spreads. Unanticipated surrenders could result in DAC unlocking or affect the recoverability of DAC and thereby increase expenses and reduce profitability.

Item 4. 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. We maintain disclosure controls and procedures as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934. Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based upon this evaluation, the principal executive officer and the principal financial officer concluded that our disclosure controls and procedures are effective in providing reasonable assurance that material information required to be disclosed in our reports filed with or submitted to the Securities and Exchange Commission under the Securities Exchange Act is made known to management, including the principal executive officer and the principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting. During the fiscal quarter ended ~~March 31,~~June 30, 2005, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II.II. OTHER INFORMATION

Item 1.1. Legal Proceedings

Information required for this Part II, Item 1, is incorporated by reference to the discussion under the heading “Regulation” and under the heading “Legal and Regulatory Proceedings and Inquiries” in Note 3 of the Company’s Condensed Financial Statements in Part I, Item 1, of this Form 10-Q.

Item 66. Exhibits.Exhibits

(a) Exhibits

An Exhibit Index has been filed as part of this report on page E-1.

2324

SIGNATURE

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)

~~May 6,~~August 8, 2005	By	/s/ Samuel H. Pilch
	Samuel H. Pilch
	Controller
	(chief accounting officer and duly
	authorized officer of the registrant)

2425

Exhibit No.			Description
10.1			~~Amendment No.~~Amended and Restated Service and Expense Agreement between Allstate Insurance Company, The Allstate Corporation and certain affiliates, effective January 1, 2004, and effective March 5, 2005 with respect to ~~Automatic Annuity Reinsurance~~Allstate Life Insurance Company of New York. Incorporated herein by reference to Exhibit 10.1 to Allstate Life Insurance Company’s Quarterly Report on Form 10-Q for quarter ended June 30, 2005.

10.2			New York Insurer Supplement to Amended and Restated Service and Expense Agreement between Allstate Insurance Company, The Allstate Corporation, Allstate Life Insurance Company of New York and ~~Allstate~~Intramerica Life Insurance Company, effective ~~January 1,~~March 5, 2005. Incorporated herein by reference to Exhibit 10.2 to Allstate Life Insurance Company’s Quarterly Report on Form 10-Q for quarter ended June 30, 2005.

15			Acknowledgement of awareness from Deloitte & Touche LLP dated ~~May 6,~~August 8, 2005, concerning unaudited interim financial information.

31.1			Rule ~~13a-14(a)~~15d-14(a) Certification of Principal Executive Officer

31.2			Rule ~~13d-14(a)~~15d-14(a) Certification of Principal Financial Officer

32			Section 1350 Certifications

E-1

Commission file number: 333-100029

ALLSTATE LIFE INSURANCE COMPANYOFNEW YORK

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

March 31,June 30, 2005

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

1. Basis of Presentation

Pending accounting standard

2. Reinsurance

3. Guarantees and Contingent Liabilities

OVERVIEW

RESULTS OF OPERATIONS

INVESTMENTS

CAPITAL RESOURCES AND LIQUIDITY

Changes in market interest rates may lead to a significant decrease in the sales and profitability of spread-based products

Item 4. 4. Controls and Procedures

PART II.II. OTHER INFORMATION

Item 1.1. Legal Proceedings

Item 66. Exhibits.Exhibits

SIGNATURE

ALLSTATE LIFE INSURANCE COMPANY
OF
NEW YORK