1

                    SECURITIES AND EXCHANGE COMMISSION

                          Washington, D.C.  20549

                                FORM 10-K/A

                    AMENDMENT TO APPLICATION OR REPORT


               Filed pursuant to Section  12, 13 or 15(d) of

                    THE SECURITIES EXCHANGE ACT OF 1934

                For the fiscal year ended December 31, 1994

                   POLICY MANAGEMENT SYSTEMS CORPORATION
          (Exact name of registrant as specified in its charter)

                              AMENDMENT NO. 1

The undersigned registrant hereby amends the following items,
financial statements, exhibits or other portions of its Annual
Report on Form 10-K for the fiscal year ended December 31, 1994
as set forth in the pages attached hereto:

List all such items, financial statements, exhibits or other
portions amended.
(1)  Item 14
(2)  Form 11-K (401(k) Retirement Savings Plan)

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


                         POLICY MANAGEMENT SYSTEMS CORPORATION
                                      (Registrant)

Date:   July 14, 1995              By:  Timothy V. Williams
                                   Executive Vice President,
                                   Chief Financial Officer

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                                  Part IV

Item 14.  Exhibits, Financial Statement Schedules,
          and Reports on Form 8-K

Financial Statements and Schedules

     See index to Consolidated Financial Statements and
Supplementary Data on page 24.

Exhibits Filed

     Exhibits required to be filed with this Annual Report on
Form 10-K are listed in the following Exhibit Index.  Certain of
such exhibits which have heretofore been filed with the
Securities and Exchange Commission and which are designated by
reference to their exhibit numbers in prior filings are hereby
incorporated herein by reference and made a part thereof.

     Pursuant to Rule 15d-21 promulgated under the Securities
Exchange Act of 1934, the following annual report for the
Company's 401 (k) Retirement Plan is filed herewith:

     Form 11-K for the Company's 401 (k) Retirement Savings Plan
for the year ended December 31, 1994 is incorporated herein by
reference.

Form 8-K

     The Company filed a report on Form 8-K, dated December 7,
1994 under Item 5.  Other Events, relating to an agreement in
principle, subject to court approval, to settle the securities
class action pending against the company.