<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE CONDENSED CONSOLIDATED BALANCE SHEET AND THE CONDENSED CONSOLIDATED
STATEMENT OF INCOME OF ARM FINANCIAL GROUP, INC'S FORM 10-Q FOR THE
QUARTER ENDED MARCH 31, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   3-MOS
<FISCAL-YEAR-END>                          DEC-31-1998
<PERIOD-START>                             JAN-01-1998
<PERIOD-END>                               MAR-31-1998
<DEBT-HELD-FOR-SALE>                         4,420,538
<DEBT-CARRYING-VALUE>                                0
<DEBT-MARKET-VALUE>                                  0
<EQUITIES>                                      27,897
<MORTGAGE>                                      16,235
<REAL-ESTATE>                                        0
<TOTAL-INVEST>                               4,590,970
<CASH>                                         344,079
<RECOVER-REINSURE>                                   0
<DEFERRED-ACQUISITION>                          95,914
<TOTAL-ASSETS>                               7,858,736
<POLICY-LOSSES>                              4,647,540
<UNEARNED-PREMIUMS>                                  0
<POLICY-OTHER>                                       0
<POLICY-HOLDER-FUNDS>                                0
<NOTES-PAYABLE>                                 38,000
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                     50,000
<COMMON>                                           233
<OTHER-SE>                                     247,324
<TOTAL-LIABILITY-AND-EQUITY>                 7,858,736
<PREMIUMS>                                           0
<INVESTMENT-INCOME>                            104,406
<INVESTMENT-GAINS>                               5,165
<OTHER-INCOME>                                   4,658
<BENEFITS>                                      81,680
<UNDERWRITING-AMORTIZATION>                      2,724
<UNDERWRITING-OTHER>                             8,765
<INCOME-PRETAX>                                 16,480
<INCOME-TAX>                                     5,499
<INCOME-CONTINUING>                             10,981
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    10,981
<EPS-PRIMARY>                                     0.42
<EPS-DILUTED>                                     0.40
<RESERVE-OPEN>                                       0
<PROVISION-CURRENT>                                  0
<PROVISION-PRIOR>                                    0
<PAYMENTS-CURRENT>                                   0
<PAYMENTS-PRIOR>                                     0
<RESERVE-CLOSE>                                      0
<CUMULATIVE-DEFICIENCY>                              0