<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AND STATEMENT OF INCOME OF ARM FINANCIAL GROUP, INC'S FORM 10K FOR THE
YEAR ENDED DECEMBER 31, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO 
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1998
<PERIOD-START>                             JAN-01-1998
<PERIOD-END>                               DEC-31-1998
<DEBT-HELD-FOR-SALE>                         5,812,330
<DEBT-CARRYING-VALUE>                                0
<DEBT-MARKET-VALUE>                                  0
<EQUITIES>                                      31,745
<MORTGAGE>                                      14,554
<REAL-ESTATE>                                        0
<TOTAL-INVEST>                               5,287,014
<CASH>                                         525,316
<RECOVER-REINSURE>                                   0
<DEFERRED-ACQUISITION>                         125,589
<TOTAL-ASSETS>                               9,786,264
<POLICY-LOSSES>                              6,600,498
<UNEARNED-PREMIUMS>                                  0
<POLICY-OTHER>                                       0
<POLICY-HOLDER-FUNDS>                                0
<NOTES-PAYABLE>                                 38,000
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                     75,000
<COMMON>                                           237
<OTHER-SE>                                     135,196
<TOTAL-LIABILITY-AND-EQUITY>                 9,786,264
<PREMIUMS>                                           0
<INVESTMENT-INCOME>                            480,423
<INVESTMENT-GAINS>                             (1,874)
<OTHER-INCOME>                                  21,581
<BENEFITS>                                     380,738
<UNDERWRITING-AMORTIZATION>                     12,593
<UNDERWRITING-OTHER>                            39,367
<INCOME-PRETAX>                                 58,880
<INCOME-TAX>                                    15,066
<INCOME-CONTINUING>                             43,814
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    43,814
<EPS-PRIMARY>                                     1.59
<EPS-DILUTED>                                     1.53
<RESERVE-OPEN>                                       0
<PROVISION-CURRENT>                                  0
<PROVISION-PRIOR>                                    0
<PAYMENTS-CURRENT>                                   0
<PAYMENTS-PRIOR>                                     0
<RESERVE-CLOSE>                                      0
<CUMULATIVE-DEFICIENCY>                              0