For the Quarterly Period Ended: MARCH 31, 2000

Commission File Number: 0-10306

(Exact name of registrant as specified in its charter)

(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (203)358-8000

Former name, former address and former fiscal year, if changed since last report.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X. No.

Common stock outstanding as of May 10, 2000

Consolidated Balance Sheets -

March 31, 2000 (unaudited) and December 31, 1999............ 3

Consolidated Statements of Operations -

Three Months Ended March 31, 2000 and 1999 (unaudited.)........ 4

Consolidated Statements of Cash Flows -

Three Months Ended March 31, 2000 and 1999(unaudited)........ 5

Notes to Consolidated Financial Statements (unaudited)........... 6 - 9

Management's Discussion and Analysis of Results of Operations and

Financial Condition........................... 10 - 13

Item 6 - Exhibits and Reports on Form 8-K................ 14

Signatures................................ 15

(B) PRINCIPLES OF CONSOLIDATION AND PREPARATION OF

Independence Holding Company, a Delaware corporation ("IHC"), is a holding company engaged principally in the life and health insurance business through its wholly-owned subsidiaries, Standard Security Life Insurance Company of New York ("Standard Life"), Madison National Life Insurance Company, Inc. ("Madison Life") and First Standard Security Insurance Company ("First Standard") and their subsidiaries (collectively, the "Insurance Group"). IHC and its subsidiaries (including the Insurance Group) are collectively referred to as the "Company." All remaining income, principally income from parent company liquidity (cash, cash equivalents, resale agreements, marketable securities and partnership investments) and expense items associated with parent company activities, the Company's remaining real estate holdings and certain other investments of the Company, are included in Corporate.

The Company's operating income was $3.7 million, for both periods ended March 31, 2000 and 1999. The Company had net realized and unrealized losses of $1.1 million in 2000 and gains of $.4 million in 1999. Decisions to sell securities are based on cash flow needs, investment opportunities and economic and market conditions, thus creating fluctuations in gains (losses) from year to year. Excluding net realized and unrealized gains, operating income increased 46% to $4.8 million in 2000 as compared to $3.3 million in 1999 which approximately consisted of: an increase in acquisitions of $1.5 million and an increase in yields on investable assets of $.8 million offset by an increase in interest expense of $.3 million and a decrease in other lines of $.5 million (see Note 8 of Notes to Consolidated Financial Statements). Net income was $2.4 million, or $.33 per share, diluted, for both quarters ended March 31, 2000 and 1999.

The Insurance Group's operating income increased $.4 million to $4.2 million in 2000 from $3.8 million in 1999. Operating income includes net realized and unrealized losses of $1.1 million in 2000 compared to gains of $.4 million in 1999. Operating income excluding net realized and unrealized losses was $5.3 million in 2000 compared to $3.5 million in 1999.

Premium revenues increased $1.9 million to $22.1 million in 2000 from $20.2 million in 1999; premium revenues increased $2.2 million at Madison Life and decreased $.3 million at Standard Life. The increase at Madison Life is comprised of: a $.5 million increase in long-term disability ("LTD") premiums as a result of an increase in premiums written in 2000; a $.3 million increase in group term life, and a $3.0 million increase in ordinary life and individual accident and health premiums due to the 1999 acquisitions; such increases were offset by: a $.9 million decrease in the credit lines of business, primarily due to the runoff of acquisitions of two single premium blocks of business effective in 1997; a $.4 million decrease in dental premiums due to the runoff of this block and a $.3 million decrease in other life and health lines of business. The decrease at Standard Life is comprised of: a $.6 million decrease in stop-loss premiums due to lower retention in 2000 and a $.5 million decrease in DBL due to higher lapses; such decreases are offset by: a $.3 million increase in its provider excess line; a $.3 million increase in the closed group life assumed block purchased effective April 1, 1999 and a $.2 million increase in the point of service line.

Total net investment income increased $3.8 million primarily due to higher returns on certain equity investments, higher yields on fixed income securities and by an increase in assets due to the acquisitions in 1999. The annualized return on investments of the Insurance Group in the first quarter of 2000 was 7.5% compared to 6.5% in the first quarter of 1999.

Other income decreased $2.3 million due to $.3 million less fee income earned by the managing general underwriter ("MGU") in which Madison Life acquired a controlling interest effective December 31, 1997; and a $2.0 million decrease at Standard Life due to an increase in coinsurance reserves due to the surrender by a large group of policyholders in a modified coinsurance treaty.

Insurance benefits, claims and reserves increased $1.7 million, reflecting an increase of $3.0 million at Madison Life and a decrease of $1.3 million at Standard Life. Madison Life's increase resulted from: a $.2 million increase in the credit line of business; a $1.8 million increase in ordinary life and individual accident and health reserves and claims, a $.3 million increase in surrenders and $1.0 million increase in interest on annuity policies, all of such increases due to acquisitions in 1999; and a $.5 million increase in LTD claims due to the increase in premiums; such increases were offset by: a $.3 million decrease in dental claims due to the runoff of this line; and a $.5 million decrease in claims and reserves in other life and health lines of business. The change at Standard Life is comprised of: a $1.8 million decrease in stop-loss reserves due to lower loss ratios; and a $1.4 million decrease in the closed block of ordinary life business due to the surrender by a large group of policyholders; such increases were offset by: a $.6 million increase in DBL claims and reserves due to higher claims; a $.6 million increase in interest expense and group annuity and life reserves due to the acquisition on April 1, 1999; a $.5 million increase in point of service claims; and a $.2 million increase in all other lines.

Amortization of deferred acquisition costs and general and administrative expenses for the Insurance Group increased $.1 million. Madison Life's expenses increased $.1 million and Standard Life's and IndependenceCare's expenses remained constant.

Operating income for the quarter ended March 31, 2000 decreased by $.4 million from 1999 to a loss of $.5 million. Operating income includes a realized gain of $.1 million in 1999. Excluding realized gains, operating income decreased by $.3 million due to an increase in interest expense attributable to the borrowing of $15.0 million during the fourth quarter of 1999. All other income and expense items remained constant.

The Insurance Group normally provides cash flow from: (i) operations; (ii) the receipt of scheduled principal payments on its portfolio of fixed income securities; and (iii) earnings on investments. Such cash flow is used partially to finance liabilities for insurance policy benefits. These liabilities represent long-term and short-term obligations which are calculated using certain assumed interest rates.

Asset Quality

The nature and quality of insurance company investments must comply with all applicable statutes and regulations which have been promulgated primarily for the protection of policyholders. Of the aggregate carrying value of the Insurance Group's investment assets, approximately 80.7% was invested in investment grade fixed income securities, resale agreements, policy loans and cash and cash equivalents at March 31, 2000. Also at such date, approximately 97% of the Insurance Group's fixed maturities were investment grade. These investments carry less risk and, therefore, lower interest rates than other types of fixed maturity investments. At March 31, 2000, approximately 3% of the carrying value of fixed maturities was invested in diversified non-investment grade fixed income securities (investments in such securities have different risks than investment grade securities, including greater risk of loss upon default, and thinner trading markets). Less than .1% of the carrying value of the Company's total investments was represented by real estate and mortgage loans. The Company has no non-performing fixed maturities.

Risk Management

The Company manages interest rate risk by seeking to maintain a portfolio with a duration and average life that falls within the band of the duration and average life of the applicable liabilities, and may utilize options to modify the duration and average life of such assets.

The Company monitors its investment portfolio on a continuous basis and believes that the liquidity of the Insurance Group will not be adversely affected by its current investments. This monitoring includes the maintenance of an asset-liability model that matches current insurance liability cash flows with current investment cash flows.

The expected change in fair value of the Company's fixed income portfolio at March 31, 2000 given a 100 to 300 basis point rise or decline in interest rates is not materially different than the expected change at December 31, 1999. In the Company's analysis of the asset-liability model, a 100 to 300 basis point change in interest rates on the Insurance Group's liabilities would not be expected to have a material adverse effect on the Company. With respect to its liabilities, if interest rates were to increase, the risk to the Company is that policies would be surrendered and assets would need to be sold. This is not a material exposure to the Company since a large portion of the Insurance Group's interest sensitive policies are burial policies that are not subject to the typical surrender patterns of other interest sensitive policies, and many of the Insurance Group's universal life and annuity policies come from liquidated companies which tend to exhibit lower surrender rates than such policies of continuing companies. Additionally, there are charges to help offset the benefits being surrendered. If interest rates were to decrease substantially, the risk to the Company is that some of its investment assets would be subject to early redemption. This is not a material exposure because the Company would have additional gains in its portfolio to help offset the future reduction of investment income. With respect to its investments, the Company employs (from time to time as warranted) investment strategies to mitigate interest rate and other market exposures.

Balance Sheet

The increase in fixed maturities is offset by a decrease in notes receivable as a portion of the Mississippi Guaranty Association notes were paid-down and invested in fixed maturities. Also offsetting the increase in fixed maturities is an increase in due to brokers due to the timing of a securities trade that settled after March 31, 2000.

The Company had net receivables from reinsurers of $114.0 million at March 31, 2000. Substantially all of the business ceded to such reinsurers is of short duration. All of such receivables are either due from highly rated companies or are adequately secured. Accordingly, no allowance for doubtful accounts was necessary at March 31, 2000.

Corporate derives its funds principally from: (i) dividends and interest income from the Insurance Group; (ii) management fees from its subsidiaries; and (iii) investment income from Corporate liquidity. Regulatory constraints historically have not affected the Company's consolidated liquidity, although state insurance laws have provisions relating to the ability of the parent company to use cash generated by the Insurance Group.

Total corporate liquidity (cash, cash equivalents, resale agreements and marketable securities) amounted to $14.1 million at March 31, 2000.

Due to its superior capital ratios, broad licensing and excellent asset quality and credit-worthiness, the Insurance Group remains well positioned to increase or diversify its current activities. It is anticipated that future acquisitions or other expansion of operations will be funded internally from existing capital and surplus and parent company liquidity, including the remaining $15.0 million availability under its credit facility. In the event additional funds are required, it is expected that they would be borrowed or raised in the public or private capital markets to the extent determined to be necessary or desirable.

In accordance with Statement of Financial Accounting Standards ("SFAS") No. 115, the Company may carry its portfolio of fixed income securities either as held to maturity (carried at amortized cost), as trading securities (carried at fair market value) or as available-for-sale (carried at fair market value); the Company has chosen to carry all of its debt securities as available-for-sale. The Company experienced a decrease in unrealized losses of $1.4 million, net of deferred tax expense and deferred policy acquisition costs, in total stockholders' equity, reflecting unrealized losses of $9.6 million at March 31, 2000 versus $11.0 million at December 31, 1999. From time to time, as warranted, the Company employs investment strategies to mitigate interest rate and other market exposures.

Some of the statements included within Management's Discussion and Analysis may be considered to be forward looking statements which are subject to certain risks and uncertainties. Factors which could cause the actual results to differ materially from those suggested by such statements are described from time to time in the Company's Annual Report on Form 10-K and other filings with the Securities and Exchange Commission.

a) 1) Exhibit 11. Statement re: computation of per share earnings.

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.

Dated: May 12, 2000 By:/s/ Teresa A. Herbert