ALLSTATE LIFE INSURANCE CO OF NEW YORK
424B3, 2000-09-15
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                   Allstate Life Insurance Company of New York

                   Supplement to The Custom Annuity Prospectus
                                Dated May 1, 2000

The  following  sentence  replaces  the  second  paragraph  on  page  1  of  the
prospectus:

         The Contracts are available through Dean Witter Reynolds, Inc., the
         principal underwriter for the Contracts.

The following  sentence replaces the third sentence of the first paragraph under
the heading "Systematic Withdrawal Program" on page 13 of the prospectus:

         We will deposit systematic  withdrawal payments into your bank account
         or a Morgan Stanley Dean Witter Active Assets(TM) Account.

The  following  paragraph  replaces  the  fourth  paragraph  under  the  heading
"Appendix A/Market Value Adjustment" on page 25 of the prospectus:

         For any withdrawal,  if J is not available, J will be equal to the most
         recent Moody's Monthly Corporate Bond Yield Average (for the applicable
         duration) as published by Moody's Investor Services,  Inc. In the event
         that the  Moody's  Monthly  Corporate  Bond Yield  Average is no longer
         available, a suitable replacement index, subject to the approval of the
         New York Insurance Department, would be utilized.

September 15, 2000


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