Allied Life: Death Claims and Merger Expenses



                                

                        ALLIED LIFE FINANCIAL CORPORATION 
                REPORTS DEATH CLAIMS AND PROPOSED MERGER EXPENSES
                  Contact Wendell Crosser 800-532-1436 ext.4622

                                 
Des Moines, Iowa, (July 8, 1998) -- ALLIED Life Financial Corporation (NASDAQ:
ALFC) announced that second quarter 1998 death claims (net of reinsurance) are
expected to be between $3.0 million and $3.2 million.  Second quarter 1997
death claims were $2.0 million.

The Company also announced that it has incurred second quarter 1998 expenses of
approximately $950,000 associated with the Agreement and Plan of Merger to be
acquired by Nationwide Mutual Insurance Company ("Nationwide") at a price of
$30 per share cash.  The transaction is subject to regulatory approvals and
approval by the ALFC shareholders if required.  The transaction is structured
as a tender offer for all of the outstanding shares of common stock of ALFC, to
be followed by a second-stage merger of a subsidiary of Nationwide with and
into ALFC.  Management believes the events leading up to the proposed Plan of
Merger caused questions in the minds of the field producers which resulted in
new production for the quarter at less than expected levels.  A series of
meetings with agents are being held to address their questions, and management
expects future new business to return to more historic levels.

Second quarter earnings are expected to be released after the close of the
market on July 23, 1998.



The Company's estimates and expectations discussed in this press release are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 ("Reform Act").  These forward-looking statements
are made pursuant to the safe harbor provisions of the Reform Act.  Investors
are cautioned that there are important factors that could cause actual
results to differ materially from those in these forward-looking statements. 
Such factors include, without limitation, that a final accounting of actual
second quarter expenses has not been completed as of the date of this release. 
Investors are referred to Management's Discussion and Analysis of Financial
Condition and Results of Operations in the Company's 1997 Annual Report
on Form 10-K filed with the Securities and Exchange Commission for a discussion
of additional factors that could cause actual results to differ from these
forward-looking statements.

ALLIED Life Financial Corporation is a holding company that, through its
principal subsidiary, ALLIED Life Insurance Company, underwrites, markets, and
distributes life insurance and annuity products in rural and suburban areas of
the United States.  



Ends.