UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    Form 13F

                               FORM 13F COVER PAGE

Report for the Calendar Year or Quarter Ended:       JUNE 30, 2008
                                                     ------------------------
Check here if Amendment |_|; Amendment Number:
                                                     ----------
  This Amendment (Check only one.):               |_| is a restatement.
                                                  |_| adds new holdings entries.

Institutional Investment Manager Filing this Report:

Name:        ALLSTATE LIFE INSURANCE COMPANY
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Address:     3075 SANDERS ROAD, SUITE G4A
             --------------------------------------
             NORTHBROOK, IL.  60062-7127
             --------------------------------------

             --------------------------------------

Form 13F File Number:   28-01037

The institutional manager filing this report and the person by whom it is signed
hereby  represent that the person signing the report is authorized to submit it,
that all information contained herein is true, correct and complete, and that it
is understood that all required items, statements, schedules, lists, and tables,
are considered integral parts of this form.

Person Signing this Report on Behalf of Reporting Manager:

Name:        PAUL SCHUTT
             ----------------------------------------------
Title:       ASSISTANT VICE PRESIDENT INVESTMENT OPERATIONS
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             Phone:       847-402-5169
             ----------------------------------------------

Signature, Place, and Date of Signing:

             /s/  PAUL SCHUTT                 NORTHBROOK,IL.         8/12/08
             ----------------------------  --------------------  ---------------
                  [Signature]                  [City, State]          [Date]

Report Type (Check only one.):

|X|   13F HOLDINGS REPORT. (Check here if all holdings of this reporting manager
      are reported in this report.)

|_|   13F NOTICE.   (Check here if no holdings reported are in this report, and
      all holdings are reported by other reporting manager(s).).)

|_|   13F  COMBINATION  REPORT.   (Check here if a portion of the  holdings for
      this  reporting  manager  are  reported  in this  report and a portion are
      reported by other reporting manager(s).)


List of Other Managers Reporting for this Manager:




                              FORM 13F SUMMARY PAGE


Report Summary:


Number of Other Included Managers:         ONE
                                           -------------------------------------

Form 13F Information Table Entry Total:              55
                                           -------------------------------------

Form 13F Information Table Value Total:         361,966 (THOUSAND)
                                           -------------------------------------


List of Other Included Managers:


Provide a numbered list of the name(s) and Form 13F file number(s) of all
 institutional investment managers with respect to which this report is filed,
 other than the manager filing this report.

[If there are no entries in this list, state "NONE" and omit the column headings
and list entries.]

No.          Form 13F File Number          Name

1            028-10298                     ALLSTATE INVESTMENTS LLC
                                           -------------------------------------




                                 FORM 13F REPORT

NAME OF REPORTING MANAGER: ALLSTATE LIFE INSURANCE COMPANY


TITLE VALUE SHRS OR SH/ PUT/ INVESTMENT OTHER VOTING AUTHORITY NAME OF ISSUER CLASS CUSIP (x$1000) PRN AMT PRN CALL DISCRETION MANAGERS SOLE SHARED NONE - ------------------------------------------------------------------------------------------------------------------------------------ AMERICAN FINANCIAL GROUP INC COMMON 025932104 1,533 57,318 SH DEFINED 1 X REINSURANCE GROUP AMERICA INC COMMON 759351109 3,917 90,000 SH DEFINED 1 X RPM INTERNATIONAL INC COMMON 749685103 5,459 265,000 SH DEFINED 1 X TRAVELERS COMPANIES INC COMMON 89417E109 434 10,000 SH DEFINED 1 X WACHOVIA CORP NON-REDEEM P/S 929903219 8,593 9,750 SH DEFINED 1 X ALLERGAN INC 1.500000% 04/01/2026 DEBT 018490AL6 5,796 5,500,000 PRN DEFINED 1 X ALZA CORP 0% 07/28/2020 DEBT 02261WAB5 5,818 6,500,000 PRN DEFINED 1 X AMDOCS LIMITED .500000% 03/15/2024 DEBT 02342TAD1 7,595 7,750,000 PRN DEFINED 1 X AMGEN INC .375000% 02/01/2013 DEBT 031162AQ3 7,395 8,500,000 PRN DEFINED 1 X ARCHER DANIELS .875000% 02/15/2014 DEBT 039483AW2 1,006 1,000,000 PRN DEFINED 1 X AVNET INC 2.000000% 03/15/2034 DEBT 053807AL7 10,854 10,500,000 PRN DEFINED 1 X BECKMAN COULTER INC 2.500000% 12/15/2036 DEBT 075811AD1 1,106 1,000,000 PRN DEFINED 1 X BEST BUY 2.250000% 01/15/2022 DEBT 086516AF8 11,468 11,000,000 PRN DEFINED 1 X BRISTOL-MYERS SQUIBB 2.510000% 09/15/2023 DEBT 110122AN8 15,413 15,500,000 PRN DEFINED 1 X CAMERON INTL CORP 2.500000% 06/15/2026 DEBT 13342BAB1 13,237 7,850,000 PRN DEFINED 1 X CARNIVAL CORP 2.000000% 04/15/2021 DEBT 143658AN2 7,131 7,000,000 PRN DEFINED 1 X COSTCO WHOLESALE CORP 0% 08/19/2017 DEBT 22160QAC6 510 320,000 PRN DEFINED 1 X DANAHER CORP 0% 01/22/2021 DEBT 235851AF9 11,987 10,550,000 PRN DEFINED 1 X DOMINION RESOURCES INC 2.125000% 12/15/2023 DEBT 25746UAT6 9,619 7,500,000 PRN DEFINED 1 X ELEC DATA SYSTEM DEBT 285661AF1 1,696 1,700,000 PRN DEFINED 1 X EMC CORP 1.750000% 12/01/2013 DEBT 268648AM4 2,111 1,850,000 PRN DEFINED 1 X FAIR ISAAC CORP 1.500000% 08/15/2023 DEBT 303250AD6 991 1,000,000 PRN DEFINED 1 X FISHER SCIENTIFIC INTL 3.250000% 03/01/2024 DEBT 338032AX3 12,629 8,350,000 PRN DEFINED 1 X FLUOR CORP 1.500000% 02/15/2024 DEBT 343412AA0 582 175,000 PRN DEFINED 1 X GENZYME CORP 1.250000% 12/01/2023 DEBT 372917AN4 10,399 9,400,000 PRN DEFINED 1 X HASBRO INC 2.750000% 12/01/2021 DEBT 418056AN7 9,441 5,700,000 PRN DEFINED 1 X HCC INSURANCE HOLDINGS 1.300000% 04/01/2023 DEBT 404132AB8 7,728 7,325,000 PRN DEFINED 1 X HOLOGIC INC 2.000000% 12/15/2037 DEBT 436440AA9 845 1,000,000 PRN DEFINED 1 X INTEL CORP 2.950000% 12/15/2035 DEBT 458140AD2 5,940 6,100,000 PRN DEFINED 1 X INTL GAME TECHNOLOGY 2.600000% 12/15/2036 DEBT 459902AP7 17,040 17,750,000 PRN DEFINED 1 X LABORATORY CORP AMERICA HOLDINGS DEBT 50540RAG7 11,938 12,500,000 PRN DEFINED 1 X LEHMAN BROTHERS HOLDINGS .250000% 05/08/2010 DEBT 524908FN5 1,344 1,500,000 PRN DEFINED 1 X LIBERTY MEDIA CORP 3.250000% 03/15/2031 DEBT 530715AR2 640 1,000,000 PRN DEFINED 1 X LIBERTY MEDIA LLC 3.12500% 03/30/2023 DEBT 530718AF2 1,564 1,500,000 PRN DEFINED 1 X LOCKHEED MARTIN CORP 3.018130% 08/15/2033 DEBT 539830AP4 11,559 8,500,000 PRN DEFINED 1 X MEDTRONIC INC 1.625000% 04/15/2013 DEBT 585055AM8 9,084 8,500,000 PRN DEFINED 1 X MERRILL LYNCH & CO 0% 03/13/2032 DEBT 590188W46 15,521 15,250,000 PRN DEFINED 1 X MYLAN LABORATORIES INC 1.250000% 03/15/2012 DEBT 628530AG2 838 1,000,000 PRN DEFINED 1 X NABORS INDUSTRIES INC .940000% 05/15/2011 DEBT 629568AP1 11,070 9,000,000 PRN DEFINED 1 X NATIONAL CITY CORP 4.000000% 02/01/2011 DEBT 635405AW3 8,088 10,000,000 PRN DEFINED 1 X NEXTEL COMMUNIC DEBT 65332VAY9 1,930 2,000,000 PRN DEFINED 1 X OMNICOM GROUP DEBT 681919AK2 4,461 4,500,000 PRN DEFINED 1 X OMNICOM GROUP INC 0% 07/01/2038 DEBT 681919AT3 9,880 9,500,000 PRN DEFINED 1 X PRUDENTIAL FINANCIAL INC 2.940000% 12/12/2036 DEBT 744320AG7 6,818 7,000,000 PRN DEFINED 1 X PSS WORLD MEDICAL INC 2.250000% 03/15/2024 DEBT 69366AAB6 535 500,000 PRN DEFINED 1 X RAYONIER TRS HOLDINGS IN 3.750000% 10/15/2012 DEBT 75508AAB2 4,020 4,000,000 PRN DEFINED 1 X SANDISK CORP 1.000000% 05/15/2013 DEBT 80004CAC5 686 1,000,000 PRN DEFINED 1 X SCHLUMBERGER LIMITED 2.125000% 06/01/2023 DEBT 806857AD0 540 200,000 PRN DEFINED 1 X ST JUDE MEDICAL INC 1.220000% 12/15/2008 DEBT 790849AD5 1,980 2,000,000 PRN DEFINED 1 X TEVA PHARMACEUT FIN BV 1.750000% 02/01/2026 DEBT 88165FAA0 8,223 7,400,000 PRN DEFINED 1 X TEVA PHARMACEUT FIN LLC .250000% 02/01/2024 DEBT 88164RAB3 3,605 2,700,000 PRN DEFINED 1 X TJX COMPANIES INC 0% 02/13/2021 DEBT 872540AL3 12,118 11,500,000 PRN DEFINED 1 X TRANSOCEAN INC 1.500000% 12/15/2037 DEBT 893830AV1 12,430 11,000,000 PRN DEFINED 1 X US BANCORP INC 3.600000% 09/20/2036 DEBT 902973AQ9 9,913 10,000,000 PRN DEFINED 1 X WYETH 2.390000% 01/15/2024 DEBT 983024AD2 14,910 14,600,000 PRN DEFINED 1 X - ---------------------------------------------------------------------------------- "STOCK" 5 19,937 432,068 - ---------------------------------------------------------------------------------- DEBT 50 342,029 317,470,000 - ---------------------------------------------------------------------------------- REPORT TOTALS 55 361,966 317,902,068 - ----------------------------------------------------------------------------------