Washington, D. C. 20549

(Exact name of registrant as specified in its charter)

(Registrant's telephone number, including area code)

(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 [ ]

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [x]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the last practicable date.

Registrant has 6,437 shares of common stock outstanding on May 16, 2005, all of which are owned by Sun Life of Canada (U.S.) Holdings, Inc.

2

For the three months ended March 31,

(1) See Note 1.

3

(in thousands except per share data)

4

(in thousands)

For the three months ended March 31,

(1) See Note 1.

5

(in thousands)

For the three months ended March 31, 2005 and 2004

(1) See Note 1.

6

(in thousands)

For the three months ended March 31,

Continued on next page

(1) See Note 1.

7

(in thousands)

For the three months ended March 31,

(1) See Note 1.

8

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2. TRANSACTIONS WITH AFFILIATES

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8. SUBSEQUENT EVENTS

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Pursuant to General Instruction H(2)(a) of Quarterly Report on Form 10-Q ("Form 10-Q"), the registrant, Sun Life Assurance Company of Canada (U.S.) ("the Company"), elects to omit the Management's Discussion and Analysis of Financial Condition and Results of Operations. Below is an analysis of the Company's results of operations that explains material changes in the Statement of Operations between the three months ended March 31, 2005 and March 31, 2004.

This Form 10-Q may include forward-looking statements by the Company under the Private Securities Litigation Reform Act of 1995. These statements are not matters of historical fact; they relate to such topics as future product sales, volume growth, market share, market risk and financial goals. It is important to understand that these forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those that the statements anticipate. These risks and uncertainties may concern, among other things:

As discussed in Note 1 to the unaudited condensed consolidated financial statements, the 2004 financial statements have been restated. This discussion and analysis gives effect to the restatement.

Acquisition costs related to the issuance of fixed and variable annuities and life insurance products are deferred and amortized, generally in proportion to the ratio of annual gross profits to the estimated total gross profits over the lives of the contracts. Estimated gross profits are reviewed periodically and adjusted retrospectively when the Company revises its estimates. Estimated gross profits include assumptions related to investment yields and interest rates, mortality, lapse, expense, and asset growth rates. Although realization of deferred policy acquisition costs ("DAC") is not assured, the Company believes that all of these costs will be realized. The amount of DAC considered realizable, however, could be reduced if the estimates of gross profits or total revenues discussed above are reduced.

Changes in any of the assumptions that serve to increase or decrease the estimated future gross profits will cause the amortization of DAC to decrease or increase, respectively, in the current period. This will cause fluctuation in earnings from period to period. There were no changes in assumptions for the three months ended March 31, 2005. These changes in assumptions resulted in a decrease in DAC amortization of $79.6 million for the three months ended March 31, 2004.

DAC is also adjusted for amounts relating to the recognition of unrealized investment gains and losses. This adjustment, net of tax, is included with the change in net unrealized investment gains or losses that is credited or charged directly to accumulated other comprehensive income (loss). DAC was decreased by $65.4 million and $172.9 million for the unrealized gains at March 31, 2005 and December 31, 2004, respectively, relating to this adjustment.

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The Company's net income was $35.1 million and $122.6 million for the three-month periods ended March 31, 2005 and 2004, respectively. Income before income taxes, minority interest share of income (loss) and cumulative effect of change in accounting principle was $54.9 million and $197.8 million for the three-month periods ended March 31, 2005 and 2004, respectively. This $142.9 million decrease was primarily due to decreases in the Wealth Management Segment ($114.3 million) and the Corporate Segment ($33.5 million), partially offset by increases in the Individual Protection Segment ($4.3 million) and Group Protection Segment ($0.6 million). Income tax expense was $21.1 million (38.4%) and $61.4 million (31.0%) for the three-month periods ended March 31, 2005 and 2004, respectively. The results of operations by segment are discussed more fully below.

The Company's net income (loss) from operations reflects the operations of its four business segments: Wealth Management, Individual Protection, Group Protection and Corporate.

The following provides a summary of net income (loss) from operations by segment.

The Wealth Mangement Segment sells a full range of retirement-oriented insurance products that provide fixed, indexed or variable returns to policyholders. Annuities are insurance products designed to offer individuals protection against the risk of outliving their financial assets during retirement. Annuities offer a tax-deferred means of accumulating savings for retirement needs and provide a tax-efficient source of income in the payout period. The Company earns spread income from fixed and indexed annuities; variable annuities primarily produce fee income. Through 2002, this segment also marketed funding agreements ("FA's") to unrelated third parties.

The segment's principal products are categorized as follows:

Fixed Annuities - Fixed annuity products are primarily single premium deferred annuities ("SPDA"). A SPDA policyholder typically makes a single premium payment at the time of issuance. The Company obligates itself to credit interest to the policyholder's account at a rate that is guaranteed for an initial term and is reset annually thereafter, subject to a guaranteed minimum rate. Interest crediting continues until the policy is surrendered, the policyholder dies, or when the policyholder turns age 90.

Variable Annuities - Variable annuities offer a selection of underlying investment alternatives that may satisfy a variety of policyholder risk/return objectives. Under a variable annuity, the policyholder has the opportunity to select separate account investment options (consisting of underlying mutual funds), which pass the investment risk directly to the policyholder in return for the potential of higher returns. Variable annuities also include guaranteed fixed interest options and benefits. The Company has several different variable annuity products that offer various separate account investment choices, depending on the product, and guaranteed fixed interest options.

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Equity-Indexed Annuities - Equity-indexed annuities credit interest to the policyholder using a formula based upon the positive change in value of a specified equity index. The Company's equity-indexed annuity products calculate interest earnings using the Standard & Poor's 500 Composite Stock Price Index ("S&P 500 Index") ("S&P", "S&P 500", and "Standard & Poor's" are trademarks of The McGraw Hill Companies, Inc. and have been licensed for use by the Company). The Company's equity-indexed products also provide a guarantee of principal (less withdrawals) at the end of the term or surrender charge period.

Institutional Investment Contracts - Institutional contracts are FA's issued to institutional investors or to entities that in turn issue promissory notes to unrelated third parties. These contracts may contain any of a number of features including variable or fixed interest rates and equity index options, and may be denominated in foreign currencies.

In 1997, the Company discontinued the marketing of group pension and guaranteed investment contracts ("GIC's") products in the United States. Although these products are not currently sold in the U.S., there continues to be a block of U.S. group retirement business in-force, including GIC's, pension plans and group annuities. A significant portion of these pension contracts is non-surrenderable, resulting in limited liquidity exposure to the Company.

The Company uses derivative instruments to manage the risks inherent in the contract options of many of these products.

Other - The Wealth Management Segment currently manages a closed block of single premium whole life insurance policies ("SPWL"), a retirement-oriented tax-advantaged life insurance product. The Company discontinued sales of the SPWL product in response to certain tax law changes in the 1980's. The Company had SPWL policyholder balances of $1.7 billion as of March 31, 2005. On December 31, 2003, this entire block of business was reinsured on a funds withheld basis with Sun Life Assurance Company of Canada, an affiliate. By reinsuring the SPWL product, the Company reduced net investment income by $23.4 million and $23.7 million, and interest credited by $14.8 million and $20.1 million for the three months ended March 31, 2005 and 2004, respectively. In addition, the Company also increased net investment income, relating to an experience rating refund under the reinsurance agreement, by $6.0 million and $1.8 million for the three months ended March 31, 2005 and 2004, respectively. The liability for the SPWL policies is included in contractholder deposit funds and other policy liabilities.

The Company sells its annuity products via two affiliated distribution organizations, Sun Life Financial Distributors, Inc. and Independent Financial Marketing Group, Inc. The annuity products are also distributed through a variety of unaffiliated retail organizations including securities brokers, financial institutions, insurance agents, and financial advisers. Investment funds available under these products are managed by several investment managers, including Massachusetts Financial Services Company and Sun Capital Advisers LLC, affiliates of the Company.

The following is a summary of operations for the Wealth Management Segment for the three-month periods ended

March 31 (in 000's):

The pre-tax income was $41.7 million and $155.9 million for the three-month periods ended March 31, 2005 and 2004, respectively. The $114.2 million decrease in pre-tax income was primarily due to an increase in amortization of DAC, decreases in net investment income and in net realized gains offset by improvement in derivative income.

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Total Revenues were $327.6 million and $358.3 million for the three months ended March 31, 2005 and 2004, respectively. The decrease of $30.7 million was primarily due to decreases in net investment income and net realized gains on the sale of securities offset by improvement in derivative income. The significant changes from the three-month periods ended March 31, 2005 and 2004 were as follows:

Investment income - was $221.0 million and $279.0 million for the three months ended March 31, 2005 and 2004, respectively. Investment income, excluding the mark to market of the trading portfolio and partnership income, was $251.3 million and $239.3 million for the three months ended March 31, 2005 and 2004, respectively. The increase of $12.0 million during 2005, as compared to 2004, was the result of a higher average investment yield ($3.7 million) and an increase in average invested assets ($8.3 million). Investment income (loss) related to the changes in the market value of securities in the trading portfolio and changes in the value of the partnership investments was ($30.2 million) and $39.7 million for the three months ended March 31, 2005 and 2004, respectively. The change in the market value of the trading portfolio is primarily related to changes in the interest rate environment.

Separate Account fees - are primarily mortality and expense charges earned on variable annuity balances. These charges, which are based on the market values of the assets in the separate accounts supporting the contracts, were $54.6 million and $53.8 million for the three months ended March 31, 2005 and 2004, respectively. Variable product fees represented 1.43% and 1.44% of the average variable annuity separate account balances for the three months ended March 31, 2005 and 2004, respectively. Average separate account assets were $15.3 billion and $15.0 billion for the three months ended March 31, 2005 and 2004, respectively.

Surrender charges - are revenues earned on the early withdrawal of fixed, equity-indexed and variable annuity policyholder balances. Surrender charges on fixed, equity-indexed and variable annuity surrenders generally are assessed at declining rates applied to policyholder surrenders during the first five to seven years of the contract. Total surrender charges were $6.5 million and $7.0 million for the three months ended March 31, 2005 and 2004, respectively.

Derivative income (loss) - was $25.2 million and $(55.5) million for the three months ended March 31, 2005 and 2004, respectively. Derivative income (loss) primarily represents fair value changes of derivative instruments and the net interest received or paid on swap agreements.

All derivatives are recognized on the balance sheet at fair value. Net interest received or paid on swap agreements and changes in the fair value of derivatives are reported in current period operations as a component of net derivative income (losses). The Company believes that these derivatives provide economic hedges and the cost of formally documenting the effectiveness of the fair value of the hedged items in accordance with the provisions of Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities," is not justified.

The Company issues annuity contracts and FA's that contain a derivative instrument that is "embedded" in the contract. Upon issuing the contract, the embedded derivative is separated from the host contract (annuity contract or FA contract) and is carried at fair value. The Company also purchases call options and futures on the S&P 500 Index and total return swaps to economically hedge its obligation under certain of these equity-indexed annuity contracts. Each FA contract is highly-individualized but typically involves the issuance of foreign currency denominated contracts backed by cross currency swaps or equity linked cross currency swaps. The combination of these swaps with interest rate swaps allows the Company to lock in U.S. dollar fixed rate payments for the life of the contract.

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As a component of its investment strategy and to reduce its exposure to interest rate risk, the Company utilizes interest rate swap agreements. Interest rate swap agreements are agreements to exchange with a counterparty interest rate payments of differing character (e.g., fixed-rate payments exchanged for variable-rate payments) based on an underlying principal balance (notional principal) to hedge against interest rate changes. The Company also utilizes put options on the S&P 500 Index to hedge against stock market exposure inherent in the mortality and expense charges and guaranteed minimum living and death benefit features of the Company's variable annuities.

Net derivative income (loss) for the Wealth Management Segment for the three months ended March 31 consisted of the following (in 000's):

Realized investment gains - were $3.2 million and $48.8 million for the three months ended March 31, 2005 and 2004, respectively. Sales of investments generally are made to maximize total return and take advantage of prevailing market conditions. Realized investment gains (losses) include write-downs of fixed maturities for other-than-temporary impairments of $(8.8) million and $(7.4) million for the three months ended March 31, 2005 and 2004, respectively.

Interest credited - to policyholders was $162.6 million and $163.9 million for the three months ended March 31, 2005 and 2004, respectively. The decrease of $1.3 million was the result of a decrease in average interest credited rate of ($8.7 million) offset by a higher average policyholder balances of ($7.4 million).

Interest expense - was $15.7 million and $21.0 million for the three months ended March 31, 2005 and the 2004, respectively. The $5.3 million decrease was due to lower allocated capital charge from the Corporate Segment.

Policyholder benefits - were $25.9 million and $32.3 million for the three months ended March 31, 2005 and 2004, respectively. The $6.4 million decrease in 2005 compared to 2004 was primarily due to a $3.6 million and $3.3 million decrease in death benefits and annuity payments, respectively.

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Operating Expenses - were $35.5 million and $26.2 million for the three months ended March 31, 2005 and 2004, respectively. The increase of $9.3 million was primarily due to an $8.2 million increase in general operating expenses and a $1.1 million increase in commission expense. The increase in operating expense was due to increased marketing costs and overhead allocations.

Amortization of deferred policy acquisition costs - relates to the costs of acquiring new business, which vary with and are primarily related to the production of new annuity business. Such acquisition costs include commissions, costs of policy issuance, underwriting and selling expenses. Amortization expense was $44.1 million and $(42.5) million for the three months ended March 31, 2005 and 2004, respectively. The $86.6 million increase in DAC amortization was primarily due to a $82.2 million unlocking adjustment that decreased amortization for the three months ended March 31, 2004. The unlocking adjustment in 2004 was due to favorable changes in the equity markets utilized in the estimated future gross profit assumptions used to calculate DAC amortization. There were no changes in assumptions for the three months ended March 31, 2005.

Amortization of value of business acquired - relates to the actuarial-determined present value of projected future gross profits from policies in force at the date that Keyport Life Insurance Company was acquired (November 1, 2001). This amount is amortized in proportion to the projected emergence of profits over the estimated lives of the contracts. Amortization was $2.2 million and $1.5 million for the three months ended March 31, 2005 and 2004, respectively.

The following provides a summary of the operations for the Individual Protection Segment for the three-month periods ended March 31 (in 000's):

Total revenues were $21.5 million and $14.7 million for three months ended March 31, 2005 and 2004, respectively. The $6.9 million increase was due to increases in fee income ($4.4 million), net investment income ($1.4 million) and net realized investment gain ($1.4 million) partially offset by a decrease of $0.3 million in derivative income. The improvement in fee income was attributed to a $66.6 million increase in deposits in 2005 compared to the same period in 2004. Deposits were $96.7 million and $30.1 million for the three months ended March 31, 2005 and 2004, respectively. The increase in net investment income was primarily due to an increase in the asset base of the COLI VUL product.

Total expenses were $17.4 million and $14.7 million for the three months ended March 31, 2005 and 2004, respectively. The $2.7 million increase was primarily due to a $1.8 million increase in other operating expenses and a $0.8 million increase in interest credited. The change in operating expenses was attributed to a $1.3 million increase in premium taxes and a $0.5 million increase in commissions related to the increase in deposits in the COLI VUL product.

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The Group Protection Segment markets and administers group life insurance, stop loss insurance and long-term disability products to small and mid-size employers as part of such companies' employee benefit plans. This segment operates only in the State of New York through a subsidiary, Sun Life Insurance and Annuity Company of New York.

The following provides a summary of operations for the Group Protection Segment for the three months ended

March 31 (in 000's):

Total revenues were $8.7 million and $8.0 million for the three months ended March 31, 2005 and 2004, respectively. The $0.7 million increase in revenue was primarily due to a net increase in premiums in the group life insurance ($1.1 million) and long-term disability ($0.5 million) lines of business, offset by a decrease in stop-loss insurance ($0.9 million).

Total expenditures remained consistent and were $8.6 million and $8.5 million for the three months ended March 31, 2005 and 2004, respectively.

The following provides a summary of operations for the Corporate Segment for the three months ended

March 31 (in 000's):

The Corporate Segment had pretax income of $9.0 million and $42.5 for the three months ended March 31, 2005 and 2004, respectively. The $33.5 million decrease in pretax income was primarily attributed to a $25.2 million decrease in derivative income associated with the consolidation of the VIE and a provision recorded in anticipation of settling administrative actions with the U.S. Securities and Exchange Commission (the "SEC"), as well as an $8.1 million decrease in realized gain on sale of investments. Those decreases were partially offset by a $14.8 million improvement in earnings due to venture capital and other alternative investments and an $11.5 million decrease in other expenses.

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Omitted pursuant to Instruction H(2)(c) of Form 10-Q.

Based on an evaluation as of the end of the period covered by this report, the Company's management, including the Company's principal executive officer and principal financial officer, have concluded that the Company's disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) are effective. This evaluation included consideration of the restatement described in Note 1 to the Company's condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q. There has been no change in the Company's internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the quarter ended March 31, 2005 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

As part of an industry wide investigation, state regulators are investigating certain compensation arrangements and other business practices between insurance companies and brokers. The Company and certain of its affiliates have received requests for information from state regulators and are cooperating with respect to these matters.

The Company's variable annuity contracts and variable life insurance policies are subject to various levels of regulation under federal securities laws administered by the SEC and under certain state securities laws. On or about October 30, 2003, the Company received a request from the SEC for information regarding its policies, practices and procedures with respect to subaccount "market timing," its policies, practices and procedures with respect to receiving and processing exchange orders from contract owners, and its oversight of such activities in the Company's separate accounts. The Company responded to this request and an additional related request. On March 4, 2004, the Boston District Office of the SEC notified the Company that it intended to commence an examination of the Company and certain of its affiliates pursuant to Section 31(b) of the Investment Company Act of 1940 and the Securities Exchange Act of 1934 relating to these and certain other subjects. The Company is cooperating with the SEC in these matters.

As a result of these investigations and examinations, the Company is engaged in discussions with the SEC that may lead to settled administrative actions involving the Company and certain of its subsidiaries. The Company has recorded a provision associated with such matters in its Corporate Segment, which had a material adverse effect on the Company's operating results for the quarterly period ended March 31, 2005. While it is not possible to predict the final outcome of the Company's discussions with the SEC, management expects that the ultimate resolution of these matters will not be material to the financial condition of the Company.

In addition, the SEC and other regulators have conducted or are conducting investigations and examinations of certain of the Company's affiliates relating to various issues, including market timing and late trading of mutual funds and variable insurance products, directed brokerage, revenue-sharing and other arrangements with distributors, and recordkeeping requirements. While it is not possible to predict the final outcome of these matters, management expects that their ultimate resolution will not be material to the financial condition of the Company.

The Company and its subsidiaries are engaged in various kinds of ordinary routine litigation incidental to the Company's business which, in management's judgment, is not expected to be material to the business or financial condition of the Company or its subsidiaries.

Omitted pursuant to Instruction H (2) (b) of Form 10-Q.

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Omitted pursuant to Instruction H (2) (b) of Form 10-Q.

Omitted pursuant to Instruction H (2) (b) of Form 10-Q.

(a) None.

(b) None.

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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.