TRAVELERS FUND ABD FOR VARIABLE ANNUITIES, 485BPOS, 1998-04-10

TRAVELERS FUND ABD FOR VARIABLE ANNUITIES
485BPOS, 1998-04-10

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<PAGE> 1
Registration No. 33-65343
811-07465

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 4
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 6

THE TRAVELERS FUND ABD FOR VARIABLE ANNUITIES
(Exact name of Registrant)

THE TRAVELERS INSURANCE COMPANY
(Name of Depositor)

ONE TOWER SQUARE, HARTFORD, CONNECTICUT 06183
(Address of Depositor's Principal Executive Offices)

Depositor's Telephone Number, including area code: (860) 277-0111

ERNEST J. WRIGHT
Secretary
The Travelers Insurance Company
One Tower Square
Hartford, Connecticut 06183
(Name and Address of Agent for Service)

Approximate Date of Proposed Public Offering: .

It is proposed that this filing will become effective (check appropriate box):

[ ] immediately upon filing pursuant to paragraph (b) of Rule 485
[X] on May 1, 1998 pursuant to paragraph (b) of Rule 485
[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485 on
[ ] on ___________ pursuant to paragraph (a)(1) of Rule 485

If appropriate, check the following box:

______ this post-effective amendment designates a new effective date for a
previously filed post- effective amendment.

<PAGE> 2

THE TRAVELERS FUND ABD FOR VARIABLE ANNUITIES

Cross-Reference Sheet

Form N-4

<TABLE>
<CAPTION>
ITEM
NO. CAPTION IN PROSPECTUS
- ---- ---------------------
<S> <C> <C>
1. Cover Page Prospectus

2. Definitions Glossary of Special Terms

3. Synopsis Prospectus Summary

4. Condensed Financial Information Condensed Financial Information

5. General Description of Registrant, The Insurance Company; The Separate
Depositor, and Portfolio Companies Account and the Funding Options; Voting
Rights

6. Deductions (and Expenses) Fee Table; Charges and Deductions;
Distribution of Variable Annuity Contracts

7. General Description of Variable The Contract; Ownership Provisions; Transfers
Annuity Contracts

8. Annuity Period The Annuity Period; Payment Options

9. Death Benefit Death Benefit

10. Purchases and Contract Value The Contract

11. Redemptions Surrenders and Redemptions; Miscellaneous
Contract Provisions; The Contract

12. Taxes Federal Tax Considerations

13. Legal Proceedings Legal Proceedings and Opinions

14. Table of Contents of Statement Appendix D
of Additional Information

CAPTION IN STATEMENT OF ADDITIONAL
INFORMATION
----------------------------------

15. Cover Page Statement of Additional Information

16. Table of Contents Table of Contents

17. General Information and History The Insurance Company

18. Services Principal Underwriter; Distribution and
Management Agreement

19. Purchase of Securities Being Offered Valuation of Assets

20. Underwriters Principal Underwriter

21. Calculation of Performance Data Performance Information

22. Annuity Payments Not Applicable

23. Financial Statements Financial Statements
</TABLE>

<PAGE> 3

PART A

Information Required in a Prospectus

<PAGE> 4

TRAVELERS PORTFOLIO ARCHITECT VARIABLE ANNUITY
CONTRACT PROFILE

MAY 1, 1998

THIS PROFILE IS A SUMMARY OF SOME OF THE MORE IMPORTANT POINTS THAT YOU SHOULD
KNOW AND CONSIDER BEFORE PURCHASING THE CONTRACT. THE CONTRACT IS MORE FULLY
DESCRIBED IN THE FULL PROSPECTUS WHICH IS ATTACHED TO THIS PROFILE. PLEASE READ
THE PROSPECTUS CAREFULLY. THE TERMS "WE," "US," "OUR" AND THE "COMPANY" REFER TO
THE TRAVELERS INSURANCE COMPANY. "YOU" AND "YOUR" REFER TO THE CONTRACT OWNER.

1. THE VARIABLE ANNUITY CONTRACT. The Contract offered by The Travelers
Insurance Company is a variable annuity that is intended for retirement savings
or other long-term investment purposes. The Contract provides a death benefit as
well as guaranteed income options. Portfolio Architect may be issued as an
individual Contract or as a group Contract. In states where only group Contracts
are available, you will be issued a certificate summarizing the provisions of
the group contract. For convenience, we refer to both Contracts and certificates
as "Contracts." Under a qualified Contract, you can make one or more payments,
as you choose, on a tax-deferred basis. Under a nonqualified Contract, you can
make one or more payments with after-tax dollars. You direct your payment(s) to
one or more of the variable funding options listed in Section 4 and/or to the
Fixed Account. We guarantee money directed to the Fixed Account as to principal
and interest. The variable funding options are designed to produce a higher rate
of return than the Fixed Account; however, this is not guaranteed. You may also
lose money in the variable funding options.

The Contract, like all deferred variable annuity contracts, has two phases: the
accumulation phase and the income phase. During the accumulation phase, under a
qualified contract, your pre-tax contributions accumulate on a tax-deferred
basis and are taxed as income when you make a withdrawal, presumably when you
are in a lower tax bracket. During the accumulation phase, under a nonqualified
contract, earnings on your after-tax contributions accumulate on a tax-deferred
basis and are taxed as income when you make a withdrawal. The income phase
occurs when you begin receiving regular payments from your Contract. The amount
of money you accumulate in your Contract determines the amount of income
(annuity payments) you receive during the income phase.

2. ANNUITY PAYMENTS (THE INCOME PHASE). You may choose to receive annuity
payments from the Fixed Account or the variable funding options. If you want to
receive regular payments from your annuity, you can choose one of the following
annuity options: Option 1 -- payments for your life (life annuity) -- assuming
that you are the annuitant; Option 2 -- payments for your life with an added
guarantee that payments will continue to your beneficiary for a certain number
of months (120, 180 or 240, as you select), if you should die during that
period; Option 3 -- Joint and Last Survivor Life Annuity, in which payments are
made for your life and the life of another person (usually your spouse). Option
3 can also be elected with payments continuing at a reduced rate after the death
of one payee. There are also two Income Options: Fixed Amount -- the cash
surrender value of your Contract will be paid to you in equal payments; or Fixed
Period -- the cash surrender value will be used to make payments for a fixed
time period. If you should die before the end of the Fixed Period, the remaining
amount would go to your beneficiary.

Once you make an election of an annuity option or an income option and begin to
receive payments, it cannot be changed. During the income phase, you have the
same investment choices you had during the accumulation phase. If amounts are
directed to the variable funding options, the dollar amount of your payments may
increase or decrease.

<PAGE> 5

3. PURCHASE. You may purchase the Contract with an initial payment of at least
$5,000. You may make additional payments of at least $500 at any time during the
accumulation phase. (In some states, additional payments are not allowed.)

WHO SHOULD PURCHASE THIS CONTRACT? The Contract is currently available for use
in connection with (1) individual nonqualified purchases; (2) rollovers for
Individual Retirement Annuities (IRAs) and (3) rollovers for other qualified
retirement plans. Qualified contracts include contracts qualifying under Section
401(a), 403(b), or 408(b) of the Internal Revenue Code of 1986, as amended.

4. INVESTMENT OPTIONS. You can direct your money into the Fixed Account or any
or all of the following funding options. The funding options are described in
the prospectuses for the funds. Depending on market conditions, you may make or
lose money in any of these options:

Capital Appreciation Fund

Money Market Portfolio

DELAWARE GROUP PREMIUM FUND, INC.

REIT Series

DREYFUS VARIABLE INVESTMENT FUND

Capital Appreciation Portfolio

Small Cap Portfolio

SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.

Salomon Brothers Variable Investors Fund

TRAVELERS SERIES FUND, INC.

Alliance Growth Portfolio

MFS Total Return Portfolio

Putnam Diversified Income Portfolio

THE TRAVELERS SERIES TRUST

Convertible Bond Portfolio

Disciplined Mid Cap Stock Portfolio

Disciplined Small Cap Stock Portfolio

Equity Income Portfolio

Federated High Yield Portfolio

Federated Stock Portfolio

Large Cap Portfolio

Lazard International Stock Portfolio

MFS Emerging Growth Portfolio

MFS Mid Cap Growth Portfolio

MFS Research Portfolio

Strategic Stock Portfolio

Travelers Quality Bond Portfolio

WARBURG PINCUS TRUST

Emerging Markets Portfolio

5. EXPENSES. The Contract has insurance features and investment features, and
there are costs related to each. For Contracts with a value of less than
$40,000, the Company deducts an annual contract administrative charge of $30.
The annual insurance charge is 1.25% of the amounts you direct to the funding
options; and a related sub-account administrative charge of .15% annually is
charged.

Each funding option charges for management and other expenses. The charges range
from 0.40% to 1.40% annually, of the average daily net asset balance of the
funding option, depending on the funding option.

If you withdraw amounts under the Contract, the Company may deduct a withdrawal
charge (0% to 6%) of the amount of purchase payments withdrawn from the
Contract. If you withdraw all amounts under the Contract, or if you begin
receiving annuity payments, the Company may be required by your state to deduct
a premium tax of 0%-5%.

The following table is designed to help you understand the Contract charges. The
"Total Annual Insurance Charges" column includes the mortality and expense risk
charge, the sub-account administrative charge, and reflects the $30 annual
contract administrative charge as .014%. The "Total Annual Funding Option
Expenses" column reflects the investment charges for each portfolio, including
any expense waiver or reimbursement. The column "Total Annual Charges" reflects
the sum of the previous two columns. The columns under the heading "Examples"
show you how much you would pay under the Contract for a one-year period and for
a 10-year period. As required by the SEC, the examples assume that you invested
$1,000 in a Contract that earns 5% annually and that you withdraw your money at
the end of year 1 and at the end of year 10. For year 1, the examples show the
total annual charges assessed during that time as well as the

ii
<PAGE> 6

withdrawal charge. For the 10-year example, the total annual charges are
included, but no withdrawal charge is reflected. For these examples, the premium
tax is assumed to be 0%.

<CAPTION>
<S> <C> <C> <C> <C> <C>
Capital Appreciation Fund................................ 1.41% 0.84% 2.25% $83 $259
Money Market Portfolio................................... 1.41% 0.40% 1.81% 78 213
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series.......................................... 1.41% 0.85% 2.26% 83 260
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio....................... 1.41% 0.80% 2.21% 82 255
Small Cap Portfolio.................................. 1.41% 0.78% 2.19% 82 253
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.
Salomon Brothers Variable Investors Fund............. 1.41% 1.00% 2.41% 84 275
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio............................ 1.41% 0.82% 2.23% 83 257
MFS Total Return Portfolio........................... 1.41% 0.86% 2.27% 83 261
Putnam Diversified Income Portfolio.................. 1.41% 0.88% 2.29% 83 263
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio........................... 1.41% 0.80% 2.21% 82 255
Disciplined Mid Cap Stock Portfolio.................. 1.41% 0.95% 2.36% 84 270
Disciplined Small Cap Stock Portfolio................ 1.41% 1.00% 2.41% 84 275
Equity Income Portfolio.............................. 1.41% 0.95% 2.36% 84 270
Federated High Yield Portfolio....................... 1.41% 0.95% 2.36% 84 270
Federated Stock Portfolio............................ 1.41% 0.95% 2.36% 84 270
Large Cap Portfolio.................................. 1.41% 0.95% 2.36% 84 270
Lazard International Stock Portfolio................. 1.41% 1.25% 2.66% 87 300
MFS Emerging Growth Portfolio........................ 1.41% 0.95% 2.36% 84 270
MFS Mid Cap Growth Portfolio......................... 1.41% 1.00% 2.41% 84 275
MFS Research Portfolio............................... 1.41% 1.00% 2.41% 84 275
Strategic Stock Portfolio............................ 1.41% 0.90% 2.31% 83 265
Travelers Quality Bond Portfolio..................... 1.41% 0.75% 2.16% 82 250
WARBURG PINCUS TRUST
Emerging Markets Portfolio........................... 1.41% 1.40% 2.81% 88 314
</TABLE>

6. TAXES. The payments you make to a qualified Contract during the accumulation
phase are made with before-tax dollars. You will be taxed on your purchase
payments and on any earnings when you make a withdrawal or begin receiving
annuity or income payments. Under a nonqualified Contract, payments to the
Contract are made with after-tax dollars, and any earnings will accumulate
tax-deferred. You will be taxed on these earnings when they are withdrawn from
the Contract.

For owners of qualified Contracts, if you reach a certain age, you may be
required by federal tax laws to begin receiving payments from your annuity or
risk paying a penalty tax. In those cases, we can calculate and pay you the
minimum required distribution amounts. If you are younger than 59 1/2 when you
take money out, you may be charged a 10% federal penalty tax on the amount
withdrawn.

7. ACCESS TO YOUR MONEY. You can take withdrawals any time during the
accumulation phase. A withdrawal charge may apply. The amount of the charge
depends on a number of factors, including the length of time since the purchase
payment was made (6% if withdrawn within one year, gradually decreasing to 0%
for payments held by the Company for 8 years or more). After the first contract
year, you may withdraw up to 10% of the contract value (as of the previous
Contract year end) without a withdrawal charge. Of course, you may also have to
pay income taxes and a tax penalty on any money you take out.

iii
<PAGE> 7

8. PERFORMANCE. The value of the Contract will vary depending upon the
investment performance of the funding options you choose. The following chart
shows total returns for each funding option for the time periods shown. These
numbers reflect the insurance charges, administrative charge, investment charges
and all other expenses of the funding option. The numbers do not reflect any
withdrawal charge or any applicable taxes, which, if applied, would reduce such
performance. Past performance is not a guarantee of future results.

LAST TEN CALENDAR YEARS (OR FULL YEARS SINCE INCEPTION):

<TABLE>
<CAPTION>
- --------------------------------------------------------------------
PORTFOLIO NAME 1997
- --------------------------------------------------------------------
<S> <C>
Capital Appreciation Fund................................... 24.36%
Money Market Portfolio...................................... 3.59%
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio................................. 27.22%
MFS Total Return Portfolio................................ 19.55%
Putnam Diversified Income Portfolio....................... 6.24%
THE TRAVELERS SERIES TRUST
Equity Income Portfolio................................... 30.47%
Federated High Yield Portfolio............................ 13.84%
Federated Stock Portfolio................................. 31.66%
Large Cap Portfolio....................................... 21.72%
Lazard International Stock Portfolio...................... 6.61%
MFS Emerging Growth Portfolio............................. 19.33%
Travelers Quality Bond Portfolio.......................... 5.64%
</TABLE>

Those funding options not illustrated above do not yet have one full year of
performance history.

9. DEATH BENEFIT. The death benefit applies upon the first death of the owner,
joint owner, or annuitant. Assuming you are the Annuitant, if you die before you
move to the income phase, the person you have chosen as your beneficiary will
receive a death benefit. The death benefit paid depends on your age at the time
of your death. The death benefit value is calculated at the close of the
business day on which the Company's Home Office receives due proof of death. If
you die before you reach age 90, the death benefit equals the greatest of: (1)
the Contract Value;(2) the total purchase payments made under the Contract less
all partial withdrawals; or (3) the maximum "final death benefit value"
occurring on or before your 80(th) birthday (after adjustments for all purchase
payments and withdrawals). (See the Contract prospectus for a full explanation
of "final death benefit value".)

Assuming you are the annuitant, if you die on or after age 90 and before the
maturity date, the death benefit payable will be the contract value, less any
applicable premium tax or outstanding loans.

NOTE: In all cases described above, amounts will be reduced by loans
outstanding, premium taxes owed and partial withdrawals not previously deducted.
Certain states may have varying age requirements.

10. OTHER INFORMATION

RIGHT TO RETURN. If you cancel the Contract within twenty days after you
receive it, you will receive a full refund of the Contract Value (including
charges). Where state law requires a longer right to return period, or the
return of purchase payments, the Company will comply. You bear the investment
risk during the right to return period; therefore, the Contract Value returned
may be greater or less than your purchase payment. If the Contract is purchased
as an Individual Retirement Annuity, and is returned within the first seven days
after delivery, your full purchase payment will be refunded; during the
remainder of the right to return period, the Contract Value (including charges)
will be refunded. The Contract Value will be determined at the close of business
on the day we receive a written request for a refund.

TRANSFERS BETWEEN FUNDING OPTIONS. You can transfer between the funding options
as frequently as you wish without any current tax implications. Currently there
is no charge for transfers, nor a

iv
<PAGE> 8

limit to the number of transfers allowed. The Company may, in the future, charge
a fee for any transfer request, or limit the number of transfers allowed. The
Company, at the minimum, would always allow one transfer every six months. You
may transfer between the Fixed Account and the funding options twice a year
(during the 30 days after the six-month contract date anniversary), provided the
amount is not greater than 15% of the Fixed Account Value on that date.

ADDITIONAL FEATURES. This Contract has other features you may be interested in.
These include:

DOLLAR COST AVERAGING. This is a program that allows you to invest a fixed
amount of money in funding options each month, theoretically giving you a lower
average cost per unit over time than a single one-time purchase. Dollar Cost
Averaging requires regular investments regardless of fluctuating price levels,
and does not guarantee profits or prevent losses in a declining market.
Potential investors should consider their financial ability to continue
purchases through periods of low price levels.

SYSTEMATIC WITHDRAWAL OPTION. Before the maturity date, you can arrange to
have money sent to you at set intervals throughout the year. Of course, any
applicable charges and taxes will apply on amounts withdrawn.

AUTOMATIC REBALANCING. You may elect to have the Company periodically
reallocate the values in your Contract to match your original (or your latest)
funding option allocation request.

11. INQUIRIES. If you need more information, please contact us at (800)
842-8573 or:
Travelers Insurance Company
Annuity Services
One Tower Square
Hartford, CT 06183

v
<PAGE> 9

PORTFOLIO ARCHITECT
PROSPECTUS

This prospectus describes PORTFOLIO ARCHITECT, a flexible premium variable
annuity contract (the "Contract") issued by The Travelers Insurance Company (the
"Company" "we" or "our"). The Contract is available in connection with certain
retirement plans that qualify for special federal income tax treatment
("qualified Contracts") as well as those that do not qualify for such treatment
("nonqualified Contracts"). Portfolio Architect may be issued as an individual
Contract or as a group Contract. In states where only group Contracts are
available, you will be issued a certificate summarizing the provisions of the
group Contract. For convenience, this prospectus refers to both Contracts and
certificates as "Contracts."

You can choose to have your purchase payments accumulate on a fixed basis (i.e.
a Fixed Account funded through the Company's general account) and/or a variable
basis (i.e., one or more of the sub-accounts ("funding options")) of the
Travelers Fund ABD for Variable Annuities ("Fund ABD"). Your contract value will
vary daily to reflect the investment experience of the funding options you
select and any interest credited to the Fixed Account. The variable funding
options currently available are:

Capital Appreciation Fund

Money Market Portfolio

DELAWARE GROUP PREMIUM FUND, INC.

REIT Series

DREYFUS VARIABLE INVESTMENT FUND

Capital Appreciation Portfolio

Small Cap Portfolio

SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.

Salomon Brothers Variable Investors Fund

TRAVELERS SERIES FUND, INC.

Alliance Growth Portfolio

MFS Total Return Portfolio

Putnam Diversified Income Portfolio

THE TRAVELERS SERIES TRUST

Convertible Bond Portfolio

Disciplined Mid Cap Stock Portfolio

Disciplined Small Cap Stock Portfolio

Equity Income Portfolio

Federated High Yield Portfolio

Federated Stock Portfolio

Large Cap Portfolio

Lazard International Stock Portfolio

MFS Emerging Growth Portfolio

MFS Mid Cap Growth Portfolio

MFS Research Portfolio

Strategic Stock Portfolio

Travelers Quality Bond Portfolio

WARBURG PINCUS TRUST

Emerging Markets Portfolio

The Fixed Account is described in Appendix B. Unless specified otherwise, this
prospectus refers to the variable funding options. The contracts and/or some of
the funding options may not be available in all states. THIS PROSPECTUS IS VALID
ONLY WHEN ACCOMPANIED BY THE CURRENT PROSPECTUSES FOR THE VARIABLE FUNDING
OPTIONS. THESE PROSPECTUSES SHOULD BE READ AND RETAINED FOR FUTURE REFERENCE.

This prospectus provides the information that you should know before investing
in the Contract. You can receive additional information about Fund ABD by
requesting a copy of the Statement of Additional Information ("SAI") dated May
1, 1998. The SAI has been filed with the Securities and Exchange Commission
("SEC") and is incorporated by reference into this prospectus. To request a
copy, write to The Travelers Insurance Company, Annuity Services, One Tower
Square, Hartford, Connecticut 06183, call (800) 842-8573 or access the SEC's
website (http://www.sec.gov). The contents of the SAI appears in Appendix C of
this prospectus.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

VARIABLE ANNUITY CONTRACTS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ENDORSED OR
GUARANTEED BY ANY BANK, NOR ARE THEY FEDERALLY INSURED OR OTHERWISE PROTECTED BY
THE FDIC, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY; THEY ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL INVESTMENT.

PROSPECTUS DATED MAY 1, 1998

<PAGE> 10

TABLE OF CONTENTS

<TABLE>
<S> <C>
INDEX OF SPECIAL TERMS................. 2
FEE TABLE.............................. 3
CONDENSED FINANCIAL INFORMATION........ 5
THE ANNUITY CONTRACT................... 5
Purchase Payments...................... 6
Accumulation Units..................... 6
The Funding Options.................... 6
Substitutions and Additions............ 8
CHARGES AND DEDUCTIONS................. 8
Withdrawal Charge...................... 8
Free Withdrawal Allowance.............. 9
Administrative Charges................. 9
Mortality and Expense Risk Charge...... 9
Reduction or Elimination of Contract
Charges.............................. 9
Funding Option Expenses................ 10
Premium Tax............................ 10
Changes in Taxes Based Upon Premium or
Value................................ 10
OWNERSHIP PROVISIONS................... 10
Types of Ownership..................... 10
Beneficiary............................ 10
Annuitant.............................. 11
TRANSFERS.............................. 11
Dollar Cost Averaging.................. 11
ACCESS TO YOUR MONEY................... 11
Systematic Withdrawals................. 12
Loans.................................. 12
DEATH BENEFIT.......................... 12
Death Proceeds Before the Maturity
Date................................. 12
Payment of Proceeds.................... 13
Death Proceeds After the Maturity
Date................................. 14
THE ANNUITY PERIOD..................... 14
Maturity Date.......................... 14
Allocation of Annuity.................. 14
Variable Annuity....................... 14
Fixed Annuity.......................... 15
PAYMENT OPTIONS........................ 15
Election of Options.................... 15
Annuity Options........................ 16
Income Options......................... 16
MISCELLANEOUS CONTRACT PROVISIONS...... 17
Right to Return........................ 17
Termination............................ 17
Required Reports....................... 17
Suspension of Payments................. 17
Transfers of Contract Values to Other
Annuities............................ 17
THE SEPARATE ACCOUNT................... 18
Mixed and Shared Funding............... 18
Performance Information................ 18
FEDERAL TAX CONSIDERATIONS............. 19
General Taxation of Annuities.......... 19
Types of Contracts: Qualified or
Nonqualified......................... 19
Nonqualified Annuity Contracts......... 19
Qualified Annuity Contracts............ 20
Penalty Tax for Premature
Distributions........................ 20
Diversification Requirements for
Variable Annuities................... 20
Ownership of the Investments........... 20
Mandatory Distributions for Qualified
Plans................................ 21
OTHER INFORMATION...................... 21
The Insurance Company.................. 21
IMSA................................... 21
Year 2000 Compliance................... 21
Distribution of Variable Annuity
Contracts............................ 22
Conformity with State and Federal
Laws................................. 22
Voting Rights.......................... 22
Legal Proceedings And Opinions......... 22
APPENDIX A: Condensed Financial
Information.......................... 24
APPENDIX B: The Fixed Account.......... 25
APPENDIX C: Contents of the Statement
of Additional Information............ 26
</TABLE>

INDEX OF SPECIAL TERMS

The following terms are italicized throughout the prospectus. Refer to the page
listed for an explanation of each term.

<TABLE>
<S> <C>
Accumulation Unit...................... 6
Annuitant.............................. 11
Annuity Payments....................... 15
Annuity Unit........................... 15
Cash Surrender Value................... 12
Contract Date.......................... 5
Contract Owner (You, Your)............. 5
Contract Value......................... 5
Contract Year.......................... 5
Fixed Account.......................... 25
Funding Option(s)...................... 6
Income Payments........................ 17
Maturity Date.......................... 5
Purchase Payment....................... 6
Written Request........................ 6
</TABLE>

2
<PAGE> 11

FUND ABD FEE TABLE
- --------------------------------------------------------------------------------
CONTRACT OWNER TRANSACTION EXPENSES

<TABLE>
<S> <C>
WITHDRAWAL CHARGE (as a percentage of purchase payments
withdrawn):
LENGTH OF TIME FROM PURCHASE PAYMENT

<CAPTION>
(NUMBER OF YEARS) CHARGE
<S> <C>
1 6%
2 6%
3 5%
4 5%
5 4%
6 3%
7 2%
8 and over 0%
ANNUAL CONTRACT ADMINISTRATIVE CHARGE
(Waived if contract value is $40,000 or more) $30
ANNUAL SEPARATE ACCOUNT CHARGES:
(as a percentage of the average daily net assets of the
Separate Account)
Mortality and Expense Risk Charge..................... 1.25%
Administrative Expense Charge......................... 0.15%
-----
Total Separate Account Charges.................... 1.40%

FUNDING OPTION EXPENSES:
(as a percentage of average daily net assets of the Funding
Option as of December 31, 1997,
unless otherwise noted)
</TABLE>

<TABLE>
<CAPTION>
MANAGEMENT FEE OTHER EXPENSES TOTAL
(AFTER EXPENSE (AFTER EXPENSE UNDERLYING
PORTFOLIO NAME: REIMBURSEMENT) REIMBURSEMENT) FUND EXPENSES
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Capital Appreciation Fund............................... 0.75% 0.09% 0.84%
Money Market Portfolio.................................. 0.32% 0.08%(1) 0.40%
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series......................................... 0.75% 0.10%(2) 0.85%
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio...................... 0.75% 0.05% 0.80%
Small Cap Portfolio................................. 0.75% 0.03% 0.78%
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.
Salomon Brothers Variable Investors Fund............ 0.70% 0.30%(3) 1.00%
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio........................... 0.80% 0.02%(4) 0.82%
MFS Total Return Portfolio.......................... 0.80% 0.06%(4) 0.86%
Putnam Diversified Income Portfolio................. 0.75% 0.13%(4) 0.88%
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio.......................... 0.60% 0.20%(5) 0.80%
Disciplined Mid Cap Stock Portfolio................. 0.70% 0.25%(6) 0.95%
Disciplined Small Cap Stock Portfolio............... 0.80% 0.20%(5) 1.00%
Equity Income Portfolio............................. 0.75% 0.20%(6) 0.95%
Federated High Yield Portfolio...................... 0.65% 0.30%(6) 0.95%
Federated Stock Portfolio........................... 0.63% 0.32%(6) 0.95%
Large Cap Portfolio................................. 0.75% 0.20%(6) 0.95%
Lazard International Stock Portfolio................ 0.83% 0.42%(6) 1.25%
MFS Emerging Growth Portfolio....................... 0.75% 0.20%(6) 0.95%
MFS Mid Cap Growth Portfolio........................ 0.80% 0.20%(5) 1.00%
MFS Research Portfolio.............................. 0.80% 0.20% 1.00%
Strategic Stock Portfolio........................... 0.60% 0.30% 0.90%
Travelers Quality Bond Portfolio.................... 0.32% 0.43%(6) 0.75%
WARBURG PINCUS TRUST
Emerging Markets Portfolio.......................... 0.45% 0.95%(7) 1.40%
</TABLE>

3
<PAGE> 12

NOTES:

The purpose of the Fee Table is to assist contract owners in understanding the
various costs and expenses that a contract owner will bear, directly or
indirectly. See "Charges and Deductions" in this prospectus for additional
information. Expenses shown do not include premium taxes, which may be
applicable. "Other Expenses" include operating costs of the fund. These expenses
are reflected in each funding option's net asset value and are not deducted from
the account value under the Contract.

(1) Other Expenses have been restated to reflect the current expense
reimbursement arrangement with The Travelers Insurance Company. Travelers
has agreed to reimburse the Fund for the amount by which its aggregate
expenses (including the management fee, but excluding brokerage commissions,
interest charges and taxes) exceeds 0.40%. Without such arrangement, Total
Expenses would have been 1.39% for the MONEY MARKET PORTFOLIO.

(2) The adviser for the DELAWARE REIT SERIES has agreed to voluntarily waive its
fee and pay the expenses of the Series to the extent that the Series' annual
operating expenses, exclusive of taxes, interest, brokerage commissions and
extraordinary expenses, do not exceed 0.85% of its average daily net assets
through June 30, 1998.

(3) The amounts set forth for Other Expenses are based on estimates for the
current fiscal year and will include fees for shareholder services,
administrative fees, custodial fees, legal and accounting fees, printing
costs and registration fees. These expenses reflect the voluntary agreement
by the Fund's adviser to impose an expense cap of 1.00% for the fiscal year
ending December 31, 1998 on the total operating expenses of the Fund
(exclusive of taxes, interest and extraordinary expenses such as litigation
and indemnification expenses). Absent such agreement, the ratio of other
expenses and total operating expenses to the average daily net assets would
be 1.91% and 2.61%, respectively, for the SALOMON BROTHERS VARIABLE
INVESTORS FUND.

(4) Other expenses are as of October 31, 1997 (the Fund's fiscal year end).
There were no fees waived or expenses reimbursed for these funds in 1997.

(5) Other Expenses are based on estimates for the current fiscal year and will
include fees for shareholder services, administrative fees, custodial fees ,
legal and accounting fees, printing costs and registration fees.
Additionally, these fees reflect a voluntary expense reimbursement
arrangement by Travelers to reimburse the Portfolios for the amount by which
their aggregate total operating expenses exceed 1.00% for the DISCIPLINED
SMALL CAP STOCK PORTFOLIO and MFS MID CAP GROWTH PORTFOLIO; and 0.80% for
the CONVERTIBLE BOND PORTFOLIO. These expenses have been illustrated at a
limit which the Portfolios' adviser believes to be in line with the actual
projected expenses of the Portfolios.

(6) Other Expenses reflect the current expense reimbursement arrangement with
Travelers where Travelers has agreed to reimburse the Portfolios for the
amount by which their aggregate expenses (including management fees, but
excluding brokerage commissions, interest charges and taxes) exceeds 0.95%
(1.25% for the Lazard International Stock Portfolio and 0.75% for the
Quality Bond Portfolio). Without such arrangements, the Total Funding Option
Expenses for the Portfolios would have been as follows: 1.05% for MFS
EMERGING GROWTH PORTFOLIO; 1.10% for FEDERATED HIGH YIELD PORTFOLIO; 1.14%
for FEDERATED STOCK PORTFOLIO; 1.90% for EQUITY INCOME PORTFOLIO; 2.65% for
LARGE CAP PORTFOLIO; 1.82% for DISCIPLINED MID CAP STOCK PORTFOLIO; 1.76%
for LAZARD INTERNATIONAL STOCK PORTFOLIO; and 1.13% for TRAVELERS QUALITY
BOND PORTFOLIO.

(7) The WARBURG PINCUS EMERGING MARKETS PORTFOLIO'S investment advisor and
co-administrator have agreed to limit the Portfolio's total operating
expenses to 1.40% through December 31, 1998. Absent this waiver of fees, the
Portfolio's management fees, other expenses and total operating expenses
would equal 1.25%, 0.95% and 2.20%, respectively. The Portfolio's other
expenses are based on annualized estimates of expenses for the fiscal year
ending December 31, 1998, net of any fee waivers or expense reimbursements.

4
<PAGE> 13

EXAMPLE*

Assuming a 5% annual return, a $1,000 investment would be subject to the
following expenses:

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
IF CONTRACT IS SURRENDERED AT THE IF CONTRACT IS NOT SURRENDERED OR
END OF PERIOD SHOWN: ANNUITIZED AT END OF PERIOD SHOWN:
------------------------------------- -------------------------------------
PORTFOLIO NAME 1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------
Capital Appreciation Fund............... $83 $120 $161 $259 $23 $70 $121 $259
Money Market Portfolio.................. 78 107 138 213 18 57 98 213
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series.......................... 83 121 161 260 23 71 121 260
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio....... 82 119 159 255 22 69 119 255
Small Cap Portfolio.................. 82 119 158 253 22 69 118 253
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.
Salomon Brothers Variable Investors
Fund............................... 84 125 169 275 24 75 129 275
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio............ 83 120 160 257 23 70 120 257
MFS Total Return Portfolio........... 83 121 162 261 23 71 122 261
Putnam Diversified Income
Portfolio.......................... 83 122 163 263 23 72 123 263
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio........... 82 119 159 255 22 69 119 255
Disciplined Mid Cap Stock
Portfolio.......................... 84 124 166 270 24 74 126 270
Disciplined Small Cap Stock
Portfolio.......................... 84 125 169 275 24 75 129 275
Equity Income Portfolio.............. 84 124 166 270 24 74 126 270
Federated High Yield Portfolio....... 84 124 166 270 24 74 126 270
Federated Stock Portfolio............ 84 124 166 270 24 74 126 270
Large Cap Portfolio.................. 84 124 166 270 24 74 126 270
Lazard International Stock
Portfolio.......................... 87 133 181 300 27 83 141 300
MFS Emerging Growth Portfolio........ 84 124 166 270 24 74 126 270
MFS Mid Cap Growth Portfolio......... 84 125 169 275 24 75 129 275
MFS Research Portfolio............... 84 125 169 275 24 75 129 275
Strategic Stock Portfolio............ 83 122 164 265 23 72 124 265
Travelers Quality Bond Portfolio..... 82 118 156 250 22 68 116 250
WARBURG PINCUS TRUST
Emerging Markets Portfolio........... 88 137 189 314 28 87 149 314
</TABLE>

* THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. THIS
EXAMPLE REFLECTS THE $30 ANNUAL CONTRACT ADMINISTRATIVE CHARGE AS AN ANNUAL
CHARGE OF 0.014% OF ASSETS.

CONDENSED FINANCIAL INFORMATION

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

See Appendix A.

THE ANNUITY CONTRACT
- --------------------------------------------------------------------------------

Travelers Portfolio Architect Annuity is a contract between you, the contract
owner, and The Travelers Insurance Company (called "us" or the "Company"). Under
this contract, you make purchase payments to us and we credit them to your
account. The Company promises to pay you an income, in the form of annuity or
income payments, beginning on a future date that you choose, the maturity date.
The purchase payments accumulate tax deferred in the funding options of your
choice. We offer multiple variable funding options, and one fixed account
option. You assume the risk of gain or loss according to the performance of the
variable funding options. The contract value is the amount of purchase payments,
plus or minus any investment experience or interest. The contract value also
reflects all surrenders made and charges deducted. There is generally no
guarantee that at the maturity date the contract value will equal or exceed the
total purchase payments made under the Contract. The date the contract and its
benefits became effective is referred to as the contract date. Each 12-month
period following the contract date is called a contract year.

5
<PAGE> 14

Certain changes and elections must be made in writing to the Company. Where the
term "written request" is used, it means that written information must be sent
to the Company's Home Office in a form and content satisfactory to us.

PURCHASE PAYMENTS

The initial purchase payment must be at least $5,000. Additional payments of at
least $500 may be made under the Contract at any time. Under certain
circumstances, we may waive the minimum purchase payment requirement. Purchase
Payments over $1,000,000 may be made with our prior consent. In some states, we
do not accept additional purchase payments.

We will apply the initial purchase payment within two business days after we
receive it at our Home Office. Subsequent purchase payments will be credited to
a Contract within one business day. Our business day ends when the New York
Stock Exchange closes, usually 4:00 p.m. Eastern time.

ACCUMULATION UNITS

An accumulation unit is used to calculate the value of a Contract. An
accumulation unit works like a share of a mutual fund. Each funding option has a
corresponding accumulation unit value. The accumulation units are valued each
business day and may increase or decrease from day to day. The number of
accumulation units we will credit to your Contract once we receive a purchase
payment is determined by dividing the amount directed to each funding option by
the value of the accumulation unit. We calculate the value of an accumulation
unit for each funding option each day after the New York Stock Exchange closes.
After the value is calculated, your account is credited. During the annuity
period (i.e., after the maturity date), you are credited with annuity units.

THE FUNDING OPTIONS

You choose which of the following variable funding options to have your purchase
payments allocated to. You will find detailed information about the options and
their inherent risks in the current prospectuses for the funding options which
must accompany this prospectus. Since each option has varying degrees of risk,
please read the prospectuses carefully before investing. Additional copies of
the prospectuses may be obtained by contacting your registered representative or
by calling 1-800-842-8573.

The current funding options are listed below, along with their investment
advisers and any subadviser:

<TABLE>
<CAPTION>
FUNDING OPTIONS INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUBADVISER
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Capital Appreciation Fund Seeks growth of capital through the use of common Travelers Asset Management
stocks. Income is not an objective. The Fund International Corporation
invests principally in common stocks of small to ("TAMIC")
large companies which are expected to experience Subadviser: Janus
wide fluctuations in price in both rising and Capital Corp.
declining markets.
Money Market Portfolio Seeks high current income from short-term money TAMIC
(formerly "Cash Income Trust") market instruments while preserving capital and
maintaining a high degree of liquidity.
DELAWARE GROUP PREMIUM FUND,
INC.
REIT Series Seeks maximum long-term total return by investing Delaware Management Company,
in securities of companies primarily engaged in Inc.
the real estate industry. Capital appreciation is Subadviser: Lincoln Investment
a secondary objective. Management, Inc.
</TABLE>

6
<PAGE> 15

<TABLE>
<CAPTION>
FUNDING OPTIONS INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUBADVISER
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
DREYFUS VARIABLE INVESTMENT
FUND
Capital Appreciation Seeks primarily to provide long-term capital The Dreyfus Corporation
Portfolio growth consistent with the preservation of Subadviser: Fayez Sarofim & Co.
capital; current income is a secondary investment
objective. The portfolio invests primarily in the
common stocks of domestic and foreign issuers.
Small Cap Portfolio Seeks to maximize capital appreciation. The Dreyfus Corporation
SALOMON BROTHERS VARIABLE
SERIES FUND, INC.
Salomon Brothers Variable Seeks long-term growth of capital. Current income Salomon Brothers Asset
Investors Fund is a secondary objective. Management ("SBAM")
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio Seeks long-term growth of capital by investing Travelers Investment Adviser
predominantly in equity securities of companies ("TIA")
with a favorable outlook for earnings and whose Subadviser: Alliance Capital
rate of growth is expected to exceed that of the Management L.P.
U.S. economy over time. Current income is only an
incidental consideration.
MFS Total Return Portfolio Seeks to obtain above-average income (compared to TIA
a portfolio entirely invested in equity Subadviser: Massachusetts
securities) consistent with the prudent Financial Services Company
employment of capital. Generally, at least 40% of ("MFS")
the Portfolio's assets will be invested in equity
securities.
Putnam Diversified Income Seeks high current income consistent with TIA
Portfolio preservation of capital. The Portfolio will Subadviser: Putnam Investment
allocate its investments among the U.S. Management, Inc.
Government Sector, the High Yield Sector, and the
International Sector of the fixed income
securities markets.
TRAVELERS SERIES TRUST
Convertible Bond Portfolio Seeks current income and capital appreciation by TAMIC
investing in convertible securities and in
combinations of nonconvertible fixed-income
securities and warrants or call options that
together resemble convertible securities
("synthetic convertible securities").
Disciplined Mid Cap Stock Seeks growth of capital by investing primarily in TAMIC
Portfolio (formerly "Mid a broadly diversified portfolio of common stocks. Subadviser: TIMCO
Cap Disciplined Equity
Fund")
Disciplined Small Cap Stock Seeks long term capital appreciation by investing TAMIC
Portfolio primarily (at least 65% of its total assets) in Subadviser: TIMCO
the common stocks of U.S. Companies with
relatively small market capitalizations at the
time of investment.
Equity Income Portfolio Seeks reasonable income by investing at least 65% TAMIC
in income-producing equity securities. The Subadviser: Fidelity Management
balance may be invested in all types of domestic & Research Company
and foreign securities, including bonds. The
Portfolio seeks to achieve a yield that exceeds
that of the securities comprising the S&P 500.
The Subadviser also considers the potential for
capital appreciation.
Federated High Yield Seeks high current income by investing primarily TAMIC
Portfolio in a professionally managed, diversified Subadviser: Federated
portfolio of fixed income securities. Investment Counseling, Inc.
Federated Stock Portfolio Seeks growth of income and capital by investing TAMIC
principally in a professionally managed and Subadviser: Federated
diversified portfolio of common stock of Investment Counseling, Inc.
high-quality companies (i.e., leaders in their
industries and characterized by sound management
and the ability to finance expected growth).
Large Cap Portfolio Seeks long-term growth of capital by investing TAMIC
primarily in equity securities of companies with Subadviser: Fidelity Management
large market capitalizations. & Research Company
</TABLE>

7
<PAGE> 16

<TABLE>
<CAPTION>
FUNDING OPTIONS INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUBADVISER
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
THE TRAVELERS SERIES TRUST (CONTINUED)
Lazard International Stock Seeks capital appreciation by investing primarily TAMIC
Portfolio in the equity securities of non-United States Subadviser: Lazard Asset
companies (i.e., incorporated or organized Management
outside the United States).
MFS Emerging Growth Seeks long-term growth of capital. Dividend and TAMIC
Portfolio interest income from portfolio securities, if Subadviser: MFS
any, is incidental.
MFS Mid Cap Growth Seeks to obtain long term growth of capital by TAMIC
Portfolio investing, under normal market conditions, at Subadviser: MFS
least 65% of its total assets in equity
securities of companies with medium market
capitalization which the investment adviser
believes have above-average growth potential.
MFS Research Portfolio Seeks to provide long-term growth of capital and TAMIC
future income. Subadviser: MFS
Strategic Stock Portfolio Seeks to provide an above-average total return TAMIC
through a combination of potential capital Subadviser: TIMCO
appreciation and dividend income by investing
primarily in high dividend yield stocks
periodically selected from the companies included
in (i) the Dow Jones Industrial Average and
(ii)the Russell 1000 Stock Index (the "Russell
1000").
Travelers Quality Bond Seeks current income, moderate capital volatility TAMIC
Portfolio and total return.
WARBURG PINCUS TRUST
Emerging Markets Portfolio Seeks long-term growth of capital by investing Warburg Pincus Asset
primarily in equity securities of non-U.S. Management, Inc.
issuers consisting of companies in emerging
securities markets.
</TABLE>

SUBSTITUTIONS AND ADDITIONS

If any of the funding options become unavailable for allocating purchase
payments, or if we believe that further investment in a funding option is
inappropriate for the purposes of the Contract, we may substitute another
funding option. However, we will not make any substitutions without notifying
you and obtaining any applicable state and SEC approval. From time to time we
may make new funding options available.

CHARGES AND DEDUCTIONS
- --------------------------------------------------------------------------------
WITHDRAWAL CHARGE

No sales charges are deducted from purchase payments when they are applied under
the Contract. However, a withdrawal charge will be deducted if any or all of the
contract value is withdrawn during the first seven years following a purchase
payment. The length of time from when we receive the purchase payment to the
time of withdrawal determines the amount of the charge.

The withdrawal charge is equal to a percentage of purchase payments withdrawn
from the Contract and is calculated as follows:

<TABLE>
<CAPTION>
LENGTH OF TIME FROM
PURCHASE PAYMENT WITHDRAWAL
(NUMBER OF YEARS) CHARGE
<S> <C>
1 6%
2 6%
3 5%
4 5%
5 4%
6 3%
7 2%
8 and over 0%
</TABLE>

8
<PAGE> 17

For purposes of the withdrawal charge calculation, withdrawals will be deemed to
be taken first from any free withdrawal amount (as described below); next from
remaining purchase payments (on a first-in, first-out basis); and then from
contract earnings (in excess of the free withdrawal amount). Unless you instruct
us otherwise, we will deduct the withdrawal charge from the amount requested.

We will not deduct a withdrawal charge (1) from payments we make due to the
death of the contract owner or the death of the annuitant with no contingent
annuitant surviving; (2) if an annuity payout has begun; or (3) if an income
option of at least five years' duration is begun after the first contract year.

FREE WITHDRAWAL ALLOWANCE

There is a 10% free withdrawal allowance available each year after the first
contract year. The available amount will be calculated as of the end of the
previous contract year. The free withdrawal allowance applies to any partial
withdrawals and to full withdrawals, except those transferred directly to
annuity contracts issued by other financial institutions. In Washington state,
this provision applies to all withdrawals.

ADMINISTRATIVE CHARGES

A Contract administrative charge of $30 is deducted annually from Contracts with
a value of less than $40,000. This charge compensates us for expenses incurred
in establishing and maintaining the Contract. The charge is deducted from the
contract value on the fourth Friday of each August by canceling accumulation
units applicable to each funding option on a pro rata basis. This charge will be
prorated from the date of purchase to the next charge deduction date. A prorated
charge will also be made if the Contract is completely withdrawn or terminated.
We will not deduct a contract administrative charge: (1) if the distribution
results from the death of the contract owner or the annuitant with no contingent
annuitant surviving, (2) after an annuity payout has begun, or (3) if the
contract value on the date of assessment is equal to or greater than $40,000.

An administrative expense charge (sometimes called "sub-account administrative
charge") is deducted on each business day from amounts allocated to the variable
funding options in order to compensate the Company for certain related
administrative and operating expenses. The charge equals, on an annual basis,
0.15% of the daily net asset value allocated to each of the variable funding
options.

MORTALITY AND EXPENSE RISK CHARGE

Each business day, the Company deducts a mortality and expense risk charge. The
deduction is reflected in our calculation of accumulation and annuity unit
values. This charge equals, on an annual basis, 1.25% of the amounts held in
each variable funding option. We reserve the right to lower this charge at any
time. The mortality risk portion compensates us for guaranteeing to provide
annuity payments according to the terms of the Contract regardless of how long
the annuitant lives and for guaranteeing to provide the death benefit if an
annuitant dies prior to the maturity date. The expense risk portion compensates
us for the risk that the charges under the Contract, which cannot be increased
during the duration of the Contract, will be insufficient to cover actual costs.

REDUCTION OR ELIMINATION OF CONTRACT CHARGES

9
<PAGE> 18

(3) any prior or existing relationship with the Company. There may be other
circumstances, of which we are not presently aware, which could result in fewer
sales expenses, administrative charges, or mortality and expense risk charges.
For certain trusts, the Company may change the order in which purchase payments
and earnings are withdrawn in order to determine the withdrawal charge. In no
event will reduction or elimination of the withdrawal charge or the
administrative charge be permitted where such reduction or elimination will be
unfairly discriminatory to any person.

FUNDING OPTION EXPENSES

The deductions from and expenses paid out of the assets of the various funding
options are summarized in the fee table and are described in the accompanying
prospectuses.

PREMIUM TAX

Certain state and local governments charge premium taxes ranging from 0% to 5%,
depending upon jurisdiction. The Company is responsible for paying these taxes
and will determine the method used to recover premium tax expenses incurred.
Where required, the Company will deduct any applicable premium taxes from the
contract value either upon death, surrender, annuitization, or at the time
purchase payments are made to the Contract, but no earlier than when the Company
has a tax liability under state law.

CHANGES IN TAXES BASED UPON PREMIUM OR VALUE

If there is any change in a law assessing taxes against the Company based upon
premiums, contract gains or value of the contract, we reserve the right to
charge you proportionately for this tax.

OWNERSHIP PROVISIONS
- --------------------------------------------------------------------------------

TYPES OF OWNERSHIP

Contract Owner (you). The Contract belongs to the contract owner named in the
Contract (on the Specifications page), or to any other person to whom the
contract is subsequently assigned. An assignment of ownership or a collateral
assignment may be made only for nonqualified contracts. You have sole power
during the annuitant's lifetime to exercise any rights and to receive all
benefits given in the contract provided you have not named an irrevocable
beneficiary and provided the Contract is not assigned.

You receive all payments while the annuitant is alive unless you direct them to
an alternate recipient. An alternate recipient does not become the contract
owner.

Joint Owner. For nonqualified contracts only, joint owners (i.e., spouses) may
be named in a written request before the contract is in effect. Joint owners may
independently exercise transfers allowed under the Contract. All other rights of
ownership must be exercised by both owners. Joint owners own equal shares of any
benefits accruing or payments made to them. All rights of a joint owner end at
death if the other joint owner survives. The entire interest of the deceased
joint owner in the Contract will pass to the surviving joint owner.

BENEFICIARY

The beneficiary is named by you in a written request. The beneficiary has the
right to receive any remaining contractual benefits upon the death of the
annuitant or the contract owner. If more than one beneficiary survives the
annuitant, they will share equally in benefits unless different shares are
recorded with the Company by written request before the death of the annuitant
or contract owner.
10
<PAGE> 19

With nonqualified contracts, the beneficiary named in the contract may differ
from the designated beneficiary (for example, the joint owner or a contingent
annuitant). In such cases, the designated beneficiary receives the contract
benefits (rather than the beneficiary) upon your death.

Unless an irrevocable beneficiary has been named, you have the right to change
any beneficiary by written request during the lifetime of the annuitant and
while the Contract continues.

ANNUITANT

The annuitant is designated in the Contract (on the Specifications page), and is
the individual on whose life the maturity date and the amount of the monthly
annuity payments depend. The annuitant may not be changed after the contract is
in effect.

For nonqualified Contracts only, the contract owner may also name one individual
as a contingent annuitant by written request before the Contract becomes
effective. A contingent annuitant may not be changed, deleted or added after the
Contract becomes effective.

TRANSFERS
- --------------------------------------------------------------------------------

Up to 30 days before the maturity date, you may transfer all or part of the
contract value between funding options. There are no charges or restrictions on
the amount or frequency of transfers currently; however, we reserve the right to
charge a fee for any transfer request, and to limit the number of transfers to
one in any six-month period. Since different funding options have different
expenses, a transfer of contract values from one funding option to another could
result in your investment becoming subject to higher or lower expenses. After
the maturity date, you may make transfers between funding options only with our
consent.

DOLLAR COST AVERAGING

Dollar cost averaging (or "automated transfers") allows you to transfer a set
dollar amount to other funding options on a monthly or quarterly basis so that
more accumulation units are purchased in a funding option if the cost per unit
is low and less accumulation units are purchased if the cost per unit is high.
Therefore, a lower-than-average cost per unit may be achieved over the long run.

You may elect automated transfers through written request or other method
acceptable to the Company. (For Contracts issued in New York, the election must
be made in writing.) You must have a minimum total contract value of $5,000 to
enroll in the Dollar Cost Averaging program. The minimum amount that may be
transferred through this program is $400.

You may establish automated transfers of contract values from the Fixed Account,
subject to certain restrictions. Automated transfers from the Fixed Account may
not deplete your Fixed Account Value in less than twelve months from your
enrollment in the Dollar Cost Averaging program.

You may start or stop participation in the Dollar Cost Averaging program at any
time, but you must give the Company at least 30 days' notice to change any
automated transfer instructions that are currently in place. All provisions and
terms of the Contract apply to automated transfers, including provisions
relating to the transfer of money between investment options. We reserve the
right to suspend or modify transfer privileges at any time and to assess a
processing fee for this service.

11
<PAGE> 20

ACCESS TO YOUR MONEY
- --------------------------------------------------------------------------------

Any time before the maturity date, you may redeem all or any portion of the cash
surrender value, that is, the contract value, less any withdrawal charge and any
premium tax not previously deducted. You must submit a written request
specifying the fixed or variable funding option(s) from which amounts are to be
withdrawn. The cash surrender value will be determined as of the close of
business after we receive your surrender request at the Home Office. The cash
surrender value may be more or less than the purchase payments made depending on
the contract value at the time of surrender.

We may defer payment of any cash surrender value for a period of up to seven
days after the written request is received, but it is our intent to pay as soon
as possible. We cannot process requests for withdrawal that are not in good
order. We will contact you if there is a deficiency causing a delay and will
advise what is needed to act upon the withdrawal request.

SYSTEMATIC WITHDRAWALS

Before the maturity date, you may choose to withdraw a specified dollar amount
(at least $100) on a monthly, quarterly, semiannual or annual basis. Any
applicable withdrawal charges (in excess of the free withdrawal allowance) and
any applicable premium taxes will be deducted. To elect systematic withdrawals,
you must have a contract value of at least $15,000 and you must make the
election on the form provided by the Company. We will surrender accumulation
units pro rata from all funding options in which you have an interest, unless
you instruct us otherwise. You may begin or discontinue systematic withdrawals
at any time by notifying us in writing, but at least 30 days' notice must be
given to change any systematic withdrawal instructions that are currently in
place.

We reserve the right to discontinue offering systematic withdrawals or to assess
a processing fee for this service upon 30 days' written notice to contract
owners (where allowed by state law).

Each systematic withdrawal is subject to federal income taxes on the taxable
portion. In addition, a 10% federal penalty tax may be assessed on systematic
withdrawals if the contract owner is under age 59 1/2. You should consult with
your tax adviser regarding the tax consequences of systematic withdrawals.

LOANS

Loans may be available under your Contract. If available, all loan provisions
are described in your Contract or loan agreement.

DEATH BENEFIT
- --------------------------------------------------------------------------------

Before the maturity date, a death benefit is payable to the beneficiary when
either the annuitant, the contract owner or the first of joint owners dies and
there is no contingent annuitant. The death benefit is calculated at the close
of the business day on which the Company's Home Office received due proof of
death and written payment instructions.

DEATH PROCEEDS BEFORE THE MATURITY DATE

DEATH OF ANY OWNER OR THE ANNUITANT BEFORE AGE 80. The Company will pay the
beneficiary an amount equal to the greatest of (1), (2) or (3) below, each
reduced by any applicable premium tax or outstanding loans:

1) the contract value;

12
<PAGE> 21

2) the total purchase payments made under the Contract less all partial
withdrawals; or

3) the highest of all "final death benefit values" as described below.

A separate death benefit value will be established on the contract date and on
each anniversary of the contract date which occurs on or before the death report
date. The death benefit value established on the contract date will initially
equal the purchase payment. The death benefit value established on each contract
date anniversary will initially equal the contract value on that anniversary.
Thereafter, each death benefit value will be adjusted to reflect any purchase
payments made, or any partial withdrawals taken, from the date on which a
particular death benefit value was established until the death report date. Once
any adjustment has been made, a "death benefit value" then becomes equal to the
previous death benefit value plus or minus that adjustment.

Adjustments to the death benefit values for any purchase payments or partial
withdrawals will be made in the order that such purchase payments or partial
withdrawals occur. For each purchase payment, death benefit values will be
increased by the amount of the purchase payment. For each partial withdrawal,
death benefit values will be reduced by a "partial withdrawal reduction" which
equals the product of (i) the death benefit value immediately before the
reduction of the partial withdrawal, and (ii) the amount of the partial
withdrawal divided by the contract value immediately before the partial
withdrawal. The "final death benefit value" associated with the contract date
and with each contract date anniversary equals the initial death benefit value
plus or minus all adjustments until the death report date.

DEATH OF ANY OWNER OR THE ANNUITANT ON OR AFTER AGE 80, BUT BEFORE AGE 90. The
death benefit payable will be the greatest of (1), (2) or (3) below, less any
applicable premium tax or outstanding loans:

1) the contract value;

2) the total purchase payments made under the Contract less all partial
withdrawals; or

3) the maximum of all "final death benefit values" associated with the
contract date or any contract date anniversary occurring on or before
the annuitant's 80th birthday.

DEATH OF ANY OWNER OR THE ANNUITANT ON OR AFTER AGE 90. The death benefit
payable will be the contract value, less any applicable premium tax or
outstanding loans.

PAYMENT OF PROCEEDS

The process of paying death benefit proceeds under various situations is
described below. Generally, the person(s) receiving the benefit may request that
the proceeds be paid in a lump sum, or be applied to one of the settlement
options available under the Contract.

DEATH OF ANNUITANT WHO IS THE CONTRACT OWNER. The Company will pay the proceeds
to any surviving joint owner, or if none, to the beneficiary(ies), or if none,
to the contract owner's estate.

Under a nonqualified contract, the death benefit proceeds must be distributed to
the beneficiary within five years of the contract owner's death. Or, the
beneficiary may elect to receive payments from an annuity which begins within
one year of the contract owner's death and is payable over the life of the
beneficiary or over a period not exceeding the beneficiary's life expectancy.

If the beneficiary is the contract owner's spouse, he or she may elect to
continue the contract as the new contract owner rather than receiving the
distribution. In such case, the distribution rules applicable when a contract
owner dies generally will apply when that spouse, as contract owner, dies.

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the original maturity date). The proceeds described above will be paid upon the
death of the last surviving contingent annuitant.

ENTITY AS OWNER. In the case of a nonqualified Contract owned by a nonnatural
person (e.g. a trust or another entity), any annuitant will be treated as the
contract owner. Any change in the annuitant will be treated as the death of the
contract owner.

DEATH PROCEEDS AFTER THE MATURITY DATE

If the death of any contract owner or annuitant occurs on or after the maturity
date, the Company will pay the beneficiary a death benefit consisting of any
benefit remaining under the annuity option then in effect.

THE ANNUITY PERIOD

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MATURITY DATE

Under the Contract, you can receive regular income payments (annuity payments).
You can choose the month and the year in which those payments begin (maturity
date). You can also choose among income plans (annuity or income options). While
the annuitant is alive, you can change your selection any time up to the
maturity date. Annuity or income payments will begin on the maturity date stated
in the Contract unless the Contract has been fully surrendered or the proceeds
have been paid to the beneficiary before that date. Annuity payments are a
series of periodic payments (a) for life; (b) for life with either a minimum
number of payments or a specific amount assured; or (c) for the joint lifetime
of the annuitant and another person, and thereafter during the lifetime of the
survivor. We may require proof that the annuitant is alive before annuity
payments are made.

Unless you elect otherwise, the maturity date will be the annuitant's 70th
birthday for qualified contracts and the annuitant's 75th birthday, or ten years
after the effective date of the contract, if later, for nonqualified contracts.
(For Contracts issued in Florida and New York, the maturity date elected may not
be later than the annuitant's 90th birthday.)

For nonqualified Contracts, at least 30 days before the original maturity date,
a contract owner may elect to extend the maturity date to any time prior to the
annuitant's 85th birthday or, for qualified Contracts, to a later date with the
Company's consent. Certain annuity options taken at the maturity date may be
used to meet the minimum required distribution requirements of federal tax law,
or a program of partial surrenders may be used instead. These mandatory
distribution requirements take effect generally upon the death of the contract
owner, or with qualified contracts upon either the later of the April 1
following the contract owner's attainment of age 70 1/2 or the year of
retirement; or upon the death of the contract owner. Independent tax advice
should be sought regarding the election of minimum required distributions.

ALLOCATION OF ANNUITY

When an annuity option is elected, it may be elected as a variable annuity, a
fixed annuity, or a combination of both. (Variable payouts may not be available
in all states. Refer to your Contract.) If, at the time annuity payments begin,
no election has been made to the contrary, the cash surrender value will be
applied to provide an annuity funded by the same investment options selected
during the accumulation period (contract value, in Oregon). At least 30 days
before the maturity date, you may transfer the contract value among the funding
options in order to change the basis on which annuity payments will be
determined. (See "Transfers.")

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VARIABLE ANNUITY

You may choose an annuity payout that fluctuates depending on the investment
experience of the variable funding options. The number of annuity units credited
to the Contract is determined by dividing the first monthly annuity payment
attributable to each funding option by the corresponding annuity unit value as
of 14 days before the date annuity payments begin. An annuity unit is used to
measure the dollar value of an annuity payment. The number of annuity units (but
not their value) remains fixed during the annuity period.

DETERMINATION OF FIRST ANNUITY PAYMENT. The Contract contains Life Annuity
Tables used to determine the first monthly annuity payment. The amount applied
to effect a variable annuity will be the cash surrender value as of 14 days
before the date annuity payments begin less any applicable premium taxes not
previously deducted.

The amount of the first monthly payment depends on the annuity option elected. A
formula for determining the adjusted age is contained in the Contract. The total
first monthly annuity payment is determined by multiplying the benefit per
$1,000 of value shown in the tables of the Contract by the number of thousands
of dollars of value of the Contract applied to that annuity option. The Company
reserves the right to require satisfactory proof of age of any person on whose
life annuity payments are based before making the first payment under any of the
settlement options.

DETERMINATION OF SECOND AND SUBSEQUENT ANNUITY PAYMENTS. The dollar amount of
the second and subsequent annuity payments is not predetermined and may change
from month to month based on the investment experience of the applicable funding
option. The total amount of each annuity payment will be equal to the sum of the
basic payments in each funding option. The actual amounts of these payments are
determined by multiplying the number of annuity units credited to each funding
option by the corresponding annuity unit value as of the date 14 days before the
date the payment is due.

FIXED ANNUITY

You may choose a fixed annuity that provides payments which do not vary during
the annuity period. We will calculate the dollar amount of the first fixed
annuity payment as described under "Variable Annuity." If it would produce a
larger payment, the first fixed annuity payment will be determined using the
Life Annuity Tables in effect on the maturity date.

PAYMENT OPTIONS
- --------------------------------------------------------------------------------

ELECTION OF OPTIONS

While the annuitant is alive, you can change your annuity or income option
selection any time up to the maturity date. Income options differ from annuity
options in that the amount of the payments made under income options are not
based upon the life of any person. Therefore, the annuitant may outlive the
payment period. Once annuity or income payments have begun, no further elections
are allowed.

During the annuitant's lifetime, if you do not elect otherwise before the
maturity date, we will pay you (or another designated payee) the first of a
series of monthly annuity payments based on the life of the annuitant, in
accordance with Annuity Option 2 (Life Annuity with 120 monthly payments
assured). For certain qualified contracts, Annuity Option 4 (Joint and Last
Survivor Joint Life Annuity -- Annuity Reduced on Death of Primary Payee) will
be the automatic option as described in the contract.

The minimum amount that can be placed under an annuity or income option will be
$2,000 unless we agree to a lesser amount. If any monthly periodic payment due
is less than $100, the Company reserves the right to make payments at less
frequent intervals, or to pay the cash surrender value in

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a lump-sum. The amount applied to effect an annuity or income option will be the
cash surrender value as of the date the payments begin, less any applicable
premium taxes not previously deducted. (Certain states may have different
requirements that we will honor.) The cash surrender value used to determine the
amount of any such payment will be determined on the same basis as the cash
surrender value during the accumulation period, including the deduction for
mortality and expense risks and the contract administrative expense charge.

On the maturity date, we will pay the amount due under the Contract in one lump
sum (except in Florida, where this is not permitted), or in accordance with the
payment option that you select. You must elect an option in writing, in a form
satisfactory to the Company. Any election made during the lifetime of the
annuitant must be made by the contract owner.

ANNUITY OPTIONS

Subject to the conditions described in "Election of Options" above, all or any
part of the cash surrender value (or, where required by state law, contract
value) may be paid under one or more of the following annuity options. Payments
under the annuity options may be elected on a monthly, quarterly, semiannual or
annual basis.

Option 1 -- Life Annuity -- No Refund. The Company will make annuity payments
during the lifetime of the annuitant ending with the last payment before death.
This option offers the maximum periodic payment, since there is no assurance of
a minimum number of payments or provision for a death benefit for beneficiaries.

Option 2 -- Life Annuity with 120, 180 or 240 Monthly Payments Assured. The
Company will make monthly annuity payments during the lifetime of the annuitant,
with the agreement that if, at the death of that person, payments have been made
for less than 120, 180 or 240 months as elected, we will continue making
payments to the beneficiary during the remainder of the period.

Option 3 -- Joint and Last Survivor Life Annuity -- No Refund. The Company will
make regular annuity payments during the lifetime of the annuitant and a second
person. When either person dies, we will continue making payments to the
survivor. No further payments will be made following the death of the survivor.

Option 4 -- Joint and Last Survivor Life Annuity -- Annuity Reduced on Death of
Primary Payee. The Company will make annuity payments during the lifetimes of
the annuitant and a second person. One will be designated the primary payee, the
other will be designated the secondary payee. On the death of the secondary
payee, the Company will continue to make monthly annuity payments to the primary
payee in the same amount that would have been payable during the joint lifetime
of the two persons. On the death of the primary payee, the Company will continue
to make annuity payments to the secondary payee in an amount equal to 50% of the
payments which would have been made during the lifetime of the primary payee. No
further payments will be made once both payees have died.

Option 5 -- Other Annuity Options. The Company will make any other arrangements
for annuity payments as may be mutually agreed upon.

INCOME OPTIONS

Instead of one of the annuity options described above, and subject to the
conditions described under "Election of Options," all or part of the cash
surrender value (or, where required by state law, contract value) may be paid
under one or more of the following income options, provided that they are
consistent with federal tax law qualification requirements. Payments under the
income options may be elected on a monthly, quarterly, semiannual or annual
basis:

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proportion to the cash surrender value attributable to each. The final payment
will include any amount insufficient to make another full payment.

Option 2 -- Payments for a Fixed Period. The Company will make payments for the
fixed period selected based on the cash surrender value as of the date payments
begin. If, at the death of the annuitant, the total number of fixed payments has
not been made, the payments will be made to the beneficiary.

Option 3 -- Other Income Options. The Company will make any other arrangements
for income payments as may be mutually agreed upon.

MISCELLANEOUS CONTRACT PROVISIONS

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RIGHT TO RETURN

You may return the Contract for a full refund of the contract value (including
charges) within twenty days after you receive it (the "right to return period").
You bear the investment risk during the right to return period; therefore, the
contract value returned may be greater or less than your purchase payment. If
the Contract is purchased as an Individual Retirement Annuity, and is returned
within the first seven days after delivery, your purchase payment will be
refunded in full; during the remainder of the right to return period, the
contract value (including charges) will be refunded. The contract value will be
determined following the close of the business day on which we receive a written
request for a refund. Where state law requires a longer period, or the return of
purchase payments or other variations of this provision, the Company will
comply. Refer to your Contract for any state-specific information.

TERMINATION

You do not need to make any purchase payments after the first to keep the
Contract in effect. However, we reserve the right to terminate the Contract on
any business day if the contract value as of that date is less than $1,000 and
no purchase payments have been made for at least two years, unless otherwise
specified by state law. Termination will not occur until 31 days after the
Company has mailed notice of termination to the contract owner's last known
address and to any assignee of record. If the Contract is terminated, we will
pay you the cash surrender value (contract value less any applicable premium
tax, in the states that so require), less any applicable administrative charge.

REQUIRED REPORTS

As often as required by law, but at least once in each contract year before the
due date of the first annuity payment, we will furnish a report showing the
number of accumulation units credited to the Contract and the corresponding
accumulation unit value(s) as of the date of the report for each funding option
to which the contract owner has allocated amounts during the applicable period.
The Company will keep all records required under federal or state laws.

SUSPENSION OF PAYMENTS

The Company reserves the right to suspend or postpone the date of any payment or
determination of values on any business day (1) when the New York Stock Exchange
("the Exchange") is closed; (2) when trading on the Exchange is restricted; (3)
when an emergency exists as determined by the SEC so that the sale of securities
held in the Separate Account may not reasonably occur or so that the Company may
not reasonably determine the value the Separate Account's net assets; or (4)
during any other period when the SEC, by order, so permits for the protection of
security holders.

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TRANSFERS OF CONTRACT VALUES TO OTHER ANNUITIES

We may permit contract owners to transfer their contract values into other
annuities offered by us or our affiliated insurance companies under rules then
in effect.

THE SEPARATE ACCOUNT
- --------------------------------------------------------------------------------

The Travelers Fund ABD For Variable Annuities ("Fund ABD") was established on
October 17, 1995 and is registered with the SEC as a unit investment trust
(separate account) under the Investment Company Act of 1940, as amended (the
"1940 Act"). The assets of Fund ABD will be invested exclusively in the shares
of the variable funding options.

The assets of Fund ABD are held for the exclusive benefit of the owners of this
separate account, according to the laws of Connecticut. Income, gains and
losses, whether or not realized, from assets allocated to Fund ABD are, in
accordance with the Contracts, credited to or charged against Fund ABD without
regard to other income, gains and losses of the Company. The assets held by Fund
ABD are not chargeable with liabilities arising out of any other business which
the Company may conduct. Obligations under the Contract are obligations of the
Company.

All investment income and other distributions of the funding options are payable
to Fund ABD. All such income and/or distributions are reinvested in shares of
the respective funding option at net asset value. Shares of the funding options
are currently sold only to life insurance company separate accounts to fund
variable annuity and variable life insurance contracts.

MIXED AND SHARED FUNDING

It is conceivable that in the future it may be disadvantageous for both variable
annuity and variable life insurance separate accounts, or for variable separate
accounts of different insurance companies, to invest simultaneously in the same
portfolios (called "mixed" and "shared" funding). Currently neither the
insurance companies nor the portfolios foresee any such disadvantages to the
companies or to variable contract owners. Each portfolio's board of trustees,
directors or managers intends to monitor events in order to identify any
material conflicts between such policy owners and to determine what action, if
any, should be taken in response thereto.

PERFORMANCE INFORMATION

From time to time, we may advertise several types of historical performance for
the Contract's funding options. We may advertise the "standardized average
annual total returns" of the funding option, calculated in a manner prescribed
by the SEC, as well as the "nonstandardized total returns," as described below.
Specific examples of the performance information appear in the SAI.

STANDARDIZED METHOD. Quotations of average annual total returns are computed
according to a formula in which a hypothetical initial investment of $1,000 is
applied to the funding option, and then related to ending redeemable values over
one-, five-, and ten-year periods, or for a period covering the time during
which the funding option has been in existence, if less. These quotations
reflect the deduction of all recurring charges during each period (on a pro rata
basis in the case of fractional periods). The deduction for the annual contract
administrative charge ($30) is converted to a percentage of assets based on the
actual fee collected (or anticipated to be collected, if a new product), divided
by the average net assets for Contracts sold (or anticipated to be sold). Each
quotation assumes a total redemption at the end of each period with the
applicable withdrawal charge deducted at that time.

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returns will not reflect the deduction of any withdrawal charge or the $30
annual contract administrative charge, which, if reflected, would decrease the
level of performance shown. The withdrawal charge is not reflected because the
Contract is designed for long-term investment.

For funding options that were in existence prior to the date they became
available under the Separate Account, the standardized average annual total
return quotations may be accompanied by returns showing the investment
performance that such funding options would have achieved (reduced by the
applicable charges) had they been held under the Contract for the period quoted.
The total return quotations are based upon historical earnings and are not
necessarily representative of future performance.

GENERAL. Within the guidelines prescribed by the SEC and the National
Association of Securities Dealers, Inc. ("NASD"), performance information may be
quoted numerically or may be presented in a table, graph or other illustration.
Advertisements may include data comparing performance to well-known indices of
market performance (including, but not limited to, the Dow Jones Industrial
Average, the Standard & Poor's (S&P) 500 Index and the S&P 400 Index, the Lehman
Brothers Long T-Bond Index, the Russell 1000, 2000 and 3000 Indices, the Value
Line Index, and the Morgan Stanley Capital International's EAFE Index).
Advertisements may also include published editorial comments and performance
rankings compiled by independent organizations (including, but not limited to,
Lipper Analytical Services, Inc. and Morningstar, Inc.) and publications that
monitor the performance of Fund Separate Account and the variable funding
options.

FEDERAL TAX CONSIDERATIONS
- --------------------------------------------------------------------------------

The following general discussion of the federal income tax consequences under
this Contract is not intended to cover all situations, and is not meant to
provide tax advice. Because of the complexity of the law and the fact that the
tax results will vary depending on many factors, you should consult your tax
adviser regarding your personal situation. For your information, a more detailed
tax discussion is contained in the SAI.

GENERAL TAXATION OF ANNUITIES

Congress has recognized the value of saving for retirement by providing certain
tax benefits, in the form of tax deferral, for money put into an annuity. The
Internal Revenue Code (Code) governs how this money is ultimately taxed,
depending upon the type of contract, qualified or non-qualified, and the manner
in which the money is distributed, as briefly described below.

TYPES OF CONTRACTS: QUALIFIED OR NONQUALIFIED

If you purchase an annuity contract with proceeds of an eligible rollover
distribution from any pension plan, specially sponsored program, or individual
retirement annuity (IRA) with pre-tax dollars, your contract is referred to as a
qualified contract. Some examples of qualified contracts are: IRAs, 403(b)
annuities, pension and profit-sharing plans (including 401(k) plans), Keogh
Plans, and certain other qualified deferred compensation plans. If you purchase
the contract on an individual basis with after-tax dollars and not under one of
the programs described above, your contract is referred to as nonqualified.

NONQUALIFIED ANNUITY CONTRACTS

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of the withdrawal that is considered earnings. Similarly, when you receive an
annuity payment, part of each payment is considered a return of your purchase
payments and will not be taxed. The remaining portion of the annuity payment
(i.e., any earnings) will be considered ordinary income for tax purposes.

If a nonqualified annuity is owned by other than an individual, however (e.g.,
by a corporation), increases in the value of the contract attributable to
purchase payments made after February 28, 1986 are includable in income
annually. Furthermore, for contracts issued after April 22, 1987, if you
transfer the contract without adequate consideration all deferred increases in
value will be includable in your income at the time of the transfer.

If you make a partial withdrawal, this money will generally be taxed as first
coming from earnings (income in the contract), and then from your purchase
payments. These withdrawn earnings are includable in your income. (See "Penalty
Tax for Premature Distributions" below.) There is income in the contract to the
extent the cash value exceeds your investment in the contract. The investment in
the contract equals the total purchase payments you paid less any amount
received previously which was excludable from gross income. Any direct or
indirect borrowing against the value of the contract or pledging of the contract
as security for a loan will be treated as a cash distribution under the tax law.

Federal tax law requires that nonqualified annuity contracts meet minimum
mandatory distribution requirements upon the death of the contract owner,
including the first of joint owners. If these requirements are not met, the
surviving joint owner, or the beneficiary, will have to pay taxes prior to
distribution. The distribution required depends, among other things, upon
whether an annuity option is elected or whether the new contract owner is the
surviving spouse. We will administer Contracts in accordance with these rules
and we will notify you when you should begin receiving payments.

QUALIFIED ANNUITY CONTRACTS

Under a qualified annuity, since amounts paid into the contract have not yet
been taxed, the full amount of all distributions, including lump-sum withdrawals
and annuity payments, are taxed at the ordinary income tax rate unless the
distribution is transferred to an eligible rollover account or contract. The
Contract is available as a vehicle for IRA rollovers and for other qualified
contracts. There are special rules which govern the taxation of qualified
contracts, including withdrawal restrictions, requirements for mandatory
distributions, and contribution limits. We have provided a more complete
discussion in the SAI.

PENALTY TAX FOR PREMATURE DISTRIBUTIONS

Taxable distributions taken before the contract owner has reached the age of
59 1/2 will be subject to a 10% additional tax penalty unless the distribution
is taken in a series of periodic distributions, for life or life expectancy, or
unless the distribution follows the death or disability of the contract owner.
Other exceptions may be available in certain tax-qualified plans.

DIVERSIFICATION REQUIREMENTS FOR VARIABLE ANNUITIES

The Code requires that any nonqualified variable annuity contracts based on a
separate account shall not be treated as an annuity for any period if
investments made in the account are not adequately diversified. Final tax
regulations define how separate accounts must be diversified. The Company
monitors the diversification of investments constantly and believes that its
accounts are adequately diversified. The consequence of any failure to diversify
is essentially the loss to the Contract Owner of tax deferred treatment. The
Company intends to administer all contracts subject to this provision of law in
a manner that will maintain adequate diversification.

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OWNERSHIP OF THE INVESTMENTS

Assets in the separate accounts, also referred to as segregated asset accounts,
must be owned by the Company and not by the Contract Owner for federal income
tax purposes. Otherwise, the deferral of taxes is lost and income and gains from
the accounts would be includable annually in the Contract Owner's gross income.

The Internal Revenue Service has stated in published rulings that a variable
contract owner will be considered the owner of the assets of a segregated asset
account if the owner possesses an incident of ownership in those assets, such as
the ability to exercise investment control over the assets. The Treasury
Department announced, in connection with the issuance of temporary regulations
concerning investment diversification, that those regulations "do not provide
guidance concerning the circumstances in which investor control of the
investments of a segregated asset account may cause the investor, rather than
the insurance company, to be treated as the owner of the assets of the account."
This announcement, dated September 15, 1986, also stated that the guidance would
be issued by way of regulations or rulings on the "extent to which policyholders
may direct their investments to particular subaccounts [of a segregated asset
account] without being treated as owners of the underlying assets." As of the
date of this prospectus, no such guidance has been issued.

The Company does not know if such guidance will be issued, or if it is, what
standards it may set. Furthermore, the Company does not know if such guidance
may be issued with retroactive effect. New regulations are generally issued with
a prospective-only effect as to future sales or as to future voluntary
transactions in existing contracts. The Company therefore reserves the right to
modify the contract as necessary to attempt to prevent Contract Owners from
being considered the owner of the assets of the separate account.

MANDATORY DISTRIBUTIONS FOR QUALIFIED PLANS

Federal tax law requires that minimum annual distributions begin by April 1st of
the calendar year following the calendar year in which an IRA owner attains age
70 1/2. Participants in qualified plans and 403(b) annuities may defer minimum
distributions until the later of April 1st of the calendar year following the
calendar year in which they attain age 70 1/2 or the year of retirement.
Distributions must begin or be continued according to required patterns
following the death of the contract owner or annuitant of both qualified and
nonqualified annuities.

OTHER INFORMATION
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THE INSURANCE COMPANY

The Travelers Insurance Company is a stock insurance company chartered in 1864
in Connecticut and continuously engaged in the insurance business since that
time. It is licensed to conduct life insurance business in all states of the
United States, the District of Columbia, Puerto Rico, Guam, the U.S. and British
Virgin Islands and the Bahamas. The Company is an indirect wholly-owned
subsidiary of Travelers Group Inc. The Company's Home Office is located at One
Tower Square, Hartford, Connecticut 06183.

IMSA

The Company is a member of the Insurance Marketplace Standards Association
("IMSA"), and as such may use the IMSA logo and IMSA membership in its
advertisements. Companies that belong to IMSA subscribe to a set of ethical
standards covering the various aspects of sales and service for individually
sold life insurance and annuities. IMSA members have adopted policies and
procedures that demonstrate a commitment to honesty, fairness and integrity in
all customer contacts involving the sale and service of individual life
insurance and annuity products.

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YEAR 2000 COMPLIANCE

Generally, computer programs were designed without considering the impact of the
upcoming change in the century. As a result, software and computer systems may
need to be upgraded or replaced in order to comply with "Year 2000"
requirements. If not corrected, these computer applications could fail or create
erroneous results by or at the Year 2000. The business, financial condition, and
result of operations of a company could be materially and adversely affected by
the failure of its systems and applications (or those either provided or
operated by third-parties) to properly operate or manage dates beyond the year
1999.

The Company has investigated the nature and extent of the work required for our
computer systems to process beyond the turn of the century, and has made
progress toward achieving this goal, including upgrading and/or replacing
existing systems. We are confirming with our service providers that they are
also in the process of replacing or modifying their systems with the same goal.
We expect that our principal systems will be Year 2000 compliant by early 1999.
While these efforts involve substantial costs, we closely monitor associated
costs and continue to evaluate associated risks based on actual expenses. While
it is likely that these efforts will be successful, if necessary modifications
and conversions are not completed in a timely manner, the Year 2000 issue could
have a material adverse effect on certain operations of the Company.

DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS

The Company intends to sell the Contracts in all jurisdictions where it is
licensed to do business and where the Contract is approved. The Contracts will
be sold by life insurance sales agents who represent the Company, and who are
licensed registered representatives of the Company or certain other registered
broker-dealers. The compensation paid to sales representatives will not exceed
7% of the payments made under the Contracts.

From time to time, the Company may pay or permit other promotional incentives,
in cash, credit or other compensation.

Any sales representative or employee will have been qualified to sell variable
annuities under applicable federal and state laws. Each broker-dealer is
registered with the SEC under the Securities Exchange Act of 1934, and all are
members of the NASD. The principal underwriter for the Contracts is Tower Square
Securities, Inc., an affiliate of the Company; however, it is currently
anticipated that Travelers Distribution Company, an affiliated broker-dealer,
may become the principal underwriter for the Contracts during 1998.

CONFORMITY WITH STATE AND FEDERAL LAWS

The Contract is governed by the laws of the state in which it is delivered. Any
paid-up annuity, cash surrender value or death benefits that are available under
the Contract are not less than the minimum benefits required by the statutes of
the state in which the Contract is delivered. We reserve the right to make any
changes, including retroactive changes, in the Contract to the extent that the
change is required to meet the requirements of any law or regulation issued by
any governmental agency to which the Company, the Contract or the contract owner
is subject.

VOTING RIGHTS

The Company is the legal owner of the shares of the funding options. However, we
believe that when a funding option solicits proxies in conjunction with a vote
of shareholders, we are required to obtain from you and from other owners
instructions on how to vote those shares. When we receive those instructions, we
will vote all of the shares we own in proportion to those instructions. This
will also include any shares we own on our own behalf. Should we determine that
we are no longer required to comply with the above, we will vote on the shares
in our own right.

22
<PAGE> 31

LEGAL PROCEEDINGS AND OPINIONS

There are no pending material legal proceedings affecting the Separate Account,
the principal underwriter or the Company. Legal matters in connection with the
federal laws and regulations affecting the issue and sale of the Contract
described in this prospectus, as well as the organization of the Company, its
authority to issue variable annuity contracts under Connecticut law and the
validity of the forms of the variable annuity contracts under Connecticut law,
have been passed on by the General Counsel of the Company.

23
<PAGE> 32

APPENDIX A: CONDENSED FINANCIAL INFORMATION

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

THE TRAVELERS FUND ABD FOR VARIABLE ANNUITIES

ACCUMULATION UNIT VALUES*

<TABLE>
<CAPTION>
PERIOD PERIOD FROM
ENDED JUNE 24, 1996
DECEMBER 31, (EFFECTIVE DATE) TO
FUNDING OPTION 1997 DECEMBER 31, 1996
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------

<CAPTION>
<S> <C> <C>
CAPITAL APPRECIATION FUND (4/97)
Unit Value at beginning of period....................... $ 1.032 $ 1.000
Unit Value at end of period............................. 1.283 1.032
Number of units outstanding at end of period............ 870,525 --
MONEY MARKET PORTFOLIO (FORMERLY "CASH INCOME TRUST") (7/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.033 N/A
Number of units outstanding at end of period............ 345,682 N/A
ALLIANCE GROWTH PORTFOLIO (6/97)
Unit Value at beginning of period....................... $ 1.037 $ 1.000
Unit Value at end of period............................. 1.319 1.037
Number of units outstanding at end of period............ 1,062,634 --
MFS TOTAL RETURN PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.183 N/A
Number of units outstanding at end of period............ 962,287 N/A
PUTNAM DIVERSIFIED INCOME PORTFOLIO (5/97)
Unit Value at beginning of period....................... 1.007 1.000
Unit Value at end of period............................. 1.070 1.007
Number of units outstanding at end of period............ 51,659 --
TRAVELERS QUALITY BOND PORTFOLIO (7/97)
Unit Value at beginning of period....................... $ 1.001 $ 1.000
Unit Value at end of period............................. 1.057 1.001
Number of units outstanding at end of period............ 378,758 --
LAZARD INTERNATIONAL STOCK PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.027 $ 1.000
Unit Value at end of period............................. 1.095 1.027
Number of units outstanding at end of period............ 849,629 --
MFS EMERGING GROWTH PORTFOLIO (4/97)
Unit Value at beginning of period....................... $ 1.004 $ 1.000
Unit Value at end of period............................. 1.198 1.004
Number of units outstanding at end of period............ 528,553 --
FEDERATED STOCK PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.285 N/A
Number of units outstanding at end of period............ 352,550 N/A
FEDERATED HIGH YIELD PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.140 N/A
Number of units outstanding at end of period............ 620,667 N/A
LARGE CAP PORTFOLIO (6/97)
Unit Value at beginning of period....................... $ 1.023 $ 1.000
Unit Value at end of period............................. 1.245 1.023
Number of units outstanding at end of period............ 491,869 --
EQUITY INCOME PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.026 $ 1.000
Unit Value at end of period............................. 1.339 1.026
Number of units outstanding at end of period............ 639,656 --
DISCIPLINED MID CAP STOCK PORTFOLIO (FORMERLY "MID CAP
DISCIPLINED EQUITY FUND") (6/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.195 N/A
Number of units outstanding at end of period............ 120,880 N/A
</TABLE>

* The Company began tracking the Accumulation Unit values in 1996, however the
Separate Account held no assets until 1997. Funding Options not listed had no
amounts yet allocated to them. The financial statements for Fund ABD are
contained in the Annual Report to contract owners. The consolidated financial
statements of The Travelers Insurance Company are contained in the SAI.

24
<PAGE> 33

APPENDIX B

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

THE FIXED ACCOUNT

The Fixed Account is secured by part of the general assets of the Company. The
general assets of the Company include all assets of the Company other than those
held in the Separate Account or any other separate account sponsored by the
Company or its affiliates.

The staff of the SEC does not generally review the disclosure in the prospectus
relating to the Fixed Account. Disclosure regarding the Fixed Account and the
general account may, however, be subject to certain provisions of the federal
securities laws relating to the accuracy and completeness of statements made in
the prospectus.

Under the Fixed Account, the Company assumes the risk of investment gain or
loss, guarantees a specified interest rate, and guarantees a specified periodic
annuity payment. The investment gain or loss of the Separate Account or any of
the variable funding options does not affect the Fixed Account portion of the
contract owner's contract value, or the dollar amount of fixed annuity payments
made under any payout option.

We guarantee that, at any time, the Fixed Account contract value will not be
less than the amount of the purchase payments allocated to the Fixed Account,
plus interest credited, less any applicable premium taxes or prior surrenders.
If the contract owner effects a surrender, the amount available from the Fixed
Account will be reduced by any applicable withdrawal charge as described under
"Charges and Deductions" in this prospectus.

Purchase payments allocated to the Fixed Account and any transfers made to the
Fixed Account become part of the Company's general account which supports
insurance and annuity obligations. Neither the general account nor any interest
therein is registered under, nor subject to the provisions of, the Securities
Act of 1933 or Investment Company Act of 1940. We will invest the assets of the
Fixed Account at our discretion. Investment income from such Fixed Account
assets will be allocated to us and to the Contracts participating in the Fixed
Account.

Investment income from the Fixed Account allocated to us includes compensation
for mortality and expense risks borne by us in connection with Fixed Account
Contracts. The amount of such investment income allocated to the Contracts will
vary from year to year in our sole discretion at such rate or rates as we
prospectively declare from time to time.

The initial rate for any allocations into the Fixed Account is guaranteed for
one year from the date of such allocation. Subsequent renewal rates will be
guaranteed for the calendar quarter. We also guarantee that for the life of the
Contract we will credit interest at not less than 3% per year. Any interest
credited to amounts allocated to the Fixed Account in excess of 3% per year will
be determined in our sole discretion. You assume the risk that interest credited
to the Fixed Account may not exceed the minimum guarantee of 3% for any given
year.

TRANSFERS

You may make transfers from the Fixed Account to any other available funding
option(s) twice a year during the 30 days following the semi-annual anniversary
of the contract effective date. The transfers are limited to an amount of up to
15% of the Fixed Account Value on the semi-annual contract effective date
anniversary. (This restriction does not apply to transfers under the Dollar Cost
Averaging Program.) Amounts previously transferred from the Fixed Account to
other funding options may not be transferred back to the Fixed Account for a
period of at least six months from the date of transfer. We reserve the right to
waive either of these restrictions.

Automated transfers from the Fixed Account to any of the funding options may
begin at any time. Automated transfers from the Fixed Account may not deplete
your Fixed Account value in a period of less than twelve months from your
enrollment in the Dollar Cost Averaging Program.

25
<PAGE> 34

APPENDIX C

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

CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION

The Statement of Additional Information contains more specific information and
financial statements relating to The Travelers Insurance Company. A list of the
contents of the Statement of Additional Information is set forth below:

The Insurance Company
Principal Underwriter
Distribution and Management Agreement
Valuation of Assets

Performance Information

Federal Tax Considerations
Independent Accountants
Financial Statements

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

Copies of the Statement of Additional Information dated May 1, 1998 (Form No.
L-12547S) are available without charge. To request a copy, please clip this
coupon on the dotted line above, enter your name and address in the spaces
provided below, and mail to: The Travelers Insurance Company, Annuity Services,
One Tower Square, Hartford, Connecticut 06183-9061.

Name:
- --------------------------------------------------------------------------------

Address:
- --------------------------------------------------------------------------------

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

26
<PAGE> 35

TRAVELERS PORTFOLIO ARCHITECT SELECT VARIABLE ANNUITY
CONTRACT PROFILE

MAY 1, 1998

THIS PROFILE IS A SUMMARY OF SOME OF THE MORE IMPORTANT POINTS THAT YOU SHOULD
KNOW AND CONSIDER BEFORE PURCHASING THE CONTRACT. THE CONTRACT IS MORE FULLY
DESCRIBED IN THE PROSPECTUS WHICH IS ATTACHED TO THIS PROFILE. PLEASE READ THE
PROSPECTUS CAREFULLY. THE TERMS "WE," "US," "OUR" AND THE "COMPANY" REFER TO THE
TRAVELERS INSURANCE COMPANY. "YOU" AND "YOUR" REFER TO THE CONTRACT OWNER.

1. THE VARIABLE ANNUITY CONTRACT. The Contract offered by The Travelers
Insurance Company is a variable annuity that is intended for retirement savings
or other long-term investment purposes. The Contract provides a death benefit as
well as guaranteed income options. The contract may be issued as an individual
Contract or as a group Contract. In states where only group Contracts are
available, you will be issued a certificate summarizing the provisions of the
group contract. For convenience, we refer to both Contracts and certificates as
"Contracts." Under a qualified Contract, you can make one or more payments, as
you choose, on a tax-deferred basis. Under a nonqualified Contract, you can make
one or more payments with after-tax dollars. You direct your payment(s) to one
or more of the variable funding options listed in Section 4 and/or to the Fixed
Account. We guarantee money directed to the Fixed Account as to principal and
interest. The variable funding options are designed to produce a higher rate of
return than the Fixed Account; however, this is not guaranteed. You may also
lose money in the variable funding options.

<PAGE> 36

<TABLE>
<S> <C>
Capital Appreciation Fund
Money Market Portfolio
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio
Small Cap Portfolio
GREENWICH STREET SERIES FUND
Appreciation Portfolio
Diversified Strategic Income Portfolio
Total Return Portfolio
SALOMON BROTHERS VARIABLE SERIES
FUNDS, INC.
Salomon Brothers Variable Investors Fund
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio
MFS Total Return Portfolio
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio
Disciplined Mid Cap Stock Portfolio
Disciplined Small Cap Stock Portfolio
Equity Income Portfolio
Federated High Yield Portfolio
Federated Stock Portfolio
Large Cap Portfolio
Lazard International Stock Portfolio
MFS Emerging Growth Portfolio
MFS Mid Cap Growth Portfolio
Travelers Quality Bond Portfolio
WARBURG PINCUS TRUST
Emerging Markets Portfolio
</TABLE>

5. EXPENSES. The Contract has insurance features and investment features, and
there are costs related to each. For Contracts with a value of less than
$40,000, the Company deducts an annual contract administrative charge of $30.
The annual insurance charge is 1.25% of the amounts you direct to the funding
options, and a related sub-account administrative charge of .15% annually is
charged.

Each funding option charges for management and other expenses. The charges range
from .40% to 1.40% annually, of the average daily net asset balance of the
funding option, depending on the funding option.

The following table is designed to help you understand the Contract charges. The
column "Total Annual Insurance Charges" column includes the mortality and
expense risk charge, the sub-account administrative charge, and reflects the $30
annual contract administrative charge as .014%. The "Total Annual Funding Option
Expenses" column reflects the investment charges for each portfolio, including
any expense waiver or reimbursement. The column "Total Annual Charges" reflects
the sum of the previous two columns. The columns under the heading "Examples"
show you how much you would pay under the Contract for a one-year period and for
a 10-year period. As required by the SEC, the examples assume that you invested
$1,000 in a Contract that earns 5% annually and that you withdraw your money at
the end of year 1 and at the end of year 10. For year 1, the examples show the
total annual charges assessed during that time as well as the withdrawal charge.
For the 10-year example, the total annual charges are included, but no
withdrawal charge is reflected.

ii
<PAGE> 37

<TABLE>
<CAPTION>
TOTAL EXAMPLES: TOTAL
TOTAL ANNUAL ANNUAL EXPENSES
ANNUAL FUNDING TOTAL AT END OF:
INSURANCE OPTION ANNUAL -----------------
PORTFOLIO NAME CHARGES EXPENSES CHARGES 1 YEAR 10 YEARS
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Capital Appreciation Fund.............................. 1.41% 0.84% 2.25% $83 $259
Money Market Portfolio................................. 1.41% 0.40% 1.81% 78 213
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series........................................ 1.41% 0.85% 2.26% 83 260
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio..................... 1.41% 0.80% 2.21% 82 255
Small Cap Portfolio................................ 1.41% 0.78% 2.19% 82 253
GREENWICH STREET SERIES FUND
Appreciation Portfolio............................. 1.41% 1.00% 2.41% 84 275
Diversified Strategic Income Portfolio............. 1.41% 0.98% 2.39% 84 273
Total Return Portfolio............................. 1.41% 0.79% 2.20% 82 254
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.
Salomon Brothers Variable Investors Fund........... 1.41% 1.00% 2.41% 84 275
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio.......................... 1.41% 0.82% 2.23% 83 257
MFS Total Return Portfolio......................... 1.41% 0.86% 2.27% 83 261
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio......................... 1.41% 0.80% 2.21% 82 255
Disciplined Mid Cap Stock Portfolio................ 1.41% 0.95% 2.36% 84 270
Disciplined Small Cap Stock Portfolio.............. 1.41% 1.00% 2.41% 84 275
Equity Income Portfolio............................ 1.41% 0.95% 2.36% 84 270
Federated High Yield Portfolio..................... 1.41% 0.95% 2.36% 84 270
Federated Stock Portfolio.......................... 1.41% 0.95% 2.36% 84 270
Large Cap Portfolio................................ 1.41% 0.95% 2.36% 84 270
Lazard International Stock Portfolio............... 1.41% 1.25% 2.66% 87 300
MFS Emerging Growth Portfolio...................... 1.41% 0.95% 2.36% 84 270
MFS Mid Cap Growth Portfolio....................... 1.41% 1.00% 2.41% 84 275
Travelers Quality Bond Portfolio................... 1.41% 0.75% 2.16% 82 250
WARBURG PINCUS TRUST
Emerging Markets Portfolio......................... 1.41% 1.40% 2.81% 88 314
</TABLE>

7. ACCESS TO YOUR MONEY. You can take withdrawals any time during the
accumulation phase. A withdrawal charge may apply. The amount of the charge
depends on a number of factors, including the length of time since the purchase
payment was made (6% if withdrawn within one year, gradually decreasing to 0%
for payments held by the company for 8 years or more). After the first contract
year, you may withdraw up to 10% of the contract value (as of the previous
Contract year end) without a withdrawal charge. Of course, you may also have to
pay income taxes and a tax penalty on any money you take out.

iii
<PAGE> 38

performance is not a guarantee of future results. Performance information that
predates the separate account is considered "nonstandard" by the SEC. Such
performance information is shown in the Statement of Additional Information that
you may request free of charge.

LAST TEN CALENDAR YEARS (OR FULL YEARS SINCE INCEPTION):

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------
PORTFOLIO NAME 1997
- ---------------------------------------------------------------------
<S> <C>
Capital Appreciation Fund................................... 24.36%
Money Market Portfolio...................................... 3.59%
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio................................. 27.22%
MFS Total Return Portfolio................................ 19.55%
THE TRAVELERS SERIES TRUST
Equity Income Portfolio................................... 30.47%
Federated High Yield Portfolio............................ 13.84%
Federated Stock Portfolio................................. 31.66%
Large Cap Portfolio....................................... 21.72%
Lazard International Stock Portfolio...................... 6.61%
MFS Emerging Growth Portfolio............................. 19.33%
Travelers Quality Bond Portfolio.......................... 5.64%
</TABLE>

Those funding options not illustrated above do not yet have one full year of
performance history.

9. DEATH BENEFIT. The death benefit applies upon the first death of the owner,
joint owner or annuitant. Assuming you are the Annuitant, if you die before you
move to the income phase, the person you have chosen as your beneficiary will
receive a death benefit. The death benefit paid depends on your age at the time
of your death. The death benefit value is calculated at the close of the
business day on which the Company's Home Office receives due proof of death. If
you die before you reach age 90, the death benefit equals the greatest of: (1)
the contract value;(2) the total purchase payments made under the Contract less
all partial withdrawals; or (3) the maximum "final death benefit value"
occurring on or before your 80(th) birthday (after adjustments for all purchase
payments and withdrawals). (See the Contract prospectus for a full explanation
of "final death benefit value.")

Assuming you are the annuitant, if you die on or after age 90 and before the
maturity date, the death benefit payable will be the contract value, less any
applicable premium tax or outstanding loans.

NOTE: In all cases described above, amounts will be reduced by loans
outstanding, premium taxes owed and partial withdrawals not previously deducted.
Certain states may have varying age requirements.

10. OTHER INFORMATION

TRANSFERS BETWEEN FUNDING OPTIONS. You can transfer between the funding options
as frequently as you wish without any current tax implications. Currently there
is no charge for transfers, nor a limit to the number of transfers allowed. We
may, in the future, charge a fee for any transfer request, or limit the number
of transfers allowed. We, at the minimum, would always allow one transfer every
six months. You may transfer between the Fixed Account and the variable funding
options twice a year (during the 30 days after the six-month contract date
anniversary), provided the amount is not greater than 15% of the Fixed Account
value on that date.

iv
<PAGE> 39

ADDITIONAL FEATURES. This Contract has other features you may be interested in.
These include:

AUTOMATIC REBALANCING. You may elect to have the Company periodically
reallocate the values in your Contract to match your original (or your latest)
funding option allocation request.

11. INQUIRIES. If you need more information, please contact us at (800)
842-8573 or:

Travelers Insurance Company
Annuity Investor Services
One Tower Square
Hartford, CT 06183-9061

v
<PAGE> 40

TRAVELERS PORTFOLIO ARCHITECT SELECT

PROSPECTUS

This prospectus describes PORTFOLIO ARCHITECT SELECT, a flexible premium
variable annuity contract (the "Contract") issued by The Travelers Insurance
Company (the "Company," "we" or "our"). The Contract is available in connection
with certain retirement plans that qualify for special federal income tax
treatment ("qualified Contracts") as well as those that do not qualify for such
treatment ("nonqualified Contracts"). Portfolio Architect Select may be issued
as an individual Contract or as a group Contract. In states where only group
Contracts are available, you will be issued a certificate summarizing the
provisions of the group Contract. For convenience, this prospectus refers to
both Contracts and certificates as "Contracts."

You can choose to have your purchase payments accumulate on a fixed basis (i.e.,
a Fixed Account funded through the Company's general account) and/or a variable
basis (i.e., one or more of the sub-accounts ("funding options")) of the
Travelers Fund ABD for Variable Annuities ("Fund ABD"). Your contract value will
vary daily to reflect the investment experience of the funding options you
select and any interest credited to the Fixed Account. The variable funding
options currently available are:

This prospectus provides the information that you should know before investing
in the Contract. You can receive additional information about Fund ABD by
requesting a copy of the Statement of Additional Information ("SAI") dated May
1, 1998. The SAI has been filed with the Securities and Exchange Commission
("SEC") and is incorporated by reference into this prospectus. To request a
copy, write to The Travelers Insurance Company, Annuity Investor Services, One
Tower Square, Hartford, Connecticut 06183-9061, call (800) 842-8573 or access
the SEC's website (http://www.sec.gov). The contents of the SAI appears in
Appendix C of this prospectus.

PROSPECTUS DATED MAY 1, 1998

<PAGE> 41

TABLE OF CONTENTS

<TABLE>
<S> <C>
INDEX OF SPECIAL TERMS................. 2
FEE TABLE.............................. 3
CONDENSED FINANCIAL INFORMATION........ 5
THE ANNUITY CONTRACT................... 5
Purchase Payments...................... 6
Accumulation Units..................... 6
The Funding Options.................... 6
Substitutions and Additions............ 8
CHARGES AND DEDUCTIONS................. 8
Withdrawal Charge...................... 8
Free Withdrawal Allowance.............. 9
Administrative Charges................. 9
Mortality and Expense Risk Charge...... 9
Reduction or Elimination of Contract
Charges.............................. 10
Funding Option Expenses................ 10
Premium Tax............................ 10
Changes in Taxes Based Upon Premium or
Value................................ 10
OWNERSHIP PROVISIONS................... 10
Types of Ownership..................... 10
Beneficiary............................ 11
Annuitant.............................. 11
TRANSFERS.............................. 11
Dollar Cost Averaging.................. 11
ACCESS TO YOUR MONEY................... 12
Systematic Withdrawals................. 12
Loans.................................. 12
DEATH BENEFIT.......................... 13
Death Proceeds Before the Maturity
Date................................. 13
Payment of Proceeds.................... 13
Death Proceeds After the Maturity
Date................................. 14
THE ANNUITY PERIOD..................... 14
Maturity Date.......................... 14
Allocation of Annuity.................. 15
Variable Annuity....................... 15
Fixed Annuity.......................... 15
PAYMENT OPTIONS........................ 15
Election of Options.................... 15
Annuity Options........................ 16
Income Options......................... 17
MISCELLANEOUS CONTRACT PROVISIONS...... 17
Right to Return........................ 17
Termination............................ 17
Required Reports....................... 18
Suspension of Payments................. 18
Transfers of Contract Values to Other
Annuities............................ 18
THE SEPARATE ACCOUNT................... 18
Mixed and Shared Funding............... 18
Performance Information................ 19
FEDERAL TAX CONSIDERATIONS............. 19
General Taxation of Annuities.......... 20
Types of Contracts: Qualified or
Nonqualified......................... 20
Nonqualified Annuity Contracts......... 20
Qualified Annuity Contracts............ 20
Penalty Tax for Premature
Distributions........................ 21
Diversification Requirements for
Variable Annuities................... 21
Ownership of the Investments........... 21
Mandatory Distributions for Qualified
Plans................................ 21
OTHER INFORMATION...................... 22
The Insurance Company.................. 22
IMSA................................... 22
Year 2000 Compliance................... 22
Distribution of Variable Annuity
Contracts............................ 22
Conformity with State and Federal
Laws................................. 22
Voting Rights.......................... 23
Legal Proceedings And Opinions......... 23
APPENDIX A: Condensed Financial
Information.......................... 24
APPENDIX B: The Fixed Account.......... 25
APPENDIX C: Contents of the Statement
of Additional Information............ 26
</TABLE>

INDEX OF SPECIAL TERMS

The following terms are italicized throughout the prospectus. Refer to the page
listed for an explanation of each term.

<TABLE>
<S> <C>
Accumulation Unit...................... 6
Annuitant.............................. 11
Annuity Payments....................... 14
Annuity Unit........................... 6
Cash Surrender Value................... 12
Contract Date.......................... 6
Contract Owner (You, Your)............. 5
Contract Value......................... 5
Contract Year.......................... 6
Fixed Account.......................... 24
Funding Option(s)...................... 6
Income Payments........................ 15
Maturity Date.......................... 5
Purchase Payment....................... 5
Written Request........................ 6
</TABLE>

2
<PAGE> 42

FUND ABD FEE TABLE
- --------------------------------------------------------------------------------
CONTRACT OWNER TRANSACTION EXPENSES

<TABLE>
<S> <C>
WITHDRAWAL CHARGE (as a percentage of purchase payments
withdrawn):

LENGTH OF TIME FROM PURCHASE PAYMENT
</TABLE>

<TABLE>
<CAPTION>
(NUMBER OF YEARS) CHARGE
<S> <C>
1 6%
2 6%
3 5%
4 5%
5 4%
6 3%
7 2%
8 and over 0%
ANNUAL CONTRACT ADMINISTRATIVE CHARGE
(Waived if contract value is $40,000 or more) $30
ANNUAL SEPARATE ACCOUNT CHARGES:
(as a percentage of the average daily net assets of the
Separate Account)
Mortality and Expense Risk Charge..................... 1.25%
Administrative Expense Charge......................... 0.15%
-----
Total Separate Account Charges.................... 1.40%
FUNDING OPTION EXPENSES:
(as a percentage of average daily net assets of the Funding
Option as of December 31, 1997, unless noted otherwise)
</TABLE>

<TABLE>
<CAPTION>
MANAGEMENT OTHER TOTAL ANNUAL
FEE EXPENSES FUNDING
(AFTER EXPENSES (AFTER EXPENSES OPTION
PORTFOLIO NAME ARE REIMBURSED) ARE REIMBURSED) EXPENSES
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Capital Appreciation Fund..................... 0.75% 0.09% 0.84%
Money Market Portfolio........................ 0.32% 0.08%(1) 0.40%
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series............................... 0.75% 0.10%(2) 0.85%
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio............ 0.75% 0.05% 0.80%
Small Cap Portfolio....................... 0.75% 0.03% 0.78%
GREENWICH STREET SERIES FUND
Appreciation Portfolio.................... 0.75% 0.25% 1.00%
Diversified Strategic Income Portfolio.... 0.65% 0.33% 0.98%
Total Return Portfolio.................... 0.55% 0.24% 0.79%
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.
Salomon Brothers Variable Investors
Fund.................................... 0.70% 0.30%(3) 1.00%
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio................. 0.80% 0.02%(4) 0.82%
MFS Total Return Portfolio................ 0.80% 0.06%(4) 0.86%
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio................ 0.60% 0.20%(5) 0.80%
Disciplined Mid Cap Stock Portfolio....... 0.70% 0.25%(6) 0.95%
Disciplined Small Cap Stock Portfolio..... 0.80% 0.20%(5) 1.00%
Equity Income Portfolio................... 0.75% 0.20%(6) 0.95%
Federated High Yield Portfolio............ 0.65% 0.30%(6) 0.95%
Federated Stock Portfolio................. 0.63% 0.32%(6) 0.95%
Large Cap Portfolio....................... 0.75% 0.20%(6) 0.95%
Lazard International Stock Portfolio...... 0.83% 0.42%(6) 1.25%
MFS Emerging Growth Portfolio............. 0.75% 0.20%(6) 0.95%
MFS Mid Cap Growth Portfolio.............. 0.80% 0.20%(5) 1.00%
Travelers Quality Bond Portfolio.......... 0.32% 0.43%(6) 0.75%
WARBURG PINCUS TRUST
Emerging Markets Portfolio................ 0.45% 0.95%(7) 1.40%
</TABLE>

3
<PAGE> 43

NOTES:

(4) Other expenses are as of October 31, 1997 (the Fund's fiscal year end).
There were no fees waived or expenses reimbursed for these funds in 1997.

4
<PAGE> 44

EXAMPLE*

Assuming a 5% annual return on assets, a $1,000 investment would be subject to
the following expenses:

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
IF CONTRACT IS SURRENDERED AT THE IF CONTRACT IS NOT SURRENDERED OR
END OF PERIOD SHOWN ANNUITIZED AT END OF PERIOD SHOWN:
------------------------------------- -------------------------------------
UNDERLYING FUNDING OPTION 1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------
Capital Appreciation Fund............... $83 $120 $161 $259 $23 $70 $121 $259
Money Market Portfolio.................. 78 107 138 213 18 57 98 213
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series.......................... 83 121 161 260 23 71 121 260
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio....... 82 119 159 255 22 69 119 255
Small Cap Portfolio.................. 82 119 158 253 22 69 118 253
GREENWICH STREET SERIES FUND
Appreciation Portfolio............... 84 125 169 275 24 75 129 275
Diversified Strategic Income
Portfolio.......................... 84 125 168 273 24 75 128 273
Total Return Portfolio............... 82 119 158 254 22 69 118 254
SALOMON BROTHERS VARIABLE SERIES FUNDS,
INC.
Salomon Brothers Variable Investors
Fund................................. 84 125 169 275 24 75 129 275
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio............ 83 120 160 257 23 70 120 257
MFS Total Return Portfolio........... 83 121 162 261 23 71 122 261
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio........... 82 119 159 255 22 69 119 255
Disciplined Mid Cap Stock
Portfolio.......................... 84 124 166 270 24 74 126 270
Disciplined Small Cap Stock
Portfolio.......................... 84 125 169 275 24 75 129 275
Equity Income Portfolio.............. 84 124 166 270 24 74 126 270
Federated High Yield Portfolio....... 84 124 166 270 24 74 126 270
Federated Stock Portfolio............ 84 124 166 270 24 74 126 270
Large Cap Portfolio.................. 84 124 166 270 24 74 126 270
Lazard International Stock
Portfolio.......................... 87 133 181 300 27 83 141 300
MFS Emerging Growth Portfolio........ 84 124 166 270 24 74 126 270
MFS Mid Cap Growth Portfolio......... 84 125 169 275 24 75 129 275
Travelers Quality Bond Portfolio..... 82 118 156 250 22 68 116 250
WARBURG PINCUS TRUST
Emerging Markets Portfolio........... 88 137 189 314 28 87 149 314
</TABLE>

CONDENSED FINANCIAL INFORMATION

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

See Appendix A

THE ANNUITY CONTRACT
- --------------------------------------------------------------------------------

Travelers Portfolio Architect Select is a contract between you, the contract
owner, and The Travelers Insurance Company (called "us" or the "Company"). Under
this contract, you make purchase payments to us and we credit them to your
account. The Company promises to pay you an income, in the form of annuity or
income payments, beginning on a future date that you choose, the maturity date.
The purchase payments accumulate tax deferred in the funding options of your
choice. We offer multiple variable funding options, and one fixed account
option. You assume the risk of gain or loss according to the performance of the
variable funding options. The contract value is the amount of purchase payments,
plus or minus any investment experience or interest. The contract value also
reflects all surrenders made and charges deducted. There is generally no
guarantee that at the maturity date the contract value will equal or exceed the
total purchase

5
<PAGE> 45

payments made under the Contract. The date the contract and its benefits became
effective is referred to as the contract date. Each anniversary of this contract
date is called a contract year.

PURCHASE PAYMENTS

The initial purchase payment must be at least $5,000. Additional payments of at
least $500 may be made under the Contract at any time. Under certain
circumstances, we may waive the minimum purchase payment requirement. Purchase
payments over $1,000,000 may be made with our prior consent. In some states, we
do not accept additional purchase payments.

ACCUMULATION UNITS

THE FUNDING OPTIONS

The current funding options are listed below, along with their investment
advisers and any subadviser:

<TABLE>
<CAPTION>
FUNDING OPTION INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUBADVISER
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Capital Appreciation Fund Seeks growth of capital through the use of Travelers Asset Management
common stocks. Income is not an objective. International Corporation
The Fund invests principally in common stocks ("TAMIC")
of small to large companies which are Subadviser: Janus Capital Corp.
expected to experience wide fluctuations in
price in both rising and declining markets.
Money Market Portfolio Seeks high current income from short-term TAMIC
(formerly "Cash Income money market instruments while preserving
Trust") capital and maintaining a high degree of
liquidity.
DELAWARE GROUP PREMIUM
FUND, INC.
REIT Series Seeks maximum long-term total return. Capital Delaware Management Company, Inc.
appreciation is a secondary objective. Subadviser: Lincoln Investment
Management, Inc.
</TABLE>

6
<PAGE> 46

<TABLE>
<CAPTION>
FUNDING OPTION INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUBADVISER
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
DREYFUS VARIABLE INVESTMENT
FUND
Capital Appreciation Seeks primarily to provide long-term capital The Dreyfus Corporation
Portfolio growth consistent with the preservation of Subadviser: Fayez Sarofim & Co.
capital, current income is a secondary
investment objective. The portfolio invests
primarily in the common stocks of domestic
and foreign issuers.
Small Cap Portfolio Seeks to maximize capital appreciation. The Dreyfus Corporation

GREENWICH STREET SERIES
FUND
Appreciation Portfolio Seeks long term appreciation of capital by Mutual Management Corp. ("MMC")
investing primarily in equity securities.
Diversified Strategic Seeks high current income by investing MMC
Income Portfolio primarily in the following fixed income Subadviser: Smith Barney Global
securities. U.S. Gov't. and mortgage-related Capital Management, Inc.
securities, foreign gov't. bonds and
corporate bonds rated below investment grade.
Total Return Portfolio An equity portfolio that seeks to provide MMC
total return, consisting of long-term capital
appreciation and income. The Portfolio will
invest primarily in a diversified portfolio
of dividend-paying common stocks.
SALOMON BROTHERS VARIABLE
SERIES FUND, INC.
Salomon Brothers Variable Seeks long-term growth of capital. Current Salomon Brothers Asset Management
Investors Fund income is a secondary objective.
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio Seeks long-term growth of capital by TIA
investing predominantly in equity securities Subadviser: Alliance Capital
of companies with a favorable outlook for Management L.P.
earnings and whose rate of growth is expected
to exceed that of the U.S. economy over time.
Current income is only an incidental
consideration.
MFS Total Return Seeks to obtain above-average income TIA
Portfolio (compared to a portfolio entirely invested in Subadviser: Massachusetts
equity securities) consistent with the Financial Services Company ("MFS")
prudent deployment of capital. Generally, at
least 40% of the Portfolio's assets will be
invested inequity securities.

THE TRAVELERS SERIES TRUST
Disciplined Mid Cap Stock Seeks growth of capital by investing TAMIC
Portfolio primarily in a broadly diversified portfolio Subadviser: TIMCO
of common stocks.
Disciplined Small Cap Seeks long term capital appreciation by TAMIC
Stock Portfolio investing primarily (at least 65% of its Subadviser: TIMCO
total assets) in the common stocks of U.S.
companies with relatively small market
capitalizations at the time of investment.
Equity Income Portfolio Seeks reasonable income by investing at least TAMIC
65% in income-producing equity securities. Subadviser: Fidelity Management &
The balance may be invested in all types of Research Company
domestic and foreign securities, including
bonds. The Portfolio seeks to achieve a yield
that exceeds that of the securities
comprising the S&P 500. The Subadviser also
considers the potential for capital
appreciation.
Federated High Yield Seeks high current income by investing TAMIC
Portfolio primarily in a professionally managed, Subadviser: Federated Investment
diversified portfolio of fixed income Counseling, Inc.
securities.
</TABLE>

7
<PAGE> 47

THE TRAVELERS SERIES TRUST
(CONT'D)
Federated Stock Portfolio Seeks growth of income and capital by TAMIC
investing principally in a professionally Subadviser: Federated Investment
managed and diversified portfolio of common Counseling, Inc.
stock of high-quality companies (i.e.,
leaders in their industries and characterized
by sound management and the ability to
finance expected growth).
Large Cap Portfolio Seeks long-term growth of capital by TAMIC
investing primarily in equity securities of Subadviser: Fidelity Management &
companies with large market capitalizations. Research Company
Lazard International Seeks capital appreciation by investing TAMIC
Stock Portfolio primarily in the equity securities of Subadviser: Lazard Asset
non-United States companies (i.e., Management
incorporated or organized outside the United
States).
MFS Emerging Growth Seeks long-term growth of capital by TAMIC
Portfolio investing in common stocks of companies that Subadviser: MFS
are believed to be early in their life
cycles, but which are also believed to have
the potential to become major enterprises.
Dividend and interest income from portfolio
securities, if any, is incidental.
MFS Mid Cap Growth Seeks to obtain long term growth of capital TAMIC
Portfolio by investing, under normal market conditions, Subadviser: MFS
at least 65% of its total assets in equity
securities of companies with medium market
capitalization which the investment adviser
believes have above-average growth potential.
Travelers Quality Bond Seeks current income, moderate capital TAMIC
Portfolio volatility and total return.
WARBURG PINCUS TRUST
Emerging Markets Seeks long-term growth of capital by Warburg Pincus Asset Management,
Portfolio investing primarily in equity securities of Inc.
non-U.S. issuers consisting of companies in
emerging securities markets.
</TABLE>

SUBSTITUTIONS AND ADDITIONS

CHARGES AND DEDUCTIONS
- --------------------------------------------------------------------------------
WITHDRAWAL CHARGE

8
<PAGE> 48

The withdrawal charge is equal to a percentage of purchase payments withdrawn
from the Contract and is calculated as follows:

<TABLE>
<CAPTION>
LENGTH OF TIME FROM
PURCHASE PAYMENT WITHDRAWAL
(NUMBER OF YEARS) CHARGE
<S> <C>
1 6%
2 6%
3 5%
4 5%
5 4%
6 3%
7 2%
8 and over 0%
</TABLE>

FREE WITHDRAWAL ALLOWANCE

ADMINISTRATIVE CHARGES

MORTALITY AND EXPENSE RISK CHARGE

9
<PAGE> 49

annuitant lives and for guaranteeing to provide the death benefit if an
annuitant dies prior to the maturity date. The expense risk portion compensates
us for the risk that the charges under the Contract, which cannot be increased
during the duration of the Contract, will be insufficient to cover actual costs.

REDUCTION OR ELIMINATION OF CONTRACT CHARGES

The withdrawal charge, the administrative charges, and the mortality and expense
risk charge under the Contract may be reduced or eliminated when certain sales
or administration of the Contract result in savings or reduction of
administrative or sales expenses, and/or mortality and expense risks. Any such
reduction will be based on the following: (1) the size and type of group to
which sales are to be made; (2) the total amount of purchase payments to be
received; and (3) any prior or existing relationship with the Company. There may
be other circumstances, of which we are not presently aware, which could result
in fewer sales expenses, administrative charges, or mortality and expense risk
charges. For certain trusts, the Company may change the order in which purchase
payments and earnings are withdrawn in order to determine the withdrawal charge.
In no event will reduction or elimination of the withdrawal charge or the
administrative charge be permitted where such reduction or elimination will be
unfairly discriminatory to any person.

FUNDING OPTION EXPENSES

The deductions from and expenses paid out of the assets of the various funding
options are summarized in the fee table and are described in the accompanying
prospectuses.

PREMIUM TAX

CHANGES IN TAXES BASED UPON PREMIUM OR VALUE

If there is any change in a law assessing taxes against the Company based upon
premiums, contract gains or value of the contract, we reserve the right to
charge you proportionately for this tax.

OWNERSHIP PROVISIONS
- --------------------------------------------------------------------------------

TYPES OF OWNERSHIP

You receive all payments while the annuitant is alive unless you direct them to
an alternate recipient. An alternate recipient does not become the contract
owner.

Joint Owner. For nonqualified contracts only, joint owners (i.e., spouses) may
be named in a written request before the contract is in effect. Joint owners may
independently exercise transfers

10
<PAGE> 50

allowed under the Contract. All other rights of ownership must be exercised by
both owners. Joint owners own equal shares of any benefits accruing or payments
made to them. All rights of a joint owner end at death if the other joint owner
survives. The entire interest of the deceased joint owner in the Contract will
pass to the surviving joint owner.

BENEFICIARY

Unless an irrevocable beneficiary has been named, you have the right to change
any beneficiary by written request during the lifetime of the annuitant and
while the Contract continues.

ANNUITANT

TRANSFERS
- --------------------------------------------------------------------------------

DOLLAR COST AVERAGING

You may establish automated transfers of contract values from the Fixed Account,
subject to certain restrictions. Automated transfers from the Fixed Account may
not deplete your Fixed

11
<PAGE> 51

Account Value in less than twelve months from your enrollment in the Dollar Cost
Averaging program.

ACCESS TO YOUR MONEY
- --------------------------------------------------------------------------------

Any time before the maturity date, you may redeem all or any portion of the cash
surrender value, that is, the contract value, less any withdrawal charge,
outstanding loans and any premium tax not previously deducted. You must submit a
written request specifying the fixed or variable funding option(s) from which
amounts are to be withdrawn. The cash surrender value will be determined as of
the close of business after we receive your surrender request at the Home
Office. The cash surrender value may be more or less than the purchase payments
made depending on the contract value at the time of surrender.

SYSTEMATIC WITHDRAWALS

We reserve the right to discontinue offering systematic withdrawals or to assess
a processing fee for this service upon 30 days' written notice to contract
owners (where allowed by state law).

LOANS

Loans may be available under your Contract. If available, all loan provisions
are described in your Contract or loan agreement.

12
<PAGE> 52

DEATH BENEFIT
- --------------------------------------------------------------------------------

Before the maturity date, when there is no contingent annuitant, a death benefit
is payable to the beneficiary when either the annuitant, the contract owner or
the first of joint owners dies. The death benefit is calculated at the close of
the business day on which the Company's Home Office received due proof of death
and written payment instructions.

DEATH PROCEEDS BEFORE THE MATURITY DATE

1) the contract value;

2) the total purchase payments made under the Contract less all partial
withdrawals; or

3) the highest of all "final death benefit values" as described below.

1) the contract value;

2) the total purchase payments made under the Contract less all partial
withdrawals; or

3) the maximum of all "final death benefit value" associated with the
contract date or any contract date anniversary occurring on or before
the annuitant's 80th birthday.

DEATH OF ANY OWNER OR THE ANNUITANT ON OR AFTER AGE 90. The death benefit
payable will be the contract value, less any applicable premium tax or
outstanding loans.

PAYMENT OF PROCEEDS

13
<PAGE> 53

DEATH OF ANNUITANT WHO IS THE CONTRACT OWNER. The Company will pay the proceeds
to any surviving joint owner, or if none, to the beneficiary(ies), or if none,
to the contract owner's estate.

DEATH OF ANNUITANT WHO IS NOT THE CONTRACT OWNER. If there is no contingent
annuitant, the Company will pay the death proceeds to the beneficiary. However,
if there is a contingent annuitant, he or she becomes the annuitant and the
Contract continues in effect (generally using the original maturity date). The
proceeds described above will be paid upon the death of the last surviving
contingent annuitant.

DEATH PROCEEDS AFTER THE MATURITY DATE

THE ANNUITY PERIOD
- --------------------------------------------------------------------------------

MATURITY DATE

14
<PAGE> 54

or upon the death of the contract owner. Independent tax advice should be sought
regarding the election of minimum required distributions.

ALLOCATION OF ANNUITY

VARIABLE ANNUITY

FIXED ANNUITY

PAYMENT OPTIONS
- --------------------------------------------------------------------------------

ELECTION OF OPTIONS

While the annuitant is alive, you can change your annuity or income option
selection any time up to the maturity date. Income options differ from annuity
options in that the amount of the payments

15
<PAGE> 55

made under income options are not based upon the life of any person. Therefore,
the annuitant may outlive the payment period. Once annuity or income payments
have begun, no further elections are allowed.

The amount applied to effect an annuity or income option will be the cash
surrender value as of the date income payments begin, less any applicable
premium taxes not previously deducted. (Certain states may have different
requirements that we will honor.) The cash surrender value used to determine the
amount of any payment will be determined on the same basis as the cash surrender
value during the accumulation period, including the deduction for mortality and
expense risks and the contract administrative expense charge.

ANNUITY OPTIONS

16
<PAGE> 56

would have been made during the lifetime of the primary payee. No further
payments will be made once both payees have died.

Option 5 -- Other Annuity Options. The Company will make any other arrangements
for annuity payments as may be mutually agreed upon.

INCOME OPTIONS

Option 1 -- Payments of a Fixed Amount. The Company will make equal payments of
the amount elected until the cash surrender value applied under this option has
been exhausted. The first payment and all later payments will be paid from each
funding option or the Fixed Account in proportion to the cash surrender value
attributable to each. The final payment will include any amount insufficient to
make another full payment.

Option 3 -- Other Income Options. The Company will make any other arrangements
for income payments as may be mutually agreed upon.

MISCELLANEOUS CONTRACT PROVISIONS

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

RIGHT TO RETURN

TERMINATION

17
<PAGE> 57

REQUIRED REPORTS

SUSPENSION OF PAYMENTS

The Company reserves the right to suspend or postpone the date of any payment or
determination of values on any business day (1) when the New York Stock Exchange
("the Exchange") is closed; (2) when trading on the Exchange is restricted; (3)
when an emergency exists as determined by the SEC so that the sale of securities
held in the Separate Account may not reasonably occur or so that the Company may
not reasonably determine the value of the Separate Account's net assets; or (4)
during any other period when the SEC, by order, so permits for the protection of
security holders.

TRANSFERS OF CONTRACT VALUES TO OTHER ANNUITIES

We may permit contract owners to transfer their contract values into other
annuities offered by us or our affiliated insurance companies under rules then
in effect.

THE SEPARATE ACCOUNT
- --------------------------------------------------------------------------------

MIXED AND SHARED FUNDING

18
<PAGE> 58

PERFORMANCE INFORMATION

NONSTANDARDIZED METHOD. Nonstandardized "total returns" will be calculated in a
similar manner based on the performance of the funding options over a period of
time, usually for the calendar year-to-date, and for the past one-, three-,
five- and ten-year periods. Nonstandardized total returns will not reflect the
deduction of any withdrawal charge or the $30 annual contract administrative
charge, which, if reflected, would decrease the level of performance shown. The
withdrawal charge is not reflected because the Contract is designed for
long-term investment.

GENERAL. Within the guidelines prescribed by the SEC and the National
Association of Securities Dealers, Inc. ("NASD"), performance information may be
quoted numerically or may be presented in a table, graph or other illustration.
Advertisements may include data comparing performance to well-known indices of
market performance (including, but not limited to, the Dow Jones Industrial
Average, the Standard & Poor's (S&P) 500 Index and the S&P 400 Index, the Lehman
Brothers Long T-Bond Index, the Russell 1000, 2000 and 3000 Indices, the Value
Line Index, and the Morgan Stanley Capital International's EAFE Index).
Advertisements may also include published editorial comments and performance
rankings compiled by independent organizations (including, but not limited to,
Lipper Analytical Services, Inc. and Morningstar, Inc.) and publications that
monitor the performance of the Separate Account and the variable funding
options.

FEDERAL TAX CONSIDERATIONS

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

19
<PAGE> 59

GENERAL TAXATION OF ANNUITIES

TYPES OF CONTRACTS: QUALIFIED OR NONQUALIFIED

NONQUALIFIED ANNUITY CONTRACTS

As the owner of a nonqualified annuity, you do not receive any tax benefit
(deduction or deferral of income) on purchase payments, but you will not be
taxed on increases in the value of your contract until a distribution
occurs -- either as a withdrawal (distribution made prior to the maturity date),
or as annuity payments. When a withdrawal is made, you are taxed on the amount
of the withdrawal that is considered earnings. Similarly, when you receive an
annuity payment, part of each payment is considered a return of your purchase
payments and will not be taxed. The remaining portion of the annuity payment
(i.e., any earnings) will be considered ordinary income for tax purposes.

QUALIFIED ANNUITY CONTRACTS

20
<PAGE> 60

There are special rules which govern the taxation of qualified contracts,
including withdrawal restrictions, requirements for mandatory distributions, and
contribution limits. We have provided a more complete discussion in the SAI.

PENALTY TAX FOR PREMATURE DISTRIBUTIONS

DIVERSIFICATION REQUIREMENTS FOR VARIABLE ANNUITIES

The Code requires that any nonqualified variable annuity contracts based on a
separate account shall not be treated as an annuity for any period if
investments made in the account are not adequately diversified. Final tax
regulations define how separate accounts must be diversified. The Company
monitors the diversification of investments constantly and believes that its
accounts are adequately diversified. The consequence of any failure is
essentially the loss to the Contract Owner of tax deferred treatment. The
Company intends to administer all contracts subject to this provision of law in
a manner that will maintain adequate diversification.

OWNERSHIP OF THE INVESTMENTS

Assets in the separate accounts, also referred to as segregated asset accounts
must be owned by the Company and not by the Contract Owner for federal income
tax purposes. Otherwise, the deferral of taxes is lost and income and gains from
the accounts would be includible annually in the Contract Owner's gross income.

MANDATORY DISTRIBUTIONS FOR QUALIFIED PLANS

21
<PAGE> 61

OTHER INFORMATION
- --------------------------------------------------------------------------------

THE INSURANCE COMPANY

The Travelers Insurance Company is a stock insurance company chartered in 1864
in Connecticut and continuously engaged in the insurance business since that
time. It is licensed to conduct life insurance business in all states of the
United States, the District of Columbia, Puerto Rico, Guam, the U.S. and British
Virgin Islands and the Bahamas. The Company is an indirect wholly owned
subsidiary of Travelers Group Inc. The Company's Home Office is located at One
Tower Square, Hartford, Connecticut 06183.

IMSA

YEAR 2000 COMPLIANCE

Generally, computer programs were designed without considering the impact of the
upcoming change in the century. As a result, software and computer systems may
need to be upgraded or replaced in order to comply with "Year 2000"
requirements. If not corrected, these computer applications could fail or create
erroneous results by or at the Year 2000. The business, financial condition, and
results of operation of a company could be materially and adversely affected by
the failure of its systems and applications (or those either provided or
operated by third-parties) to properly operate or manage dates beyond the year
1999.

DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS

From time to time, the Company may pay or permit other promotional incentives,
in cash, credit or other compensation.

22
<PAGE> 62

anticipated that Travelers Distribution Company, an affiliated broker-dealer,
may become the principal underwriter for the Contracts during 1998.

CONFORMITY WITH STATE AND FEDERAL LAWS

VOTING RIGHTS

The Company is the legal owner of the shares of the funding options. However, we
believe that when a funding option solicits proxies in conjunction with a vote
of shareholders we are required to obtain from you and from other owners
instructions on how to vote those shares. When we receive those instructions, we
will vote all of the shares we own in proportion to those instructions. This
will also include any shares we own on our own behalf. Should we determine that
we are no longer required to comply with the above, we will vote on the shares
in our own right.

LEGAL PROCEEDINGS AND OPINIONS

There are no pending material legal proceedings affecting the Separate Account,
the principal underwriter and the Company. Legal matters in connection with the
federal laws and regulations affecting the issue and sale of the Contract
described in this prospectus, as well as the organization of the Company, its
authority to issue variable annuity contracts under Connecticut law and the
validity of the forms of the variable annuity contracts under Connecticut law,
have been passed on by the General Counsel of the Company.

23
<PAGE> 63

APPENDIX A: CONDENSED FINANCIAL INFORMATION

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

THE TRAVELERS FUND ABD FOR VARIABLE ANNUITIES

ACCUMULATION UNIT VALUES*

<CAPTION>
<S> <C> <C>
CAPITAL APPRECIATION FUND (4/97)
Unit Value at beginning of period....................... $ 1.032 $ 1.000
Unit Value at end of period............................. 1.283 1.032
Number of units outstanding at end of period............ 870,525 --
MONEY MARKET PORTFOLIO (FORMERLY "CASH INCOME TRUST") (7/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.033 N/A
Number of units outstanding at end of period............ 345,682 N/A
ALLIANCE GROWTH PORTFOLIO (6/97)
Unit Value at beginning of period....................... $ 1.037 $ 1.000
Unit Value at end of period............................. 1.319 1.037
Number of units outstanding at end of period............ 1,062,634 --
MFS TOTAL RETURN PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.183 N/A
Number of units outstanding at end of period............ 962,287 N/A
TRAVELERS QUALITY BOND PORTFOLIO (7/97)
Unit Value at beginning of period....................... $ 1.001 $ 1.000
Unit Value at end of period............................. 1.057 1.001
Number of units outstanding at end of period............ 378,758 --
LAZARD INTERNATIONAL STOCK PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.027 $ 1.000
Unit Value at end of period............................. 1.095 1.027
Number of units outstanding at end of period............ 849,629 --
MFS EMERGING GROWTH PORTFOLIO (4/97)
Unit Value at beginning of period....................... $ 1.004 $ 1.000
Unit Value at end of period............................. 1.198 1.004
Number of units outstanding at end of period............ 528,553 --
FEDERATED STOCK PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.285 N/A
Number of units outstanding at end of period............ 352,550 N/A
FEDERATED HIGH YIELD PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.140 N/A
Number of units outstanding at end of period............ 620,667 N/A
LARGE CAP PORTFOLIO (6/97)
Unit Value at beginning of period....................... $ 1.023 $ 1.000
Unit Value at end of period............................. 1.245 1.023
Number of units outstanding at end of period............ 491,869 7,800
EQUITY INCOME PORTFOLIO (5/97)
Unit Value at beginning of period....................... $ 1.026 $ 1.000
Unit Value at end of period............................. 1.339 1.026
Number of units outstanding at end of period............ 639,656 30,196
DISCIPLINED MID CAP STOCK PORTFOLIO (FORMERLY "MID CAP
DISCIPLINED EQUITY FUND") (6/97)
Unit Value at beginning of period....................... $ 1.000 N/A
Unit Value at end of period............................. 1.195 N/A
Number of units outstanding at end of period............ 120,880 N/A
APPRECIATION PORTFOLIO (6/97)
Unit Value at beginning of period....................... 1.000 N/A
Unit Value at end of period............................. 1.092 N/A
Number of units outstanding at end of period............ 506,282 N/A
DIVERSIFIED STRATEGIC INCOME PORTFOLIO (6/97)
Unit Value at beginning of period....................... 1.000 N/A
Unit Value at end of period............................. 1.048 N/A
Number of units outstanding at end of period............ 733,829 N/A
</TABLE>

24
<PAGE> 64

APPENDIX B

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

THE FIXED ACCOUNT

The Fixed Account is secured by part of the general assets of the Company. The
general assets of the Company include all assets of the Company other than those
held in Fund ABD or any other separate account sponsored by the Company or its
affiliates.

Under the Fixed Account, the Company assumes the risk of investment gain or
loss, guarantees a specified interest rate, and guarantees a specified periodic
annuity payment. The investment gain or loss of Fund ABD or any of the variable
funding options does not affect the Fixed Account portion of the contract
owner's contract value, or the dollar amount of fixed annuity payments made
under any payout option.

We guarantee that, at any time, the Fixed Account contract value will not be
less than the amount of the purchase payments allocated to the Fixed Account,
plus interest credited less any applicable premium taxes or prior surrenders. If
the contract owner effects a surrender, the amount available from the Fixed
Account will be reduced by any applicable withdrawal charge as described under
"Charges and Deductions" in this prospectus.

TRANSFERS

You may make transfers from the Fixed Account to any other available funding
option(s) twice a year during the 30 days following the semiannual anniversary
of the contract effective date. The transfers are limited to an amount of up to
15% of the Fixed Account Value on the semiannual contract effective date
anniversary. (This restriction does not apply to transfers under the Dollar Cost
Averaging Program.) Amounts previously transferred from the Fixed Account to
other funding options may not be transferred back to the Fixed Account for a
period of at least six months from the date of transfer. We reserve the right to
waive either of these restrictions.

25
<PAGE> 65

APPENDIX C

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

CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION

The Insurance Company
Principal Underwriter
Distribution and Management Agreement
Valuation of Assets

Performance Information

Federal Tax Considerations
Independent Accountants
Financial Statements

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

Name: _

Address:

26
<PAGE> 66

TRAVELERS PREMIER ADVISERS VARIABLE ANNUITY
CONTRACT PROFILE

MAY 1, 1998

1. THE VARIABLE ANNUITY CONTRACT. The Contract offered by The Travelers
Insurance Company is a variable annuity that is intended for retirement savings
or other long-term investment purposes. The Contract provides a death benefit as
well as guaranteed income options. The contract may be issued as an individual
Contract or as a group Contract. In states where only group Contracts are
available, you will be issued a certificate summarizing the provisions of the
group contract. For convenience, we refer to both Contracts and certificates as
"Contracts." Under a qualified Contract, you can make one or more payments, as
you choose, on a tax-deferred basis. Under a nonqualified Contract, you can make
one or more payments with after-tax dollars. You direct your payment(s) to one
or more of the variable funding options listed in Section 4 and/or to the Fixed
Account. We guarantee money directed to the Fixed Account as to principal and
interest. The variable funding options are designed to produce a higher rate of
return than the Fixed Account, however, this is not guaranteed. You may also
lose money in the variable funding options.

2. ANNUITY PAYMENTS (THE INCOME PHASE). You may choose to receive annuity
payments from the Fixed Account or the variable funding options. If you want to
receive payments from your annuity, you can choose one of the following annuity
options: Option 1 -- payments for your life (life annuity) -- assuming that you
are the annuitant; Option 2 -- payments for your life with an added guarantee
that payments will continue to your beneficiary for a certain number of months
(120, 180 or 240, as you select), if you should die during that period; Option
3 -- Joint and Last Survivor Life Annuity, in which payments are made for your
life and the life of another person (usually your spouse). Option 3 can also be
elected with payments continuing at a reduced rate after the death of one payee.
There are also two Income Options: Fixed Amount -- the cash surrender value of
your Contract will be paid to you in equal payments; or Fixed Period -- the cash
surrender value will be used to make payments for a fixed time period. If you
should die before the end of the Fixed Period, the remaining amount would go to
your beneficiary.

<PAGE> 67

3. PURCHASE. You may purchase the Contract with an initial payment of at least
$5,000. You may make additional payments of at least $500 at any time during the
accumulation phase.

WHO SHOULD PURCHASE THIS CONTRACT? The Contract is currently available for use
in connection with (1) individual nonqualified purchases; (2) rollovers from
Individual Retirement Annuities (IRAs); and (3) rollovers from other qualified
retirement plans. Qualified contracts include contracts qualifying under Section
401(a), 403(b), or 408(b) of the Internal Revenue Code of 1986, as amended.

MORGAN STANLEY UNIVERSAL FUNDS, INC.:
Emerging Markets Equity Portfolio
Global Equity Portfolio
Mid Cap Value Portfolio
Value Portfolio
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.:
Salomon Brothers Variable Capital Fund
Salomon Brothers Variable High Yield Bond Fund

Salomon Brothers Variable Investors Fund
Salomon Brothers Variable Strategic Bond Fund

VAN KAMPEN AMERICAN CAPITAL LIFE
INVESTMENT TRUST:
Domestic Income Portfolio
Emerging Growth Portfolio
Enterprise Portfolio
Government Portfolio
Growth and Income Portfolio
Money Market Portfolio
Morgan Stanley Real Estate Securities
Portfolio

Each funding option charges for management and other expenses. The charges range
from 0.60% to 1.75% annually, of the average daily net asset balance of the
funding option, depending on the funding option.

If you withdraw money, the Company may deduct a withdrawal charge (0% to 6%) of
the purchase payments from the Contract. If you withdraw all amounts under the
contract, or if you begin receiving annuity payments, the Company may be
required by your state to deduct a premium tax of 0%-5%.

The following table is designed to help you understand the Contract charges. The
"Total Annual Insurance Charges" column includes the mortality and expense risk
charge and the sub-account administrative charge and reflects the $30 annual
contract administrative charge as .064%. The "Total Annual Funding Option
Expenses" column reflects the investment charges for each portfolio, including
any expense waiver or reimbursement. The column "Total Annual Charges" reflects
the sum of the previous two columns. The columns under the heading "Examples"
show you how much you would pay under the Contract for a one-year period and for
a 10-year period. As required by the SEC, the examples assume that you invested
$1,000 in a Contract that earns 5% annually and that you withdraw your money at
the end of year 1 and at the end of year 10. For year 1, the Total Annual
Insurance Charges are assessed as well as the withdrawal charges. For year 10,
the example shows the aggregate of all the annual charges assessed during that
time, but no withdrawal charge is shown. For these examples, the premium tax is
assumed to be 0%.

ii
<PAGE> 68

<TABLE>
<CAPTION>
EXAMPLES:
TOTAL ANNUAL
TOTAL ANNUAL EXPENSES
TOTAL ANNUAL FUNDING OPTION TOTAL ANNUAL AT END OF:
PORTFOLIO NAME INSURANCE CHARGES EXPENSES CHARGES 1 YEAR 10 YEARS
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------

<CAPTION>
<S> <C> <C> <C> <C> <C>
MORGAN STANLEY UNIVERSAL FUNDS, INC.:
Emerging Markets Equity Portfolio....... 1.46% 1.75% 3.21% $92 $352
Global Equity Portfolio................. 1.46% 1.15% 2.61% 86 295
Mid Cap Value Portfolio................. 1.46% 1.05% 2.51% 85 285
Value Portfolio......................... 1.46% 0.85% 2.31% 83 285
SOLOMON BROTHERS VARIABLE SERIES FUNDS,
INC.:
Variable Investors Fund................. 1.46% 1.00% 2.46% 85 280
Variable Capital Fund................... 1.46% 1.00% 2.46% 85 280
Variable High Yield Bond Fund........... 1.46% 1.00% 2.46% 85 280
Variable Strategic Bond Fund............ 1.46% 1.00% 2.46% 85 280
VAN KAMPEN AMERICAN CAPITAL LIFE
INVESTMENT TRUST:
Domestic Income Portfolio............... 1.46% 0.60% 2.06% 81 239
Emerging Growth Portfolio............... 1.46% 0.85% 2.31% 83 265
Enterprise Portfolio.................... 1.46% 0.60% 2.06% 81 239
Government Portfolio.................... 1.46% 0.60% 2.06% 81 239
Growth and Income Portfolio............. 1.46% 0.75% 2.21% 82 255
Money Market Portfolio.................. 1.46% 0.60% 2.06% 81 239
Morgan Stanley Real Estate Securities
Portfolio............................. 1.46% 1.07% 2.53% 86 287
</TABLE>

6. TAXES. The payments you make to a qualified Contract during the accumulation
phase are made with before-tax dollars. You will be taxed on your purchase
payments and on any earnings when you make a withdrawal or begin receiving
annuity or income payments. Under a nonqualified Contract, payments to the
contract are made with after-tax dollars, and any earnings will accumulate
tax-deferred. You will be taxed on these earnings when they are withdrawn from
the Contract.

7. ACCESS TO YOUR MONEY. You can take withdrawals any time during the
accumulation phase. A withdrawal charge may apply. The amount of the charge
depends on a number of factors, including the length of time since the purchase
payment was made (6% if withdrawn within one year, gradually decreasing to 0%
for payments held by the Company for 8 years or more). After the first contract
year, you may withdraw up to 10% of the contract value (as of the end of the
prior year) without a withdrawal charge. Of course, you may also have to pay
income taxes and a tax penalty on any taxable amounts withdrawn.

8. PERFORMANCE. The value of the Contract will vary depending upon the
investment performance of the funding options you choose. The Statement of
Additional Information reflects adjusted historical total returns for each
funding option. These rates of return reflect the insurance charges,
administrative charge, investment charges and all other expenses of the funding
option. The rates of return do not reflect any withdrawal charge or any
applicable taxes, which, if applied, would reduce such performance. Past
performance is not a guarantee of future results.

Those funding options not illustrated do not yet have one full year of
performance history in the Separate Account.

9. DEATH BENEFIT. The death benefit applies upon the first death of the owner,
joint owner or annuitant. Assuming you are the annuitant, if you die before you
move to the income phase, the person you have chosen as your beneficiary will
receive a death benefit. The death benefit paid

iii
<PAGE> 69

depends on your age at the time of your death. The death benefit value is
calculated at the close of the business day on which the Company's Home Office
receives due proof of death. If you die before you reach age 90, the death
benefit equals the greatest of: (1) the Contract Value;(2) the total purchase
payments made under the Contract less all partial withdrawals; or (3) the
maximum "final death benefit value" occurring on or before your 80(th) birthday
(after adjustments for all purchase payments and withdrawals). (See the Contract
prospectus for a full explanation of "final death benefit value.")

Assuming you are the annuitant, if you die on or after age 90 and before the
maturity date, the death benefit payable will be the contract value.

NOTE: In all cases, death benefit amounts will be reduced by premium taxes owed,
partial withdrawals not previously deducted, and any outstanding loans. Certain
states may have varying age requirements.

10. OTHER INFORMATION

TRANSFERS BETWEEN FUNDING OPTIONS. You can transfer between the funding options
as frequently as you wish without any current tax implications. Currently there
is no charge for transfers, nor a limit to the number of transfers allowed. The
Company may, in the future, charge a fee for any transfer request, or limit the
number of transfers allowed. The Company, at the minimum, would always allow one
transfer every six months. You may transfer between the Fixed Account and the
funding options twice a year (during the 30 days after the six-month contract
date anniversary), provided the amount is not greater than 15% of the Fixed
Account Value on that date.

ADDITIONAL FEATURES. This Contract has other features you may be interested in.
These include:

AUTOMATIC REBALANCING. You may elect to have the Company periodically
reallocate the values in your Contract to match your original (or your latest)
funding option allocation request.

11. INQUIRIES. If you need more information, please contact us at (800)
599-9460 or:

Travelers Insurance Company
Annuity Investor Services
One Tower Square
Hartford, CT 06183

iv
<PAGE> 70

TRAVELERS PREMIER ADVISERS

PROSPECTUS

This prospectus describes TRAVELERS PREMIER ADVISERS, a flexible premium
variable annuity contract (the "Contract") issued by The Travelers Insurance
Company (the "Company" "we" or "our"). The Contract is available in connection
with certain retirement plans that qualify for special federal income tax
treatment ("qualified Contracts") as well as those that do not qualify for such
treatment ("nonqualified Contracts"). Travelers Premier Advisers may be issued
as an individual Contract or as a group Contract. In states where only group
Contracts are available, you will be issued a certificate summarizing the
provisions of the group Contract. For convenience, this prospectus refers to
both Contracts and certificates as "Contracts."

Salomon Brothers Variable Investors Fund
Salomon Brothers Variable Strategic Bond Fund

The Fixed Account is described in Appendix A. Unless specified otherwise, this
prospectus refers to the variable funding options. The contracts and/or some of
the funding options may not be available in all states. THIS PROSPECTUS IS VALID
ONLY WHEN ACCOMPANIED BY THE CURRENT PROSPECTUSES FOR THE VARIABLE FUNDING
OPTIONS. THESE PROSPECTUSES SHOULD BE READ AND RETAINED FOR FUTURE REFERENCE.

This prospectus provides the information that you should know before investing
in the Contract. You can receive additional information about Fund ABD by
requesting a copy of the Statement of Additional Information ("SAI") dated May
1, 1998. The SAI has been filed with the Securities and Exchange Commission
("SEC") and is incorporated by reference into this prospectus. To request a
copy, write to The Travelers Insurance Company, Annuity Investor Services, One
Tower Square, Hartford, Connecticut 06183, call (800) 599-9460 or access the
SEC's website (http://www.sec.gov). The contents of the SAI appears in Appendix
B of this prospectus.

PROSPECTUS DATED MAY 1, 1998

<PAGE> 71

TABLE OF CONTENTS

<TABLE>
<S> <C>
INDEX OF SPECIAL TERMS................. 2
FEE TABLE.............................. 3
THE ANNUITY CONTRACT................... 5
Purchase Payments...................... 5
Accumulation Units..................... 5
The Funding Options.................... 5
Substitutions and Additions............ 7
CHARGES AND DEDUCTIONS................. 7
Withdrawal Charge...................... 7
Free Withdrawal Allowance.............. 8
Administrative Charges................. 8
Mortality and Expense Risk Charge...... 8
Reduction or Elimination of Contract
Charges.............................. 8
Funding Option Expenses................ 9
Premium Tax............................ 9
Changes in Taxes Based Upon Premium or
Value................................ 9
OWNERSHIP PROVISIONS................... 9
Types of Ownership..................... 9
Beneficiary............................ 9
Annuitant.............................. 10
TRANSFERS.............................. 10
Dollar Cost Averaging.................. 10
ACCESS TO YOUR MONEY................... 10
Systematic Withdrawals................. 11
Loans.................................. 11
DEATH BENEFIT.......................... 11
Death Proceeds Before the Maturity
Date................................. 11
Payment of Proceeds.................... 12
Death Proceeds After the Maturity
Date................................. 12
THE ANNUITY PERIOD..................... 13
Maturity Date.......................... 13
Allocation of Annuity.................. 13
Variable Annuity....................... 13
Fixed Annuity.......................... 14
PAYMENT OPTIONS........................ 14
Election of Options.................... 14
Annuity Options........................ 14
Income Options......................... 15
MISCELLANEOUS CONTRACT PROVISIONS...... 15
Right to Return........................ 15
Termination............................ 16
Required Reports....................... 16
Suspension of Payments................. 16
Transfers of Contract Values to Other
Annuities............................ 16
THE SEPARATE ACCOUNT................... 16
Performance Information................ 17
FEDERAL TAX CONSIDERATIONS............. 17
General Taxation of Annuities.......... 17
Types of Contracts: Qualified or
Nonqualified......................... 18
Nonqualified Annuity Contracts......... 18
Qualified Annuity Contracts............ 18
Penalty Tax for Premature
Distributions........................ 19
Diversification Requirements for
Variable Annuities................... 19
Ownership of the Investments........... 19
Mandatory Distributions for Qualified
Plans................................ 19
OTHER INFORMATION...................... 19
The Insurance Company.................. 19
IMSA................................... 20
Year 2000 Compliance................... 20
Distribution of Variable Annuity
Contracts............................ 20
Conformity with State and Federal
Laws................................. 20
Voting Rights.......................... 21
Legal Proceedings and Opinions......... 21
APPENDIX A: The Fixed Account.......... 22
APPENDIX B: Contents of the Statement
of Additional Information............ 23
</TABLE>

INDEX OF SPECIAL TERMS

The following terms are italicized throughout the prospectus. Refer to the page
listed for an explanation of each term.

<TABLE>
<S> <C>
Accumulation Unit...................... 5
Annuitant.............................. 10
Annuity Payments....................... 13
Annuity Unit........................... 13
Cash Surrender Value................... 10
Contract Date.......................... 5
Contract Owner (You, Your)............. 5
Contract Value......................... 5
Contract Year.......................... 5
Fixed Account.......................... 22
Funding Option(s)...................... 5
Income Payments........................ 14
Maturity Date.......................... 5
Purchase Payment....................... 5
Written Request........................ 5
</TABLE>

2
<PAGE> 72

FUND ABD FEE TABLE
- --------------------------------------------------------------------------------

CONTRACT OWNER TRANSACTION EXPENSES

WITHDRAWAL CHARGE (as a percentage of purchase payments withdrawn):

<TABLE>
<CAPTION>
LENGTH OF TIME FROM PURCHASE PAYMENT
(NUMBER OF YEARS) CHARGE
<S> <C>
1 6%
2 6%
3 5%
4 5%
5 4%
6 3%
7 2%
8 and over 0%
ANNUAL CONTRACT ADMINISTRATIVE CHARGE
(Waived if contract value is $40,000 or more) $30
</TABLE>

ANNUAL SEPARATE ACCOUNT CHARGES: (as a percentage of the average daily net
assets of the Separate Account)

<TABLE>
<S> <C>
Mortality and Expense Risk Charge.................... 1.25%
Administrative Expense Charge........................ 0.15%
-----
Total Separate Account Charges.................... 1.40%
</TABLE>

FUNDING OPTION EXPENSES:
(as a percentage of average daily net assets of the Funding Option)

<TABLE>
<CAPTION>
TOTAL ANNUAL
FUNDING
MANAGEMENT OTHER OPTION
FEE EXPENSES EXPENSES
(AFTER EXPENSES (AFTER EXPENSES (AFTER EXPENSES
PORTFOLIO NAME ARE REIMBURSED) ARE REIMBURSED) ARE REIMBURSED)
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
MORGAN STANLEY UNIVERSAL FUNDS, INC.:
Emerging Markets Equity Portfolio............ 0.00%(1) 1.75% 1.75%
Global Equity Portfolio...................... 0.00%(1) 1.15% 1.15%
Mid Cap Value Portfolio...................... 0.00%(1) 1.05% 1.05%
Value Portfolio.............................. 0.00%(1) 0.85% 0.85%
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.:
Salomon Brothers Variable Investors Fund..... 0.70% 0.30%(2) 1.00%
Salomon Brothers Variable Capital Fund....... 0.85% 0.15%(2) 1.00%
Salomon Brothers Variable High Yield Bond Fund.. 0.75% 0.25%(2) 1.00%
Salomon Brothers Variable Strategic Bond
Fund....................................... 0.75% 0.25%(2) 1.00%
VAN KAMPEN AMERICAN CAPITAL LIFE INVESTMENT TRUST:
Domestic Income Portfolio.................... 0.05%(3) 0.55% 0.60%
Emerging Growth Portfolio.................... 0.00%(3) 0.85% 0.85%
Enterprise Portfolio......................... 0.44%(3) 0.16% 0.60%
Government Portfolio......................... 0.36%(3) 0.24% 0.60%
Growth and Income Portfolio ................. 0.00%(3) 0.75% 0.75%
Money Market Portfolio....................... 0.12%(3) 0.48% 0.60%
Morgan Stanley Real Estate Securities
Portfolio.................................. 1.00%(3) 0.07% 1.07%
</TABLE>

NOTES:

3
<PAGE> 73

(NOTES CONTINUED)

(1) The Advisers, with respect to the Portfolios listed in the Morgan Stanley
Universal Funds, Inc. Series Trust, have voluntarily agreed to a reduction
in its management fees and to reimburse the Portfolios for which it acts as
investment adviser if such fees would cause total annual operating expenses
to exceed the amounts set forth in the tables above. Absent of such
reductions, the expenses would have been as follow:

(2) Reflects the voluntary agreement by Salomon Brothers Asset Management to
impose an expense cap for the fiscal year ending December 31, 1998 on the
total annual operating expenses of each fund at the amount shown in the
table through the reimbursement of expenses. Absent such agreement, the
ratio of other expenses and total operating expenses would be:

(3) Van Kampen American Capital has voluntarily agreed to a reduction in its
management fees and to reimburse the Portfolios for which it acts as
investment adviser if such fees would cause total annual operating expenses
to exceed the amounts set forth in the tables above. Absent of such
reductions, the expenses would have been:

<TABLE>
<CAPTION>
TOTAL ANNUAL
MANAGEMENT OTHER OPERATING
PORTFOLIO FEES EXPENSES EXPENSES
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Domestic Income Portfolio.................... 0.50% 0.55% 1.05%
Enterprise Portfolio......................... 0.50% 0.16% 0.66%
Emerging Growth Portfolio.................... 0.70% 1.44% 2.14%
Government Portfolio......................... 0.50% 0.24% 0.74%
Growth and Income Portfolio.................. 0.60% 1.03% 1.63%
Morgan Stanley Real Estate Securities
Portfolio.................................. (no waiver) (no waiver) (no waiver)
Money Market Portfolio....................... 0.50% 0.48% 0.98%
</TABLE>

EXAMPLE*

Assuming a 5% annual return, a $1,000 investment would be subject to the
following expenses:

<TABLE>
<CAPTION>
IF ANNUITIZED, OR IF NO WITHDRAWALS
IF SURRENDERED OR WITHDRAWN AT THE ARE MADE AT THE END OF THE PERIOD
END OF THE PERIOD SHOWN SHOWN.
- ---------------------------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME 1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MORGAN STANLEY UNIVERSAL FUNDS, INC.:
Emerging Markets Portfolio..................... $92 $149 $208 $352 $32 $99 $168 $352
Global Equity Portfolio........................ 86 131 179 295 26 81 139 295
Mid Cap Value Portfolio........................ 85 128 174 285 25 78 134 285
Value Portfolio................................ 83 122 164 265 23 72 124 265
SALOMON BROTHERS VARIABLE SERIES FUNDS, INC.:
Variable Capital Fund.......................... 85 127 171 280 25 77 131 280
Variable High Yield Bond Fund.................. 85 127 171 280 25 77 131 280
Variable Investors Fund........................ 85 127 171 280 25 77 131 280
Variable Strategic Bond Fund................... 85 127 171 280 25 77 131 280
VAN KAMPEN AMERICAN CAPITAL LIFE INVESTMENT TRUST:
Domestic Income Portfolio...................... 81 115 151 239 21 65 111 239
Emerging Growth Portfolio...................... 83 122 164 265 23 72 124 265
Enterprise Portfolio........................... 81 115 151 239 21 65 111 239
Government Portfolio........................... 81 115 151 239 21 65 111 239
Growth and Income Portfolio.................... 82 119 159 255 22 69 119 255
Money Market Portfolio......................... 81 115 151 239 21 65 111 239
Morgan Stanley Real Estate Securities
Portfolio..................................... 86 129 175 287 26 79 135 287
</TABLE>

4
<PAGE> 74

THE ANNUITY CONTRACT
- --------------------------------------------------------------------------------

Travelers Premier Advisers is a contract between you, the contract owner, and
The Travelers Insurance Company (called "us" or the "Company"). Under this
contract, you make purchase payments to us and we credit them to your Contract.
The Company promises to pay you an income, in the form of annuity or income
payments, beginning on a future date that you choose, the maturity date. The
purchase payments accumulate tax deferred in the funding options of your choice.
We offer multiple variable funding options, and one fixed account option. The
contract owner assumes the risk of gain or loss according to the performance of
the variable funding options. The contract value is the amount of purchase
payments, plus or minus any investment experience or interest. The contract
value also reflects all surrenders made and charges deducted. There is generally
no guarantee that at the maturity date the contract value will equal or exceed
the total purchase payments made under the Contract. The date the contract and
its benefits became effective is referred to as the contract date. Each
anniversary of this contract date marks a contract year.

PURCHASE PAYMENTS

ACCUMULATION UNITS

An accumulation unit is used to calculate the value of a Contract. An
accumulation unit works like a share of a mutual fund. Each funding option has a
corresponding accumulation unit value. The accumulation units are valued each
business day and may increase or decrease from day to day. The number of
accumulation units we will credit to your Contract once we receive a purchase
payment is determined by dividing the amount directed to each funding option by
the value of the accumulation unit. We calculate the value of an accumulation
unit for each funding option each day after the New York Stock Exchange closes.
After the value is calculated, your Contract is credited. During the annuity
period (i.e., after the maturity date), you are credited with annuity units.

THE FUNDING OPTIONS

5
<PAGE> 75

The current variable funding options are listed below, along with their
investment adviser:

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
INVESTMENT INVESTMENT INVESTMENT
OPTIONS OBJECTIVE ADVISER/SUBADVISER
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MORGAN STANLEY UNIVERSAL
FUNDS, INC.:
Emerging Markets Equity Seeks long-term capital appreciation by investing Morgan Stanley Asset
Portfolio primarily in equity securities of emerging market Management Inc. ("MSAM")
country issuers with a focus on those in which the
adviser believes the economies are developing strongly
and in which the markets are becoming more
sophisticated.
Global Equity Portfolio Seeks long-term capital appreciation by investing MSAM
primarily in equity securities of issuers throughout the
world, including the U.S.
Mid Cap Value Portfolio Seeks above-average total return over a market cycle of Miller Anderson &
three to five years by investing in common stock and Sherrerd, LLP ("MAS")
other equity securities of issuers with equity
capitalizations in the range of the companies
represented in the S&P Mid Cap 400 Index (currently $100
million to $8 billion).
Value Portfolio Seeks above-average total return over a market cycle of MAS
three to five years by investing primarily in a
diversified portfolio of common stocks and other equity
securities that the adviser believes to be relatively
undervalued based on various measures such as price
earnings ratios and price book ratios.
SALOMON BROTHERS VARIABLE
SERIES FUNDS, INC.:
Variable Capital Fund Capital appreciation, primarily through investments in Salomon Brothers Asset
common stocks which are believed to have above-average Management ("SBAM")
price appreciation potential and which may involve
above-average risk.
Variable High Yield To maximize current income, and, secondarily, to seek SBAM
Bond Fund capital appreciation through investments in medium or
lower rating categories.
Variable Investors Fund Long-term growth of capital, and, secondarily, current SBAM
income, through investments in common stocks of well-
known companies.
Variable Strategic Bond Seeks a high level of current income. As a secondary SBAM
Fund objective, the portfolio will seek capital appreciation.
VAN KAMPEN AMERICAN CAPITAL
LIFE INVESTMENT TRUST:
Domestic Income Seeks current income, primarily and capital appreciation Van Kampen American
Portfolio as a secondary objective only when consistent with its Capital Asset Management,
primary investment objective. The Portfolio attempts to Inc. ("VKACAM")
achieve these objectives through investment primarily in
a diversified portfolio of fixed-income securities. The
Portfolio may invest in investment-grade securities and
lower rated and nonrated securities. Lower rated
securities (commonly known as "junk bonds") are regarded
by the rating agencies as predominantly speculative with
respect to the issuer's continuing ability to meet
principal and interest payments.
Emerging Growth Seeks capital appreciation by investing in a portfolio VKACAM
Portfolio of securities consisting principally of common stocks of
small and medium sized companies considered by the
adviser to be emerging growth companies.
Enterprise Portfolio Seeks capital appreciation through investments believed VKACAM
by the Adviser to have above-average potential for
capital appreciation.
Government Portfolio Seeks to provide investors with a high current return VKACAM
consistent with preservation of capital by investing
primarily in debt securities issued or guaranteed by the
U.S. government, its agencies or instrumentalities.
Growth and Income Seeks long-term growth of capital and income by VKACAM
Portfolio investing primarily in income-producing equity
securities, including common stocks and convertible
securities.
</TABLE>

6
<PAGE> 76

SUBSTITUTIONS AND ADDITIONS

CHARGES AND DEDUCTIONS
- --------------------------------------------------------------------------------
WITHDRAWAL CHARGE

The withdrawal charge is equal to a percentage of purchase payments withdrawn
from the Contract and is calculated as follows:

<TABLE>
<CAPTION>
LENGTH OF TIME FROM
PURCHASE PAYMENT WITHDRAWAL
(NUMBER OF YEARS) CHARGE
<S> <C>
1 6%
2 6%
3 5%
4 5%
5 4%
6 3%
7 2%
8 and over 0%
</TABLE>

For purposes of the withdrawal charge calculation, withdrawals will be deemed to
be taken in the following order:

(a) from any purchase payments to which no withdrawal charge is
applicable;

(b) from any remaining free withdrawal allowance (as described below)
after reduction by the amount of (a);

(d) from any Contract earnings.

7
<PAGE> 77

NOTE: Any free withdrawals taken will not reduce purchase payments still subject
to a withdrawal charge.

FREE WITHDRAWAL ALLOWANCE

Any withdrawal deemed to be taken from purchase payments to which no withdrawal
charge applies will reduce any free withdrawal allowance available in that
contract year. Any withdrawal deemed to be taken from the free withdrawal
allowance will not reduce the amount of purchase payments to which withdrawal
charges are applicable.

ADMINISTRATIVE CHARGES

A Contract administrative charge of $30 is deducted annually from Contracts with
a value of less than $40,000. This charge compensates us for expenses incurred
in establishing and maintaining the Contract. The charge is deducted from the
contract value on the fourth Friday of each August by canceling accumulation
units applicable to each funding option on a pro rata basis. For the first
contract year this charge will be prorated (i.e., calculated) from the date of
purchase. A prorated charge will also be made if the Contract is completely
withdrawn or terminated. We will not deduct a contract administrative charge:
(1) if the distribution results from the death of the contract owner or the
annuitant with no contingent annuitant surviving, (2) after an annuity payout
has begun, or (3) if the contract value on the date of assessment is equal to or
greater than $40,000.

MORTALITY AND EXPENSE RISK CHARGE

REDUCTION OR ELIMINATION OF CONTRACT CHARGES

8
<PAGE> 78

order in which purchase payments and earnings are withdrawn in order to
determine the withdrawal charge. In no event will reduction or elimination of
the withdrawal charge or the administrative charge be permitted where such
reduction or elimination will be unfairly discriminatory to any person.

FUNDING OPTION EXPENSES

The deductions from and expenses paid out of the assets of the various funding
options are summarized in the fee table and are described in the accompanying
prospectuses.

PREMIUM TAX

CHANGES IN TAXES BASED UPON PREMIUM OR VALUE

If there is any change in a law assessing taxes against the Company based upon
premiums, contract gains or value of the contract, we reserve the right to
charge you proportionately for this tax.

OWNERSHIP PROVISIONS
- --------------------------------------------------------------------------------

TYPES OF OWNERSHIP

You receive all payments while the annuitant is alive unless you direct them to
an alternate recipient. An alternate recipient does not become the contract
owner.

BENEFICIARY

Unless an irrevocable beneficiary has been named, you have the right to change
any beneficiary by written request during the lifetime of the annuitant and
while the Contract continues.

9
<PAGE> 79

ANNUITANT

For nonqualified Contracts only, the contract owner may also name one individual
as a contingent annuitant by written request before the Contract becomes
effective. If the annuitant dies prior to the maturity date, and a contingent
annuitant has been named, the contingent annuitant becomes the annuitant and the
Contract continues. A contingent annuitant may not be changed, deleted or added
after the Contract becomes effective.

TRANSFERS
- --------------------------------------------------------------------------------

DOLLAR COST AVERAGING

ACCESS TO YOUR MONEY
- --------------------------------------------------------------------------------

Any time before the maturity date, you may redeem all or any portion of the cash
surrender value, that is, the contract value, less any withdrawal charge and any
premium tax not previously deducted. You must submit a written request
specifying the fixed or variable funding option(s) from which amounts are to be
withdrawn. If no funding options are specified, the withdrawal will be made on a
pro rata basis. The cash surrender value will be determined as of the close of
business after we receive your surrender request at the Home Office. The cash
surrender value may be more or less than the purchase payments made depending on
the contract value at the time of surrender.

10
<PAGE> 80

SYSTEMATIC WITHDRAWALS

Beginning in the second contract year and before the maturity date, you may
choose to withdraw a specified dollar amount (at least $100) on a monthly,
quarterly, semiannual or annual basis. Any applicable withdrawal charges (in
excess of the free withdrawal allowance) and any applicable premium taxes will
be deducted. To elect systematic withdrawals, you must have a contract value of
at least $15,000 and you must make the election on the form provided by the
Company. We will surrender accumulation units pro rata from all funding options
in which you have an interest, unless you instruct us otherwise. You may begin
or discontinue systematic withdrawals at any time by notifying us in writing,
but at least 30 days' notice must be given to change any systematic withdrawal
instructions that are currently in place.

We reserve the right to discontinue offering systematic withdrawals or to assess
a processing fee for this service upon 30 days' written notice to contract
owners (where allowed by state law).

LOANS

Loans may be available under your Contract. If available, all loan provisions
are described in your Contract or loan agreement.

DEATH BENEFIT
- --------------------------------------------------------------------------------

DEATH PROCEEDS BEFORE THE MATURITY DATE

1) the contract value;

2) the total purchase payments made under the Contract less all partial
withdrawals; or

3) the highest of all "final death benefit values" as described below.

Adjustments to the death benefit values for any purchase payments or partial
withdrawals will be made in the order that such purchase payments or partial
withdrawals occur. For each purchase

11
<PAGE> 81

payment, death benefit values will be increased by the amount of the purchase
payment. For each partial withdrawal, death benefit values will be reduced by a
"partial withdrawal reduction" which equals the product of (i) the death benefit
value immediately before the reduction of the partial withdrawal, and (ii) the
amount of the partial withdrawal divided by the contract value immediately
before the partial withdrawal. The "final death benefit value" associated with
the contract date and with each contract date anniversary equals the initial
death benefit value plus or minus all adjustments until the death report date.

1) the contract value;

2) the total purchase payments made under the Contract less all partial
withdrawals; or

3) the maximum of all "final death benefit values" associated with the
contract date or any contract date anniversary occurring on or before
the annuitant's 80th birthday.

DEATH OF ANY OWNER OR THE ANNUITANT ON OR AFTER AGE 90. The death benefit
payable will be the contract value, less any applicable premium tax or
outstanding loans.

PAYMENT OF PROCEEDS

DEATH OF ANNUITANT WHO IS THE CONTRACT OWNER. The Company will pay the proceeds
to any surviving joint owner, or if none, to the beneficiary(ies), or if none,
to the contract owner's estate.

Under a nonqualified contract, the death benefit proceeds must be distributed to
the beneficiary within five years of the contract owner's death. Or, the
beneficiary may elect to receive payments from an annuity which begins within
one year of the contract owner's death and which is payable over the life of the
beneficiary or over a period not exceeding the beneficiary's life expectancy.

DEATH PROCEEDS AFTER THE MATURITY DATE

If any owner or the annuitant dies on or after the maturity date, the Company
will pay the beneficiary a death benefit consisting of any benefit remaining
under the annuity or income option then in effect.

12
<PAGE> 82

THE ANNUITY PERIOD

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

MATURITY DATE

ALLOCATION OF ANNUITY

When an annuity option is elected, it may be elected as a variable annuity, a
fixed annuity, or a combination of both. (Variable payouts may not be available
in all states. Refer to your contract.) If, at the time annuity payments begin,
no election has been made to the contrary, the cash surrender value will be
applied to provide an annuity funded by the same investment options selected
during the accumulation period (contract value, in Oregon). At least 30 days
before the maturity date, you may transfer the contract value among the funding
options in order to change the basis on which annuity payments will be
determined. (See "Transfers.")

VARIABLE ANNUITY

13
<PAGE> 83

Company reserves the right to require satisfactory proof of age of any person on
whose life annuity payments are based before making the first payment under any
of the settlement options.

FIXED ANNUITY

PAYMENT OPTIONS
- --------------------------------------------------------------------------------

ELECTION OF OPTIONS

The amount applied to effect an annuity or income option will be the cash
surrender value as of the date the payments begin, less any applicable premium
taxes not previously deducted and any applicable withdrawal charge. (Certain
states may have different requirements that we will honor.) The cash surrender
value used to determine the amount of any such payment will be determined on the
same basis as the cash surrender value during the accumulation period, including
the deduction for mortality and expense risks and the contract administrative
expense charge.

ANNUITY OPTIONS

14
<PAGE> 84

Option 5 -- Other Annuity Options. The Company will make any other arrangements
for annuity payments as may be mutually agreed upon.

INCOME OPTIONS

Option 3 -- Other Income Options. The Company will make any other arrangements
for income payments as may be mutually agreed upon.

MISCELLANEOUS CONTRACT PROVISIONS

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

RIGHT TO RETURN

15
<PAGE> 85

during the remainder of the right to return period, the contract value
(including charges) will be refunded. The contract value will be determined
following the close of the business day on which we receive a written request
for a refund. Where state law requires a longer period, or the return of
purchase payments or other variations of this provision, the Company will
comply. Refer to your Contract for any state-specific information.

TERMINATION

REQUIRED REPORTS

SUSPENSION OF PAYMENTS

TRANSFERS OF CONTRACT VALUES TO OTHER ANNUITIES

We may permit contract owners to transfer their contract values into other
annuities offered by us or our affiliated insurance companies under rules then
in effect.

THE SEPARATE ACCOUNT
- --------------------------------------------------------------------------------

16
<PAGE> 86

PERFORMANCE INFORMATION

From time to time, we may advertise several types of historical performance for
the Contract's funding options. We may advertise the "standardized average
annual total returns" of the funding option, calculated in a manner prescribed
by the SEC, as well as the "nonstandardized total return," as described below.
Specific examples of the performance information appear in the SAI.

GENERAL. Within the guidelines prescribed by the SEC and the National
Association of Securities Dealers, Inc. ("NASD"), performance information may be
quoted numerically or may be presented in a table, graph or other illustration.
Advertisements may include data comparing performance to well-known indices of
market performance (including, but not limited to, the Dow Jones Industrial
Average, the Standard & Poor's (S&P) 500 Index and the S&P 400 Index, the Lehman
Brothers Long T-Bond Index, the Russell 1000, 2000 and 3000 Indices, the Value
Line Index, and the Morgan Stanley Capital International's EAFE Index).
Advertisements may also include published editorial comments and performance
rankings compiled by independent organizations (including, but not limited to,
Lipper Analytical Services, Inc. and Morningstar, Inc.) and publications that
monitor the performance of the Separate Account and the variable funding
options.

FEDERAL TAX CONSIDERATIONS
- --------------------------------------------------------------------------------

GENERAL TAXATION OF ANNUITIES

Congress has recognized the value of saving for retirement by providing certain
tax benefits, in the form of tax deferral, for money put into an annuity. The
Internal Revenue Code (Code) governs

17
<PAGE> 87

how this money is ultimately taxed, depending upon the type of contract,
qualified or non-qualified, and the manner in which the money is distributed, as
briefly described below.

TYPES OF CONTRACTS: QUALIFIED OR NONQUALIFIED

NONQUALIFIED ANNUITY CONTRACTS

QUALIFIED ANNUITY CONTRACTS

18
<PAGE> 88

PENALTY TAX FOR PREMATURE DISTRIBUTIONS

DIVERSIFICATION REQUIREMENTS FOR VARIABLE ANNUITIES

OWNERSHIP OF THE INVESTMENTS

MANDATORY DISTRIBUTIONS FOR QUALIFIED PLANS

OTHER INFORMATION
- --------------------------------------------------------------------------------

THE INSURANCE COMPANY

The Travelers Insurance Company is a stock insurance company chartered in 1864
in Connecticut and continuously engaged in the insurance business since that
time. It is licensed to conduct life

19
<PAGE> 89

insurance business in all states of the United States, the District of Columbia,
Puerto Rico, Guam, the U.S. and British Virgin Islands and the Bahamas. The
Company is an indirect wholly owned subsidiary of Travelers Group Inc. The
Company's Home Office is located at One Tower Square, Hartford, Connecticut
06183.

IMSA

YEAR 2000 COMPLIANCE

DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS

From time to time, the Company may pay or permit other promotional incentives,
in cash, credit or other compensation.

CONFORMITY WITH STATE AND FEDERAL LAWS

20
<PAGE> 90

that the change is required to meet the requirements of any law or regulation
issued by any governmental agency to which the Company, the Contract or the
contract owner is subject.

VOTING RIGHTS

LEGAL PROCEEDINGS AND OPINIONS

21
<PAGE> 91

APPENDIX A
- --------------------------------------------------------------------------------

THE FIXED ACCOUNT

Under the Fixed Account, the Company assumes the risk of investment gain or
loss, guarantees a specified interest rate, and guarantees a specified periodic
annuity payment. The investment gain or loss of Fund ABD or any of the variable
funding options does not affect the Fixed Account portion of the contract
owner's contract value, or the dollar amount of fixed annuity payments made
under any payout option.

TRANSFERS

You may make transfers from the Fixed Account to any other available funding
option(s) twice a year during the 30 days following the semi-annual anniversary
of the contract effective date. The transfers are limited to an amount of up to
15% of the Fixed Account Value on the semiannual contract effective date
anniversary. (This restriction does not apply to transfers under the Dollar Cost
Averaging Program.) Amounts previously transferred from the Fixed Account to
other funding options may not be transferred back to the Fixed Account for a
period of at least six months from the date of transfer. We reserve the right to
waive either of these restrictions.

22
<PAGE> 92

APPENDIX B
- --------------------------------------------------------------------------------

CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION

The Insurance Company
Principal Underwriter
Distribution and Management Agreement
Valuation of Assets

Performance Information

Federal Tax Considerations
Independent Accountants
Financial Statements

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

Copies of the Statement of Additional Information dated May 1, 1998 (Form No.
L-12547S) are available without charge. To request a copy, please clip this
coupon on the dotted line above, enter your name and address in the spaces
provided below, and mail to: The Travelers Insurance Company, Annuity Investor
Services, One Tower Square, Hartford, Connecticut 06183-8034.

Name:

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

Address:
- ---------------------------------------------------------------

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

23
<PAGE> 93

PART B

Information Required in a Statement of Additional Information

<PAGE> 94

PORTFOLIO ARCHITECT
PORTFOLIO ARCHITECT SELECT
PREMIER ADVISERS

STATEMENT OF ADDITIONAL INFORMATION

dated

May 1, 1998

for

THE TRAVELERS FUND ABD FOR VARIABLE ANNUITIES

ISSUED BY

THE TRAVELERS INSURANCE COMPANY

This Statement of Additional Information ("SAI") is not a prospectus but relates
to, and should be read in conjunction with, the Individual Variable Annuity
Contract Prospectus dated May 1, 1998. A copy of the Prospectus may be obtained
by writing to The Travelers Insurance Company, Annuity Services, One Tower
Square, Hartford, Connecticut 06183-9061, or by calling (800) 842-8573. This
SAI should be read in conjunction with the accompanying 1997 Annual Report for
the Fund.

TABLE OF CONTENTS

<TABLE>
<S> <C>
THE INSURANCE COMPANY..................................................... 1

PRINCIPAL UNDERWRITER..................................................... 1

DISTRIBUTION AND MANAGEMENT AGREEMENT..................................... 2

VALUATION OF ASSETS....................................................... 2

PERFORMANCE INFORMATION................................................... 3

FEDERAL TAX CONSIDERATIONS................................................ 8

INDEPENDENT ACCOUNTANTS................................................... 11

FINANCIAL STATEMENTS...................................................... F-1
</TABLE>

<PAGE> 95

THE INSURANCE COMPANY

The Travelers Insurance Company (the "Company"), is a stock insurance
company chartered in 1864 in Connecticut and continuously engaged in the
insurance business since that time. The Company is licensed to conduct life
insurance business in all states of the United States, the District of Columbia,
Puerto Rico, Guam, the U.S. and British Virgin Islands and the Bahamas. The
Company's Home Office is located at One Tower Square, Hartford, Connecticut
06183.

The Company is a wholly owned subsidiary of The Travelers Insurance
Group Inc., which is indirectly owned through a wholly owned subsidiary, by
Travelers Group Inc., a financial services holding company engaged, through its
subsidiaries, principally in four business segments: (i) Investment Services;
(ii) Consumer Finance Services; (iii) Life Insurance Services; and (iv) Property
and Casualty Insurance Services.

STATE REGULATION. The Company is subject to the laws of the state of Connecticut
governing insurance companies and to regulation by the Insurance Commissioner of
the state of Connecticut. An annual statement covering the operations of the
Company for the preceding year, as well as its financial conditions as of
December 31 of such year, must be filed with the Commissioner in a prescribed
format on or before March 1 of each year. The Company's books and assets are
subject to review or examination by the Commissioner or his agents at all times,
and a full examination of its operations is conducted at least once every four
years.

The Company is also subject to the insurance laws and regulations of all
other states in which it is licensed to operate. However, the insurance
departments of each of these states generally apply the laws of the home state
(jurisdiction of domicile) in determining the field of permissible investments.

THE SEPARATE ACCOUNT. Fund ABD meets the definition of a separate account under
the federal securities laws, and will comply with the provisions of the 1940
Act. Additionally, the operations of Fund ABD are subject to the provisions of
Section 38a-433 of the Connecticut General Statutes which authorizes the
Connecticut Insurance Commissioner to adopt regulations under it. Section
38a-433 contains no restrictions on the investments of the Separate Account, and
the Commissioner has adopted no regulations under the Section that affect the
Separate Account.

PRINCIPAL UNDERWRITER

Tower Square Securities, Inc. ("Tower Square"), an indirect,
wholly-owned subsidiary of the Company, serves as principal underwriter for Fund
ABD and the Contracts. The offering is continuous. Tower Square's principal
executive offices are located at One Tower Square, Hartford, Connecticut. It is
anticipated that Travelers Distribution Company, an affiliated broker dealer,
will become the principal underwriter during 1998.

1
<PAGE> 96

DISTRIBUTION AND MANAGEMENT AGREEMENT

Under the terms of the Distribution and Management Agreement among Fund
ABD, the Company and Tower Square, the Company provides all administrative
services and mortality and expense risk guarantees related to variable annuity
contracts sold by the Company in connection with Fund ABD. Tower Square performs
the sales functions related to the Contracts. The Company reimburses Tower
Square for commissions paid, other sales expenses and certain overhead expenses
connected with sales functions. The Company also pays all costs (including costs
associated with the preparation of sales literature); all costs of qualifying
Fund ABD and the variable annuity contract with regulatory authorities; the
costs of proxy solicitation; and all custodian, accountant's and legal fees. The
Company also provides without cost to Fund ABD all necessary office space,
facilities, and personnel to manage its affairs.

VALUATION OF ASSETS

FUNDING OPTIONS: The value of the assets of each funding option is determined on
each business day as of the close of the New York Stock Exchange. Each security
traded on a national securities exchange is valued at the last reported sale
price on the business day. If there has been no sale on that day, then the value
of the security is taken to be the mean between the reported bid and asked
prices on the business day or on the basis of quotations received from a
reputable broker or any other recognized source.

Any security not traded on a securities exchange but traded in the
over-the-counter-market and for which market quotations are readily available is
valued at the mean between the quoted bid and asked prices on the business day
or on the basis of quotations received from a reputable broker or any other
recognized source.

Securities traded on the over-the-counter-market and listed securities
with no reported sales are valued at the mean between the last reported bid and
asked prices or on the basis of quotations received from a reputable broker or
other recognized source.

Short-term investments for which a quoted market price is available are
valued at market. Short-term investments maturing in more than sixty days for
which there is no reliable quoted market price are valued by "marking to market"
(computing a market value based upon quotations from dealers or issuers for
securities of a similar type, quality and maturity.) "Marking to market" takes
into account unrealized appreciation or depreciation due to changes in interest
rates or other factors which would influence the current fair values of such
securities. Short-term investments maturing in sixty days or less for which
there is no reliable quoted market price are valued at amortized cost which
approximates market.

THE CONTRACT VALUE: The value of an accumulation unit on any business day is
determined by multiplying the value on the preceding business day by the net
investment factor for the valuation period just ended. The net investment factor
is used to measure the investment performance of a funding option from one
valuation period to the next. The net investment factor for a funding option for
any valuation period is equal to the sum of 1.000000 plus the net investment
rate (the gross investment rate less any applicable funding option deductions
during the valuation period relating to the mortality and

2
<PAGE> 97

expense risk charge and the administrative expense charge). The gross investment
rate of a funding option is equal to (a) minus (b), divided by (c) where:

(a) = investment income plus capital gains and losses (whether realized or
unrealized);
(b) = any deduction for applicable taxes (presently zero); and
(c) = the value of the assets of the funding option at the beginning of the
valuation period.

The gross investment rate may be either positive or negative. A funding
option's investment income includes any distribution whose ex-dividend date
occurs during the valuation period.

ACCUMULATION UNIT VALUE. The value of the accumulation unit for each funding
option was initially established at $1.00. The value of an accumulation unit on
any business day is determined by multiplying the value on the preceding
business day by the net investment factor for the valuation period just ended.
The net investment factor is calculated for each funding option and takes into
account the investment performance, expenses and the deduction of certain
expenses.

ANNUITY UNIT VALUE. The initial Annuity Unit Value applicable to each funding
option was established at $1.00. An annuity unit value as of any business day is
equal to (a) the value of the annuity unit on the preceding business day,
multiplied by (b) the corresponding net investment factor for the valuation
period just ended, divided by (c) the assumed net investment factor for the
valuation period. (For example, the assumed net investment factor based on an
annual assumed net investment rate of 3.0% for a Valuation Period of one day is
1.000081 and, for a period of two days, is 1.000081 x 1.000081.)

PERFORMANCE INFORMATION

From time to time, the Company may advertise several types of historical
performance for the Funding Options of Fund ABD. The Company may advertise the
"standardized average annual total returns" of the Funding Option, calculated in
a manner prescribed by the Securities and Exchange Commission, as well as the
"nonstandardized total return," as described below:

STANDARDIZED METHOD. Quotations of average annual total returns are
computed according to a formula in which a hypothetical initial investment of
$1,000 is applied to the Funding Option, and then related to ending redeemable
values over one-, five-, and ten-year periods, or for a period covering the time
during which the Funding Option has been in existence, if less. If a Funding
Option has been in existence for less than one year, the "since inception" total
return performance quotations are year-to-date and are not average annual total
returns. These quotations reflect the deduction of all recurring charges during
each period (on a pro rata basis in the case of fractional periods). The
deduction for the annual contract administrative charge ($30) is converted to a
percentage of assets based on the actual fee collected (or anticipated to be
collected, if a new product), divided by the average net assets for contracts
sold (or anticipated to be sold) under the Prospectus to which this Statement of
Additional Information relates. Each quotation assumes a total redemption at the
end of each period with the assessment of any applicable withdrawal charge at
that time.

NONSTANDARDIZED METHOD. Nonstandardized "total returns" will be
calculated in a similar manner based on the performance of the Funding Options
over a period of time, usually for the

3
<PAGE> 98

calendar year-to-date, and for the past one-, three-, five- and ten-year
periods. Nonstandardized total returns will not reflect the deduction of any
applicable withdrawal charge or the $30 annual contract administrative charge,
which, if reflected, would decrease the level of performance shown. The
withdrawal charge is not reflected because the Contract is designed for
long-term investment.

For Funding Options that were in existence prior to the date they became
available under Fund ABD, the standardized average annual total return
quotations may be accompanied by returns showing the investment performance that
such Funding Options would have achieved (reduced by the applicable charges) had
they been held under the Contract for the period quoted. The total return
quotations are based upon historical earnings and are not necessarily
representative of future performance.

Average annual total returns for each of the Funding Options (excluding
Money Market Portfolio) computed according to the standardized and
nonstandardized methods for the period ending December 31, 1997 are set forth in
the following table.

4
<PAGE> 99

PORTFOLIO ARCHITECT
TOTAL RETURN CALCULATIONS
FUNDING OPTIONS OF FUND ABD

<TABLE>
<CAPTION>
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS NONSTANDARDIZED TOTAL RETURNS
(taking into account all charges and fees) (taking into account all charges and fees except
deferred sales charges and contract administrative charge)
- -----------------------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME SUBACCOUNT 1 YEAR 5 YEAR 10 YEAR FUND 1 YEAR 3 YEAR 5 YEAR 10 YEAR
INCEPTION INCEPTION
DATE(1) DATE(2)
=============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Capital Appreciation Fund 12/4/96 18.36% 20.63% -- 5/26/83 24.38% 28.32% 17.62% 14.77%
Money Market Portfolio 12/4/96 -2.41% -2.55%* -- 12/31/87 3.60% 3.03% 2.64% 3.83%
DELAWARE GROUP PREMIUM FUND, INC
REIT Series 5/1/98 -- -- -- -- -- -- -- --
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio 3/23/98 -- -- -- -- -- -- -- --
Small Cap Portfolio 3/23/98 -- -- -- -- -- -- -- --
SALOMON BROTHERS VARIABLE SERIES
FUNDS, INC
Salomon Brothers Variable 3/23/98 -- -- -- -- -- -- -- --
Investors Fund
TRAVELERS SERIES FUND, INC
Alliance Growth Portfolio 12/4/96 21.22% 23.92% -- 6/20/94 27.24% 29.21% 25.91% --
MFS Total Return Portfolio 12/4/96 12.33% 11.43% -- 6/20/94 19.56% 18.70% 14.94%* --
Putnam Diversified Income Portfoio 12/4/96 0.24% 0.90%* -- 6/20/94 6.26% 9.48% 8.22%* --
THE TRAVELERS SERIES TRUST
Convertible Bond Portfolio 5/1/98 -- -- -- -- -- -- -- --
Disciplined Mid Cap Stock Portfolio 4/1/97 13.46%* -- -- 4/1/97 33.00%* -- -- --
Disciplined Small Cap Stock 5/1/98 -- -- -- -- -- -- -- --
Portfolio
Equity Income Portfolio 12/4/96 24.47% 25.70% -- 8/30/96 30.48% 32.07% -- --
Federated High Yield Portfolio 12/4/96 7.84% 7.39% -- 8/30/96 13.85% 15.99%* -- --
Federated Stock Portfolio 12/4/96 25.65% 20.76% -- 8/30/96 31.67% 33.78%* -- --
Large Cap Portfolio 12/4/96 15.72% 17.13% -- 8/30/96 21.74% 26.74%* -- --
Lazard International Stock 12/4/96 0.61% 3.25% -- 8/30/96 6.63% 9.88%* -- --
Portfolio
MFS Emerging Growth Portfolio 12/4/96 13.33% 12.81% -- 8/30/96 19.34% 18.80%* -- --
MFS Mid Cap Growth Portfolio 3/23/98 -- -- -- -- -- -- -- --
MFS Research Portfolio 3/23/98 -- -- -- -- -- -- -- --
Strategic Stock Portfolio 5/1/98 -- -- -- -- -- -- -- --
Travelers Quality Bond Portfolio 12/4/96 -0.37% -0.25%* -- 8/30/96 5.65% 6.57%* -- --
WARBURG PINCUS TRUST
Emerging Markets Portfolio 5/1/98 -- -- -- -- -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>

* Figures represent period "Since Inception," as defined below.

(1) Subaccount Inception Date reflects the actual date that the underlying fund
became available under the Separate Account, as determined by the effective
date of the Separate Account's 1940 Act Registration Statement.

(2) Fund Inception Date reflects the date that the underlying fund commenced
operations. For those funds that were in existence prior to the date that
they became available under the Separate Account, the performance figures
represent actual returns of the fund adjusted to reflect the charges that
would have been assessed under the Separate Account during the period(s)
shown. As illustrated herein, periods greater than 1 year reflect

Hypothetical Adjusted Returns.

5
<PAGE> 100

PORTFOLIO ARCHITECT SELECT
TOTAL RETURN CALCULATIONS
FUNDING OPTIONS OF FUND ABD

<TABLE>
<CAPTION>
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS NONSTANDARDIZED TOTAL RETURNS
(taking into account all charges and fees) (taking into account all charges and fees except
deferred sales charges and contract administrative charge)
- -----------------------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME SUBACCOUNT 1 YEAR 5 YEAR 10 YEAR FUND 1 YEAR 3 YEAR 5 YEAR 10 YEAR
INCEPTION INCEPTION
DATE(1) DATE(2)
=============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Capital Appreciation Fund 12/4/96 18.36% 20.63%* -- 5/26/83 24.38% 28.32% 17.62% 14.77%
Money Market Portfolio 12/4/96 -2.41% -2.55%* -- 12/31/87 3.60% 3.03% 2.64% 3.83%
DELAWARE GROUP PREMIUM FUND, INC.
REIT Series 5/1/98 -- -- -- -- -- -- -- --
DREYFUS VARIABLE INVESTMENT FUND
Capital Appreciation Portfolio 3/23/98 -- -- -- -- -- -- -- --
Small Cap Portfolio 3/23/98 -- -- -- -- -- -- -- --
GREENWICH STREET SERIES FUND
Appreciation Portfolio 6/2/97 3.18%* -- -- 10/16/91 24.66% 23.24% 14.03% 12.78%*
Diversified Strategic Income 6/2/97 -1.19%* -- -- 10/16/91 6.63% 10.21% 7.32% 6.04%*
Portfolio
Total Return Portfolio 5/1/98 -- -- -- -- -- -- -- --
SALOMON BROTHERS VARIABLE SERIES
FUNDS, INC.
Salomon Brothers Variable 3/23/98 -- -- -- -- -- -- -- --
Investors Fund
TRAVELERS SERIES FUND, INC.
Alliance Growth Portfolio 12/4/96 21.22% 23.92%* -- 6/20/94 27.24% 29.21% 25.91% --
MFS Total Return Portfolio 12/4/96 12.33% 11.43%* -- 6/20/94 19.56% 18.70% 14.94%* --
THE TRAVELERS SERIES TRUST
Convertible Bond Portfoli 5/1/98 -- -- -- -- -- -- -- --
Disciplined Mid Cap Stock Portfolio 4/1/97 13.46%* -- -- 4/1/97 33.00%* -- -- --
Disciplined Small Cap Stock 5/1/98 -- -- -- -- -- -- --
Portfolio
Equity Income Portfolio 12/4/96 24.47% 25.70%* -- 8/30/96 30.48% 32.07% -- --
Federated High Yield Portfolio 12/4/96 7.84% 7.39%* -- 8/30/96 13.85% 15.99%* -- --
Federated Stock Portfolio 12/4/96 25.65% 20.76%* -- 8/30/96 31.67% 33.78%* -- --
Large Cap Portfolio 12/4/96 15.72% 17.13% -- 8/30/96 21.74% 26.74%* -- --
Lazard International Stock 12/4/96 0.61% 3.25%* -- 8/30/96 6.63% 9.88%* -- --
Portfolio
MFS Emerging Growth Portfolio 12/4/96 13.33% 12.81%* -- 8/30/96 19.34% 18.80%* -- --
MFS Mid Cap Growth Portfolio 3/23/98 -- -- -- -- -- -- --
Travelers Quality Bond Portfolio 12/4/96 -0.37% -0.25%* -- 8/30/96 5.65% 6.57%* -- --
WARBURG PINCUS TRUST
Emerging Markets Portfolio 5/1/98 -- -- -- -- -- -- -- --
</TABLE>

* Figures represent period "Since Inception," as defined below.

6
<PAGE> 101

TRAVELERS PREMIER ADVISERS
VARIABLE ANNUITY
FUND PERFORMANCE AS OF 12/31/97

<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
NONSTANDARDIZED PERFORMANCE
- ----------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE RETURNS AVERAGE ANNUAL RETURNS
-------------------------------------------------------------------------------------
FUND NAME 1 YR 3 Y 5 YR 10 YR 3 YR 5 YR 10 YR SINCE INCEPTION
INCEPTION DATE
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MORGAN STANLEY UNIVERSAL FUNDS, INC.:
Emerging Markets Equity Portfolio -1.09% -- -- -- -- -- -- -2.76% 10/1/96
Global Equity Portfolio -- -- -- -- -- -- -- 18.57% 1/2/97
MAS Mid Cap Value Portfolio -- -- -- -- -- -- -- 39.40% 1/2/97
MAS Value Portfolio -- -- -- -- -- -- -- 19.50% 1/2/97
- ----------------------------------------------------------------------------------------------------------------------------------

VAN KAMPEN AMERICAN CAPITAL LIFE
INVESTMENT TRUST:
Domestic Income Portfolio 10.36% 28.15% 38.62% 76.90% 8.60% 6.74% 5.86% 5.90% 11/4/87
Emerging Growth Portfolio 18.77% -- -- -- -- -- -- 20.37% 7/3/95
Enterprise Portfolio 32.46% 117.01% 122.98% 340.64% 29.41% 17.39% 15.97% 11.14% 4/7/86
Government Portfolio 8.10% 25.78% 25.82% 90.87% 7.93% 4.70% 6.67% 5.62% 4/7/86
Growth and Income Portfolio 19.90% -- -- -- -- -- -- 19.05% 12/23/96
Morgan Stanley Real Estate
Securities Portfolio 19.83% -- -- -- -- -- -- 26.09% 7/3/95
Money Market Portfolio 3.60% 11.44% 15.38% 48.40% 3.67% 2.90% 4.02% 4.12% 4/7/86
- ----------------------------------------------------------------------------------------------------------------------------------

SALOMON BROTHERS VARIABLE
SERIES FUNDS, INC.:
Salomon Brothers Variable
Investors Fund -- -- -- -- -- -- -- -- 2/17/98
Salomon Brothers Variable High
Yield Bond Fund -- -- -- -- -- -- -- -- 2/17/98
Salomon Brothers Variable
Capital Fund -- -- -- -- -- -- -- -- 2/17/98
Salomon Brothers Variable
Strategic Bond Fund -- -- -- -- -- -- -- -- 2/17/98
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

7
<PAGE> 102

FEDERAL TAX CONSIDERATIONS

The following description of the federal income tax consequences under
this Contract is not exhaustive and is not intended to cover all situations.
Because of the complexity of the law and the fact that the tax results will vary
according to the factual status of the individual involved, tax advice may be
needed by a person contemplating purchase of an annuity contract and by a
contract owner or beneficiary who may make elections under a contract. For
further information, please consult a qualified tax adviser.

MANDATORY DISTRIBUTIONS FOR QUALIFIED PLANS

Federal tax law requires that minimum annual distributions begin by
April 1st of the calendar year following the calendar year in which a
participant under a qualified plan, a Section 403(b) annuity, or an IRA attains
age 70 1/2. Distributions must also begin or be continued according to required
patterns following the death of the contract owner or the annuitant.

NONQUALIFIED ANNUITY CONTRACTS

Individuals may purchase tax-deferred annuities without tax law funding
limits. The purchase payments receive no tax benefit, deduction or deferral, but
increases in the value of the contract are generally deferred from tax until
distribution. If a nonqualified annuity is owned by other than an individual,
however, (e.g., by a corporation), the increases in value attributable to
purchase payments made after February 28, 1986 are includable in income
annually. Furthermore, for contracts issued after April 22, 1987, all deferred
increases in value will be includable in the income of a contract owner when the
contract owner transfers the contract without adequate consideration.

If two or more annuity contracts are purchased from the same insurer
within the same calendar year, distributions from any of them will be taxed
based upon the amount of income in all of the same calendar year series of
annuities. This will generally have the effect of causing taxes to be paid
sooner on the deferred gain in the contracts.

Those receiving partial distributions made before the maturity date will
generally be taxed on an income-first basis to the extent of income in the
contract. If you are exchanging another annuity contract for this annuity,
certain pre-August 14, 1982 deposits into an annuity contract that have been
placed in the contract by means of a tax-deferred exchange under Section 1035 of
the Code may be withdrawn first without income tax liability. This information
on deposits must be provided to the Company by the other insurance company at
the time of the exchange. There is income in the contract generally to the
extent the cash value exceeds the investment in the contract. The investment in
the contract is equal to the amount of premiums paid less any amount received
previously which was excludable from gross income. Any direct or indirect
borrowing against the value of the contract or pledging of the contract as
security for a loan will be treated as a cash distribution under the tax law.

The federal tax law requires that nonqualified annuity contracts meet
minimum mandatory distribution requirements upon the death of the contract
owner, including the first of joint owners. Failure to meet these requirements
will cause the surviving joint owner, or the beneficiary, to lose the tax
benefits associated with annuity contracts, i.e., primarily the tax deferral
prior to distribution. The distribution required depends, among other things,
upon whether an annuity option is elected or whether the new contract owner is
the surviving spouse. Contracts will be administered by the Company in
accordance with these rules and the Company will make a notification when
payments should be commenced.

8
<PAGE> 103

INDIVIDUAL RETIREMENT ANNUITIES

To the extent of earned income for the year and not exceeding $2,000 per
individual, an individual may make deductible contributions to an individual
retirement annuity (IRA). There are certain limits on the deductible amount
based on the adjusted gross income of the individual and spouse and based on
their participation in a retirement plan. If an individual is married and the
spouse does not have earned income, the individual may establish IRAs for the
individual and spouse. Purchase payments may then be made annually into IRAs for
both spouses in the maximum amount of 100% of earned income up to a combined
limit of $4,000.

The Code provides for the purchase of a Simplified Employee Pension
(SEP) plan. A SEP is funded through an IRA with an annual employer contribution
limit of 15% of compensation up to $30,000 for each participant.

SIMPLE Plan IRA Form

Effective January 1, 1997, employers may establish a savings incentive
match plan for employees ("SIMPLE plan") under which employees can make elective
salary reduction contributions to an IRA based on a percentage of compensation
of up to $6,000. (Alternatively, the employer can establish a SIMPLE cash or
deferred arrangement under IRS Section 401(k)). Under a SIMPLE plan IRA, the
employer must either make a matching contribution of 100% on the first 3% or 7%
contribution for all eligible employees. Early withdrawals are subject to the
10% early withdrawal penalty generally applicable to IRAs, except that an early
withdrawal by an employee under a SIMPLE plan IRA, within the first two years of
participation, shall be subject to a 25% early withdrawal tax.

ROTH IRAS

Effective January 1, 1998, Section 408A of the Code permits certain
individuals to contribute to a Roth IRA. Eligibility to make contributions is
based upon income, and the applicable limits vary based on marital status and/or
whether the contribution is a rollover contribution from another IRA or an
annual contribution. Contributions to a Roth IRA, which are subject to certain
limitations ($2,000 per year for annual contributions), are not deductible and
must be made in cash or as a rollover or transfer from another Roth IRA or other
IRA. A conversion of a "traditional" IRA to a Roth IRA may be subject to tax and
other special rules apply. You should consult a tax adviser before combining any
converted amounts with other Roth IRA contributions, including any other
conversion amounts from other tax years.

Qualified distributions from a Roth IRA are tax-free. A qualified
distribution requires that the Roth IRA has been held for at least 5 years, and
the distribution is made after age 59 1/2, on death or disability of the owner,
or for a limited amount ($10,000) for a qualified first time home purchase for
the owner or certain relatives. Income tax and a 10% penalty tax may apply to
distributions made (1) before age 59 1/2 (subject to certain exceptions) or (2)
during five taxable years starting with the year in which the first contribution
is made to the Roth IRA.

9
<PAGE> 104

QUALIFIED PENSION AND PROFIT-SHARING PLANS

Under a qualified pension or profit-sharing plan, purchase payments made
by an employer are not currently taxable to the participant and increases in the
value of a contract are not subject to taxation until received by a participant
or beneficiary.

Distributions are taxable to the participant or beneficiary as ordinary
income in the year of receipt. Any distribution that is considered the
participant's "investment in the contract" is treated as a return of capital and
is not taxable. Certain lump-sum distributions may be eligible for special
forward averaging tax treatment for certain classes of individuals.

FEDERAL INCOME TAX WITHHOLDING
The portion of a distribution which is taxable income to the recipient
will be subject to federal income tax withholding as follows:

1. ELIGIBLE ROLLOVER DISTRIBUTION FROM SECTION 403(b) PLANS OR ARRANGEMENTS
OR FROM QUALIFIED PENSION AND PROFIT-SHARING PLANS

There is a mandatory 20% tax withholding for plan distributions that are
eligible for rollover to an IRA or to another retirement plan but that are not
directly rolled over. A distribution made directly to a participant or
beneficiary may avoid this result if:

(a) a periodic settlement distribution is elected based upon a life or
life expectancy calculation, or

(b) a term-for-years settlement distribution is elected for a period of
ten years or more, payable at least annually, or

(c) a minimum required distribution as defined under the tax law is taken
after the attainment of the age of 70 1/2 or as otherwise required by
law.

A distribution including a rollover that is not a direct rollover will
be subject to the 20% withholding, and a 10% additional tax penalty may apply to
any amount not added back in the rollover. The 20% withholding may be recovered
when the participant or beneficiary files a personal income tax return for the
year if a rollover was completed within 60 days of receipt of the funds, except
to the extent that the participant or spousal beneficiary is otherwise
underwithheld or short on estimated taxes for that year.

2. OTHER NON-PERIODIC DISTRIBUTIONS (FULL OR PARTIAL REDEMPTIONS)

To the extent not described as requiring 20% withholding in 1 above, the
portion of a non-periodic distribution which constitutes taxable income will be
subject to federal income tax withholding, if the aggregate distributions exceed
$200 for the year, unless the recipient elects not to have taxes withheld. If no
such election is made, 10% of the taxable distribution will be withheld as
federal income tax. Election forms will be provided at the time distributions
are requested. This form of withholding applies to all annuity programs.

10
<PAGE> 105

3. PERIODIC DISTRIBUTIONS (DISTRIBUTIONS PAYABLE OVER A PERIOD GREATER THAN ONE
YEAR)

The portion of a periodic distribution which constitutes taxable income
will be subject to federal income tax withholding under the wage withholding
tables as if the recipient were married claiming three exemptions. A recipient
may elect not to have income taxes withheld or have income taxes withheld at a
different rate by providing a completed election form. Election forms will be
provided at the time distributions are requested. This form of withholding
applies to all annuity programs. As of January 1, 1998, a recipient receiving
periodic payments (e.g., monthly or annual payments under an annuity option)
which total $15,200 or less per year, will generally be exempt from periodic
withholding.

Recipients who elect not to have withholding made are liable for payment
of federal income tax on the taxable portion of the distribution. All recipients
may also be subject to penalties under the estimated tax payment rules if
withholding and estimated tax payments are not sufficient to cover tax
liabilities.

Recipients who do not provide a social security number or other taxpayer
identification number will not be permitted to elect out of withholding.
Additionally, U.S citizens residing outside of the country, or U.S. legal
residents temporarily residing outside the country, are not permitted to elect
out of withholding.

INDEPENDENT ACCOUNTANTS

Financial statements as of December 31, 1997 and for the period April
28, 1997 (date operations commenced) to December 31, 1997 of Fund ABD, included
in the Annual Report incorporated by reference in this SAI, have been
incorporated herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.

The consolidated financial statements of the Travelers Insurance Company
and Subsidiaries as of December 31, 1997 and 1996, and for each of the years in
the three-year period ended December 31, 1997, have been included herein in
reliance upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, appearing elsewhere herein, and upon the authority of said firm as
experts in accounting and auditing.

11
<PAGE> 106
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES

INDEPENDENT AUDITORS' REPORT

The Board of Directors and Shareholder
The Travelers Insurance Company and Subsidiaries:

We have audited the accompanying consolidated balance sheets of The Travelers
Insurance Company and Subsidiaries as of December 31, 1997 and 1996, and the
related consolidated statements of income and retained earnings and cash flows
for each of the years in the three-year period ended December 31, 1997. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of The Travelers
Insurance Company and Subsidiaries as of December 31, 1997 and 1996, and the
results of their operations and their cash flows for each of the years in the
three-year period ended December 31, 1997, in conformity with generally accepted
accounting principles.

/s/ KPMG Peat Marwick LLP
Hartford, Connecticut
January 26, 1998

F-1
<PAGE> 107
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
($ IN MILLIONS)

<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1997 1996 1995
------ ------ ------
<S> <C> <C> <C>
REVENUES
Premiums $1,583 $1,387 $1,504
Net investment income 2,037 1,950 1,884
Realized investment gains 199 65 106
Other revenues 354 284 204
- -------------------------------------------------------------------------------------------
Total Revenues $4,173 $3,686 $3,698
- -------------------------------------------------------------------------------------------

BENEFITS AND EXPENSES
Current and future insurance benefits 1,341 1,187 1,206
Interest credited to contractholders 829 863 997
Amortization of deferred acquisition costs and value of
insurance in force 293 281 290
General and administrative expenses 427 380 368
- -------------------------------------------------------------------------------------------
Total Benefits and Expenses 2,890 2,711 2,861
- -------------------------------------------------------------------------------------------

Income from continuing operations before federal income taxes 1,283 975 837
- -------------------------------------------------------------------------------------------

Federal income taxes:
Current expense 434 284 233
Deferred 10 58 57
- -------------------------------------------------------------------------------------------
Total Federal Income Taxes 444 342 290
- -------------------------------------------------------------------------------------------

Income from continuing operations 839 633 547
- -------------------------------------------------------------------------------------------
Discontinued operations, net of income taxes
Income from operations (net of taxes of $0, $0 and $18) -- -- 72
Gain on disposition (net of taxes of $0, $14 and $68) -- 26 131
- -------------------------------------------------------------------------------------------
Income from Discontinued Operations -- 26 203
- -------------------------------------------------------------------------------------------

Net income 839 659 750
Retained earnings beginning of year 2,471 2,312 1,562
Dividends to parent 500 500 --
- -------------------------------------------------------------------------------------------
Retained Earnings End of Year $2,810 $2,471 $2,312
===========================================================================================
</TABLE>

See Notes to Consolidated Financial Statements.

F-2
<PAGE> 108
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
($ IN MILLIONS)

<TABLE>
<CAPTION>
December 31, 1997 1996
- ----------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Fixed maturities, available for sale at fair value (cost,
$20,682; $19,284) $21,511 $19,637
Equity securities, at fair value (cost, $480; $330) 512 338
Mortgage loans 2,869 2,920
Real estate held for sale 134 297
Trading securities, at market value 800 --
Policy loans 1,872 1,910
Short-term securities 1,102 902
Other invested assets 1,702 1,253
- ----------------------------------------------------------------------------------
Total Investments $30,502 $27,257
- ----------------------------------------------------------------------------------

Cash 58 74
Investment income accrued 338 355
Premium balances receivable 106 105
Reinsurance recoverables 4,339 3,858
Deferred acquisition costs and value of insurance in force 2,312 2,133
Separate and variable accounts 11,319 8,127
Other assets 1,052 1,064
- ----------------------------------------------------------------------------------
Total Assets $50,026 $42,973
- ----------------------------------------------------------------------------------

LIABILITIES
Contractholder funds 14,913 14,189
Future policy benefits 12,569 11,762
Policy and contract claims 378 536
Trading securities sold not yet purchased, at market value 462 --
Separate and variable accounts 11,309 8,115
Commercial paper -- 50
Deferred federal income taxes 409 57
Other liabilities 2,661 1,936
- ----------------------------------------------------------------------------------
Total Liabilities $42,701 $36,645
- ----------------------------------------------------------------------------------

SHAREHOLDER'S EQUITY
Common stock, par value $2.50; 40 million shares authorized,
issued and outstanding 100 100
Additional paid-in capital 3,187 3,170
Retained earnings 2,810 2,471
Unrealized investment gains, net of taxes 1,228 587
- ----------------------------------------------------------------------------------
Total Shareholder's Equity $ 7,325 $ 6,328
- ----------------------------------------------------------------------------------

Total Liabilities and Shareholder's Equity $50,026 $42,973
==================================================================================
</TABLE>

See Notes to Consolidated Financial Statements.

F-3
<PAGE> 109
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH
($ IN MILLIONS)

<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1997 1996 1995
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Premiums collected $ 1,519 $ 1,387 $ 1,346
Net investment income received 2,059 1,910 1,855
Other revenues received 180 131 90
Benefits and claims paid (1,230) (1,060) (846)
Interest credited to contractholders (853) (820) (960)
Operating expenses paid (445) (343) (615)
Income taxes paid (368) (328) (63)
Trading account investments, (purchases) sales, net (54) -- --
Other 18 (70) (137)
- ----------------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 826 807 670
Net cash used in discontinued operations -- (350) (596)
- ----------------------------------------------------------------------------------------------------------------------
Net Cash Provided by Operations $ 826 $ 457 $ 74
- ----------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities of investments
Fixed maturities 2,259 1,928 1,974
Mortgage loans 663 917 680
Proceeds from sales of investments
Fixed maturities 7,592 9,101 6,773
Equity securities 341 479 379
Mortgage loans 207 178 704
Real estate held for sale 169 210 253
Purchases of investments
Fixed maturities (11,143) (11,556) (10,748)
Equity securities (483) (594) (305)
Mortgage loans (771) (470) (144)
Policy loans, net 38 (23) (325)
Short-term securities, (purchases) sales, net (2) 498 291
Other investments, (purchases) sales, net (260) (137) (267)
Securities transactions in course of settlement 311 (52) 258
Net cash provided by investing activities of discontinued operations -- 348 1,425
- ----------------------------------------------------------------------------------------------------------------------
Net Cash Provided by (used in) Investing Activities $ (1,079) $ 827 $ 948
- ----------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Redemption of commercial paper, net (50) (23) (1)
Contractholder fund deposits 3,544 2,493 2,705
Contractholder fund withdrawals (2,757) (3,262) (3,755)
Dividends to parent company (500) (500) --
Other -- 9 --
- ----------------------------------------------------------------------------------------------------------------------
Net Cash Provided by (used in) Financing Activities $ 237 $ (1,283) $ (1,051)
- ----------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash $ (16) $ 1 $ (29)
- ----------------------------------------------------------------------------------------------------------------------
Cash at December 31, $ 58 $ 74 $ 73
======================================================================================================================
</TABLE>

See Notes to Consolidated Financial Statements.

F-4
<PAGE> 110
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Significant accounting policies used in the preparation of the accompanying
financial statements follow.

Basis of Presentation

The Travelers Insurance Company and Subsidiaries (the Company) is a wholly
owned subsidiary of The Travelers Insurance Group Inc. (TIGI), an indirect
wholly owned subsidiary of Travelers Group Inc. (Travelers Group). The
consolidated financial statements include the accounts of the Company and its
insurance and non-insurance subsidiaries on a fully consolidated basis. The
primary insurance subsidiaries of the Company are The Travelers Life and
Annuity Company (TLAC) and Primerica Life Insurance Company (Primerica Life)
and its subsidiary National Benefit Life Insurance Company (NBL).

- TRAVELERS LIFE AND ANNUITY offers fixed and variable deferred annuities,
payout annuities and term, universal and variable life and long-term care
insurance to individuals and small businesses. It also provides group
pension products, including guaranteed investment contracts and group
annuities for employer-sponsored retirement and savings plans. These
products are primarily marketed through The Copeland Companies (Copeland),
an indirect, wholly owned subsidiary of the Company, the Financial
Consultants of Salomon Smith Barney, an affiliate of the Company, and a
nationwide network of independent agents. The Company's Corporate and
Other Segment was absorbed into Travelers Life and Annuity during the
second quarter of 1996.

- PRIMERICA LIFE INSURANCE offers individual life products, primarily term
insurance, to consumers through a nationwide sales force of approximately
80,000 full and part-time independent agents.

As discussed in Note 2 of Notes to Consolidated Financial Statements, in
January 1995 the group life insurance and related businesses of the Company
were sold to Metropolitan Life Insurance Company (MetLife). Also in January
1995, the group medical component was exchanged for a 42% interest in The
MetraHealth Companies, Inc. (MetraHealth). The Company's interest in
MetraHealth was sold on October 2, 1995 and through that date was accounted
for on the equity method. The Company's discontinued operations reflect the
results of the medical insurance business not transferred, the equity
interest in the earnings of MetraHealth through October 2, 1995 (date of
sale) and the gains from the sales of these businesses.

In September 1995, Travelers Group made a pro rata distribution to its
stockholders of shares of Class A Common Stock of Transport Holdings Inc.,
which at the time was a wholly owned subsidiary of Travelers Group and was
the indirect owner of the business of Transport Life Insurance Company
(Transport Life). Immediately prior to this distribution, the Company
distributed Transport Life, an indirect wholly owned subsidiary of the
Company, to TIGI, as a return of capital.

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and benefits and expenses during the
reporting period. Actual results could differ from those estimates.

Certain prior year amounts have been reclassified to conform with the 1997
presentation.
F-5
<PAGE> 111
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Accounting Changes

EMPLOYERS' DISCLOSURES ABOUT PENSIONS AND OTHER POSTRETIREMENT BENEFITS

In February, 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 132, "Employers' Disclosures
about Pensions and Other Postretirement Benefits" (FAS 132). FAS 132
supersedes the disclosure requirements in FASB Statements No. 87, "Employers'
Accounting for Pensions," No. 88, "Employers' Accounting for Settlements and
Curtailments of Defined Benefits Pension Plans and Termination of Benefits,"
and No. 106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions." FAS 132 addresses disclosure only and does not address measurement
or recognition. In addition to other disclosure changes, FAS 132 allows
employers to disclose total contributions to multi-employer plans without
disaggregating the amounts attributable to pensions and other postretirement
benefits. This statement is effective for fiscal years beginning after
December 15, 1997. Earlier application is encouraged. Effective December 31,
1997, the Company adopted FAS 132. The adoption of this standard did not have
any impact on results of operations, financial condition or liquidity.

ACCOUNTING FOR TRANSFERS AND SERVICING OF FINANCIAL ASSETS AND
EXTINGUISHMENTS OF LIABILITIES

Effective January 1, 1997, the Company adopted Statement of Financial
Accounting Standards No. 125, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities" (FAS 125). FAS 125
establishes accounting and reporting standards for transfers and servicing of
financial assets and extinguishments of liabilities. These standards are
based on an approach that focuses on control. Under this approach, after a
transfer of financial assets, an entity recognizes the financial and
servicing assets it controls and the liabilities it has incurred,
derecognizes financial assets when control has been surrendered, and
derecognizes liabilities when extinguished. FAS 125 provides standards for
distinguishing transfers of financial assets that are sales from transfers
that are secured borrowings. The requirements of FAS 125 are effective for
transfers and servicing of financial assets and extinguishments of
liabilities occurring after December 31, 1996, and are to be applied
prospectively. However, in December 1996 the FASB issued Statement of
Financial Accounting Standards No. 127, "Deferral of the Effective Date of
Certain Provisions of FASB Statement No. 125," which delays until January 1,
1998 the effective date for certain provisions. Application of FAS 125 prior
to the effective date or retroactively is not permitted. The adoption of the
provisions of FAS 125 effective January 1, 1997 did not have a material
impact on results of operations, financial condition or liquidity. The
adoption of the provisions of FAS 127 effective January, 1998 are
not expected to have a material impact on the results of operations,
financial condition or liquidity.

ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS
TO BE DISPOSED OF

Effective January 1, 1996, the Company adopted Statement of Financial
Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of." This statement
establishes accounting standards for the impairment of long-lived assets and
certain identifiable intangibles to be disposed. This statement requires a
write down to fair value when long-lived assets to be held and used are
impaired. The statement also requires long-lived assets to be disposed (e.g.,
real estate held for sale) be carried at the lower of cost or fair value less
cost to sell, and does not allow such assets to be depreciated. The adoption
of this standard did not have a material impact on the Company's financial
condition, results of operations or liquidity.

F-6
<PAGE> 112
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

ACCOUNTING FOR STOCK-BASED COMPENSATION

In October 1995, the FASB issued Statement of Financial Accounting Standards
No. 123, "Accounting for Stock-Based Compensation" (FAS 123). This statement
establishes financial accounting and reporting standards for stock-based
employee compensation plans as well as transactions in which an entity issues
its equity instruments to acquire goods or services from non-employees. This
statement defines a fair value-based method of accounting for employee stock
options or similar equity instruments, and encourages all entities to adopt
this method of accounting for all employee stock compensation plans. However,
it also allows an entity to continue to measure compensation cost for those
plans using the intrinsic value-based method of accounting prescribed by
Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees" (APB 25). Entities electing to remain with the accounting method
prescribed in APB 25 must make pro-forma disclosures of net income and
earnings per share, as if the fair value-based method of accounting defined
by FAS 123 had been applied. FAS 123 is applicable to fiscal years beginning
after December 15, 1995. The Company has elected to continue to account for
its stock-based employee compensation plans using the accounting method
prescribed by APB 25 and has included in the notes to consolidated financial
statements the pro-forma disclosures required by FAS 123. See Note 9. The
Company has adopted FAS 123 for its stock-based non-employee compensation
plans.

Accounting Policies

INVESTMENTS

Fixed maturities include bonds, notes and redeemable preferred stocks. Fair
values of investments in fixed maturities are based on quoted market prices
or dealer quotes or, if these are not available, discounted expected cash
flows using market rates commensurate with the credit quality and maturity of
the investment. Also included in fixed maturities are loan-backed and
structured securities, which are amortized using the retrospective method.
Fixed maturities are classified as "available for sale" and are reported at
fair value, with unrealized investment gains and losses, net of income taxes,
charged or credited directly to shareholder's equity.

Equity securities, which include common and nonredeemable preferred stocks,
are classified as "available for sale" and carried at fair value based
primarily on quoted market prices. Changes in fair values of equity
securities are charged or credited directly to shareholder's equity, net of
income taxes.

Mortgage loans are carried at amortized cost. A mortgage loan is considered
impaired when it is probable that the Company will be unable to collect
principal and interest amounts due. For mortgage loans that are determined to
be impaired, a reserve is established for the difference between the
amortized cost and fair market value of the underlying collateral. In
estimating fair value, the Company uses interest rates reflecting the higher
returns required in the current real estate financing market. Impaired loans
were insignificant at December 31, 1997 and 1996.

Real estate held for sale is carried at the lower of cost or fair value less
estimated cost to sell. Fair value of foreclosed properties is established at
the time of foreclosure by internal analysis or external appraisers, using
discounted cash flow analyses and other accepted techniques. Thereafter, an
allowance for losses on real estate held for sale is established if the
carrying value of the property exceeds its current fair value less estimated
costs to sell. There was no such allowance at December 31, 1997 and 1996.

F-7
<PAGE> 113
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Trading securities are carried at market value. Realized and unrealized gains
and losses on trading securities are included in investment income.

Short-term securities, consisting primarily of money market instruments and
other debt issues purchased with a maturity of less than one year, are
carried at amortized cost which approximates market.

Accrual of income, included in other assets, is suspended on fixed maturities
or mortgage loans that are in default, or on which it is likely that future
payments will not be made as scheduled. Interest income on investments in
default is recognized only as payment is received.

DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses derivative financial instruments, including financial
futures contracts, equity options, forward contracts and interest rate swaps
and caps, as a means of hedging exposure to interest rate, equity price and
foreign currency risk. Hedge accounting is used to account for derivatives.
To qualify for hedge accounting the changes in value of the derivative must
be expected to substantially offset the changes in value of the hedged item.
Hedges are monitored to ensure that there is a high correlation between the
derivative instruments and the hedged investment.

Gains and losses arising from financial futures contracts are used to adjust
the basis of hedged investments and are recognized in net investment income
over the life of the investment.

Forward contracts, equity options, and interest rate swaps and caps were not
significant at December 31, 1997 and 1996. Information concerning derivative
financial instruments is included in Note 6.

INVESTMENT GAINS AND LOSSES

Realized investment gains and losses are included as a component of pretax
revenues based upon specific identification of the investments sold on the
trade date. Also included are gains and losses arising from the remeasurement
of the local currency value of foreign investments to U.S. dollars, the
functional currency of the Company. The foreign exchange effects of Canadian
operations are included in unrealized gains and losses.

POLICY LOANS

Policy loans are carried at the amount of the unpaid balances that are not in
excess of the net cash surrender values of the related insurance policies.
The carrying value of policy loans, which have no defined maturities, is
considered to be fair value.

DEFERRED ACQUISITION COSTS AND VALUE OF INSURANCE IN FORCE

Costs of acquiring individual life insurance, annuities and long-term care
business, principally commissions and certain expenses related to policy
issuance, underwriting and marketing, all of which vary with and are
primarily related to the production of new business, are deferred.
Acquisition costs relating to traditional life insurance, including term
insurance and long-term care insurance, are amortized in relation to
anticipated premiums; universal life in relation to estimated gross profits;
and annuity contracts employing a level yield method. For life insurance, a
10- to 25-year amortization period is used; for long-term care business, a
10- to 20-year period is used, and a 10- to 20-year period is employed for
annuities. Deferred acquisition costs are reviewed periodically for
recoverability to determine if any adjustment is required.

F-8
<PAGE> 114
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The value of insurance in force is an asset recorded at the time of
acquisition of an insurance company. It represents the actuarially determined
present value of anticipated profits to be realized from life insurance,
annuities and health contracts at the date of acquisition using the same
assumptions that were used for computing related liabilities where
appropriate. The value of insurance in force was the actuarially determined
present value of the projected future profits discounted at interest rates
ranging from 14% to 18%. Traditional life insurance and guaranteed renewable
health policies are amortized in relation to anticipated premiums; universal
life is amortized in relation to estimated gross profits; and annuity
contracts are amortized employing a level yield method. The value of
insurance in force is reviewed periodically for recoverability to determine
if any adjustment is required.

SEPARATE AND VARIABLE ACCOUNTS

Separate and variable accounts primarily represent funds for which investment
income and investment gains and losses accrue directly to, and investment
risk is borne by, the contractholders. Each account has specific investment
objectives. The assets of each account are legally segregated and are not
subject to claims that arise out of any other business of the Company. The
assets of these accounts are carried at market value. Certain other separate
accounts provide guaranteed levels of return or benefits and the assets of
these accounts are primarily carried at market value. Amounts assessed to the
contractholders for management services are included in revenues. Deposits,
net investment income and realized investment gains and losses for these
accounts are excluded from revenues, and related liability increases are
excluded from benefits and expenses.

GOODWILL

Goodwill represents the cost of acquired businesses in excess of net assets
and is being amortized on a straight-line basis principally over a 40-year
period. The carrying amount is regularly reviewed for indication of
impairment in value that in the view of management would be other than
temporary. Impairments would be recognized in operating results if a
permanent diminution in value is deemed to have occurred.

CONTRACTHOLDER FUNDS

Contractholder funds represent receipts from the issuance of universal life,
pension investment and certain deferred annuity contracts. Contractholder
fund balances are increased by such receipts and credited interest and
reduced by withdrawals, mortality charges and administrative expenses charged
to the contractholders. Interest rates credited to contractholder funds range
from 3.5% to 9.45%.

FUTURE POLICY BENEFITS

Benefit reserves represent liabilities for future insurance policy benefits.
Benefit reserves for life insurance and annuities have been computed based
upon mortality, morbidity, persistency and interest assumptions applicable to
these coverages, which range from 2.5% to 10.0%, including adverse deviation.
These assumptions consider Company experience and industry standards. The
assumptions vary by plan, age at issue, year of issue and duration.
Appropriate recognition has been given to experience rating and reinsurance.

F-9
<PAGE> 115
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

PERMITTED STATUTORY ACCOUNTING PRACTICES

The Company, whose insurance subsidiaries are domiciled principally in
Connecticut and Massachusetts, prepares statutory financial statements in
accordance with the accounting practices prescribed or permitted by the
insurance departments of those states. Prescribed statutory accounting
practices include certain publications of the National Association of
Insurance Commissioners as well as state laws, regulations, and general
administrative rules. Permitted statutory accounting practices encompass all
accounting practices not so prescribed. The impact of any permitted
accounting practices on statutory surplus of the Company is not material.

PREMIUMS

Premiums are recognized as revenues when due. Reserves are established for
the portion of premiums that will be earned in future periods and for
deferred profits on limited-payment policies that are being recognized in
income over the policy term.

OTHER REVENUES

Other revenues include surrender, mortality and administrative charges and
fees as earned on investment, universal life and other insurance contracts.
Other revenues also include gains and losses on dispositions of assets and
operations other than realized investment gains and losses and revenues of
non-insurance subsidiaries.

INTEREST CREDITED TO CONTRACTHOLDERS

Interest credited to contractholders represents amounts earned by universal
life, pension investment and certain deferred annuity contracts in accordance
with contract provisions.

FEDERAL INCOME TAXES

The provision for federal income taxes is comprised of two components,
current income taxes and deferred income taxes. Deferred federal income taxes
arise from changes during the year in cumulative temporary differences
between the tax basis and book basis of assets and liabilities. The deferred
federal income tax asset is recognized to the extent that future realization
of the tax benefit is more likely than not, with a valuation allowance for
the portion that is not likely to be recognized.

Future Application of Accounting Standards

In December 1997, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of
Position 97-3, "Accounting by Insurance and Other Enterprises for
Insurance-Related Assessments" (SOP 97-3). SOP 97-3 provides guidance for
determining when an entity should recognize a liability for guaranty-fund and
other insurance-related assessments, how to measure that liability, and when
an asset may be recognized for the recovery of such assessments through
premium tax offsets or policy surcharges. This SOP is effective for financial
statements for fiscal years beginning after December 15, 1998, and the effect
of initial adoption is to be reported as a cumulative catch-up adjustment.
Restatement of previously issued financial statements is not allowed. The
Company has not yet determined when it will implement this SOP and does not
anticipate any material impact on the Company's financial condition, results
of operations or liquidity.

F-10
<PAGE> 116
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

In June 1997, the FASB issued Statement of Financial Accounting Standards No.
130, "Reporting Comprehensive Income" (FAS 130). FAS 130 establishes
standards for the reporting and display of comprehensive income and its
components in a full set of general-purpose financial statements. All items
that are required to be recognized under accounting standards as components
of comprehensive income are to be reported in a financial statement that is
displayed with the same prominence as other financial statements. FAS 130
stipulates that comprehensive income reflect the change in equity of an
enterprise during a period from transactions and other events and
circumstances from non-owner sources. Comprehensive income will thus
represent the sum of net income and other comprehensive income, although FAS
130 does not require the use of the terms comprehensive income or other
comprehensive income. The accumulated balance of other comprehensive income
shall be displayed separately from retained earnings and additional paid-in
capital in the statement of financial position. FAS 130 is effective for
fiscal years beginning after December 15, 1997. The Company anticipates that
the adoption of FAS 130 will result primarily in reporting unrealized gains
and losses on investments in debt and equity securities in comprehensive
income.

In June 1997, the FASB also issued Statement of Financial Accounting
Standards No. 131, "Disclosures About Segments of an Enterprise and Related
Information" (FAS 131). FAS 131 establishes standards for the way that public
enterprises report information about operating segments in annual financial
statements and requires that selected information about those operating
segments be reported in interim financial statements. FAS 131 supersedes
Statement of Financial Accounting Standards No. 14, "Financial Reporting for
Segments of a Business Enterprise" (FAS 14). FAS 131 requires that all
public enterprises report financial and descriptive information about its
reportable operating segments. Operating segments are defined as components
of an enterprise about which separate financial information is available that
is evaluated regularly by the chief operating decision maker in deciding how
to allocate resources and in assessing performance. FAS 131 is effective for
fiscal years beginning after December 15, 1997. The Company is currently
determining the impact of the adoption of FAS 131.

2. DISPOSITIONS AND DISCONTINUED OPERATIONS

On January 3, 1995, the Company and its affiliates completed the sale of
their group life and related non-medical group insurance businesses to
MetLife for $350 million and recognized in the first quarter of 1995 a gain
of $20 million net of taxes. In connection with the sale, the Company ceded
100% of its risks in the group life and related businesses to MetLife on an
indemnity reinsurance basis, effective January 1, 1995. In connection with
the reinsurance transaction, the Company transferred assets with a fair
market value of approximately $1.5 billion to MetLife, equal to the statutory
reserves and other liabilities transferred.

On January 3, 1995, the Company and MetLife and certain of their affiliates,
formed the MetraHealth joint venture by contributing their group medical
businesses to MetraHealth, in exchange for shares of common stock of
MetraHealth. No gain was recognized as a result of this transaction . Upon
formation of the joint venture, the Company owned 42% of the outstanding
capital stock of MetraHealth, TIGI owned 8% and the other 50% was owned by
MetLife and its affiliates. In March 1995, MetraHealth acquired HealthSpring,
Inc. for common stock of MetraHealth resulting in a reduction in the
participation of the Company and TIGI, and MetLife in the MetraHealth venture
to 48.25% each. As the medical insurance business of the Company came due for
renewal, the risks were transferred to MetraHealth and the related operating
results for this medical insurance business were reported by the Company in
1995 as part of discontinued operations.

F-11
<PAGE> 117
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

On October 2, 1995, the Company and its affiliates completed the sale of
their ownership in MetraHealth to United HealthCare Corporation and through
that date had accounted for its interest in MetraHealth on the equity method.
Gross proceeds to the Company in 1995 were $708 million in cash, an after-tax
gain of $111 million was recognized. During 1996 the Company received a
contingency payment based on MetraHealth's 1995 results. In conjunction with
this payment, certain reserves associated with the group medical business and
exit costs related to the discontinued operations were reevaluated resulting
in a final after-tax gain of $26 million.

All of the businesses sold to MetLife or contributed to MetraHealth were
included in the Company's Managed Care and Employee Benefit Operations
(MCEBO) segment prior to 1995. The Company's discontinued operations in 1996
and 1995 reflect the results of the medical insurance business not
transferred, the equity interest in the earnings of MetraHealth through
October 2, 1995 (date of sale) and the gains from sales of these businesses.
Revenues from discontinued operations were insignificant for the year ended
December 31, 1996 and $1.2 billion for the year ended December 31, 1995.

In September 1995, Travelers Group made a pro rata distribution to its
stockholders of shares of Class A Common Stock of Transport Holdings Inc.,
which at the time was a wholly owned subsidiary of Travelers Group and was
the indirect owner of the business of Transport Life. Immediately prior to
this distribution, the Company distributed Transport, an indirect wholly
owned subsidiary of the Company, to TIGI as a return of capital, resulting in
a reduction in additional paid-in capital of $334 million. The results of
Transport through September 1995 are included in income from continuing
operations.

3. COMMERCIAL PAPER AND LINES OF CREDIT

The Company issues commercial paper directly to investors. No commercial
paper was outstanding at December 31, 1997 and $50 million was outstanding at
December 31, 1996. The Company maintains unused credit availability under
bank lines of credit at least equal to the amount of the outstanding
commercial paper. Interest expense related to the commercial paper was not
significant in 1997 or 1996.

Travelers Group, Commercial Credit Company (CCC) (an indirect wholly owned
subsidiary of Travelers Group) and the Company have an agreement with a
syndicate of banks to provide $1.0 billion of revolving credit, to be
allocated to any of Travelers Group, CCC or the Company. The Company's
participation in this agreement is limited to $250 million. The revolving
credit facility consists of a five-year revolving credit facility that
expires in 2001. At December 31, 1997, $50 million was allocated to the
Company. Under this facility the Company is required to maintain certain
minimum equity and risk-based capital levels. At December 31, 1997, the
Company was in compliance with these provisions. There were no amounts
outstanding under this agreement at December 31, 1997 and 1996. If the
Company had borrowings on this facility, the interest rate would be based
upon LIBOR plus a negotiated margin.

F-12
<PAGE> 118
\ THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

4. REINSURANCE

The Company participates in reinsurance in order to limit losses, minimize
exposure to large risks, provide additional capacity for future growth and to
effect business-sharing arrangements. Reinsurance is accomplished through
various plans of reinsurance, primarily yearly renewable term coinsurance and
modified coinsurance. The Company remains primarily liable as the direct
insurer on all risks reinsured. During 1997, new universal life business was
reinsured under an 80%/20% quota share reinsurance program and new term life
business was reinsured under a 90%/10% quota share reinsurance program.
Maximum retention of $1.5 million is generally reached on policies in excess
of $7.5 million. For other plans of insurance, it is the policy of the
Company to obtain reinsurance for amounts above certain retention limits on
individual life policies, which limits vary with age and underwriting
classification. Generally, the maximum retention on an ordinary life risk is
$1.5 million.

The Company writes workers' compensation business through its Accident
Department. This business is ceded 100% to an affiliate, The Travelers
Indemnity Company.

A summary of reinsurance financial data reflected within the consolidated
statement of operations and retained earnings is presented below ($ in
millions):

<TABLE>
<CAPTION>
---------------------------------------------------------------------
WRITTEN PREMIUMS 1997 1996 1995
---------------------------------------------------------------------
<S> <C> <C> <C>
Direct $2,148 $1,982 $2,166
Assumed from:
Non-affiliated companies 1 5 --
Ceded to:
Affiliated companies (280) (284) (374)
Non-affiliated companies (273) (309) (302)
---------------------------------------------------------------------
Total Net Written Premiums $1,596 $1,394 $1,490
=====================================================================

<CAPTION>
---------------------------------------------------------------------
EARNED PREMIUMS 1997 1996 1995
---------------------------------------------------------------------
<S> <C> <C> <C>
Direct $2,170 $1,897 $2,067
Assumed from:
Non-affiliated companies 1 5 --
Ceded to:
Affiliated companies (321) (219) (283)
Non-affiliated companies (291) (315) (298)
---------------------------------------------------------------------
Total Net Earned Premiums $1,559 $1,368 $1,486
=====================================================================
</TABLE>

F-13
<PAGE> 119
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Reinsurance recoverables at December 31, 1997 and 1996 include amounts
recoverable on unpaid and paid losses and were as follows ($ in millions):

<TABLE>
<CAPTION>
----------------------------------------------------------
REINSURANCE RECOVERABLES 1997 1996
----------------------------------------------------------
<S> <C> <C>
Life and Accident and Health
Business:
Non-affiliated companies $1,362 $1,497
Property-Casualty Business:
Affiliated companies 2,977 2,361
----------------------------------------------------------
Total Reinsurance Recoverables $4,339 $3,858
==========================================================
</TABLE>

Total reinsurance recoverables at December 31, 1997 and 1996 include $697
million and $720 million, respectively, from MetLife in connection with the
sale of the Company's group life and related businesses. See Note 2.

5. SHAREHOLDER'S EQUITY

Additional Paid-In Capital

The increase of $17 million in additional paid-in capital during 1997 is due
to tax benefits related to exercising Travelers Group stock options by the
Company's employees.

Unrealized Investment Gains (Losses)

An analysis of the change in unrealized gains and losses on investments is
shown in Note 13.

Shareholder's Equity and Dividend Availability

The Company's statutory net income, which includes all insurance
subsidiaries, was $754 million, $656 million, and $235 million for the years
ended December 31, 1997, 1996 and 1995, respectively.

The Company's statutory capital and surplus was $4.12 billion and $3.44
billion at December 31, 1997 and 1996, respectively.

The Company is currently subject to various regulatory restrictions that
limit the maximum amount of dividends available to be paid to its parent
without prior approval of insurance regulatory authorities. Statutory surplus
of $551 million is available in 1998 for dividend payments by the Company
without prior approval of the Connecticut Insurance Department. In addition,
under a revolving credit facility, the Company is required to maintain
certain minimum equity and risk based capital levels. The Company is in
compliance with these covenants at December 31, 1997 and 1996.

F-14
<PAGE> 120
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

6. DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS

Derivative Financial Instruments

The Company uses derivative financial instruments, including financial
futures, equity options, forward contracts and interest rate swaps as a means
of hedging exposure to foreign currency, equity price changes and/or interest
rate risk on anticipated transactions or existing assets and liabilities. The
Company does not hold or issue derivative instruments for trading purposes.

These derivative financial instruments have off-balance sheet risk. Financial
instruments with off-balance sheet risk involve, to varying degrees, elements
of credit and market risk in excess of the amount recognized in the balance
sheet. The contract or notional amounts of these instruments reflect the
extent of involvement the Company has in a particular class of financial
instrument. However, the maximum loss of cash flow associated with these
instruments can be less than these amounts. For forward contracts and
interest rate swaps, credit risk is limited to the amounts calculated to be
due the Company on such contracts. Financial futures contracts and purchased
listed option contracts have little credit risk since organized exchanges are
the counterparties.

The Company monitors creditworthiness of counterparties to these financial
instruments by using criteria of acceptable risk that are consistent with
on-balance sheet financial instruments. The controls include credit
approvals, limits and other monitoring procedures.

The Company uses exchange traded financial futures contracts to manage its
exposure to changes in interest rates which arise from the sale of certain
insurance and investment products, or the need to reinvest proceeds from the
sale or maturity of investments. To hedge against adverse changes in interest
rates, the Company enters long or short positions in financial futures
contracts to offset asset price changes resulting from changes in market
interest rates until an investment is purchased or a product is sold.

Margin payments are required to enter a futures contract and contract gains
or losses are settled daily in cash. The contract amount of futures contracts
represents the extent of the Company's involvement, but not future cash
requirements, as open positions are typically closed out prior to the
delivery date of the contract.

At December 31, 1997 and 1996, the Company held financial futures contracts
with notional amounts of $625 million and $169 million, respectively, and a
deferred gain of $.7 million and a deferred loss of $4.1 million and a
deferred gain of $1.2 million, and a deferred loss of $.1 million,
respectively. Total losses of $5.8 million and gains of $2.0 million from
financial futures were deferred at December 31, 1997 and 1996, respectively,
relating to anticipated investment purchases and investment product sales,
and are reported as other liabilities. At December 31, 1997 and 1996, the
Company's futures contracts had no fair value because these contracts were
marked to market and settled in cash daily.

The off-balance sheet risks of equity options, forward contracts, and
interest rate swaps were not significant at December 31, 1997 and 1996.

F-15
<PAGE> 121
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The Company purchased a 5-year interest rate cap, with a notional amount of
$200 million, from Travelers Group in 1995 to hedge against losses that could
result from increasing interest rates. This instrument, which does not have
off-balance sheet risk, gives the Company the right to receive payments if
interest rates exceed specific levels at specific dates. The premium of $2
million paid for this instrument is being amortized over its life. The
interest rate cap asset is reported at fair value which is $0 and $1 million
at December 31, 1997 and 1996, respectively.

Financial Instruments with Off-Balance Sheet Risk

In the normal course of business, the Company issues fixed and variable rate
loan commitments and has unfunded commitments to partnerships. The
off-balance sheet risk of these financial instruments was not significant at
December 31, 1997 and 1996.

Fair Value of Certain Financial Instruments

The Company uses various financial instruments in the normal course of its
business. Fair values of financial instruments that are considered insurance
contracts are not required to be disclosed and are not included in the
amounts discussed.

At December 31, 1997 and 1996, investments in fixed maturities had a carrying
value and a fair value of $21.5 billion and $19.6 billion, respectively. See
Notes 1 and 13.

At December 31, 1997 and 1996, mortgage loans had a carrying value of $2.9
billion, which approximated fair value. In estimating fair value, the Company
used interest rates reflecting the higher returns required in the current
real estate financing market.

The carrying values of $143 million and $174 million of financial instruments
classified as other assets approximated their fair values at December 31,
1997 and 1996, respectively. The carrying values of $2.0 billion and $850
million of financial instruments classified as other liabilities also
approximated their fair values at December 31, 1997 and 1996, respectively.
Fair value is determined using various methods, including discounted cash
flows, as appropriate for the various financial instruments.

At December 31, 1997, contractholder funds with defined maturities had a
carrying value of $2.3 billion and a fair value of $2.3 billion, compared
with a carrying value of $1.4 billion and a fair value of $1.5 billion at
December 31, 1996. The fair value of these contracts is determined by
discounting expected cash flows at an interest rate commensurate with the
Company's credit risk and the expected timing of cash flows. Contractholder
funds without defined maturities had a carrying value of $9.7 billion and a
fair value of $9.5 billion at December 31, 1997, compared with a carrying
value of $9.1 billion and a fair value of $8.8 billion at December 31, 1996.
These contracts generally are valued at surrender value.

The assets of separate accounts providing a guaranteed return had a carrying
value and a fair value of $260 million and $260 million, respectively, at
December 31, 1997, compared with a carrying value and a fair value of $217
million and $217 million, respectively, at December 31, 1996. The liabilities
of separate accounts providing a guaranteed return had a carrying value and a
fair value of $209 million and $206 million, respectively, at December 31,
1997, compared with a carrying value and a fair value of $208 million and
$204 million, respectively, at December 31, 1996.

F-16
<PAGE> 122
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The carrying values of cash, short-term securities, trading securities,
investment income accrued, trading securities sold not purchased, and
commercial paper approximated their fair values.

The carrying value of policy loans, which have no defined maturities, is
considered to be fair value.

7. COMMITMENTS AND CONTINGENCIES

Financial Instruments with Off-Balance Sheet Risk

See Note 6 for a discussion of financial instruments with off-balance sheet
risk.

Litigation

In March 1997, a purported class action entitled Patterman v. The Travelers,
Inc. was commenced in the Superior Court of Richmond County, Georgia,
alleging, among other things, violations of the Georgia RICO statute and
other state laws by an affiliate of the Company, Primerica Financial
Services, Inc. and certain of its affiliates. Plaintiffs seek unspecified
compensatory and punitive damages and other relief. In April 1997, the
lawsuit was removed to the U.S. District Court for the Southern District of
Georgia, and in October 1997, the lawsuit was remanded to the Superior Court
of Richmond County. Later in October 1997, the defendants answered the
complaint, denied liability and asserted numerous affirmative defenses. In
February 1998, the Superior Court of Richmond County transferred the lawsuit
to the Superior Court of Gwinnett County, Georgia, and certified the transfer
order for immediate appellate review. Also in February 1998, plaintiffs
served an application for appellate review of the transfer order; defendants
subsequently opposed that application; and later in February 1998, the Court
of Appeals of the State of Georgia granted plaintiffs' application for
appellate review. Pending appeal proceedings in the trial court have been
stayed. The Company intends to vigorously contest the litigation.

The Company is also a defendant or co-defendant in various other litigation
matters in the normal course of business. Although there can be no
assurances, as of December 31, 1997, the Company believes, based on
information currently available, that the ultimate resolution of these legal
proceedings would not be likely to have a material adverse effect on its
results of operations, financial condition or liquidity.

8. BENEFIT PLANS

Pension and Other Postretirement Benefits

The Company participates in a qualified, noncontributory defined benefit
pension plan sponsored by an affiliate. In addition, the Company provides
certain other postretirement benefits to retired employees through a plan
sponsored by an affiliate. The Company's share of net expense for the
qualified pension and other postretirement benefit plans was not significant
for 1997, 1996 and 1995. Beginning January 1, 1996, the Company's other
postretirement benefit plans were amended to restrict benefit eligibility to
retirees and certain retiree-eligible employees. Previously, covered
employees could become eligible for postretirement benefits if they reached
retirement age while working for the Company.

F-17
<PAGE> 123
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Through plans sponsored by TIGI, the Company also provides defined
contribution pension plans for certain agents. Company contributions are
primarily a function of production. The expense for these plans was not
significant in 1997, 1996 and 1995.

401(k) Savings Plan

Substantially all of the Company's employees are eligible to participate in a
401(k) savings plan sponsored by Travelers Group. Prior to January 1, 1996,
the Company made matching contributions to the 401(k) savings plan on behalf
of participants in the amount of 50% of the first 5% of pre-tax contributions
made by the employee, plus an additional variable matching contribution based
on the profitability of TIGI and its subsidiaries. During 1996, the Company
made matching contributions in an amount equal to the lesser of 100% of the
pre-tax contributions made by the employee or $1,000. Effective January 1,
1997, the Company discontinued matching contributions for the majority of its
employees. The Company's expenses in connection with the 401(k) savings plan
were not significant in 1997, 1996 and 1995.

9. RELATED PARTY TRANSACTIONS

The principal banking functions, including payment of salaries and expenses,
for certain subsidiaries and affiliates of TIGI are handled by two companies.
The Travelers Insurance Company (Life Department) handles banking functions
for the life and annuity operations of Travelers Life and Annuity and some of
its non-insurance affiliates. The Travelers Indemnity Company handles banking
functions for the property-casualty operations, including most of its
property-casualty insurance and non-insurance affiliates. Settlements between
companies are made at least monthly. The Company provides various employee
benefits coverages to employees of certain subsidiaries of TIGI. The premiums
for these coverages were charged in accordance with cost allocation
procedures based upon salaries or census. In addition, investment advisory
and management services, data processing services and claims processing
services are shared with affiliated companies. Charges for these services are
shared by the companies on cost allocation methods based generally on
estimated usage by department.

The Company maintains a short-term investment pool in which its insurance
affiliates participate. The position of each company participating in the
pool is calculated and adjusted daily. At December 31, 1997 and 1996, the
pool totaled approximately $2.6 billion and $2.9 billion, respectively. The
Company's share of the pool amounted to $725 million and $196 million at
December 31, 1997 and 1996, respectively, and is included in short-term
securities in the consolidated balance sheet.

The Company sells structured settlement annuities to The Travelers Indemnity
Company in connection with the settlement of certain policyholder
obligations. Such deposits were $88 million, $40 million, and $38 million for
1997, 1996 and 1995, respectively.

The Company markets deferred annuity products and life and health insurance
through its affiliate, Salomon Smith Barney. Premiums and deposits related to
these products were $1.0 billion, $820 million, and $583 million in 1997,
1996 and 1995, respectively.

At December 31, 1996, the Company had an investment of $22 million in bonds
of its affiliate, CCC. This was included in fixed maturities in the
consolidated balance sheet.

F-18
<PAGE> 124
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The Company had an investment of $1.15 billion and $648 million in common
stock of Travelers Group at December 31, 1997 and 1996, respectively. This
investment is carried at fair value.

The Company participates in a stock option plan sponsored by Travelers Group
that provides for the granting of stock options in Travelers Group common
stock to officers and key employees. To further encourage employee stock
ownership, during 1997 Travelers Group introduced the WealthBuilder stock
option program. Under this program all employees meeting certain requirements
have been granted Travelers Group stock options.

The Company applies APB 25 and related interpretations in accounting for
stock options. Since stock options under the Travelers Group plans are issued
at fair market value on the date of award, no compensation cost has been
recognized for these awards. FAS 123 provides an alternative to APB 25
whereby fair values may be ascribed to options using a valuation model and
amortized to compensation cost over the vesting period of the options.

Had the Company applied FAS 123 in accounting for Travelers Group stock
options, net income would have been the pro forma amounts indicated below:

<TABLE>
<CAPTION>
-----------------------------------------------------------------------
YEAR ENDING DECEMBER 31, 1997 1996 1995
($ IN MILLIONS)
-----------------------------------------------------------------------
<S> <C> <C> <C>
Net income, as reported $839 $659 $750
-----------------------------------------------------------------------
FAS 123 pro forma adjustments, (9) (3) (1)
after tax
-----------------------------------------------------------------------
Net income, pro forma $830 $656 $749
</TABLE>

The Company has an interest rate cap agreement with Travelers Group. See Note
6.

10. LEASES

Most leasing functions for TIGI and its subsidiaries are administered by TAP.
In 1996, TAP assumed the obligations for several leases. Rent expense related
to all leases are shared by the companies on a cost allocation method based
generally on estimated usage by department. Rent expense was $15 million, $24
million, and $22 million in 1997, 1996 and 1995, respectively.

<TABLE>
<CAPTION>
--------------------------------------------------
YEAR ENDING DECEMBER 31, MINIMUM OPERATING
($ in millions) RENTAL PAYMENTS
--------------------------------------------------
<S> <C>
1998 $ 49
1999 44
2000 43
2001 45
2002 43
Thereafter 337
--------------------------------------------------
Total Rental Payments $561
==================================================
</TABLE>

F-19
<PAGE> 125
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Future sublease rental income of approximately $73 million will partially
offset these commitments. Also, the Company will be reimbursed for 50% of the
rental expense for a particular lease totaling $218 million, by an affiliate.
Minimum future capital lease payments are not significant.

The Company is reimbursed for use of furniture and equipment through cost
sharing agreements by its affiliates.

11. FEDERAL INCOME TAXES

<TABLE>
<CAPTION>
EFFECTIVE TAX RATE
---------------------------------------------------------------------
For The Year Ended December 31, 1997 1996 1995
($ in millions)
---------------------------------------------------------------------
<S> <C> <C> <C>
Income Before Federal Income Taxes $1,283 $ 975 $ 837
Statutory Tax Rate 35% 35% 35%
---------------------------------------------------------------------
Expected Federal Income Taxes 449 341 293
Tax Effect of:
Non-taxable investment income (4) (3) (4)
Other, net (1) 4 1
=====================================================================
Federal Income Taxes $ 444 $ 342 $ 290
=====================================================================
Effective Tax Rate 35% 35% 35%
---------------------------------------------------------------------

COMPOSITION OF FEDERAL INCOME TAXES
Current:
United States $ 410 $ 263 $ 220
Foreign 24 21 13
---------------------------------------------------------------------
Total 434 284 233
---------------------------------------------------------------------
Deferred:
United States 10 57 52
Foreign -- 1 5
---------------------------------------------------------------------
Total 10 58 57
---------------------------------------------------------------------
Federal Income Taxes $ 444 $ 342 $ 290
=====================================================================
</TABLE>

Tax benefits allocated directly to shareholder's equity for the years ended
December 31, 1997, 1996 and 1995 were $17 million, $8 million and $7 million,
respectively.

F-20
<PAGE> 126
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The net deferred tax liabilities at December 31, 1997 and 1996 were comprised
of the tax effects of temporary differences related to the following assets
and liabilities:

<TABLE>
<CAPTION>
($ in millions) 1997 1996
------- -------
<S> <C> <C>
Deferred Tax Assets:
Benefit, reinsurance and other reserves $ 550 $ 510
Contractholder funds 11 32
Operating lease reserves 68 71
Other employee benefits 102 104
Other 139 121
- -----------------------------------------------------------------------------------
Total 870 838
- -----------------------------------------------------------------------------------
Deferred Tax Liabilities:
Deferred acquisition costs and value of 608 571
insurance in force
Investments, net 484 131
Other 87 93
- -----------------------------------------------------------------------------------
Total 1,179 795
- -----------------------------------------------------------------------------------
Net Deferred Tax (Liability) Asset Before Valuation Allowance (309) 43
Valuation Allowance for Deferred Tax Assets (100) (100)
- -----------------------------------------------------------------------------------
Net Deferred Tax Liability After Valuation Allowance $ (409) $ (57)
- -----------------------------------------------------------------------------------
</TABLE>

Starting in 1994 and continuing for at least five years, the Company and its
life insurance subsidiaries will file a consolidated federal income tax
return. Federal income taxes are allocated to each member of the consolidated
group on a separate return basis adjusted for credits and other amounts
required by the consolidation process. Any resulting liability will be paid
currently to the Company. Any credits for losses will be paid by the Company
to the extent that such credits are for tax benefits that have been utilized
in the consolidated federal income tax return.

A net deferred tax asset valuation allowance of $100 million has been
established to reduce the deferred tax asset on investment losses to the
amount that, based upon available evidence, is more likely than not to be
realized. Reversal of the valuation allowance is contingent upon the
recognition of future capital gains in the Company's consolidated life
insurance company federal income tax return through 1998, and if
life/non-life consolidation is elected in 1999, the consolidated federal
income tax return of Travelers Group commencing in 1999, or a change in
circumstances which causes the recognition of the benefits to become more
likely than not. There was no change in the valuation allowance during 1997.
The initial recognition of any benefit produced by the reversal of the
valuation allowance will be recognized by reducing goodwill.

At December 31, 1997, the Company had no ordinary or capital loss
carryforwards.

The policyholders surplus account, which arose under prior tax law, is
generally that portion of the gain from operations that has not been
subjected to tax, plus certain deductions. The balance of this account,
which, under provisions of the Tax Reform Act of 1984, will not increase
after 1983, is estimated to be $932 million. This amount has not been
subjected to current income taxes but, under certain conditions that
management considers to be remote, may become subject to income taxes in
future years. At current rates, the maximum amount of such tax (for which no
provision has been made in the financial statements) would be approximately
$326 million.

F-21
<PAGE> 127
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

12. NET INVESTMENT INCOME

<TABLE>
<CAPTION>
---------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997 1996 1995
($ in millions)
---------------------------------------------------------------------
<S> <C> <C> <C>
GROSS INVESTMENT INCOME
Fixed maturities $1,460 $1,387 $1,248
Mortgage loans 291 334 419
Policy loans 137 156 166
Real estate held for sale 88 94 111
Other, including trading 150 77 97
securities
---------------------------------------------------------------------
2,126 2,048 2,041
---------------------------------------------------------------------
Investment expenses 89 98 157
---------------------------------------------------------------------
Net investment income $2,037 $1,950 $1,884
---------------------------------------------------------------------
</TABLE>

13. INVESTMENTS AND INVESTMENT GAINS (LOSSES)

Realized investment gains (losses) for the periods were as follows:

<TABLE>
<CAPTION>
---------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997 1996 1995
($ in millions)
---------------------------------------------------------------------
<S> <C> <C> <C>
REALIZED INVESTMENT GAINS
Fixed maturities $71 $(63) $(43)
Equity securities (9) 47 36
Mortgage loans 59 49 47
Real estate held for sale 67 33 18
Other 11 (1) 48
---------------------------------------------------------------------
Total Realized Investment Gains $199 $65 $106
---------------------------------------------------------------------
</TABLE>

F-22
<PAGE> 128
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Changes in net unrealized investment gains (losses) that are included as a
separate component of shareholder's equity were as follows:

<TABLE>
<CAPTION>
-------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997 1996 1995
($ in millions)
-------------------------------------------------------------------------
<S> <C> <C> <C>
UNREALIZED INVESTMENT GAINS
Fixed maturities $ 446 $ (323) $1,974
Equity securities 25 (35) 46
Other 520 220 200
-------------------------------------------------------------------------
Total Realized Investment Gains 991 (138) 2,220
-------------------------------------------------------------------------

Related taxes 350 (43) 778
-------------------------------------------------------------------------
Change in unrealized investment gains
(losses) 641 (95) 1,442
Balance beginning of year 587 682 (760)
-------------------------------------------------------------------------
Balance End of Year $1,228 $ 587 $ 682
-------------------------------------------------------------------------
</TABLE>

Included in Other are gains of $506 million, $203 million and $214 million
for 1997, 1996 and 1995, respectively, related to appreciation of Travelers
Group stock.

Fixed Maturities

Proceeds from sales of fixed maturities classified as available for sale were
$7.6 billion, $10.2 billion and $6.8 billion in 1997, 1996 and 1995,
respectively. Gross gains of $170 million, $107 million and $80 million and
gross losses of $99 million, $175 million and $124 million in 1997, 1996 and
1995, respectively, were realized on those sales.

Fair values of investments in fixed maturities are based on quoted market
prices or dealer quotes or, if these are not available, discounted expected
cash flows using market rates commensurate with the credit quality and
maturity of the investment. The fair value of investments for which a quoted
market price or dealer quote are not available amounted to $5.1 billion and
$4.6 billion at December 31, 1997 and 1996, respectively.

F-23
<PAGE> 129
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The amortized cost and fair value of investments in fixed maturities were as
follows:

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
DECEMBER 31, 1997 GROSS GROSS
($ in millions) AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AVAILABLE FOR SALE:
Mortgage-backed securities - CMOs and
pass-through securities $ 3,842 $ 124 $ 2 $ 3,964
U.S. Treasury securities and obligations
of U.S. Government and government
agencies and authorities 1,580 149 1 1,728
Obligations of states, municipalities
and political subdivisions 78 8 -- 86
Debt securities issued by
foreign governments 622 31 4 649
All other corporate bonds 14,548 547 24 15,071
Redeemable preferred stock 12 1 -- 13
- ---------------------------------------------------------------------------------------
Total Available For Sale $20,682 860 31 $21,511
- ---------------------------------------------------------------------------------------

<CAPTION>
- ----------------------------------------------------------------------------------------
DECEMBER 31, 1996 GROSS GROSS
($ in millions) AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AVAILABLE FOR SALE:
Mortgage-backed securities - CMOs and
pass-through securities $ 3,821 $ 71 $ 23 $ 3,869
U.S. Treasury securities and obligations
of U.S. Government and government
agencies and authorities 1,329 56 4 1,381
Obligations of states, municipalities and
political subdivisions 89 1 1 89
Debt securities issued by foreign
governments 618 26 3 641
All other corporate bonds 13,421 273 43 13,651
Redeemable preferred stock 6 -- -- 6
- ----------------------------------------------------------------------------------------
Total Available For Sale $19,284 $ 427 $ 74 $19,637
- ----------------------------------------------------------------------------------------
</TABLE>

F-24
<PAGE> 130

THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The amortized cost and fair value of fixed maturities at December 31, 1997,
by contractual maturity, are shown below. Actual maturities will differ from
contractual maturities because borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties.

<TABLE>
<CAPTION>
----------------------------------------------------------
($ in millions) AMORTIZED FAIR
COST VALUE
----------------------------------------------------------
<S> <C> <C>
MATURITY:
Due in one year or less $ 1,184 $ 1,191
Due after 1 year through 5 years 5,200 5,335
Due after 5 years through 10 years 5,332 5,515
Due after 10 years 5,124 5,506
---------------------------------------------------------
16,840 17,547
---------------------------------------------------------
Mortgage-backed securities 3,842 3,964
---------------------------------------------------------
Total Maturity $20,682 $21,511
---------------------------------------------------------
</TABLE>

The Company makes investments in collateralized mortgage obligations (CMOs).
CMOs typically have high credit quality, offer good liquidity, and provide a
significant advantage in yield and total return compared to U.S. Treasury
securities. The Company's investment strategy is to purchase CMO tranches
which are protected against prepayment risk, including planned amortization
class (PAC) tranches. Prepayment protected tranches are preferred because
they provide stable cash flows in a variety of interest rate scenarios. The
Company does invest in other types of CMO tranches if a careful assessment
indicates a favorable risk/return tradeoff. The Company does not purchase
residual interests in CMOs.

At December 31, 1997 and 1996, the Company held CMOs classified as available
for sale with a fair value of $2.1 billion and $2.0 billion, respectively.
Approximately 72% and 88%, respectively, of the Company's CMO holdings are
fully collateralized by GNMA, FNMA or FHLMC securities at December 31, 1997
and 1996. In addition, the Company held $1.9 billion and $1.9 billion of
GNMA, FNMA or FHLMC mortgage-backed pass-through securities at December 31,
1997 and 1996, respectively. Virtually all of these securities are rated AAA.

F-25
<PAGE> 131
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Equity Securities
The cost and fair values of investments in equity securities were as follows:

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------
EQUITY SECURITIES:
GROSS GROSS
($ in millions) UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
DECEMBER 31, 1997
Common stocks $179 $ 34 $ 11 $202
Non-redeemable preferred stocks 301 13 4 310
-----------------------------------------------------------------------------
Total Equity Securities $480 $ 47 $ 15 $512
-----------------------------------------------------------------------------

DECEMBER 31, 1996
Common stocks $212 $ 39 $ 30 $221
Non-redeemable preferred stocks 118 2 3 117
-----------------------------------------------------------------------------
Total Equity Securities $330 $ 41 $ 33 $338
-----------------------------------------------------------------------------
</TABLE>

Proceeds from sales of equity securities were $341 million, $487 million and
$379 million in 1997, 1996 and 1995, respectively. Gross gains of $53
million, $64 million and $27 million and gross losses of $62 million, $11
million and $2 million in 1997, 1996 and 1995, respectively, were realized on
those sales.

Mortgage Loans and Real Estate Held For Sale

Underperforming assets include delinquent mortgage loans, loans in the
process of foreclosure, foreclosed loans and loans modified at interest rates
below market.

At December 31, 1997 and 1996, the Company's mortgage loan and real estate
held for sale portfolios consisted of the following ($ in millions):

<TABLE>
<CAPTION>
----------------------------------------------------------
1997 1996
----------------------------------------------------------
<S> <C> <C>
Current Mortgage Loans $2,866 $2,869
Underperforming Mortgage Loans 3 51
----------------------------------------------------------
Total 2,869 2,920
----------------------------------------------------------

Real Estate Held For Sale 134 297
----------------------------------------------------------
Total $3,003 $3,217
----------------------------------------------------------
</TABLE>

F-26
<PAGE> 132
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Aggregate annual maturities on mortgage loans at December 31, 1997 are as
follows:

<TABLE>
<CAPTION>
------------------------------------------------
YEAR ENDING DECEMBER 31,
($ in millions)
------------------------------------------------
<S> <C>
Past Maturity $ 54
1998 243
1999 252
2000 321
2001 393
2002 121
Thereafter 1,485
------------------------------------------------
Total $2,869
================================================
</TABLE>

Joint Venture

In October 1997, the Company and Tishman Speyer Properties (Tishman), a
worldwide real estate owner, developer and manager, formed a joint real
estate venture with an initial equity commitment of $792 million. The Company
and certain of its affiliates committed $420 million in real estate equity
and $100 million in cash while Tishman committed $272 million in properties
and cash. Both companies are serving as asset managers for the venture and
Tishman is primarily responsible for the venture's real estate acquisition
and development efforts.

Trading Securities

Trading securities are held in a special purpose subsidiary, Tribeca
Investments LLC.

<TABLE>
<CAPTION>
-----------------------------------------------------
TRADING SECURITIES OWNED 1997
<S> <C>
Merger arbitrage $352
Convertible bond arbitrage 370
Other 78
-----------------------------------------------------
Total $800
-----------------------------------------------------

TRADING SECURITIES SOLD NOT YET PURCHASED

Merger arbitrage $213
Convertible bond arbitrage 249
-----------------------------------------------------
Total $462
-----------------------------------------------------
</TABLE>

The Company's trading portfolio investments and related liabilities are
normally held for periods less than six months. Therefore, expected future
cash flows for these assets and liabilities are expected to be realized in
less than one year.

F-27
<PAGE> 133
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Concentrations

At December 31, 1997 and 1996, the Company had no concentration of credit
risk in a single investee exceeding 10% of consolidated shareholder's equity.

The Company participates in a short-term investment pool maintained by an
affiliate. See Note 9.

Included in fixed maturities are below investment grade assets totaling $1.4
billion and $1.1 billion at December 31, 1997 and 1996, respectively. The
Company defines its below investment grade assets as those securities rated
"Ba1" or below by external rating agencies, or the equivalent by internal
analysts when a public rating does not exist. Such assets include publicly
traded below investment grade bonds and certain other privately issued bonds
that are classified as below investment grade loans.

The Company had concentrations of investments, primarily fixed maturities, in
the following industries:

<TABLE>
<CAPTION>
-------------------------------------------------
($ in millions) 1997 1996
-------------------------------------------------
<S> <C> <C>
Banking $2,215 $1,959
Finance 1,556 1,823
Electric Utilities 1,377 1,093
Asset-Backed Credit Cards 778 688
-------------------------------------------------
</TABLE>

Below investment grade assets included in the preceding table were not
significant.

At December 31, 1997 and 1996, concentrations of mortgage loans were for
properties located in highly populated areas in the states listed below:

<TABLE>
<CAPTION>
-------------------------------------------------
($ in millions) 1997 1996
-------------------------------------------------
<S> <C> <C>
California $794 $643
New York 310 297
-------------------------------------------------
</TABLE>

Other mortgage loan investments are relatively evenly dispersed throughout
the United States, with no holdings in any state exceeding $284 million and
$258 million at December 31, 1997 and 1996, respectively.

Concentrations of mortgage loans by property type at December 31, 1997 and
1996 were as follows:

<TABLE>
<CAPTION>
-------------------------------------------------
($ in millions) 1997 1996
-------------------------------------------------
<S> <C> <C>
Office $1,382 $1,208
Agricultural 771 693
Apartment 204 291
Hotel 201 217
-------------------------------------------------
</TABLE>

F-28
<PAGE> 134
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The Company monitors creditworthiness of counterparties to all financial
instruments by using controls that include credit approvals, limits and other
monitoring procedures. Collateral for fixed maturities often includes pledges
of assets, including stock and other assets, guarantees and letters of
credit. The Company's underwriting standards with respect to new mortgage
loans generally require loan to value ratios of 75% or less at the time of
mortgage origination.

Non-Income Producing Investments

Investments included in the consolidated balance sheets that were non-income
producing for the preceding 12 months were insignificant.

Restructured Investments

The Company had mortgage loans and debt securities that were restructured at
below market terms totaling approximately $7 million and $18 million at
December 31, 1997 and 1996, respectively. The new terms typically defer a
portion of contract interest payments to varying future periods. The accrual
of interest is suspended on all restructured assets, and interest income is
reported only as payment is received. Gross interest income on restructured
assets that would have been recorded in accordance with the original terms of
such loans amounted to $.9 million in 1997 and $5 million in 1996. Interest
on these assets, included in net investment income, aggregated $.2 million
and $2 million in 1997 and 1996, respectively.

14. DEPOSIT FUNDS AND RESERVES

At December 31, 1997, the Company had $24.0 billion of life and annuity
deposit funds and reserves. Of that total, $13.0 billion is not subject to
discretionary withdrawal based on contract terms. The remaining $11.0 billion
is for life and annuity products that are subject to discretionary withdrawal
by the contractholder. Included in the amount that is subject to
discretionary withdrawal is $2.0 billion of liabilities that are
surrenderable with market value adjustments. Also included are an additional
$5.2 billion of the life insurance and individual annuity liabilities which
are subject to discretionary withdrawals, and have an average surrender
charge of 4.8%. In the payout phase, these funds are credited at
significantly reduced interest rates. The remaining $3.8 billion of
liabilities are surrenderable without charge. More than 16.8% of these relate
to individual life products. These risks would have to be underwritten again
if transferred to another carrier, which is considered a significant
deterrent against withdrawal by long-term policyholders. Insurance
liabilities that are surrendered or withdrawn are reduced by outstanding
policy loans and related accrued interest prior to payout.

F-29
<PAGE> 135
THE TRAVELERS INSURANCE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

15. RECONCILIATION OF NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES

The following table reconciles net income to net cash provided by operating
activities:

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997 1996 1995
($ in millions)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Income From Continuing Operations $ 839 $ 633 $ 547
Adjustments to reconcile net income to
net cash provided by operating activities:
Realized gains (199) (65) (106)
Deferred federal income taxes 10 58 57
Amortization of deferred policy
acquisition costs and value of
insurance in force 293 281 290
Additions to deferred policy
acquisition costs (471) (350) (454)
Investment income accrued 14 2 (9)
Premium balances receivable 3 (6) (8)
Insurance reserves and accrued expenses 131 (1) 291
Other 206 255 62
- --------------------------------------------------------------------------------
Net cash provided by operating activities 826 807 670
Net cash used in discontinued operations -- (350) (596)
Net cash provided by operations $ 826 $ 457 $ 74
- --------------------------------------------------------------------------------
</TABLE>

16. NON-CASH INVESTING AND FINANCING ACTIVITIES

Significant noncash investing and financing activities include: a) the
conversion of $119 million of real estate held for sale to other invested
assets as a joint venture in 1997; b) the 1995 transfer of assets with a fair
market value of approximately $1.5 billion and statutory reserves and other
liabilities of approximately $1.5 billion to MetLife (see Note 2); c) the
1995 return of capital of Transport to TIGI (see Note 2); d) the acquisition
of real estate through foreclosures of mortgage loans amounting to $10
million, $117 million and $97 million in 1997, 1996 and 1995, respectively;
e) the acceptance of purchase money mortgages for sales of real estate
aggregating $4 million, $23 million and $27 million in 1997, 1996 and 1995,
respectively.

F-30
<PAGE> 136

STATEMENT OF ADDITIONAL INFORMATION
FUND ABD

Individual Variable Annuity Contract
issued by

The Travelers Insurance Company
One Tower Square
Hartford, Connecticut 06183

L-12547S May, 1998

12
<PAGE> 137

PART C

OTHER INFORMATION

Item 24. Financial Statements and Exhibits

(a) The financial statements of the Registrant and the Report of Independent
Accountants thereto are contained in the Registrant's Annual Report and
are incorporated into the Statement of Additional Information by
reference. The financial statements of the Registrant include:

Statement of Assets and Liabilities as of December 31, 1997

Statement of Operations for the period April 28, 1997 (date
operations commenced) to December 31, 1997

Statement of Changes in Net Assets for the period April 28, 1997
(date operations commenced) to December 31, 1997 Statement of
Investments as of December 31, 1997

Notes to Financial Statements

The consolidated financial statements of The Travelers Insurance Company
and Subsidiaries and the report of Independent Accountants, are contained
in the Statement of Additional Information. The consolidated financial
statements of The Travelers Insurance Company and Subsidiaries include:

Consolidated Statements of Income and Retained Earnings for the
years ended December 31, 1997, 1996 and 1995

Consolidated Balance Sheets as of December 31, 1997 and 1996

Consolidated Statements of Cash Flows for the years ended December
31, 1997, 1996 and 1995

Notes to Consolidated Financial Statements

(b) Exhibits

1. Resolution of The Travelers Insurance Company Board of Directors
authorizing the establishment of the Registrant. (Incorporated herein by
reference to Exhibit 1 to the Registration Statement on Form N-4, filed
December 22, 1995.)

2. Exempt.

3(a). Distribution and Management Agreement among the Registrant, The
Travelers Insurance Company and Tower Square Securities, Inc.
(Incorporated herein by reference to Exhibit 3(a) to the Registration
Statement on Form N-4, filed December 22, 1995.)

3(b). Form of Selling Agreement. (Incorporated herein by reference to Exhibit
3(b) to the Registration Statement on Form N-4, filed April 28, 1997.)

4. Form of Variable Annuity Contract(s). (Incorporated herein by reference
to Exhibit 4 to the Registration Statement on Form N-4, filed June 17,
1996.)

5. None.

<PAGE> 138

6(a). Charter of The Travelers Insurance Company, as amended on October 19,
1994. (Incorporated herein by reference to Exhibit 3(a)(i) to
Registration Statement on Form S-2, File No. 33-58677, filed via Edgar
on April 18, 1995.)

6(b). By-Laws of The Travelers Insurance Company, as amended on October 20,
1994. (Incorporated herein by reference to Exhibit 3(b)(i) to the
Registration Statement on Form S-2, File No. 33-58677, filed via Edgar
on April 18, 1995.)

7. None.

8. None.

9. Opinion of Counsel as to the legality of securities being registered.
(Incorporated herein by reference to Exhibit 9 to Post-Effective
Amendment No. 3 to the Registration Statement on Form N-4 filed April
28, 1997.)

10(a). Consent of Coopers & Lybrand L.L.P., Independent Accountants.

10(b). Consent of KPMG Peat Marwick LLP, Independent Certified Public
Accountants.

13. Schedule for computation of each performance quotation - Standardized
and Non-Standardized. (Incorporated herein by reference to Exhibit 13 to
Post-Effective Amendment No. 3 to the Registration Statement on Form
N-4, filed April 28, 1997.)

15(a). Powers of Attorney authorizing Jay S. Fishman or Ernest J. Wright as
signatory for Robert I. Lipp, Michael A. Carpenter, Charles O. Prince
III, Marc P. Weill, Irwin R. Ettinger, Donald T. DeCarlo and Christine
B. Mead. (Incorporated herein by reference to Exhibit 15 to the
Registration Statement on Form N-4, filed December 22, 1995.)

15(b). Powers of Attorney authorizing Ernest J. Wright or Kathleen A. McGah as
signatory for Michael A. Carpenter, Ian R. Stuart and Katherine M.
Sullivan. (Incorporated herein by reference to Exhibit 15(b) to the
Registration Statement on Form N-4, filed June 17, 1996.)

15(c). Powers of Attorney authorizing Ernest J. Wright or Kathleen A. McGah as
signatory for Jay S. Benet and George C. Kokulis. (Incorporated herein
by reference to Exhibit 15(c) to Post-Effective Amendment No. 1 to the
Registration Statement on Form N-4, filed August 15, 1996.)

15(d). Powers of Attorney authorizing Ernest J. Wright or Kathleen A. McGah as
signatory for Ian R. Stuart. (Incorporated herein by reference to
Exhibit 15(d) to Post-Effective Amendment No. 2 to the Registration
Statement on Form N-4 filed February 28, 1997.)

<PAGE> 139

Item 25. Directors and Officers of the Depositor

<TABLE>
<CAPTION>
Name and Principal Positions and Offices
Business Address with Depositor
- ------------------ ---------------------
<S> <C>
Michael A. Carpenter* Director, Chairman of the Board
President and Chief Executive Officer
Jay S. Benet* Director and Senior Vice President
George C. Kokulis* Director and Senior Vice President
Robert I. Lipp* Director
Ian R. Stuart* Director, Senior Vice President,
Chief Financial Officer, Chief
Accounting Officer and Controller
Katherine M. Sullivan* Director and Senior Vice President
and General Counsel
Marc P. Weill** Director and Senior Vice President
Stuart Baritz** Senior Vice President
Jay S. Fishman* Senior Vice President
Elizabeth C. Georgakopoulos* Senior Vice President
Barry Jacobson* Senior Vice President
Russell H. Johnson* Senior Vice President
Warren H. May* Senior Vice President
Christine M. Modie* Senior Vice President
David A. Tyson* Senior Vice President
F. Denney Voss* Senior Vice President
Paula Burton* Vice President
Virginia M. Meany* Vice President
Selig Ehrlich* Vice President and Actuary
Donald R. Munson, Jr.* Second Vice President
Ernest J. Wright* Vice President and Secretary
Kathleen A. McGah* Assistant Secretary and Counsel
</TABLE>

Principal Business Address:
* The Travelers Insurance Company ** Travelers Group Inc.
One Tower Square 388 Greenwich Street
Hartford, CT 06183 New York, N.Y. 10013

Item 26. Persons Controlled by or Under Common Control with the Depositor or
Registrant

Incorporated herein by reference to Item 26 to Post Effective
Amendment No. 5 to the Registration Statement on Form N-4, File No. 33-73466,
filed April 10, 1998.

Item 27. Number of Contract Owners

As of March 1, 1998, 441 contract owners held qualified and non-qualified
contracts offered by the Registrant.

<PAGE> 140

Item 28. Indemnification

Section 33-770 of the Connecticut General Statutes ("C.G.S.") regarding
indemnification of directors and officers of Connecticut corporations provides
in general that Connecticut corporations shall indemnify their officers,
directors and certain other defined individuals against judgments, fines,
penalties, amounts paid in settlement and reasonable expenses actually incurred
in connection with proceedings against the corporation. The corporation's
obligation to provide such indemnification generally does not apply unless (1)
the individual is successful on the merits in the defense of any such
proceeding; or (2) a determination is made (by persons specified in the statute)
that the individual acted in good faith and in the best interests of the
corporation; or (3) the court, upon application by the individual, determines in
view of all of the circumstances that such person is fairly and reasonably
entitled to be indemnified, and then for such amount as the court shall
determine. With respect to proceedings brought by or in the right of the
corporation, the statute provides that the corporation shall indemnify its
officers, directors and certain other defined individuals, against reasonable
expenses actually incurred by them in connection with such proceedings, subject
to certain limitations.

C.G.S. Section 33-770 provides an exclusive remedy; a Connecticut corporation
cannot indemnify a director or officer to an extent either greater or less than
that authorized by the statute, e.g., pursuant to its certificate of
incorporation, by-laws, or any separate contractual arrangement. However, the
statute does specifically authorize a corporation to procure indemnification
insurance to provide greater indemnification rights. The premiums for such
insurance may be shared with the insured individuals on an agreed basis.

Travelers Group Inc. also provides liability insurance for its directors and
officers and the directors and officers of its subsidiaries, including the
Depositor. This insurance provides for coverage against loss from claims made
against directors and officers in their capacity as such, including, subject to
certain exceptions, liabilities under the Federal securities laws.

Rule 484 Undertaking

Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liability (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

<PAGE> 141

Item 29. Principal Underwriter

(a) Tower Square Securities, Inc.
One Tower Square
Hartford, CT 06183

Tower Square Securities, Inc. also serves as the principal underwriter for:

The Travelers Growth and Income Stock Account for Variable Annuities
The Travelers Quality Bond Account for Variable Annuities
The Travelers Money Market Account for Variable Annuities
The Travelers Timed Growth and Income Stock Account for Variable
Annuities
The Travelers Timed Short-Term Bond Account for Variable Annuities
The Travelers Timed Aggressive Stock Account for Variable Annuities
The Travelers Timed Bond Account for Variable Annuities
The Travelers Fund U for Variable Annuities
The Travelers Fund VA for Variable Annuities
The Travelers Fund BD for Variable Annuities
The Travelers Fund BD II for Variable Annuities
The Travelers Fund BD III for Variable Annuities
The Travelers Fund BD IV for Variable Annuities
The Travelers Fund ABD II for Variable Annuities
The Travelers Separate Account QP for Variable Annuities
The Travelers Separate Account PF for Variable Annuities
The Travelers Separate Account PF II for Variable Annuities
The Travelers Fund UL for Variable Life Insurance
The Travelers Fund UL II for Variable Life Insurance
The Travelers Variable Life Insurance Separate Account One
The Travelers Variable Life Insurance Separate Account Three
The Travelers Variable Life Insurance Separate Account Two
The Travelers Variable Life Insurance Separate Account Four

<TABLE>
<CAPTION>
(b) Name and Principal Positions and Offices
Business Address * With Underwriter
------------------ ---------------------
<S> <C> <C>
Russell H. Johnson Chairman of the Board, Chief Executive Officer,
President and Chief Operating Officer
William F. Scully, III Member, Board of Directors,
Senior Vice President, Treasurer
and Chief Financial Officer
Cynthia P. Macdonald Vice President, Chief Compliance Officer
and Assistant Secretary
Joanne K. Russo Member, Board of Directors
Senior Vice President
William D. Wilcox General Counsel and Secretary
Kathleen A. McGah Assistant Secretary
Jay S. Benet Member, Board of Directors
George C. Kokulis Member, Board of Directors
Warren H. May Member, Board of Directors
Donald R. Munson, Jr. Senior Vice President
Stuart L. Baritz Vice President
Michael P. Kiley Vice President
Tracey Kiff-Judson Vice President
Whitney F. Burr Second Vice President
Marlene M. Ibsen Second Vice President
Robin A. Jones Second Vice President
</TABLE>

<PAGE> 142

<TABLE>
<CAPTION>
(b) Name and Principal Positions and Offices
Business Address * With Underwriter
------------------ ---------------------
<S> <C> <C>
John F. Taylor Second Vice President
John J. Williams, Jr. Director and Assistant Compliance Officer
Susan M. Curcio Director and Operations Manager
Dennis D. D'Angelo Director
Thomas P. Tooley Director
Nancy S. Waldrop Assistant Treasurer

* Principal business address: One Tower Square, Hartford, Connecticut 06183
</TABLE>

Item 30. Location of Accounts and Records

The Travelers Insurance Company
One Tower Square
Hartford, Connecticut 06183

Item 31. Management Services

Not applicable.

Item 32. Undertakings

The undersigned Registrant hereby undertakes:

(a) To file a post-effective amendment to this registration statement as
frequently as is necessary to ensure that the audited financial
statements in the registration statement are never more than sixteen
months old for so long as payments under the variable annuity contracts
may be accepted;

(b) To include either (1) as part of any application to purchase a contract
offered by the prospectus, a space that an applicant can check to
request a Statement of Additional Information, or (2) a post card or
similar written communication affixed to or included in the prospectus
that the applicant can remove to send for a Statement of Additional
Information; and

(c) To deliver any Statement of Additional Information and any financial
statements required to be made available under this Form N-4 promptly
upon written or oral request.

The Company hereby represents:

(a) That the aggregate charges under the Contracts of the Registrant
described herein are reasonable in relation to the services rendered,
the expenses expected to be incurred, and the risks assumed by the
company.

<PAGE> 143

SIGNATURES

As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant certifies that it meets the requirements of Securities Act
Rule 485(b) for effectiveness of this amendment to this registration statement
and has caused this amendment to this registration statement to be signed on its
behalf, in the City of Hartford, and State of Connecticut, on this 10th day of
April, 1998.

THE TRAVELERS FUND ABD FOR VARIABLE ANNUITIES
(Registrant)

THE TRAVELERS INSURANCE COMPANY
(Depositor)

By: *IAN R. STUART
-----------------------------------------------
Ian R. Stuart
Senior Vice President, Chief Financial Officer
Chief Accounting Officer and Controller

As required by the Securities Act of 1933, this amendment to this registration
statement has been signed by the following persons in the capacities indicated
on this 10th day of April, 1998.

<TABLE>
<S> <C>
*MICHAEL A. CARPENTER Chairman of the Board, President and Chief
- ------------------------------------- Executive Officer
(Michael A. Carpenter)

*JAY S. BENET Director
- -------------------------------------
(Jay S. Benet)

*GEORGE C. KOKULIS Director
- -------------------------------------
(George C. Kokulis)

*ROBERT I. LIPP Director
- -------------------------------------
(Robert I. Lipp)

*IAN R. STUART Director, Senior Vice President,
- ------------------------------------- Chief Financial Officer, Chief Accounting
(Ian R. Stuart) Officer and Controller

*KATHERINE M. SULLIVAN Director, Senior Vice President and
- ------------------------------------- General Counsel
(Katherine M. Sullivan)

*MARC P. WEILL Director
- -------------------------------------
(Marc P. Weill)

*By: Ernest J. Wright, Attorney-in-Fact
</TABLE>

<PAGE> 144

EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
No. Description Method of Filing
- ------- ----------- ----------------
<S> <C> <C>
1. Resolution of The Travelers Insurance Company Board of Directors
authorizing the establishment of the Registrant. (Incorporated herein
by reference to Exhibit 1 to the Registration Statement on Form N-4,
filed December 22, 1995.)

3(a). Form of Distribution and Management Agreement among the Registrant,
The Travelers Insurance Company and Tower Square Securities, Inc.
(Incorporated herein by reference to Exhibit 3(a) to the Registration
Statement on Form N-4, filed December 22, 1995.)

3(b). Form of Selling Agreement. (Incorporated herein by reference to
Exhibit 3(b) to the Registration Statement on Form N-4, filed April
28, 1997.)

4. Form of Variable Annuity Contract(s). (Incorporated herein by
reference to Exhibit 4 to the Registration Statement on Form N-4,
filed June 17, 1996.)

6(a). Charter of The Travelers Insurance Company, as amended on October 19,
1994. (Incorporated herein by reference to Exhibit 3(a)(i) to the
Registration Statement on Form S-2, File No. 33-58677, filed via
Edgar on April 18, 1995.)

9. Opinion of Counsel as to the legality of securities being registered
by Registrant. (Incorporated herein by reference to Exhibit 9 to
Post-Effective Amendment No. 3 to the Registration Statement on Form
N-4 filed April 28, 1997.)

10(a). Consent of Coopers & Lybrand L.L.P., Independent Accountants. Electronically

10(b). Consent of KPMG Peat Marwick LLP, Independent Certified Electronically
Public Accountants.

13. Schedule of computation for each performance Standardized and
Nonstandardized (Incorporated herein by reference to Exhibit 13 to
Post-Effective Amendment No. 3 to the Registration Statement on Form
N-4, filed April 28, 1997.)
</TABLE>

<PAGE> 145

<TABLE>
<S> <C> <C>
15. Powers of Attorney authorizing Jay S. Fishman or Ernest J. Wright as
signatory for Robert I. Lipp, Michael A Carpenter, Charles O. Prince
III, Marc P. Weill, Irwin R. Ettinger, Donald T. DeCarlo and
Christine B. Mead. (Incorporated herein by reference to Exhibit 15 to
the Registration Statement on Form N-4, filed December 22, 1995.)

15(b). Powers of Attorney authorizing Ernest J. Wright and Kathleen A. McGah
as signatory for Michael A. Carpenter, Ian R. Stuart and Katherine M.
Sullivan. (Incorporated herein by reference to Exhibit 15(b) to the
Registration Statement on Form N-4 filed June 17, 1996.)

15(c). Powers of Attorney authorizing Ernest J. Wright and Kathleen A. McGah
as signatory for Jay S. Benet and George C. Kokulis. (Incorporated
herein by reference to Post-Effective Amendment No. 1 to the
Registration Statement on Form N-4 filed August 15, 1997.)

15(d). Power of Attorney authorizing Ernest J. Wright and Kathleen A. McGah
as signatory for Ian R. Stuart. (Incorporated herein by reference to
Exhibit 15(d) to Post-Effective Amendment No. 2 to the Registration
Statement on Form N-4 filed February 28, 1997.)
</TABLE>

<PAGE> 1

EXHIBIT 10(A)

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in this post-effective amendment
no. 4 to the registration statement of The Travelers Fund ABD for Variable
Annuities (the "Fund") on Form N-4 (File No. 33-65343) of our report dated
February 19, 1998, on our audit of the financial statements of the Fund, which
report is included in the Fund's Annual Report for the year ended December 31,
1997 which is incorporated by reference in the post-effective amendment to the
registration statement. We also consent to the reference to our firm as experts
in the registration statement.

COOPERS & LYBRAND L.L.P.

Hartford, Connecticut
April 10, 1998

<PAGE> 1
EXHIBIT 10(B)

Consent of Independent Cerfitified Public Accountants

The Board of Directors
The Travelers Insurance Company

We consent to the use of our report included herein and to the reference to our
firm as experts under the heading "Independent Accountants".

KPMG Peat Marwick LLP

Hartford, Connecticut
April 10, 1998