SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
June 30, 1996
Unaudited
Statement of Assets and Liabilities See below
Portfolio of Investments See below
Statement of Operations See below
Statement of Changes in Net Assets See below
Notes to Financial Statements See below
Supplementary Information -- Selected Per Accumulation
Unit Data and Ratios See below
<PAGE>
SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
June 30, 1996
<CAPTION>
Sub-Account
---------------------------------------
Short-Term
Bond Portfolio Stock
<S> <C> <C> <C>
ASSETS
Investments, at fair value (cost: Bond-$6,523,000: Short-
Term Portfolio-$598,000: Stock-$11,095,355) - Note C $6,523,000 $598,000 $24,701,985
Cash 7,283 1,565 1,644
Dividends and interest receivable 8,967 409 40,867
Paydown receivable 708 - -
NET ASSETS $6,539,958 $599,974 $24,744,496
Accumulation units outstanding 2,671,181 332,903 6,698,373
Accumulation unit value $2.45 $1.80 $3.69
<FN>
See notes to financial statements.
</TABLE>
<PAGE>
SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
<TABLE>
PORTFOLIO OF INVESTMENTS (UNAUDITED)
June 30, 1996
<CAPTION>
Principal Fair
Amount Value
<S> <C> <C>
BOND SUB-ACCOUNT
Floating Rate Demand Notes--99.7%
Associate Corporation of North America, 4.81%, due on demand $2,958,000 $ 2,958,000
General Electric Credit Corporation, 4.05%, due on demand 3,565,000 3,565,000
TOTAL FLOATING RATE DEMAND NOTES (cost - $6,523,000) 6,523,000
TOTAL INVESTMENTS-BOND SUB-ACCOUNT-99.7% (cost - $6,523,000) $ 6,523,000
SHORT-TERM PORTFOLIO SUB-ACCOUNT
Floating Rate Demand Notes--99.7%
Associate Corporation of North America, 4.81%, due on demand 300,000 300,000
General Electric Credit Corporation, 4.05%, due on demand 298,000 298,000
TOTAL FLOATING RATE DEMAND NOTES (cost - $598,000) 598,000
TOTAL INVESTMENTS-SHORT-TERM PORTFOLIO SUB-ACCOUNT-99.7% (cost - $598,000) $ 598,000
</TABLE>
<TABLE>
<CAPTION>
Number of Fair
Shares Value
<S> <C> <C>
STOCK SUB-ACCOUNT
Common Stocks--96.9%
Banks--2.2%
Banc One Corporation 15,901 $ 540,634
Beverages--4.0%
Anheuser-Busch 13,200 990,000
Brokerage Firms--5.3%
Merrill Lynch 20,200 1,315,525
Consumer Products--2.7%
Warner Lambert 12,000 660,000
Drugs--5.6%
Merck & Co. 10,400 672,100
Pfizer, Inc. 10,000 713,750
1,385,850
Electrical--9.1%
Emerson Electric 10,100 912,788
General Electric 15,600 1,349,400
2,262,188
Electronics and Instruments--7.2%
Hewlett-Packard Company 18,000 1,793,250
Entertainment--3.3%
Walt Disney Company 12,800 804,800
Financial--4.6%
Federal National Mortgage Association 34,000 1,139,000
Foods--6.7%
CPC International 12,600 907,200
Sysco Corporation 22,000 753,500
1,660,700
Industrial--4.1%
Parker-Hannifin 23,700 1,004,288
Insurance--4.6%
General Reinsurance Corporation 4,400 669,900
Lincoln National Corporation 10,000 462,500
1,132,400
Mines and Minerals--3.1%
Minnesota Mining and Manufacturing Company 11,000 759,000
Oil--15.2%
Amoco Corporation 11,000 796,125
Chevron Corporation 18,600 1,097,400
Exxon Corporation 11,600 1,007,750
Mobil Corporation 7,600 852,150
3,753,425
Radio and Television--3.0%
Interpublic Group Incorporated 16,000 750,000
Restaurants--4.0%
McDonald's Corporation 21,400 1,000,450
Retail--1.7%
Home Depot Incorporated 8,000 432,000
Technology--10.5%
Intel Corporation 22,000 1,615,625
Motorola Incorporated 15,600 980,850
2,596,475
TOTAL COMMON STOCKS (cost - $10,373,354) 23,979,985
</TABLE>
<TABLE>
<CAPTION>
Principal Fair
Amount Value
<S> <C> <C>
Floating Rate Demand Notes--2.9%
Associate Corporation of North America, 4.81%, due on demand $ 414,000 $ 414,000
General Electric Credit Corporation, 4.05%, due on demand 308,000 308,000
TOTAL FLOATING RATE DEMAND NOTES (cost - $722,000) 722,000
TOTAL INVESTMENTS-STOCK SUB-ACCOUNT-99.8% (cost - $11,095,355) $24,701,985
<FN>
See notes to financial statements.
Percentages shown are based on total net assets of each Sub-Account.
</TABLE>
<PAGE>
SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
<TABLE>
STATEMENT OF OPERATIONS (UNAUDITED)
Six Months Ednded June 30, 1996
<CAPTION>
Sub-Account
---------------------------------------
Short-Term
Bond Portfolio Stock
<S> <C> <C> <C>
Investment income:
Interest $ 430,886 $ 43,907 $ 12,870
Dividends - - 396,015
430,886 43,907 408,885
Expenses--Note B:
Mortality and expense assurance 48,244 6,553 133,983
Investment advisory and management fee 30,152 4,096 83,739
Accounting service fee 21,107 2,867 58,617
General and administrative expenses 12,061 1,638 33,496
111,564 15,154 309,835
NET INVESTMENT INCOME 319,322 28,753 99,050
Realized and unrealized gains (losses):
Net realized gains 14,992 3,028,061
Unrealized gains (losses)--Note C:
Beginning of year 585,246 14,143,729
End of year - 13,606,630
Net unrealized gain (585,246) (537,099)
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS (570,254) 2,490,962
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS $(250,932) $ 28,753 $ 2,590,012
<FN>
See notes to financial statements.
</TABLE>
<PAGE>
SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<CAPTION>
Six Months Ended June 30, 1996 (Unaudited)
--------------------------------------------
Sub-Account
--------------------------------------------
Short-Term
Bond Portfolio Stock
<S> <C> <C> <C>
ADDITIONS (DEDUCTIONS)
From operations
Net investment income $ 319,322 $ 28,753 $ 93,050
Net realized gain 14,992 - 3,028,061
Net unrealized gain (loss) (585,246) - (531,099)
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS (250,932) 28,753 2,590,012
From capital transactions-Note A
Net proceeds from units sold 150,554 30,322 674,021
Cost of units redeemed (5,949,582) (1,133,910) (12,215,699)
Net asset value of units transferred, including exchanges
with the Fixed Account 212,085 - 1,416,441
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL TRANSACTIONS (5,586,943) (1,103,588) (10,125,237)
NET INCREASE (DECREASE) IN NET ASSETS (5,837,875) (1,074,835) (7,535,225)
Net assets at beginning of year 12,377,833 1,674,809 32,279,721
NET ASSETS AT END OF YEAR $ 6,539,958 $ 599,974 $ 24,744,496
ANALYSIS OF CHANGES IN UNITS OUTSTANDING
Units sold 61,001 - 187,817
Units redeemed (2,429,369) (629,618) (3,331,704)
Units transferred 84,618 16,897 399,696
INCREASE (DECREASE) IN UNITS OUTSTANDING (2,283,750) (612,721) (2,744,191)
Units outstanding at beginning of year 4,954,931 945,624 9,442,564
UNITS OUTSTANDING AT END OF YEAR 2,671,181 332,903 6,698,373
<FN>
See notes to financial statements.
</TABLE>
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS (Continued)
<CAPTION>
Year Ended December 31, 1995
--------------------------------------------
Sub-Account
--------------------------------------------
Short-Term
Bond Portfolio Stock
<S> <C> <C> <C>
ADDITIONS (DEDUCTIONS)
From operations
Net investment income $ 671,350 $ 70,362 $ 300,770
Net realized gain 789 - 721,695
Net unrealized gain (loss) 1,063,059 - 7,485,768
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS 1,735,198 70,362 8,508,233
From capital transactions-Note A
Net proceeds from units sold 419,329 36,762 1,276,994
Cost of units redeemed (1,084,252) (110,683) (2,733,504)
Net asset value of units transferred, including exchanges
with the Fixed Account (139,525) (75,944) 141,268
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL TRANSACTIONS (804,448) (149,865) (1,315,242)
NET INCREASE (DECREASE) IN NET ASSETS 930,750 (79,503) 7,192,991
Net assets at beginning of year 11,447,083 1,754,312 25,086,730
NET ASSETS AT END OF YEAR $ 12,377,833 $ 1,674,809 $ 32,279,721
ANALYSIS OF CHANGES IN UNITS OUTSTANDING
Units sold 178,815 21,559 427,709
Units redeemed (458,670) (63,500) (907,205)
Units transferred (61,842) (44,197) 39,629
INCREASE (DECREASE) IN UNITS OUTSTANDING (341,697) (86,138) (439,867)
Units outstanding at beginning of year 5,296,628 1,031,762 9,882,431
UNITS OUTSTANDING AT END OF YEAR 4,954,931 945,624 9,442,564
<FN>
See notes to financial statements.
</TABLE>
<PAGE>
SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
Unaudited
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Account: The Separate Account I of Washington National
Insurance Company (the "Separate Account") is a segregated
investment account of Washington National Insurance Company
("WNIC"). WNIC is a wholly-owned subsidiary of Washington National
Corporation. The Separate Account is registered as an open-end
diversified management investment company pursuant to the
provisions of the Investment Company Act of 1940. The Separate
Account no longer issues new contracts. There are three Sub-
Accounts within the Separate Account, each with its own investment
objectives and policies as follows:
Bond Sub-Account -- high level of current income while
preserving capital by investing in fixed income
securities.
Short-Term Portfolio Sub-Account -- moderate level of
current income consistent with liquidity and preservation
of capital by investing in one or more types of short-term
instruments.
Stock Sub-Account -- long-term capital growth and income
by investing principally in equity-type securities.
In addition, a contract holder may elect to invest in a fixed
annuity held by WNIC, called the Fixed Account.
WNIC has been a contract holder of the Separate Account since
inception. On June 26, 1996, WNIC redeemed its contracts and
withdrew $5,454,177, $1,103,730 and $10,405,137 from the Bond,
Short-Term Portfolio and Stock Sub-Accounts, respectively in
anticipation of the Separate Account's conversion to a unit
investment trust. See Note E for further discussion of this
conversion.
Valuation of Investments: Securities traded on a national
securities exchange are valued at the closing price as of the
valuation date. Investments traded in the over-the-counter market
are valued at the average between the bid and ask prices.
Commercial paper is valued at amortized cost and other short-term
investments are valued at cost. Differences, if any, from fair
value are not considered material in relation to net assets.
Investment Transactions and Income: Security transactions are
accounted for on the trade date (date the order to buy or sell is
executed). Interest income is recorded on the accrual basis and
dividend income is recorded on the ex-dividend date. Realized
gains and losses on investments are determined on a first-in,
first-out basis.
Accumulation Unit Valuation: Accumulation unit values reflect the
net asset value of each Sub-Account and are computed daily.
NOTE B -- DEDUCTIONS AND CHARGES
Deductions and charges are made from the Separate Account and paid to
WNIC as follows:
As a fee for administration and contract maintenance, WNIC
deducts $30 annually from the accumulated value of each
contract on the contract anniversary or on the date of
surrender if it occurs between contract anniversaries.
This fee does not apply to contracts for individual
retirement accounts, or to contracts which at the end of
any contract anniversary have received at least $1,000 of
payments or in which the accumulated value is at least
$20,000.
As compensation for annuity rate guarantees, WNIC deducts
an amount, computed on a daily basis, which is equal on an
annual basis to .8% of the average net asset value of the
Separate Account.
As a fee for managing and administering the investment
activities of the Separate Account, WNIC deducts an
amount, computed on a daily basis, equal to an annual rate
of .5% of the average net asset value of each Sub-Account.
As compensation for providing financial accounting
services to the Separate Account, WNIC deducts an amount,
computed on a daily basis, equal to an annual rate of .35%
of the average net asset value of the Separate Account.
As reimbursement for incurring various other general and
administrative expenses attributable to the Separate
Account, WNIC deducts an amount, computed on a daily
basis, equal to an annual rate of .2% of the average net
asset value of the Separate Account. A component of these
expenses is the fee paid to the Separate Account's Board
of Directors. Only members of the Board of Directors who
are not directors, officers, or employees of WNIC receive
an annual retainer of $1,000, and a meeting fee of $350.
In 1996, the Separate Account's three external directors
each received $500.
A contingent deferred sales charge of 6% is made on any
amounts withdrawn which are in excess of 10% of the
contract's accumulated value on the date of the first
withdrawal during the respective contract year, except
that no such charge is made for withdrawals of purchase
payments received more than 72 months prior to the date of
withdrawal and no such charge is made if the withdrawal
amount is applied to a settlement option after the
contract has been in force for five years or if the
contract contains life contingencies.
NOTE C -- INVESTMENTS
The aggregate cost of purchases and sales of investments other
than United States Government obligations and short-term notes
was:
Proceeds
From
Investments
Sub-Account Sold
Bond $10,741,428
Stock 10,577,704
There were no purchases of investments, other than short-term,
during 1996.
At June 30, 1996, the total unrealized gain on investments in the
Stock Sub-Account was $13,606,630.
NOTE D -- FEDERAL INCOME TAXES
The operations of the Separate Account form a part of, and are
taxed with, the operations of WNIC, which under the Internal
Revenue Code is taxed as a "life insurance company." The Separate
Account is not taxed as a regulated investment company under
Subchapter M of the Code. Under existing federal income tax law,
no taxes are payable on the investment income or on the realized
gains of the Separate Account.
NOTE E -- SUBSEQUENT EVENT
On July 1, 1996, the Separate Account was converted to a unit
investment trust which invests all assets in an investment
portfolio of the Scudder Variable Life Investment Fund. This
transaction was approved by contract holders at a special meeting
held March 12, 1996.
Immediately following the restructuring of the Separate Account,
all contract holders had beneficial interests in the same number
of units in each Sub-Account of the restructured Separate Account
as they owned in that Sub-Account immediately prior to the
transaction.
Effective July 1, 1996, a fourth investment option, the Growth &
Income Sub-Account, seeking long-term growth of capital, current
income, and growth income, became available. The portfolio invests
primarily in common stocks, preferred stocks, and securities
convertible into common stocks of companies which offer the
prospect for growth of earnings while paying current dividends.
Also effective July 1, 1996, the fees for managing and
administering the investment activities of the Separate Account
and for general and administrative expenses attributable to the
Separate Account (see Note B) will no longer be deducted.
<PAGE>
SEPARATE ACCOUNT I OF
WASHINGTON NATIONAL INSURANCE COMPANY
<TABLE>
SUPPLEMENTARY INFORMATION--SELECTED PER ACCUMULATION UNIT DATA AND RATIOS
Selected data per accumulation unit outstanding throughout the year
<CAPTION>
Six Months Ended
June 30, 1996
(Unaudited) 1995 1994
---------------------------- ----------------------------- ---------------------------------
Sub-Account Sub-Account Sub-Account
---------------------------- ----------------------------- ---------------------------------
Short-Term Short-Term Short-Term
Bond Portfolio Stock Bond Portfolio Stock Bond Portfolio Stock
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per accumulation unit data:
Investment income $ 0.09 $ 0.05 $ 0.04 $ 0.17 $ 0.10 $ 0.09 $ 0.16 $ 0.07 $ 0.08
Expenses (0.02) (0.02) (0.04) (0.04) (0.03) (0.06) (0.04) (0.03) (0.04)
NET INVESTMENT INCOME 0.07 0.03 0.00 0.13 0.07 0.03 0.12 0.04 0.04
Net realized and unrealized
gain (loss) on investments (0.12) - 0.27 0.21 - 0.85 (0.22) - (0.02)
Net increase (decrease) in
accumulation unit value (0.05) 0.03 0.27 0.34 0.07 0.88 (0.10) 0.04 0.02
Accumulation unit value at
beginning of year 2.50 1.77 3.42 2.16 1.70 2.54 2.26 1.66 2.52
ACCUMULATION UNIT VALUE
AT END OF YEAR $ 2.45 $ 1.80 $ 3.69 $ 2.50 $ 1.77 $ 3.42 $ 2.16 $ 1.70 $ 2.54
Ratios:
Ratio of expenses to average
net assets 1.95% 2.00% 1.94% 1.82% 1.86% 1.87% 1.87% 1.85% 1.83%
Ratio of net investment income
to average net assets 5.57 3.79 0.61 5.58 4.11 1.03 5.28 2.47 1.41
Portfolio turnover rate - - - 1.25 - 7.41 - - 12.20
Number of accumulation units
outstanding at end of year
(000's omitted) 2,671 333 6,698 4,955 946 9,443 5,297 1,032 9,882
<FN>
See notes to financial statements.
</TABLE>
<TABLE>
SUPPLEMENTARY INFORMATION--SELECTED PER ACCUMULATION UNIT DATA AND RATIOS (Continued)
Selected data per accumulation unit outstanding throughout the year
<CAPTION>
1993 1992
---------------------------------- ---------------------------------
Sub-Account Sub-Account
---------------------------------- ---------------------------------
Short-Term Short-Term
Bond Portfolio Stock Bond Portfolio Stock
<S> <C> <C> <C> <C> <C> <C>
Per accumulation unit data:
Investment income $ 0.16 $ 0.05 $ 0.07 $ 0.17 $ 0.06 $ 0.07
Expenses (0.04) (0.03) (0.04) (0.04) (0.03) (0.04)
NET INVESTMENT INCOME 0.12 0.02 0.03 0.13 0.03 0.03
Net realized and unrealized
gain (loss) on investments 0.03 - 0.21 (0.01) - 0.12
Net increase (decrease) in
accumulation unit value 0.15 0.02 0.24 0.12 0.03 0.15
Accumulation unit value at
beginning of year 2.11 1.64 2.28 1.99 1.61 2.13
ACCUMULATION UNIT VALUE
AT END OF YEAR $ 2.26 $ 1.66 $ 2.52 $ 2.11 $ 1.64 $ 2.28
Ratios:
Ratio of expenses to average
net assets 1.85% 1.85% 1.81% 1.85% 1.85% 1.85%
Ratio of net investment income
to average net assets 5.50 1.28 1.17 6.22 1.82 1.33
Portfolio turnover rate 33.66 - 3.50 10.83 - 4.92
Number of accumulation units
outstanding at end of year
(000's omitted) 5,836 980 10,202 6,457 1,065 10,457
<FN>
See notes to financial statements.
</TABLE>
