TRAVELERS TIMED GROWTH & INCOME STOCK ACC FOR VARIABLE ANNU, N-30D, 1998-08-21

TRAVELERS TIMED GROWTH & INCOME STOCK ACC FOR VARIABLE ANNU
N-30D, 1998-08-21

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<PAGE> 1

UNIVERSAL ANNUITY

SEMI-ANNUAL REPORTS
JUNE 30, 1998

[UMBRELLA LOGO]

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

TRAVELERS LIFE & ANNUITY
A Member of Travelers Group [LOGO]

The Travelers Insurance Company
The Travelers Life and Annuity Company
One Tower Square
Hartford, CT 06183
<PAGE> 2

The Travelers Investment Management Company ("TIMCO")
provides equity management and advisory services for
the following Travelers Variable Products Separate
Accounts contained in this report: The Travelers
[TIMCO LOGO] Timed Growth and Income Stock Account for Variable
Annuities, The Travelers Timed Short-Term Bond Account
for Variable Annuities and The Travelers Timed
Aggressive Stock Account for Variable Annuities.

Travelers Asset Management International Corporation
[TAMIC LOGO] ("TAMIC") provides fixed income management and
advisory services for The Travelers Timed Bond Account
for Variable Annuities.
<PAGE> 3
[TRAVELERS GROUP LOGO]

THE TRAVELERS VARIABLE PRODUCT SEPARATE ACCOUNTS
INVESTMENT ADVISORY COMMENTARY AS OF JUNE 30, 1998

ECONOMIC REVIEW AND OUTLOOK

The U.S. economy continues to provide the domestic capital markets with the
almost ideal conditions of low interest rates, lower inflation and steady
economic growth. First quarter Gross Domestic Product ("GDP") growth was well
ahead of expectations and led to the prospect of a Federal Reserve Board ("Fed")
tightening midway through the first half of 1998. Reported inflation, however,
remained low and the Asian currency crisis caused the Fed to lean towards a more
neutral stance.

Despite the strong first quarter, the U.S. economy recently showed signs of
slowing down. While industrial production and retail sales trended lower, the
most compelling evidence of the slowdown comes from the bond market. For the
first time since 1990, the portion of the Treasury yield curve showing the
spread between the 2-year and 10-year Treasury yields is now slightly inverted.
In the past, an inverted yield curve has been a harbinger of an economic
downturn.

Fed Chairman Alan Greenspan notes in his testimony on July 21, 1998 that the Fed
remains more concerned about inflation rather than an economic recession. We see
no indications of either an economic or earnings recession in the near future
and the risk in the stock market is largely mitigated by this outlook.

The U.S. stock market posted handsome returns in the first half of 1998. On a
year-to-date basis, the Dow Jones Industrial Average ("DJIA") rose 13.2% while
the broader Standard & Poor's 500 Stock Index ("S&P 500") gained 16.8%. At this
pace, the stock market would yet again produce another year of 30% or more of
appreciation, a 3 year run unprecedented in the history of equity markets. The
bond market produced healthy returns as yields on 30-year Treasury bonds fell to
their lowest level since the introduction of these securities in 1977.

We look ahead to a slower economy in the second half of 1998. The absence of
inflationary pressure should keep bond yields below 6% while the combination of
lofty valuations and slower earnings growth in 1998 could find stocks at the
upper end of a trading range for the rest of the year.

-1-

<PAGE> 4

EQUITY COMMENTARY

After three remarkable years of market appreciation averaging over 30% annually,
the first quarter's total return of the S&P 500 of almost 15% was that much more
impressive. Since 1995, the stock market's climb has also been supported by a
dramatic increase in money flows by domestic and foreign investors, as well as
corporate buybacks and merger activity. Low domestic inflation and steady
revenue gains have also contributed to the expansion in the price-to-earnings
multiple.

Consumer cyclical and technology stocks led the market higher during the first
quarter. Low interest rates, low stable inflation, and healthy economic growth
combined to support consumer confidence and generated strong sales growth and
stock price appreciation in the retail, housing, auto and airline industries.
Many technology stocks rebounded from a late 1997 decline, as investors grew
confident that the Asian economic crisis would not lead to a global economic
slowdown. Telecommunications equipment and software stocks performed the best,
while semiconductor stocks lagged due to ongoing oversupply and price weakness.

Stock market volatility increased significantly in the second quarter of 1998.
Investor focus shifted from the prospects of Fed monetary policy tightening to
the Asian crisis and eventually to hopes of reasonable corporate earnings growth
for the second quarter. Large cap stocks posted a gain for the second quarter
while small cap stocks declined to fall farther behind their large cap
counterparts.

A seesaw pattern in stock prices persisted at the beginning of the second
quarter, as stock prices remained almost unchanged at the end of April from a
month earlier. Interest rate concerns took center stage towards the end of April
as the Fed publicly discussed a shift to a tightening bias. Long-term interest
rates shot up above 6% while the S&P 500 fell 4.3% from April 23 to April 27.

Despite a strong first quarter GDP report, and continued low inflation a
slowdown in the second half of 1998 has become apparent. Bond prices stabilized
as a result of such evidence in late April and early May and stock prices
recovered to the levels established at the end of the first quarter.

Renewed concerns over Asia and slowing earnings growth rocked the stock market
in May. The S&P 500 index declined by almost 2% while the Russell 2000 Stock
Index fell nearly 5%. Several companies provided early guidance about lower
second quarter earnings during the month of May. Investors, already worried
about record valuations in the stock market, showed no mercy in their response
to such disappointments as some stock prices tumbled down by as much as 50%.

Growth stocks performed better than value stocks in the second quarter of 1998
in the large cap universe. In particular, the technology, health care and
consumer discretionary sectors performed quite well while the energy sector
underperformed significantly in the wake of falling oil prices.

The widely anticipated earnings pre-announcement season at the end of June, when
companies confess to upcoming earnings shortfalls, was not as severe as in prior
quarters. The stock market appears to have drawn a positive inference from this
event and the current outlook for second half earnings seems favorable.
Corporate earnings growth, however, is clearly slowing down and the recent
market strength and current valuations are both predicated on a healthy earnings
rebound in the second half of the year and into 1999.

Besides the historically high valuations for large cap stocks, we think the
principal risk to the U.S. stock market remains on the earnings front. If Asia
remains in a protracted recession, which is a likely scenario at this point, a
slowdown in the global economy could take its toll on U.S. corporate profits. A
prolonged period of anemic earnings growth would trigger a correction in the
stock market through a contraction in the price-to-earnings multiple. We remain
cautious about the U.S. stock market in the short term but bullish over the
intermediate to long term.

-2-
<PAGE> 5

FIXED INCOME COMMENTARY

Just when many investors were getting somewhat more comfortable with risk again,
the Asian financial crisis re-erupted in May and June. Unrest in Indonesia and
further weakness in the Japanese yen were some of the latest highlights in the
latest chapter of the Asian crisis. The region's turmoil sent Asia's stock
markets down again and caused major setbacks in most emerging country stock and
bond markets. In addition, heightened investor concerns about greater risk
triggered yet another crisis in Russia's fragile markets.

In reaction to the renewed troubles in Asia, the U.S. bond market rallied as
many global investors sought refuge in U.S. Treasury securities during the
reporting period. Combined with the United States and Japanese intervention to
stabilize the yen, the rally in U.S. Treasuries helped to support the U.S. stock
and bond markets by the end of the second quarter of 1998. Within the U.S. bond
markets, investment grade bonds barely performed better than U.S. Treasuries.
Many longer-maturity bonds could not keep pace with the strong performance of
the 30-year U.S. Treasury bond. Mortgage-backed security spreads widened and
discount bonds performed better than premium bonds, as mortgage prepayments
remained high. Corporate bond spreads widened due to heavy issuance (i.e., more
supply) with the most widening occurring in bonds issued by corporations that
were more impacted by the Asian crisis.

Municipal bonds performed poorly as heavy issuance and investor "sticker shock"
kept tax-exempt bond yields from declining as much as U.S. Treasuries. High
yield bonds and emerging market bonds also lagged U.S. Treasuries during the
second quarter of 1998, although high yield bonds are still ahead of U.S.
Treasuries for the first six months of 1998.

We continue to believe that interest rates in the U.S. will slowly move lower as
the crisis in Asia pushes U.S. GDP down to a 1%-2% annual range in the second
half of 1998. Exports from the U.S. have declined sharply and the trade deficit
has widened rapidly. We expect even greater deterioration in the U.S. trade
deficit as Asian imports accelerate in the second half of the year. Inventory
growth in the U.S. was strong in the first half of 1998, and that condition
should slow projected U.S. economic growth in the second half of the year. In
addition, we expect that corporate profits will continue to be flat, which
combined with inventories and weak commodity prices, should help to weaken
capital spending during the next several quarters.

Within the U.S. bond market, we anticipated that the yield curve will be steeper
six to twelve months from now (The yield curve shows the difference between
short-and-long-term yields). However, we think that the yield curve will likely
stay flat until it becomes clearer that the inflationary risks from currently
tight U.S. labor markets have passed. As rates decline, bond spreads are likely
to widen. In addition, bond spreads should widen more because of a continuation
of the flight to quality as well as the fact that the supply of bonds should
remain high at these rate levels. The overall low inflationary environment and
the expected economic slowdown, along with the increased volatility in the stock
market, have created a favorable backdrop for fixed income investments.

DAVID A. TYSON, CFA, TRAVELERS ASSET MANAGEMENT INTERNATIONAL CORPORATION

SANDIP A. BHAGAT, CFA, PRESIDENT & CHIEF INVESTMENT OFFICER, THE TRAVELERS
INVESTMENT MANAGEMENT COMPANY

-3-
<PAGE> 6

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
- ----------------------------------------------------------------------------------------

<S> <C>
THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES............................................................... 5

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT FOR VARIABLE ANNUITIES...................17

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT FOR VARIABLE ANNUITIES..................25

THE TRAVELERS TIMED BOND ACCOUNT FOR VARIABLE ANNUITIES..............................37
</TABLE>

-4-
<PAGE> 7

THE TRAVELERS
TIMED GROWTH AND INCOME
STOCK ACCOUNT
FOR VARIABLE ANNUITIES

The Travelers Timed Growth and Income Stock Account For Variable Annuities
("Account TGIS") is managed by The Travelers Investment Management Company
("TIMCO"). TIMCO manages Account TGIS to provide diversified exposure to the
large-company segment of the U.S. equity market, while maintaining a highly
marketable portfolio of common stocks and related financial instruments in order
to accommodate cash flows associated with market-timing moves. Stock selection
is based on a quantitative screening process favoring companies that achieve
earnings growth above consensus expectations and whose shares offer attractive
relative value. In order to achieve consistent relative performance, we manage
Account TGIS to mirror the overall risk, sector weightings and growth/value
style characteristics of the Standard & Poor's 500 Stock Index ("S&P 500"). The
S&P 500 is a value-weighted equity index comprised primarily of large-company
stocks.

For the six months ended June 30, 1998, Account TGIS achieved a total return of
18.6%, before fees and expenses, well ahead of the S&P 500 return of 16.8%. Net
of fees and expenses, Account TGIS's total return of 17.0% for the first half of
1998 compared favorably to the 11.6% average return for variable annuity stock
accounts in the Lipper Growth & Income Category. On a trailing twelve month
basis as of June 30, 1998, Account TGIS had a total return of 27.9%, net of fees
and expenses, compared to the Lipper Growth & Income Category average of 21.6%.

During the first half of 1998, stock selection in the health care, consumer
discretionary, producer durables, autos and transportation sectors made the
strongest positive contribution to Account TGIS's overall relative performance.
In the health care sector, Account TGIS benefited from our positions in
companies with strong diversified sources of earnings such as American Home
Products, Schering-Plough and Warner-Lambert. In the consumer discretionary
sector, we were helped by overweighted positions in media companies such as
Chancellor Media, New York Times and Meredith Corp. and a number of different
retailers such as Costco, Albertsons and Jones Apparel.

In the producer durables sector, our positions in Textron and United
Technologies helped performance in the first quarter. In the transportation
sector, our emphasis on the better performing airline and automobile industries
also made a positive contribution to performance. Our individual stock picks
here such as Delta Air Lines, AMR Corp. and Ford Motor all performed well during
the period. Our positions in The Equitable Companies and Morgan Stanley Dean
Witter helped performance in the financial services sector towards the end of
the second quarter.

We lost ground relative to the benchmark primarily in the technology sector. In
the technology sector, our relative performance was penalized by not holding a
number of better performing stocks such as EMC Corp. and Digital Equipment. We
were also hurt by overweighted positions in VLSI Technology and Oracle, which
both reported earnings disappointments.

Our disciplined approach to stock selection emphasizes stocks that offer
improving fundamentals and relative earnings gains at discounted stock
valuations. In the technology sector, we focus on higher growth industries like
networking and software through our positions in Cisco and Intuit. We maintain
an underweight position in the weak performing semiconductor group by excluding
stocks such as Motorola which have produced a string of negative earnings
surprises. In the health care sector, we continue to emphasize Guidant, a
leading manufacturer of medical devices that regulate heart activity through
chest implants. Our focus among the financial services sector remains on the
securities industry where we have positions in Merrill Lynch, Morgan Stanley
Dean Witter and The Equitable Companies.

-5-
<PAGE> 8

We believe that the current economic expansion has further to go and that
inflation will remain low. These factors argue in favor of a continuation of the
current bull market. Earnings growth, however, is clearly slowing down and the
recent market strength and current valuations are both predicated on a healthy
earnings rebound in the second half of the year and into 1999. Besides the
historically high valuations for large capitalization stocks, the principal risk
to the U.S. stock market remains on the earnings front. A prolonged period of
anemic earnings growth would trigger a correction in the stock market through a
contraction in the price-to-earnings multiple. We remain cautious about the U.S.
stock market over the short term. In this environment, we believe that it is
particularly important to identify companies with sustainable earnings growth at
attractive valuations across a wide variety of industries.

PORTFOLIO MANAGER: SANDIP A. BHAGAT, CFA

[TIMCO LOGO]

-6-
<PAGE> 9

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
JUNE 30, 1998

<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investment securities, at market value (cost $119,739,620)................. $ 175,584,080
Receivables:
Dividends............................................................. 144,243
Investment securities sold............................................ 10,934,353
Purchase payments and transfers from other Travelers accounts......... 67,010
Other assets............................................................... 15
---------------

Total Assets..................................................... 186,729,701
---------------

LIABILITIES:
Cash overdraft............................................................. 92,006
Payables:
Investment securities purchased....................................... 10,206,905
Contract surrenders and transfers to other Travelers accounts......... 596,291
Investment management and advisory fees............................... 7,796
Market timing fees.................................................... 30,002
Variation on futures margin........................................... 599,357
Accrued liabilities........................................................ 30,002
---------------

Total Liabilities................................................ 11,562,359
---------------

NET ASSETS:
(Applicable to 42,456,536 units outstanding at $4.125 per unit)............ $ 175,167,342
===============
</TABLE>

See Notes to Financial Statements

-7-
<PAGE> 10

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1998

<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME:
Dividends ............................................................... $ 1,143,011
Interest ............................................................... 427,831
---------------
Total income........................................................ $ 1,570,842

EXPENSES:
Market timing fees....................................................... 1,156,533
Investment management and advisory fees.................................. 300,504
Insurance charges........................................................ 1,156,533
---------------
Total expenses...................................................... 2,613,570
---------------

Net investment loss............................................ (1,042,728)
---------------

REALIZED GAIN AND CHANGE IN UNREALIZED GAIN ON
INVESTMENT SECURITIES:
Realized gain from investment security transactions:
Proceeds from investment securities sold............................ 110,293,151
Cost of investment securities sold.................................. 85,496,068
---------------

Net realized gain.............................................. 24,797,083

Change in unrealized gain on investment securities:
Unrealized gain at December 31, 1997................................ 49,281,960
Unrealized gain at June 30, 1998.................................... 55,844,460
---------------

Net change in unrealized gain for the period................... 6,562,500
---------------

Net realized gain and change in unrealized gain........... 31,359,583
---------------

Net increase in net assets resulting from operations..................... $ 30,316,855
===============
</TABLE>

See Notes to Financial Statements

-8-
<PAGE> 11

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1998 1997
---- ----
(UNAUDITED)
<S> <C> <C>
OPERATIONS:
Net investment loss........................................................ $ (1,042,728) $ (821,937)
Net realized gain from investment security transactions.................... 24,797,083 29,409,972
Net change in unrealized gain on investment securities..................... 6,562,500 18,381,102
--------------- ---------------

Net increase in net assets resulting from operations.................. 30,316,855 46,969,137
--------------- ---------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 951,975 and 2,453,311 units, respectively)............. 3,643,914 7,827,231
Participant transfers from other Travelers accounts
(applicable to 1,023,924 and 2,764,694 units, respectively)........... 3,977,795 9,073,766
Market timing transfers from other Travelers timed accounts
(applicable to 13,417,785 units)...................................... - 40,990,167
Administrative charges
(applicable to 19,712 and 67,786 units, respectively)................. (81,070) (224,578)
Contract surrenders
(applicable to 2,337,458 and 5,047,459 units, respectively)........... (8,998,399) (15,992,402)
Participant transfers to other Travelers accounts
(applicable to 1,467,635 and 4,764,847 units, respectively)........... (5,595,300) (14,956,016)
Market timing transfers to other Travelers timed accounts
(applicable to 15,942,674 and 16,465,702 units, respectively)......... (60,525,167) (45,755,486)
Other payments to participants
(applicable to 63,798 and 89,224 units, respectively)................. (246,926) (274,330)
--------------- ---------------

Net decrease in net assets resulting from unit transactions........... (67,825,153) (19,311,648)
--------------- ---------------

Net increase (decrease) in net assets............................ (37,508,298) 27,657,489

NET ASSETS:
Beginning of period........................................................ 212,675,640 185,018,151
--------------- ---------------

End of period $ 175,167,342 $ 212,675,640
=============== ===============
</TABLE>

See Notes to Financial Statements

-9-
<PAGE> 12

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1. SIGNIFICANT ACCOUNTING POLICIES

The Travelers Timed Growth and Income Stock Account for Variable Annuities
("Account TGIS") is a separate account of The Travelers Insurance Company
("The Travelers"), an indirect wholly owned subsidiary of Travelers Group
Inc., and is available for funding certain variable annuity contracts issued
by The Travelers. Account TGIS is registered under the Investment Company
Act of 1940, as amended, as a diversified, open-end management investment
company. Participants in Account TGIS have entered into market timing
service agreements with an affiliate of The Travelers, which provide for the
transfer of participants' funds to certain other timed accounts of The
Travelers, at the discretion of the market timer.

The following is a summary of significant accounting policies consistently
followed by Account TGIS in the preparation of its financial statements.

SECURITY VALUATION. Investments in securities traded on a national
securities exchange are valued at the last-reported sale price as of the
close of business of the New York Stock Exchange on the last business day of
the period; 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.

When market quotations are not considered to be readily available for
long-term corporate bonds and notes, such investments are generally stated
at fair value on the basis of valuations furnished by a pricing service.
These valuations are determined for normal institutional-size trading units
of such securities using methods based on market transactions for comparable
securities and various relationships between securities which are generally
recognized by institutional traders. Securities, including restricted
securities, for which pricing services are not readily available are valued
by management at prices which it deems in good faith to be fair.

Short-term investments for which a quoted market price is available are
valued at market. Short-term investments for which there is no reliable
quoted market price are valued at amortized cost which approximates market.

SECURITY TRANSACTIONS. Security transactions are accounted for on the trade
date. Dividend income is recorded on the ex-dividend date. Interest income
is recorded on the accrual basis. Premiums and discounts are amortized to
interest income utilizing the constant yield method.

FUTURES CONTRACTS. Account TGIS may use stock index futures contracts, and
may also use interest rate futures contracts, as a substitute for the
purchase or sale of individual securities. When Account TGIS enters into a
futures contract, it agrees to buy or sell a specified index of stocks or
debt securities at a future time for a fixed price, unless the contract is
closed prior to expiration. Account TGIS is obligated to deposit with a
broker an "initial margin" equivalent to a percentage of the face, or
notional value of the contract.

It is Account TGIS's practice to hold cash and cash equivalents in an amount
at least equal to the notional value of outstanding purchased futures
contracts, less the initial margin. Cash and cash equivalents include cash
on hand, securities segregated under federal and brokerage regulations, and
short-term highly liquid investments with maturities generally three months
or less when purchased. Generally, futures contracts are closed prior to
expiration.

Futures contracts purchased by Account TGIS are priced and settled daily;
accordingly, changes in daily prices are recorded as realized gains or
losses and no asset is recorded in the Statement of Investments. However,
when Account TGIS holds open futures contracts, it assumes a market risk
generally equivalent to the underlying market risk of change in the value of
the specified indexes or debt securities associated with the futures
contract.

OPTIONS. Account TGIS may purchase index or individual equity put or call
options, thereby obtaining the right to sell or buy a fixed number of shares
of the underlying asset at the stated price on or before the stated
expiration date. Account TGIS may sell the options before expiration.
Options held by Account TGIS are listed on either national securities
exchanges or on over-the-counter markets, and are short-term contracts with
a duration of less than nine months. The market value of the options will be
the latest sale price at the close of the New York Stock Exchange, or in the
absence of such sale, the latest bid quotation.

-10-
<PAGE> 13

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

REPURCHASE AGREEMENTS. When Account TGIS enters into a repurchase agreement
(a purchase of securities whereby the seller agrees to repurchase the
securities at a mutually agreed upon date and price), the repurchase price
of the securities will generally equal the amount paid by Account TGIS plus
a negotiated interest amount. The seller under the repurchase agreement will
be required to provide to Account TGIS securities (collateral) whose market
value, including accrued interest, will be at least equal to 102% of the
repurchase price. Account TGIS monitors the value of collateral on a daily
basis. Repurchase agreements will be limited to transactions with national
banks and reporting broker dealers believed to present minimal credit risks.
Account TGIS's custodian will take actual or constructive receipt of all
securities underlying repurchase agreements until such agreements expire.

FEDERAL INCOME TAXES. The operations of Account TGIS form a part of the
total operations of The Travelers and are not taxed separately. The
Travelers is taxed as a life insurance company under the Internal Revenue
Code of 1986, as amended (the "Code"). Under the existing federal income tax
law no taxes are payable on the investment income and capital gains of
Account TGIS. Account TGIS is not taxed as a "regulated investment company"
under Subchapter M of the Code.

OTHER. 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 expenses during the
reporting period. Actual results could differ from those estimates.

YEAR 2000. In 1996, The Travelers began the process of identifying,
evaluating and implementing changes to computer programs necessary to
address the year 2000 issue. This issue involves the ability of computer
systems that have time-sensitive programs to properly recognize the year
2000. The inability to do so could result in major failures or
miscalculations. The Travelers has a comprehensive plan in progress to
address its internal year 2000 issue with modifications to existing programs
and conversions to new programs to bring all of its critical business
systems into year 2000 compliance by year-end 1998. The total cost
associated with the required modifications and conversions, which are
expensed as incurred, is not expected to have a material effect on The
Travelers financial position, results of operations or liquidity. The
Travelers also has third party customers, financial institutions, vendors
and others with which it conducts business and is in the process of
confirming their plans to address year 2000 issues. While The Travelers has
been advised that these efforts by third party vendors and customers will be
successfully completed in a timely manner, it is possible that a series of
failures by third parties could have a material adverse effect on The
Travelers results of operations in future periods.

2. INVESTMENTS

The costs of purchases and proceeds from sales of investments (other than
short-term securities), were $46,737,189 and $78,622,884, respectively; the
proceeds from sales of direct and indirect U.S. government securities were
$413,571 for the six months ended June 30, 1998. Realized gains and losses
from investment security transactions are reported on an identified cost
basis.

Account TGIS placed a portion of its security transactions with brokerage
firms which are affiliates of The Travelers. The commissions paid to these
affiliated firms were $11,818 and $24,649 for the six months ended June 30,
1998 and the year ended December 31, 1997, respectively.

At June 30, 1998, Account TGIS held 22 open S&P 500 Stock Index futures
contracts expiring in September, 1998. The underlying face value, or
notional value, of these contracts at June 30, 1998 amounted to $6,286,500.
In connection with these contracts, short-term investments with a par value
of $335,000 had been pledged as margin deposits.

Net realized gains resulting from futures contracts were $2,569,073 and
$6,907,342 for the six months ended June 30, 1998 and the year ended
December 31, 1997, respectively. These gains are included in the net
realized gain from investment security transactions on both the Statement of
Operations and the Statement of Changes in Net Assets. The cash settlement
for June 30, 1998 is shown on the Statement of Assets and Liabilities as a
payable for variation on futures margin.

-11-
<PAGE> 14

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

3. CONTRACT CHARGES

Investment management and advisory fees are calculated daily at an annual
rate of 0.3233% of Account TGIS's average net assets. These fees are paid to
The Travelers Investment Management Company, an indirect wholly owned
subsidiary of Travelers Group Inc.

A market timing fee equivalent on an annual basis to 1.25% of the average
net assets of Account TGIS is deducted for market timing services. The
Travelers deducts the fee daily and, in turn, pays the fee to Copeland
Financial Services, Inc., a registered investment adviser and an affiliate
of The Travelers which provides market timing services to subscribing
participants in Account TGIS.

Insurance charges are paid for the mortality and expense risks assumed by
The Travelers. These charges are equivalent to 1.25% of the average net
assets of Account TGIS on an annual basis. Additionally, for contracts in
the accumulation phase, a semi-annual charge of $15 (prorated for partial
periods) is deducted from participant account balances and paid to The
Travelers to cover administrative charges.

No sales charge is deducted from participant purchase payments when they are
received. However, The Travelers generally assesses a 5% contingent deferred
sales charge if a participant's purchase payment is surrendered within five
years of its payment date. Contract surrender payments include $43,242 and
$94,019 of contingent deferred sales charges for the six months ended June
30, 1998 and the year ended December 31, 1997, respectively.

4. SUPPLEMENTARY INFORMATION
(Selected data for a unit outstanding throughout each period.)

<TABLE>
<CAPTION>
SIX
MONTHS
ENDED FOR THE YEARS ENDED DECEMBER 31,
JUNE 30, (DERIVED FROM AUDITED FINANCIAL INFORMATION)
-------- ----------------------------------------------------
1998 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income....................................... $ .031 $ .075 $ .061 $ .083 $ .064 $ .043
Operating expenses............................................ .054 .090 .069 .057 .041 .042
------- ------- ------- -------- ------- ------

Net investment income (loss).................................. (.023) (.015) (.008) .026 .023 .001

Unit value at beginning of period............................. 3.526 2.717 2.263 1.695 1.776 1.689
Net realized and change in unrealized gains (losses).......... .622 .824 .462 .542 (.104) .086
------- ------- ------- -------- ------- ------

Unit value at end of period................................... $ 4.125 $ 3.526 $ 2.717 $ 2.263 $ 1.695 $1.776
======= ======= ======= ======== ======= ======

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase (decrease) in unit value......................... $ .60 $ .81 $ .45 $ .57 $ (.08) $ .09
Ratio of operating expenses to average net assets*............ 2.82% 2.82% 2.82% 2.82% 2.82% 2.82%
Ratio of net investment income (loss) to average net assets*.. (1.17)% (.45) (.34) 1.37% 1.58% .08%
Number of units outstanding at end of period (thousands)...... 42,457 60,312 68,111 105,044 29,692 -
Portfolio turnover rate....................................... 27% 63% 81% 79% 19% 70%
Average commission rate paid+................................. $ .056 $ .053 $ .046 - - -
</TABLE>

* Annualized.

+ The average commission rate paid is a required disclosure for fiscal years
beginning after September 1, 1995. It is calculated by dividing the total
dollar amount of commissions paid for equity securities by the total
number of shares purchased and sold during the period.

-12-
<PAGE> 15

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF INVESTMENTS (UNAUDITED)
JUNE 30, 1998

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------- -------------
COMMON STOCKS (96.3%)

<S> <C> <C>
AEROSPACE (1.2%)
Boeing Co. 17,000 $ 757,562
General Dynamics 9,100 423,150
United Technologies Corp. 9,800 906,500
-------------
2,087,212
-------------
AIRLINES (1.5%)
AMR Corp. (A) 10,260 854,145
Continental Airlines (A) 10,400 633,100
Delta Air Lines 4,500 581,625
US Airways Group Inc. (A) 6,300 499,275
-------------
2,568,145
-------------
AUTOMOTIVE (2.3%)
Chrysler Corp. 12,000 676,500
Ford Motor Co. 30,400 1,793,600
General Motors Corp. 13,400 895,287
Navistar International Corp. (A) 25,000 721,875
-------------
4,087,262
-------------
BANKING (8.9%)
Banc One Corp. 5,572 310,987
BankAmerica Corp. 16,200 1,400,287
BankBoston Corp. 14,800 823,250
Bankers Trust Corp. 4,000 464,250
Chase Manhattan Corp. 15,048 1,136,124
Citicorp 8,200 1,223,850
Comerica Inc. 7,900 523,375
First Union Corp. 5,600 326,200
Fleet Financial Group Inc. 9,300 776,550
Golden West Financial Corp. 5,300 563,456
M & T Bank Corp. 700 387,800
J.P. Morgan & Company 3,200 374,800
NationsBank Corp. 21,406 1,637,559
Norwest Corp. 23,100 863,362
PNC Bank Corp. 5,500 295,969
Republic New York Corp. 10,200 641,962
State Street Corp. 7,900 549,050
Summit Bancorp. 13,700 650,750
SunTrust Banks Inc. 9,900 804,994
Washington Mutual 18,650 809,526
Wells Fargo & Co. 3,000 1,107,000
-------------
15,671,101
-------------
BEVERAGE (2.3%)
Adolph Coors Co. 14,300 487,987
Anheuser-Busch Cos. 200 9,437
Coca-Cola Co. 41,800 3,573,900
-------------
4,071,324
-------------
BROKERAGE (2.1%)
MGIC Investment Corp. 9,300 530,681
Marsh & McLennan Cos. 9,600 580,200
Merrill Lynch & Co. 11,300 1,042,425
Morgan Stanley Dean Witter & Co. 17,140 1,566,167
-------------
3,719,473
-------------

BUILDING MATERIALS (0.6%)
Kaufman & Broad Home Corp. 12,200 387,350
Masco Corp. 11,300 683,650
-------------
1,071,000
-------------
CAPITAL GOODS (2.2%)
Cordant Technologies Inc. 10,100 465,863
Crane Co. 11,384 552,836
Deere & Co. 10,600 560,475
Emerson Electric Co. 7,600 458,850
Pitney Bowes, Inc. 11,800 567,875
Tellabs, Inc. (A) 8,000 572,750
Thomas & Betts Corp. 11,900 586,075
-------------
3,764,724
-------------
CHEMICALS (1.8%)
Crompton & Knowles Corp. 15,900 400,481
Dow Chemical Co. 4,300 415,756
DuPont Co. 18,900 1,410,412
Lyondell Petrochemical 11,100 337,856
Monsanto Co. 10,100 564,337
-------------
3,128,842
-------------
CONSTRUCTION MACHINERY (0.5%)
Caterpillar, Inc. 7,000 370,125
Ingersoll-Rand 12,600 555,187
-------------
925,312
-------------
CONSUMER (5.5%)
Colgate-Palmolive 9,100 800,800
General Electric Corp. 52,900 4,813,900
Gillette Co. 13,378 758,365
Procter & Gamble Co. 24,000 2,185,500
Unilever N.V. 9,600 757,800
Whirlpool Corp. 6,000 412,500
-------------
9,728,865
-------------
CONSUMER SERVICES (0.3%)
Kimberly-Clark Corp. 9,620 441,317
-------------

CONTAINERS (0.3%)
Owens-Illinois (A) 10,200 456,450
-------------

DEFENSE (0.2%)
Raytheon Co. 7,200 425,700
-------------

ENTERTAINMENT (1.0%)
Time Warner, Inc. 9,900 845,831
Walt Disney Co. 9,341 981,389
-------------
1,827,220
-------------
FINANCE (1.4%)
American Express Co. 8,600 980,400
Associates First Capital 7,927 609,388
Countrywide Credit Industries 8,700 441,525
Pulte Corp. 14,200 424,225
-------------
2,455,538
-------------
</TABLE>

-13-
<PAGE> 16

STATEMENT OF INVESTMENTS (UNAUDITED) - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------- -------------
<S> <C> <C>
FOOD (3.6%)
Dean Foods Co. 7,050 $ 387,309
H.J Heinz Co. 15,900 892,387
Interstate Bakeries Corp. 13,400 444,712
Kellogg Co. 7,200 270,450
McDonalds Corp. 12,500 862,500
PepsiCo Inc. 27,100 1,116,181
Sara Lee Corp. 17,600 984,500
Suiza Foods Corp. (A) 11,700 698,344
Sysco Corp. 24,100 617,562
-------------
6,273,945
-------------
HEALTHCARE (1.8%)
Abbott Laboratories 28,900 1,181,287
Guidant Corp. 10,300 734,519
HEALTHSOUTH Corp. (A) 30,800 821,975
Health Management
Association, Inc. (A) 12,850 429,672
-------------
3,167,453
-------------
INDEPENDENT ENERGY (0.6%)
Burlington Resources, Inc. 9,900 426,319
Entergy Corp. 14,200 408,250
Halliburton Co. 4,800 213,900
-------------
1,048,469
-------------
INDUSTRIAL (1.1%)
AccuStaff, Inc. (A) 12,800 400,000
Mercury General Corp. 5,600 360,850
Tyco International Ltd. 19,700 1,241,100
-------------
2,001,950
-------------
INSURANCE (4.1%)
Allstate Corp. 12,438 1,138,854
Ambac Financial Group, Inc. 6,300 368,550
American International Group 17,875 2,609,750
Choicepoint Inc. (A) 310 15,694
Equitable Companies, Inc. 8,800 659,450
Everest Reinsurance Holdings 9,900 380,531
Hartford Financial Services Group 5,200 594,750
SunAmerica, Inc. 14,050 806,997
Transatlantic Holdings, Inc. 3,790 293,014
20th Century Industries 14,000 401,625
-------------
7,269,215
-------------
INTEGRATED ENERGY (5.9%)
Amoco Corp. 29,600 1,232,100
Atlantic Richfield Co. 5,700 445,312
Chevron Corp. 11,200 930,300
Exxon Corp. 46,400 3,308,900
Mobil Corp. 18,800 1,440,550
Royal Dutch Petroleum Co. 29,300 1,606,006
Texaco, Inc. 15,800 943,063
Unocal Corp. 13,300 475,475
-------------
10,381,706
-------------

MEDIA (2.4%)
Chancellor Media Corp. (A) 8,800 436,975
Clear Channel Communications (A) 9,400 1,025,775
Gannett Co. 10,000 710,625
Meredith Corp. 12,900 605,494
New York Times Co. 8,900 705,325
Tele-Communications, Inc. (A) 8,900 341,815
Viacom, Inc. (A) 6,425 374,256
-------------
4,200,265
-------------
METALS (1.3%)
Aeroquip-Vickers, Inc. 5,761 336,298
Alumax Inc. 11,200 519,400
Bethlehem Steel Corp. (A) 28,000 348,250
Illinois Tool Works 9,500 633,531
USX-U.S. Steel Group 10,900 359,700
-------------
2,197,179
-------------
NATURAL GAS PIPELINE (1.0%)
Columbia Gas Systems, Inc. 6,600 367,125
Enron Corp. 5,600 302,750
Sonat, Inc. 8,200 316,725
Williams Companies, Inc. 23,500 793,125
-------------
1,779,725
-------------
OIL FIELD (0.5%)
BJ Services Co. (A) 9,048 262,958
Schlumberger Ltd. 8,300 566,994
-------------
829,952
-------------
PAPER (0.9%)
Georgia-Pacific Corp. 8,300 489,181
International Paper Co. 5,200 223,600
Mead Corp. 10,190 323,533
Weyerhaeuser Co. 3,500 161,656
Willamette Industries, Inc. 10,600 339,200
-------------
1,537,170
-------------
PHARMACEUTICALS (9.2%)
American Home Products Corp. 30,600 1,583,550
Bristol-Myers Squibb Co. 20,600 2,367,713
CVS Corp. 19,600 763,175
Eli Lilly & Co. 20,900 1,380,706
Johnson & Johnson 20,100 1,482,375
Merck & Co. 17,600 2,354,000
Pfizer, Inc. 23,860 2,593,284
Schering-Plough Corp. 18,000 1,649,250
Warner-Lambert Co. 20,400 1,415,250
Watson Pharmaceuticals, Inc. (A) 12,200 569,588
-------------
16,158,891
-------------
RAILROADS (0.3%)
CSX Corp. 9,100 414,050
Union Pacific Corp. 3,800 167,675
-------------
581,725
-------------
</TABLE>

-14-
<PAGE> 17

STATEMENT OF INVESTMENTS (UNAUDITED) - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------- -------------
<S> <C> <C>
RETAILERS (6.0%)
Borders Group, Inc. (A) 9,100 $ 336,700
Costco Cos. (A) 13,300 839,146
Dayton Hudson Corp. 19,600 950,600
Federated Department
Stores, Inc. (A) 9,800 527,363
Gap Inc. 9,450 582,356
General Nutrition Cos., Inc. (A) 22,400 698,600
Home Depot, Inc. 17,500 1,453,594
Jones Apparel Group Inc. (A) 9,400 343,688
J.C. Penney Co., Inc. 4,700 339,869
Kmart Corp. (A) 27,100 521,675
Office Depot, Inc. (A) 17,100 539,719
Ross Stores, Inc. 7,600 327,750
Stride Rite Corp. 300 4,519
TJX Companies, Inc. 22,800 550,050
Wal-Mart Stores, Inc. 39,900 2,423,925
-------------
10,439,554
-------------
SERVICES (4.2%)
Equifax, Inc. 2,400 87,150
HBO & Co. 23,400 825,580
Lincare Holdings, Inc. (A) 10,800 453,937
Medtronic, Inc. 8,800 561,000
Microsoft Corp. (A) 47,100 5,105,932
Oracle Corp. (A) 16,700 409,671
-------------
7,443,270
-------------
SUPERMARKETS (0.7%)
Kroger Co. (A) 11,300 484,488
Safeway Inc. (A) 16,343 664,956
-------------
1,149,444
-------------
TECHNOLOGY (8.7%)
Berg Electronics (A) 7,600 148,675
Ceridian Corp. (A) 10,000 587,500
Cisco Systems, Inc. (A) 24,750 2,279,319
Compaq Computer Corp. 37,779 1,071,965
Computer Associates International 6,100 338,931
Compuware Corp. (A) 6,900 352,547
Dell Computer Corp. (A) 12,400 1,150,487
EMC Corp. (A) 19,800 887,288
Eastman Kodak Co. 6,150 449,334
Hewlett Packard Co. 13,800 826,275
Intel Corp. 30,200 2,237,630
International Business
Machines Corp. 21,300 2,445,506
Intuit Inc. (A) 6,900 422,840
Sun Microsystems Inc.(A) 13,300 578,134
Symbol Technologies, Inc. 14,000 528,500
Texas Instruments, Inc. 6,800 396,525
Xerox Corp. 5,800 589,425
-------------
15,290,881
-------------

TELECOMMUNICATIONS (8.1%)
AT&T Corp. 27,000 $ 1,542,375
AirTouch Communications, Inc. (A) 9,100 531,781
Ameritech Corp. 19,400 870,575
Bell Atlantic Corp. 27,360 1,248,300
BellSouth Corp. 17,500 1,174,688
GTE Corp. 17,100 951,188
Lucent Technologies Inc. 29,768 2,476,326
MCI Communications Corp. 11,900 691,315
MediaOne Group, Inc. (A) 10,500 461,344
Northern Telecom Ltd. 8,800 499,400
SBC Communications, Inc. 34,650 1,386,000
Sprint Corp. 7,770 547,785
U S West, Inc. 8,387 394,178
WorldCom Inc. (A) 29,400 1,421,305
-------------
14,196,560
-------------
TEXTILE (0.3%)
Fruit of The Loom (A) 16,200 537,638
-------------

TOBACCO (1.0%)
Loews Corp. 4,300 374,638
Philip Morris Cos. 36,400 1,433,250
-------------
1,807,888
-------------
U.S. AGENCY (0.8%)
Federal Home Loan Mortgage Corp. 13,000 611,813
Federal National
Mortgage Association 12,900 783,675
-------------
1,395,488
-------------
UTILITIES (1.7%)
Edison International 21,400 632,638
FPL Group Inc. 9,200 579,600
Houston Industries 4,600 142,025
MidAmerican Energy Holdings Co. 23,600 510,350
PacifiCorp 4,800 108,600
Southern Co. 11,800 326,713
Texas Utilities Co. 16,600 690,975
-------------
2,990,901
-------------
TOTAL COMMON STOCKS
(COST $113,263,608) 169,108,754
-------------
</TABLE>

-15-
<PAGE> 18

STATEMENT OF INVESTMENTS (UNAUDITED) - CONTINUED

<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
------------- --------------
SHORT-TERM INVESTMENTS (3.7%)

<S> <C> <C>
COMMERCIAL PAPER (3.5%)
American Home Products Corp.,
5.67% due September 18, 1998 $ 1,879,000 $ 1,855,960
PepsiCo Inc.
6.08% due July 1, 1998 1,457,000 1,457,000
Prudential Funding Corp.,
5.63% due July 22, 1998 2,773,000 2,763,530
--------------
6,076,490
--------------
U.S. TREASURY (0.2%)
United States of America Treasury,
5.21% due July 23, 1998 (B) $ 400,000 398,836
--------------

TOTAL SHORT-TERM
INVESTMENTS (COST $6,476,012) 6,475,326
--------------

<CAPTION>
NOTIONAL
VALUE
-------------
FUTURES CONTRACTS (0.0%)

<S> <C> <C>
S&P 500 Stock Index,
Exp. September, 1998 (C) $ 6,286,500 -
--------------

TOTAL INVESTMENTS (100%)
(COST $119,739,620) (D) $ 175,584,080
==============
</TABLE>

NOTES

(A) Non-income Producing Security.

(B) Par value of $335,000 pledged to cover margin deposits on futures
contracts.

(C) As more fully discussed in Note 1 to the financial statements, it is
Account TGIS's practice to hold cash and cash equivalents (including
short-term investments) at least equal to the underlying face value, or
notional value, of outstanding purchased futures contracts, less the
initial margin. Account TGIS uses futures contracts as a substitute for
holding individual securities.

(D) At June 30, 1998, net unrealized appreciation for all securities was
$55,844,460. This consisted of aggregate gross unrealized appreciation
for all securities in which there was an excess of market value over
cost of $57,158,923 and aggregate gross unrealized depreciation for all
securities in which there was an excess of cost over market value of
$1,314,463.

See Notes to Financial Statements

-16-
<PAGE> 19

THE TRAVELERS
TIMED SHORT-TERM
BOND ACCOUNT
FOR VARIABLE ANNUITIES

For the six months ended June 30, 1998 the economy continued to expand at a
greater than expected pace. However, growth slowed somewhat in the second
quarter as the result of dislocations produced by the ongoing crisis in Asia,
and the impact of the General Motors labor strike. Inflation for the most part
continued to be nonexistent. As a result, the financial markets rallied and the
30-year Treasury bond yield ended at 5.62%, down 30 basis points from year-end.
In addition, the federal funds rate remained unchanged at 5.50%.

It is anticipated that Gross Domestic Product growth will approximate 2% for the
second quarter after a sizzling 5.4% rate for the first quarter. Accordingly,
the Federal Reserve Board ("Fed") appears to be remaining on the sidelines for
the foreseeable future.

The strategy in management of The Travelers Timed Short-Term Bond Account For
Variable Annuities' short-term assets will be to extend maturates from the
current average of 31 days to between 60 and 90 days. At June 30, 1998 the asset
size of the portfolio was $125.1 million with an average yield of 5.58%.

PORTFOLIO MANAGER: EMIL J. MOLINARO JR.

[TIMCO LOGO]

-17-
<PAGE> 20

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
JUNE 30, 1998

<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investment securities, at market value (cost $125,128,848)........................ $ 125,107,994
Cash ............................................................................. 34,051
Receivables:
Investment securities sold................................................... 1,859,000
Purchase payments and transfers from other Travelers accounts................ 55,062
--------------

Total Assets............................................................ 127,056,107
--------------

LIABILITIES:
Payables:
Investment securities purchased.............................................. 1,892,685
Contract surrenders and transfers to other Travelers accounts................ 380,351
Investment management and advisory fees...................................... 5,561
Market timing fees........................................................... 21,402
Accrued liabilities............................................................... 21,414
--------------

Total Liabilities....................................................... 2,321,413
--------------

NET ASSETS:
(Applicable to 87,921,044 units outstanding at $1.419 per unit)................... $ 124,734,694
==============
</TABLE>

See Notes to Financial Statements

-18-
<PAGE> 21

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1998

<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME:
Interest ........................................................... $ 2,942,268

EXPENSES:
Market timing fees................................................... $ 653,863
Investment management and advisory fees.............................. 169,616
Insurance charges.................................................... 653,863
-----------
Total expenses.................................................. 1,477,342
-------------

Net investment income...................................... 1,464,926
-------------

REALIZED LOSS AND CHANGE IN UNREALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES:
Realized loss from investment security transactions:
Proceeds from investment securities sold........................ 520,000
Cost of investment securities sold.............................. 520,020
-----------

Net realized loss.......................................... (20)

Change in unrealized gain (loss) on investment securities:
Unrealized gain at December 31, 1997............................ 1,451
Unrealized loss at June 30, 1998................................ (20,854)
-----------

Net change in unrealized gain (loss) for the period........... (22,305)
-------------

Net realized loss and change in unrealized gain (loss)..... (22,325)
-------------

Net increase in net assets resulting from operations................. $ 1,442,601
=============
</TABLE>

See Notes to Financial Statements

-19-
<PAGE> 22

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1998 1997
---- ----
(UNAUDITED)

<S> <C> <C>
OPERATIONS:
Net investment income.............................................................. $ 1,464,926 $ 2,113,331
Net realized loss from investment security transactions............................ (20) (336)
Net change in unrealized gain (loss) on investment securities...................... (22,305) 11,785
--------------- ---------------

Net increase in net assets resulting from operations.......................... 1,442,601 2,124,780
--------------- ---------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 1,811,309 and 2,871,021 units, respectively)................... 2,553,548 3,957,433
Participant transfers from other Travelers accounts
(applicable to 1,848,589 and 1,695,500 units, respectively)................... 2,605,254 2,349,190
Market timing transfers from other Travelers timed accounts
(applicable to 43,058,981 and 46,933,510 units, respectively)................. 60,525,167 64,283,327
Administrative charges
(applicable to 42,621 and 57,421 units, respectively)......................... (60,442) (79,709)
Contract surrenders
(applicable to 3,624,734 and 4,875,179 units, respectively)................... (5,112,306) (6,710,909)
Participant transfers to other Travelers accounts
(applicable to 2,307,789 and 5,843,389 units, respectively)................... (3,251,676) (8,038,607)
Market timing transfers to other Travelers timed accounts
(applicable to 47,867,671 units).............................................. - (65,788,808)
Other payments to participants
(applicable to 84,433 and 159,816 units, respectively)........................ (119,027) (219,800)
--------------- ---------------

Net increase (decrease) in net assets resulting from unit transactions........ 57,140,518 (10,247,883)
--------------- ---------------

Net increase (decrease) in net assets.................................... 58,583,119 (8,123,103)

NET ASSETS:
Beginning of period................................................................ 66,151,575 74,274,678
--------------- ---------------

End of period $ 124,734,694 $ 66,151,575
=============== ===============
</TABLE>

See Notes to Financial Statements

-20-
<PAGE> 23

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1. SIGNIFICANT ACCOUNTING POLICIES

The Travelers Timed Short-Term Bond Account for Variable Annuities ("Account
TSB"), is a separate account of The Travelers Insurance Company ("The
Travelers"), an indirect wholly owned subsidiary of Travelers Group Inc.,
and is available for funding certain variable annuity contracts issued by
The Travelers. Account TSB is registered under the Investment Company Act of
1940, as amended, as a diversified, open-end management investment company.
Participants in Account TSB have entered into market timing service
agreements with an affiliate of The Travelers, which provide for the
transfer of participants' funds to certain other timed accounts of The
Travelers, at the discretion of the market timers.

The following is a summary of significant accounting policies consistently
followed by Account TSB in the preparation of its financial statements.

When market quotations are not considered to be readily available for
long-term corporate bonds and notes, such investments are generally stated
at fair value on the basis of valuations furnished by a pricing service.
These valuations are determined for normal institutional-size trading units
of such securities, using methods based on market transactions for
comparable securities and various relationships between securities which are
generally recognized by institutional traders. Securities, including
restricted securities, for which pricing services are not readily available,
are valued by management at prices which it deems in good faith to be fair.

SECURITY TRANSACTIONS. Security transactions are accounted for on the trade
date. Interest income is recorded on the accrual basis. Premiums and
discounts are amortized to interest income utilizing the constant yield
method.

REPURCHASE AGREEMENTS. When Account TSB enters into a repurchase agreement
(a purchase of securities whereby the seller agrees to repurchase the
securities at a mutually agreed upon date and price), the repurchase price
of the securities will generally equal the amount paid by Account TSB plus a
negotiated interest amount. The seller under the repurchase agreement will
be required to provide to Account TSB securities (collateral) whose market
value, including accrued interest, will be at least equal to 102% of the
repurchase price. Account TSB monitors the value of collateral on a daily
basis. Repurchase agreements will be limited to transactions with national
banks and reporting broker dealers believed to present minimal credit risks.
Account TSB's custodian will take actual or constructive receipt of all
securities underlying repurchase agreements until such agreements expire.

FEDERAL INCOME TAXES. The operations of Account TSB form a part of the total
operations of The Travelers and are not taxed separately. The Travelers is
taxed as a life insurance company under the Internal Revenue Code of 1986,
as amended (the "Code"). Under existing federal income tax law, no taxes are
payable on the investment income and capital gains of Account TSB. Account
TSB is not taxed as a "regulated investment company" under Subchapter M of
the Code.

-21-
<PAGE> 24

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

2. INVESTMENTS

Realized gains and losses from investment security transactions are reported
on an identified cost basis.

3. CONTRACT CHARGES

Investment management and advisory fees are calculated daily at an annual
rate of 0.3233% of Account TSB's average net assets. These fees are paid to
The Travelers Investment Management Company, an indirect wholly owned
subsidiary of Travelers Group Inc.

A market timing fee equivalent on an annual basis to 1.25% of the average
net assets of Account TSB is deducted for market timing services. The
Travelers deducts the fee daily and, in turn, pays the fee to Copeland
Financial Services, Inc., a registered investment adviser and an affiliate
of The Travelers which provides market timing services to subscribing
participants in Account TSB.

Insurance charges are paid for the mortality and expense risks assumed by
The Travelers. These charges are equivalent to 1.25% of the average net
assets of Account TSB on an annual basis. Additionally, for contracts in the
accumulation phase, a semi-annual charge of $15 (prorated for partial
periods) is deducted from participant account balances and paid to The
Travelers to cover administrative charges.

No sales charge is deducted from participant purchase payments when they are
received. However, The Travelers generally assesses a 5% contingent deferred
sales charge if a participant's purchase payment is surrendered within five
years of its payment date. Contract surrender payments include $30,028 and
$56,053 of contingent deferred sales charges for the six months ended June
30, 1998 and the year ended December 31, 1997, respectively.

-22-
<PAGE> 25

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

4. SUPPLEMENTARY INFORMATION
(Selected data for a unit outstanding throughout each period.)

<TABLE>
<CAPTION>
SIX
MONTHS
ENDED FOR THE YEARS ENDED DECEMBER 31,
JUNE 30, (DERIVED FROM AUDITED FINANCIAL INFORMATION)
-------- -----------------------------------------------------
1998 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income.................................... $ .039 $ .077 $ .057 $ .074 $ .055 $ .041
Operating expenses......................................... .019 .039 .030 .035 .036 .037
------- ------- ------- ------ -------- --------

Net investment income...................................... .020 .038 .027 .039 .019 .004

Unit value at beginning of period.......................... 1.399 1.361 1.333 1.292 1.275 1.271
Net realized and change in unrealized gains (losses)*...... .000 .000 .001 .002 (.002) -
------- ------- ------- ------ -------- --------
Unit value at end of period................................ $ 1.419 $ 1.399 $ 1.361 $1.333 $ 1.292 $ 1.275
======= ======= ======= ====== ======== ========

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase in unit value................................. $ .02 $ .04 $ .03 $ .04 $ .02 $ -
Ratio of operating expenses to average net assets**........ 2.82% 2.82% 2.82% 2.82% 2.82% 2.82%
Ratio of net investment income to average net assets**..... 2.80% 2.77% 2.47% 3.17% 1.45% .39%
Number of units outstanding at end of period (thousands)... 87,921 47,262 54,565 - 216,713 353,374
</TABLE>

* Effective May 2, 1994, Account TSB was authorized to invest in securities
with a maturity of greater than one year. As a result, net realized and
change in unrealized gains (losses) are no longer included in total
investment income.

** Annualized.

-23-
<PAGE> 26

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF INVESTMENTS (UNAUDITED)
JUNE 30, 1998

<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
---------------- -----------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (100%)

COMMERCIAL PAPER (100%)
American Home Products Corp.,
5.64% due August 21, 1998 $ 979,000 $ 971,171
Bell Atlantic Financial Services Inc.,
5.70% due July 14, 1998 1,440,000 1,436,845
Dakota Certificates Program,
5.66% due August 14, 1998 6,600,000 6,554,288
General Electric Capital Corp.,
5.64% due July 17, 1998 6,500,000 6,482,775
H. J. Heinz Co.,
5.63% due July 15, 1998 4,065,000 4,055,480
H. J. Heinz Co.,
5.63% due July 29, 1998 5,000,000 4,977,625
J. C. Penney Co., Inc.,
5.65% due August 28, 1998 9,345,000 9,260,278
J.P. Morgan & Company,
5.64% due July 21, 1998 7,514,000 7,489,482
Marsh & McLennan Cos.,
5.70% due July 28, 1998 6,000,000 5,974,056
Merrill Lynch & Co.,
5.67% due July 14, 1998 7,140,000 7,124,356
National Rural Utilities Co-Op,
Financial Corp.,
5.64% due August 6, 1998 7,835,000 7,790,341
PacifiCorp,
5.64% due July 29, 1998 10,475,000 10,428,124
PepsiCo, Inc.,
6.08% due July 1, 1998 1,893,000 1,893,000
Potomac Electric Power Co.,
5.64% due July 28, 1998 3,674,000 3,658,114
Prudential Funding Corp.,
5.61% due July 9, 1998 9,300,000 9,286,748
Sherwin Williams Co.,
5.64% due August 3, 1998 5,000,000 4,973,800
Sherwin Williams Co.,
5.64% due August 12, 1998 6,000,000 5,960,280
Societe Generale North America,
5.63% due July 7, 1998 5,085,000 5,079,340
Southern New England Telephone,
5.65% due July 20, 1998 7,046,000 7,024,087
Tampa Electric Co.,
5.64% due August 3, 1998 2,435,000 2,422,241
Transamerica Financial Corp.,
5.64% due July 13, 1998 1,990,000 1,985,942
TRW, Inc.,
5.65% due July 27, 1998 1,700,000 1,692,904
TRW, Inc.,
5.69% due September 23, 1998 8,700,000 8,586,717
----------------

TOTAL INVESTMENTS (100%)
(COST $125,128,848) $ 125,107,994
================
</TABLE>

See Notes to Financial Statements

-24-
<PAGE> 27

THE TRAVELERS
TIMED AGGRESSIVE
STOCK ACCOUNT
FOR VARIABLE ANNUITIES

The Travelers Timed Aggressive Stock Account For Variable Annuities ("Account
TAS") is managed by The Travelers Investment Management Company ("TIMCO"). TIMCO
manages Account TAS to provide diversified exposure to the mid- and
small-capitalization sector of the U.S. equity market, while maintaining a
highly marketable portfolio of common stocks and related financial instruments
in order to accommodate cash flows associated with market-timing moves. Stock
selection is based on a disciplined quantitative screening process that favors
companies that achieve earnings growth above consensus expectations and whose
shares offer attractive relative value. In order to achieve consistent relative
performance, we manage Account TAS to mirror the overall risk, sector weightings
and growth/value style characteristics of the Standard & Poor's 400 MidCap Stock
Index ("S&P 400"). The S&P 400 is a value-weighted index comprised of mid- and
small-company stocks.

For the six months ended June 30, 1998, Account TAS had a total return of 9.7%,
before fees and expenses, ahead of the 8.7% total return of S&P 400. Net of fees
and expenses, Account TAS's total return of 8.1% for the first half of 1998
lagged the 12.6% average return achieved by variable annuity stock funds in the
Lipper Capital Appreciation Mid Cap Category. On a trailing twelve month basis
as of June 30, 1998, Account TAS's total return of 26.7%, net of fees and
expenses, compared favorable with the Lipper Mid Cap Capital Appreciation
Category average of 21.0%.

During the first half of 1998, stock selection in the technology, financial
services, consumer discretionary, materials and processing sectors made the
strongest positive contribution to the portfolio's overall relative performance.
In the technology sector, our emphasis on a number of rapidly growing software
companies such as Keane Inc., BMC Software and Computer Sciences was rewarded as
those stocks rose sharply. In the financial services sector, the portfolio's
biggest winner was Capital One Financial, a player in the credit card and
consumer banking businesses, whose earnings estimates have climbed rapidly in
the last six months. Our positions in Bear Stearns, Hartford Life and Franklin
Resources also performed well in this sector.

In the consumer discretionary sector, we were helped by overweighted positions
in media companies such as New York Times and Meredith Corp. and a number of
different retailers such as Family Dollar, Costco and Staples. The portfolio
also benefited from not holding Manpower Inc. and US Office Products, which fell
on higher costs and declining revenues. In the materials sector, the portfolio
avoided a number of earnings disappointments in companies such as Witco, IMC
Global and Lubrizol. We lost ground to the benchmark in the transportation
sector. Our positions in Overseas Shipholding and CNF Transportation adversely
affected performance and we also lagged the sector performance as a result of
our small underweight position in the airline industry.

Our disciplined approach to stock selection emphasizes stocks that offer
improving fundamentals and relative earnings gains at discounted stock
valuations. In the technology sector, we focus on the higher growth software
industry with positions in Keane Inc., BMC Software and Compuware. We maintain
an underweight position in the weak performing semiconductor group by excluding
stocks such as Xilinx and Analog Devices, which have produced a string of
negative earnings surprises. In the health care sector, we continue to emphasize
Biomet and Guidant, leading manufacturers of medical devices, and medical
services distribution companies such as Mckesson. In the consumer discretionary
sector, our focus is on diversified media companies like New York Times and
retailers such as Family Dollar, TJX and Neiman Marcus which demonstrate strong
sales and earnings momentum.

-25-
<PAGE> 28

PORTFOLIO MANAGER: SANDIP A. BHAGAT, CFA

[TIMCO LOGO]

-26-
<PAGE> 29

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
JUNE 30, 1998

<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investment securities, at market value (cost $72,169,367).................... $ 88,337,670
Cash......................................................................... 87,335
Receivables:
Dividends............................................................... 44,534
Investment securities sold.............................................. 7,763,780
Purchase payments and transfers from other Travelers accounts........... 42,308
-------------

Total Assets....................................................... 96,275,627
-------------

LIABILITIES:
Payables:
Investment securities purchased......................................... 6,024,338
Contract surrenders and transfers to other Travelers accounts........... 91,011
Investment management and advisory fees................................. 4,300
Market timing fees...................................................... 15,357
Variation on futures margin............................................. 13,539
Accrued liabilities.......................................................... 15,407
-------------

Total Liabilities.................................................. 6,163,952
-------------

NET ASSETS:
(Applicable to 24,601,003 units outstanding at $3.665 per unit)............ $ 90,111,675
=============
</TABLE>

See Notes to Financial Statements

-27-
<PAGE> 30

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1998

<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME:
Dividends ................................................................... $ 378,597
Interest ................................................................... 425,156
-------------

Total Income............................................................ $ 803,753

EXPENSES:
Market timing fees........................................................... 559,600
Investment management and advisory fees...................................... 156,745
Insurance charges............................................................ 559,600
-------------
Total expenses.......................................................... 1,275,945
---------------

Net investment loss................................................ (472,192)
---------------

REALIZED GAIN AND CHANGE IN UNREALIZED GAIN ON
INVESTMENT SECURITIES:
Realized gain from investment security transactions:
Proceeds from investment securities sold................................ 45,593,727
Cost of investment securities sold...................................... 39,162,342
-------------

Net realized gain.................................................. 6,431,385

Change in unrealized gain on investment securities:
Unrealized gain at December 31, 1997.................................... 15,078,427
Unrealized gain at June 30, 1998........................................ 16,168,303

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

Net change in unrealized gain for the period....................... 1,089,876
---------------

Net realized gain and change in unrealized gain............... 7,521,261
---------------

Net increase in net assets resulting from operations......................... $ 7,049,069
===============
</TABLE>

See Notes to Financial Statements

-28-
<PAGE> 31

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1998 1997
---- ----
(UNAUDITED)
<S> <C> <C>
OPERATIONS:
Net investment loss............................................................ $ (472,192) $ (591,046)
Net realized gain from investment security transactions........................ 6,431,385 14,770,772
Net change in unrealized gain on investment securities......................... 1,089,876 5,613,596
-------------- ---------------

Net increase in net assets resulting from operations...................... 7,049,069 19,793,322
-------------- ---------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 754,224 and 1,773,947 units, respectively)................. 2,693,451 5,233,718
Participant transfers from other Travelers accounts
(applicable to 203,292 and 343,016 units, respectively)................... 735,715 1,050,497
Market timing transfers from other Travelers timed accounts
(applicable to 6,455,170 units)........................................... - 17,684,347
Administrative charges
(applicable to 14,934 and 38,438 units, respectively)..................... (54,345) (117,747)
Contract surrenders
(applicable to 950,370 and 1,793,810 units, respectively)................. (3,437,459) (5,349,748)
Participant transfers to other Travelers accounts
(applicable to 1,236,530 and 3,726,120 units, respectively)............... (4,446,257) (11,042,553)
Market timing transfers to other Travelers timed accounts
(applicable to 7,255,179 units)........................................... - (18,527,841)
Other payments to participants
(applicable to 19,219 and 61,544 units, respectively)..................... (69,571) (201,368)
-------------- ---------------

Net decrease in net assets resulting from unit transactions............... (4,578,466) (11,270,695)
-------------- ---------------

Net increase in net assets........................................... 2,470,603 8,522,627

NET ASSETS:
Beginning of period............................................................ 87,641,072 79,118,445
-------------- ---------------

End of period $ 90,111,675 $ 87,641,072
============== ===============
</TABLE>

See Notes to Financial Statements

-29-
<PAGE> 32

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1. SIGNIFICANT ACCOUNTING POLICIES

The Travelers Timed Aggressive Stock Account for Variable Annuities
("Account TAS") is a separate account of The Travelers Insurance Company
("The Travelers"), an indirect wholly owned subsidiary of Travelers Group
Inc., and is available for funding certain variable annuity contracts issued
by The Travelers. Account TAS is registered under the Investment Company Act
of 1940, as amended, as a diversified, open-end management investment
company. Participants in Account TAS have entered into market timing service
agreements with an affiliate of The Travelers, which provide for the
transfer of participants' funds to certain other timed accounts of The
Travelers, at the discretion of the market timers.

The following is a summary of significant accounting policies consistently
followed by Account TAS in the preparation of its financial statements.

FUTURES CONTRACTS. Account TAS may use stock index futures contracts, and
may also use interest rate futures contracts, as a substitute for the
purchase or sale of individual securities. When Account TAS enters into a
futures contract, it agrees to buy or sell a specified index of stocks, or
debt securities, at a future time for a fixed price, unless the contract is
closed prior to expiration. Account TAS is obligated to deposit with a
broker an "initial margin" equivalent to a percentage of the face, or
notional value of the contract.

It is Account TAS's practice to hold cash and cash equivalents in an amount
at least equal to the notional value of outstanding purchased futures
contracts, less the initial margin. Cash and cash equivalents include cash
on hand, securities segregated under federal and brokerage regulations, and
short-term highly liquid investments with maturities generally three months
or less when purchased. Generally, futures contracts are closed prior to
expiration.

Futures contracts purchased by Account TAS are priced and settled daily;
accordingly, changes in daily prices are recorded as realized gains or
losses and no asset is recorded in the Statement of Investments. However,
when Account TAS holds open futures contracts, it assumes a market risk
generally equivalent to the underlying market risk of change in the value of
the specified indexes or debt securities associated with the futures
contract.

OPTIONS. Account TAS may purchase index or individual equity put or call
options, thereby obtaining the right to sell or buy a fixed number of shares
of the underlying asset at the stated price on or before the stated
expiration date. Account TAS may sell the options before expiration. Options
held by Account TAS are listed on either national securities exchanges or on
over-the-counter markets, and are short-term contracts with a duration of
less than nine months. The market value of the options will be the latest
sale price at the close of the New York Stock Exchange, or, in the absence
of such sale, the latest bid quotation.

-30-
<PAGE> 33

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

REPURCHASE AGREEMENTS. When Account TAS enters into a repurchase agreement
(a purchase of securities whereby the seller agrees to repurchase the
securities at a mutually agreed upon date and price), the repurchase price
of the securities will generally equal the amount paid by Account TAS plus a
negotiated interest amount. The seller under the repurchase agreement will
be required to provide to Account TAS securities (collateral) whose market
value, including accrued interest, will be at least equal to 102% of the
repurchase price. Account TAS monitors the value of collateral on a daily
basis. Repurchase agreements will be limited to transactions with national
banks and reporting broker dealers believed to present minimal credit risks.
Account TAS's custodian will take actual or constructive receipt of all
securities underlying repurchase agreements until such agreements expire.

FEDERAL INCOME TAXES. The operations of Account TAS form a part of the total
operations of The Travelers and are not taxed separately. The Travelers is
taxed as a life insurance company under the Internal Revenue Code of 1986,
as amended (the "Code"). Under existing federal income tax law, no taxes are
payable on the investment income and capital gains of Account TAS. Account
TAS is not taxed as a "regulated investment company" under Subchapter M of
the Code.

2. INVESTMENTS

The aggregate costs of purchases and proceeds from sales of investments
(other than short-term securities), were $40,678,323 and $44,516,691,
respectively, for the six months ended June 30, 1998. Realized gains and
losses from investment security transactions are reported on an identified
cost basis.

Account TAS placed a portion of its security transactions with brokerage
firms which are affiliates of The Travelers. The commissions paid to these
affiliated firms were $8,952 and $7,564 for the six months ended June 30,
1998 and the year ended December 31, 1997, respectively.

At June 30, 1998, Account TAS held 88 open S&P 400 MidCap Index futures
contracts expiring in September, 1998. The underlying face value, or
notional value, of these contracts at June 30, 1998 amounted to $16,042,400.
In connection with these contracts, short-term investments with a par value
of $685,000 had been pledged as margin deposits.

Net realized gains resulting from futures contracts were $1,077,036 and
$3,766,611 for the six months ended June 30, 1998 and the year ended
December 31, 1997, respectively. These gains are included in the net
realized gain from investment security transactions on both the Statement of
Operations and the Statement of Changes in Net Assets. The cash settlement
for June 30, 1998 is shown on the Statement of Assets and Liabilities as a
payable for variation on futures margin.

-31-
<PAGE> 34

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

3. CONTRACT CHARGES

Investment management and advisory fees are calculated daily at an annual
rate of 0.35% of Account TAS's average net assets. These fees are paid to
The Travelers Investment Management Company, an indirect wholly owned
subsidiary of Travelers Group Inc.

A market timing fee equivalent on an annual basis to 1.25% of the average
net assets of Account TAS is deducted for market timing services. The
Travelers deducts the fee daily and, in turn, pays the fee to Copeland
Financial Services, Inc., a registered investment adviser and an affiliate
of The Travelers which provides market timing services to subscribing
participants in Account TAS.

Insurance charges are paid for the mortality and expense risks assumed by
The Travelers. These charges are equivalent to 1.25% of the average net
assets of Account TAS on an annual basis. Additionally, for contracts in the
accumulation phase, a semi-annual charge of $15 (prorated for partial
periods) is deducted from participant account balances and paid to The
Travelers to cover administrative charges.

No sales charge is deducted from participant purchase payments when they are
received. However, The Travelers generally assesses a 5% contingent deferred
sales charge if a participant's purchase payment is surrendered within five
years of its payment date. Contract surrender payments include $37,849 and
$69,828 of contingent deferred sales charges for the six months ended June
30, 1998 and the year ended December 31, 1997, respectively.

4. SUPPLEMENTARY INFORMATION
(Selected data for a unit outstanding throughout each period.)

<TABLE>
<CAPTION>
SIX
MONTHS
ENDED FOR THE YEARS ENDED DECEMBER 31,
JUNE 30, (DERIVED FROM AUDITED FINANCIAL INFORMATION)
-------- -----------------------------------------------------
1998 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income.................................... $ .032 $ .063 $ .041 $ .042 $ .036 $ .037
Operating expenses......................................... .050 .085 .069 .057 .049 .048
------- ------- ------- ------- ------- -------

Net investment loss........................................ (.018) (.022) (.028) (.015) (.013) (.011)

Unit value at beginning of period.......................... 3.389 2.623 2.253 1.706 1.838 1.624
Net realized and change in unrealized gains (losses)....... .294 .788 .398 .562 (.119) .225
------- ------- ------- ------- ------- -------

Unit value at end of period................................ $ 3.665 $ 3.389 $ 2.623 $ 2.253 $ 1.706 $ 1.838
======= ======= ======= ======= ======= =======

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase (decrease) in unit value...................... $ .28 $ .77 $ .37 $ .55 $ (.13) $ .21
Ratio of operating expenses to average net assets*......... 2.85% 2.85% 2.84% 2.83% 2.80% 2.82%
Ratio of net investment loss to average net assets*........ (1.05)% (.76) (1.13)% (.74) (.72) (.80)
Number of units outstanding at end of period (thousands)... 24,601 25,865 30,167 45,575 25,109 43,059
Portfolio turnover rate.................................... 55% 92% 98% 113% 142% 71%
Average commission rate paid+.............................. $ .053 $ .052 $ .047 - - -
</TABLE>

* Annualized.

-32-
<PAGE> 35

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF INVESTMENTS (UNAUDITED)
JUNE 30, 1998

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
COMMON STOCKS (82.9%)

<S> <C> <C>
AEROSPACE (0.9%)
Precision Castparts Corp. 5,900 $ 314,913
Sundstrand Corp. 8,800 503,800
------------
818,713
------------
AIRLINES (0.6%)
Alaska Air Group (A) 4,000 218,250
Continental Airlines (A) 2,900 176,538
Northwest Airlines (A) 2,800 108,062
------------
502,850
------------
AUTOMOTIVE (1.0%)
Arvin Industries, Inc. 7,400 268,712
Harley-Davidson, Inc. 7,540 292,175
Hertz Corp. Class A 3,500 155,094
Navistar International Corp. (A) 4,900 141,488
------------
857,469
------------
BANKING (5.8%)
AmSouth Bancorp 4,275 168,061
Associated Banc-Corp 4,875 183,574
Capital One Financial Corp. 5,200 645,775
Dime Savings Bank 9,400 281,413
First Security Corp. 5,850 125,226
First Tennesse National Corp. 9,600 303,000
First Virginia Banks, Inc. 4,000 204,500
Firstar Corp. 11,100 421,800
Hibernia Corp. Class A 10,500 211,969
M & T Bank Corp. 333 184,482
Marshall & Ilsley Corp. 7,800 398,775
Mercantile Bankshares Corp. 9,650 335,638
Regions Financial Corp. 10,000 410,312
SouthTrust Corp. 11,250 490,078
Union Planters Corp. 5,100 299,944
UnionBanCal Corp. 1,600 155,600
Wilmington Trust Co. 5,100 310,781
------------
5,130,928
------------
BEVERAGE (1.5%)
Brown-Forman Corp. Class B 4,800 308,400
Coca-Cola Enterprises, Inc. 26,200 1,028,350
------------
1,336,750
------------
BROKERAGE (2.5%)
A.G. Edwards, Inc. 10,850 463,159
Bear Stearns Cos. 9,326 530,416
FINOVA Group, Inc. 7,300 413,363
Franklin Resources Inc. 3,000 162,000
Paine Webber Group, Inc. 11,100 475,912
T. Rowe Price & Associates, Inc. 4,600 172,788
------------
2,217,638
------------
BUILDING MATERIALS (1.5%)
Carlisle Companies 5,700 245,456
Centex Corp. 6,800 256,700
Southdown, Inc. 3,800 271,225
Vulcan Materials 4,800 512,100
------------
1,285,481
------------

CAPITAL GOODS (1.4%)
Cordant Technologies Inc. 7,520 346,860
Crane Co. 3,150 152,972
Leggett & Platt, Inc. 20,800 520,000
Thomas & Betts Corp. 4,200 206,850
------------
1,226,682
------------
CHEMICALS (2.1%)
Albemarle Corp. 13,600 300,050
Crompton & Knowles Corp. 14,800 372,775
International Specialty
Products, Inc. (A) 13,000 242,125
Mylan Labs, Inc. 9,600 288,600
Solutia Inc. 23,500 674,156
------------
1,877,706
------------
CONSTRUCTION MACHINERY (0.2%)
Ingersoll-Rand Co. 4,900 215,906
------------

CONSUMER (0.7%)
HON Industry, Inc. 9,480 321,727
Maytag Corp. 3,000 148,125
Whirlpool Corp. 2,300 158,125
------------
627,977
------------
CONSUMER SERVICES (0.4%)
DST Systems, Inc. (A) 2,900 162,400
Knight-Ridder, Inc. 2,700 148,669
------------
311,069
------------
ENTERTAINMENT (0.4%)
International Game Technology 14,800 358,900
------------

ENVIROMENTAL (1.2%)
USA Waste Services, Inc. (A) 13,165 650,022
U.S. Filter Corp. (A) 16,200 454,612
------------
1,104,634
------------
FINANCE (0.5%)
Countrywide Credit Industries, Inc. 3,300 167,475
Crestar Financial 4,800 261,900
------------
429,375
------------
FOOD (2.8%)
Brinker International (A) 13,000 250,250
Cracker Barrel Old Country Store 9,300 296,146
Dean Foods Co. 6,690 367,532
Interstate Bakeries Corp. 12,400 411,525
J.M. Smucker Co. 7,300 181,131
Starbucks Corp. (A) 6,600 352,481
Suiza Foods Corp. (A) 5,800 346,188
U.S. Foodservice (A) 8,300 291,019
------------
2,496,272
------------
</TABLE>

-33-
<PAGE> 36

STATEMENT OF INVESTMENTS (UNAUDITED) - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
<S> <C> <C>
HEALTHCARE (2.8%)
Cardinal Health, Inc. 1,800 $ 168,750
Concentra Managed Care, Inc. (A) 8,800 228,525
Guidant Corp. 4,200 299,513
Health Management Assoc. Inc. (A) 21,450 717,234
HEALTHSOUTH Corp. (A) 6,700 178,806
Humana, Inc. (A) 5,900 184,006
NovaCare, Inc. (A) 21,000 246,750
Total Renal Care Holdings (A) 14,000 483,000
------------
2,506,584
------------
HOME CONSTRUCTION (0.5%)
Clayton Homes, Inc. 9,150 173,850
Masco Corp. 3,800 229,900
------------
403,750
------------
INDEPENDENT ENERGY (1.0%)
AES Corp. (A) 17,300 909,331
------------

INDUSTRIAL (4.3%)
AccuStaff, Inc. (A) 7,900 246,875
Allegiance Corp. 4,700 240,875
Cintas Corp. 11,200 570,149
Corrections Corp. of America (A) 12,700 298,450
Herman Miller, Inc. 12,200 296,231
Mercury General Corp. 4,300 277,081
Minerals Technologies, Inc. 3,100 157,712
National Service Industry, Inc. 2,900 147,538
Noble Drilling Corp. (A) 18,700 449,969
Pentair, Inc. 6,700 284,750
Robert Half International, Inc. (A) 10,400 581,100
Teleflex, Inc. 6,600 250,800
------------
3,801,530
------------
INSURANCE (3.3%)
AFLAC, Inc. 15,900 481,969
Ambac Financial Group, Inc. 7,100 415,350
Enhance Financial Services
Group, Inc. 4,800 162,000
Everest Reinsurance Holdings 3,500 134,531
Hartford Life Inc. 3,600 204,975
Health Care & Retirement Corp. (A) 8,600 339,163
Old Republic International Corp. 16,350 479,259
PMI Group, Inc. 4,700 344,862
Provident Life & Accident
Insurance Co. 4,800 165,600
20th Century Industries 8,100 232,369
------------
2,960,078
------------
INTERGRATED ENERGY (0.2%)
Parker Drilling Co. (A) 19,400 137,013
------------

MEDIA (1.5%)
Interpublic Group of
Companies, Inc. 2,600 157,788
Meredith Corp. 4,100 192,444
New York Times Co. 4,000 317,000
TCA Cable TV, Inc. 4,500 270,563
Valassis Communications, Inc. (A) 4,000 154,250
Washington Post Co. 370 213,120
------------
1,305,165
------------

METALS (0.5%)
Aeroquip-Vickers, Inc. 2,686 156,795
Bethlehem Steel Corp. (A) 11,700 145,519
USX-U.S. Steel Group 4,600 151,800
------------
454,114
------------
NATURAL GAS DISTRIBUTORS (1.0%)
El Paso Natural Gas Co. 4,400 168,300
MCN Energy Group, Inc. 5,100 126,863
MarketSpan Corp. (A) 9,600 287,400
National Fuel Gas Co. 6,000 261,375
------------
843,938
------------
NATURAL GAS PIPELINE (0.3%)
Consolidated Natural Gas Co. 4,600 270,825
------------

OIL FIELD (1.8%)
ENSCO International, Inc. 14,200 246,725
Global Marine, Inc. (A) 13,100 244,806
Tidewater, Inc. 4,600 151,800
Transocean Offshore, Inc. 14,100 627,450
Varco International, Inc. (A) 14,000 277,375
------------
1,548,156
------------
PAPER (0.6%)
P.H. Glatfelter 12,800 202,400
Reynolds & Reynolds 6,100 110,944
Sonoco Products 8,250 249,563
------------
562,907
------------
PHARMACEUTICALS (3.2%)
Bergen Brunswig Corp. 7,475 346,653
CVS Corp. 6,148 239,388
McKesson Corp. 11,600 942,500
Omnicare, Inc. 10,900 415,562
PharMerica, Inc. (A) 12,500 150,781
Watson Pharmaceuticals, Inc. (A) 15,160 707,783
------------
2,802,667
------------
RAILROADS (0.7%)
Kansas City Southern
Industries, Inc. 6,500 322,563
Trinity Industries 8,100 336,150
------------
658,713
------------
REAL ESTATE (0.5%)
CarrAmerica Realty Corp. 4,000 113,500
Crescent Real Estate Equities 4,000 134,500
Kimco Realty 4,000 164,000
------------
412,000
------------
REFINING (1.0%)
Ashland, Inc. 4,100 211,663
Murphy Oil Corp. 3,600 182,475
Tosco Corp. 12,400 364,250
Valero Energy Corp. 4,400 146,300
------------
904,688
------------
</TABLE>

-34-
<PAGE> 37

STATEMENT OF INVESTMENTS (UNAUDITED) - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ -------------
<S> <C> <C>
RETAILERS (7.6%)
AutoZone, Inc. (A) 4,800 $ 153,300
Bed Bath & Beyond, Inc. (A) 9,000 466,593
Borders Group, Inc. (A) 4,800 177,600
Costco Cos. (A) 5,300 334,397
Dollar General Corp. 15,358 607,601
Family Dollar Stores 27,400 506,900
General Nutrition Cos. (A) 11,100 346,181
Kohl's Corp. (A) 17,400 902,625
Liz Claiborne, Inc. 4,900 256,025
Neiman-Marcus
Group, Inc. (A) 6,500 282,344
Office Depot, Inc. (A) 13,000 410,312
OfficeMax, Inc. (A) 9,580 158,070
Payless ShoeSource, Inc. (A) 3,900 287,381
Ross Stores, Inc. 4,000 172,500
Staples, Inc. (A) 27,997 811,037
TJX Companies, Inc. 14,400 347,400
Viking Office Products, Inc. (A) 12,700 397,669
Wolverine World Wide 5,800 125,787
-------------
6,743,722
-------------
SERVICES (4.5%)
Biogen Inc. (A) 2,500 122,500
Biomet, Inc. 10,400 343,850
Cadence Design Systems, Inc. (A) 23,350 729,688
Ecolab, Inc. 8,200 254,200
HBO & Co. 6,600 232,856
Omnicom Group 6,500 324,187
Paychex, Inc. 12,712 516,821
Stewart Enterprises, Inc. 14,400 385,649
Stryker Corp. 13,400 514,225
SunGard Data Systems, Inc. (A) 14,100 541,088
-------------
3,965,064
-------------
SUPERMARKETS (0.7%)
Hannaford Brothers Co. 6,900 303,600
Kroger Co. (A) 7,400 317,275
-------------
620,875
-------------
TECHNOLOGY (13.2%)
America Online, Inc. 16,940 1,795,640
American Power Conversion (A) 7,600 227,050
BMC Software, Inc. (A) 21,200 1,101,736
Berg Electronics Corp. (A) 8,027 157,028
Comdisco, Inc. 22,600 429,400
Computer Sciences Corp. 3,100 198,400
Compuware Corp. (A) 17,500 894,140
Fiserv, Inc. (A) 6,150 261,183
FORE Systems, Inc. (A) 7,100 187,928
General Instrument Corp. (A) 6,700 182,156
Keane, Inc. (A) 9,700 543,200
Lexmark International
Group, Inc. Class A (A) 8,400 512,400
Linear Technology Corp. 7,700 464,406

TECHNOLOGY (CONTINUED)
Maxim Integrated Products (A) 13,200 418,687
Networks Associates, Inc. (A) 12,150 581,301
Parker-Hannifin 5,300 202,063
PeopleSoft, Inc. (A) 3,200 150,300
SCI Systems (A) 8,700 327,337
Solectron Corp. (A) 8,700 365,944
Sterling Commerce, Inc. (A) 6,900 334,650
Sterling Software, Inc. (A) 11,300 334,056
Storage Technology Corp. (A) 14,600 633,275
Symantec Corp. (A) 10,800 281,475
Symbol Technologies, Inc. 9,300 351,075
Synopsys, Inc. (A) 8,900 407,452
Transaction Systems Architects (A) 4,000 154,125
Vitesse Semiconductor (A) 6,000 185,625
-------------
11,682,032
-------------
TELECOMMUNICATIONS (2.9%)
ADC Telecommunications, Inc. (A) 10,600 387,231
Advanced Fibre
Communications, Inc. (A) 3,900 156,365
Aliant Communications, Inc. 11,100 304,556
Century Telephone Enterprises 15,650 717,944
NEXTEL Communications, Inc. (A) 7,800 193,781
Qwest Communications
International (A) 0 5
360 Communications Company (A) 17,900 572,800
Winstar Communications, Inc. (A) 4,600 197,656
-------------
2,530,338
-------------
TEXTILE (0.2%)
VF Corp. 3,000 154,500
-------------

TOBACCO (0.1%)
Universal Corp. 2,700 100,913
-------------

TRANSPORTATION (1.2%)
Airborne Freight Corp. 9,973 348,432
GATX Corp. 9,400 412,425
J.B. Hunt Transport 8,400 299,775
-------------
1,060,632
-------------
</TABLE>

-35-
<PAGE> 38

STATEMENT OF INVESTMENTS (UNAUDITED) - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ -------------
<S> <C> <C>
UTILITIES (5.8%)
Baltimore Gas & Electric Co. 5,500 $ 170,844
Black Hills Corp. 7,650 175,950
CalEnergy Co. (A) 10,000 300,625
FirstEnergy Corp. 9,500 292,125
Florida Progress Corp. 4,500 185,062
GPU, Inc. 7,800 294,937
NIPSCO Industries Inc. 18,000 504,000
New Century Energies, Inc. 14,400 654,300
New England Electric System 5,100 220,575
Northeast Utilities (A) 10,100 171,069
Pinnacle West Capital 12,200 549,000
Public Service Company of
New Mexico 16,200 367,537
SCANA Corp. 14,800 441,225
TECO Energy, Inc. 15,300 410,231
Wisconsin Energy Corp. 13,100 397,912
-------------
5,135,392
-------------
TOTAL COMMON STOCKS
(COST $57,102,973) 73,273,277
-------------

<CAPTION>
PRINCIPAL
AMOUNT
------------
SHORT-TERM INVESTMENTS (17.1%)

<S> <C> <C>
COMMERCIAL PAPER (16.3%)
American Home Products Corp.,
5.67% due September 9, 1998 $ 1,461,000 1,443,085
Asset Securitization Corp.,
5.63% due July 16, 1998 2,200,000 2,194,509
BellSouth Capital Funding,
5.61% due July 1, 1998 1,456,000 1,455,764
Goldman Sachs Group LP,
5.67% due August 27, 1998 2,200,000 2,180,391
Morgan Stanley Dean Witter & Co.,
5.64% due July 7, 1998 1,725,000 1,723,080
Motorola, Inc.,
5.75% due July 23, 1998 975,000 971,522
National Rural Utilities Coop
Financial Corp.,
5.64% due July 30, 1998 1,968,000 1,958,896
Prudential Funding Corp.,
5.63% due July 22, 1998 1,637,000 1,631,410
Tribune Co.,
5.69% due August 26, 1998 830,000 822,729
-------------
14,381,386
-------------
U.S. TREASURY (0.8%)
United States of America Treasury,
5.61% due July 23, 1998 (B) 685,000 683,007
-------------

TOTAL SHORT-TERM
INVESTMENTS (COST $15,066,394) 15,064,393
-------------

<CAPTION>
NOTIONAL MARKET
VALUE VALUE
------------- -------------
FUTURES CONTRACTS (0.0%)

<S> <C> <C>
S&P 400 MidCap Index,
Exp. September, 1998 (C) $ 16,042,400 -
-------------

TOTAL INVESTMENTS (100%)
(COST $72,169,367) (D) $ 88,337,670
=============
</TABLE>

NOTES

(A) Non-income Producing Security.

(B) Par value of $685,000 pledged to cover margin deposits on futures
contracts.

(C) As more fully discussed in Note 1 to the financial statements, it is
Account TAS's practice to hold cash and cash equivalents (including
short-term investments) at least equal to the underlying face value, or
notional value, of outstanding purchased futures contracts, less the
initial margin. Account TAS uses futures contracts as a substitute for
holding individual securities.

(D) At June 30, 1998, net unrealized appreciation for all securities was
$16,168,303. This consisted of aggregate gross unrealized appreciation for
all securities in which there was an excess of market value over cost of
$17,570,777 and aggregate gross unrealized depreciation for all securities
in which there was an excess of cost over market value of $1,402,474.

See Notes to Financial Statements

-36-
<PAGE> 39

THE TRAVELERS TIMED BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1998 1997
---- ----
(UNAUDITED)
<S> <C> <C>
OPERATIONS:
Net investment income......................................................... $ - $ 73,246
Net realized gain from investment security transactions....................... - 153,914
------------- -------------

Net increase in net assets resulting from operations..................... - 227,160
------------- -------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 71,480 units)............................................. - 89,455
Participant transfers from other Travelers accounts
(applicable to 4,094 units).............................................. - 5,130
Market timing transfers from other Travelers timed accounts
(applicable to 5,774,393 units).......................................... - 7,114,294
Administrative charges
(applicable to 4,881 units).............................................. - (6,000)
Contract surrenders
(applicable to 192,583 units)............................................ - (240,631)
Participant transfers to other Travelers accounts
(applicable to 5,652,503 units).......................................... - (7,189,408)
------------- -------------

Net decrease in net assets resulting from unit transactions.............. - (227,160)
------------- -------------

Net change in net assets............................................ - -

NET ASSETS:
Beginning of period........................................................... - -
------------- -------------

End of period $ - $ -
============= =============
</TABLE>

See Notes to Financial Statements

-37-
<PAGE> 40

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1. SIGNIFICANT ACCOUNTING POLICIES

The Travelers Timed Bond Account for Variable Annuities ("Account TB") is a
separate account of The Travelers Insurance Company ("The Travelers"), an
indirect wholly owned subsidiary of Travelers Group Inc., and is available
for funding certain variable annuity contracts issued by The Travelers.
Account TB is registered under the Investment Company Act of 1940, as
amended, as a diversified, open-end management investment company.
Participants in Account TB have entered into market timing service
agreements with an affiliate of The Travelers, which provide for the
transfer of participants' funds to certain other timed accounts of The
Travelers, at the discretion of the market timer.

ELIMINATION OF TIMING STRATEGY On October 1, 1997, The Travelers eliminated
the U.S. Government Securities Market Timing Strategy. As a result, Account
TB had no further activity through June 30, 1998.

The following is a summary of significant accounting policies consistently
followed by Account TB in the preparation of its financial statements.

FUTURES CONTRACTS. Account TB may use interest rate futures contracts as a
substitute for the purchase or sale of individual securities. When Account
TB enters into a futures contract, it agrees to buy or sell specified debt
securities, at a future time for a fixed price, unless the contract is
closed prior to expiration. Account TB is obligated to deposit with a broker
an "initial margin" equivalent to a percentage of the face, or notional
value of the contract.

It is Account TB's practice to hold cash and cash equivalents in an amount
at least equal to the notional value of outstanding purchased futures
contracts, less the initial margin. Cash and cash equivalents include cash
on hand, securities segregated under federal and brokerage regulations, and
short-term highly liquid investments with maturities generally three months
or less when purchased. Generally, futures contracts are closed prior to
expiration.

Futures contracts purchased by Account TB are priced and settled daily;
accordingly, changes in daily prices are recorded as realized gains or
losses and no asset is recorded in the Statement of Investments. However,
when Account TB holds open futures contracts, it assumes a market risk
generally equivalent to the underlying market risk of change in the value of
the specified debt securities associated with the futures contract.

-38-
<PAGE> 41

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

REPURCHASE AGREEMENTS. When Account TB enters into a repurchase agreement (a
purchase of securities whereby the seller agrees to repurchase the
securities at a mutually agreed upon date and price), the repurchase price
of the securities will generally equal the amount paid by Account TB plus a
negotiated interest amount. The seller under the repurchase agreement will
be required to provide to Account TB securities (collateral) whose market
value, including accrued interest, will be at least equal to 102% of the
repurchase price. Account TB monitors the value of collateral on a daily
basis. Repurchase agreements will be limited to transactions with national
banks and reporting broker dealers believed to present minimal credit risks.
Account TB's custodian will take actual or constructive receipt of all
securities underlying repurchase agreements until such agreements expire.

FEDERAL INCOME TAXES. The operations of Account TB form a part of the total
operations of The Travelers and are not taxed separately. The Travelers is
taxed as a life insurance company under the Internal Revenue Code of 1986,
as amended (the "Code"). Under existing federal income tax law, no taxes are
payable on the investment income and capital gains of Account TB. Account TB
is not taxed as a "regulated investment company" under Subchapter M of the
Code.

2. INVESTMENTS

There were no purchases or sales of securities for the six months ended June
30, 1998.

-39-
<PAGE> 42

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED

3. CONTRACT CHARGES

Investment management and advisory fees are calculated daily at annual rates
which start at 0.50% and decrease, as net assets increase, to 0.25% of
Account TB's average net assets. These fees are paid to Travelers Asset
Management International Corporation, an indirect wholly owned subsidiary of
Travelers Group Inc.

A market timing fee equivalent on an annual basis to 1.25% of the average
net assets of Account TB is deducted for market timing services. The
Travelers deducts the fee daily and, in turn, pays the fee to Copeland
Financial Services, Inc., a registered investment adviser and an affiliate
of The Travelers which provides market timing services to subscribing
participants in Account TB.

Insurance charges are paid for the mortality and expense risks assumed by
The Travelers. These charges are equivalent to 1.25% of the average net
assets of Account TB on an annual basis. Additionally, for contracts in the
accumulation phase, a semi-annual charge of $15 (prorated for partial
periods) is deducted from participant account balances and paid to The
Travelers to cover administrative charges.

No sales charge is deducted from participant purchase payments when they are
received. However, The Travelers generally assesses a 5% contingent deferred
sales charge if a participant's purchase payment is surrendered within five
years of its payment date. Contract surrender payments include $1,559 of
contingent deferred sales charges for the year ended December 31, 1997.

4. SUPPLEMENTARY INFORMATION
(Selected data for a unit outstanding throughout each period.)

<TABLE>
<CAPTION>
SIX
MONTHS
ENDED FOR THE YEARS ENDED DECEMBER 31,
JUNE 30, (DERIVED FROM AUDITED FINANCIAL INFORMATION)
-------- ----------------------------------------------------
1998 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income..................................... $ .000 $ .025 $ .033 $ .071 $ .007 $ .054
Operating expenses.......................................... .000 .011 .015 .031 .006 .036
------ ------ ------- ------- ------- -------

Net investment income....................................... .000 .014 .018 .040 .001 .018

Unit value at beginning of period........................... 1.273 1.232 1.383 1.215 1.234 1.132
Net realized and change in unrealized gains (losses)........ .000 .027 (.169) .128 (.020) .084
------ ------ ------- ------- ------- -------

Unit value at end of period................................. $1.273 $1.273 $ 1.232 $ 1.383 $ 1.215 $ 1.234
====== ====== ======= ======= ======= =======

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase (decrease) in unit value....................... $ .00 $ .04 $ (.15) $ .17 $ (.02) $ .10
Ratio of operating expenses to average net assets*.......... .00% 3.00% 3.00% 3.00% 3.00% 3.00%
Ratio of net investment income to average net assets*....... .00% 3.64% 3.48% 3.98% 1.02% 1.48%
Number of units outstanding at end of period (thousands).... - - - 11,466 - 20,207
Portfolio turnover rate..................................... -% 129% 153% 117% -% 190%
</TABLE>

* Annualized.

-40-
<PAGE> 43

Investment Advisers
-------------------
THE TRAVELERS INVESTMENT MANAGEMENT COMPANY
Hartford, Connecticut
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

TRAVELERS ASSET MANAGEMENT INTERNATIONAL CORPORATION
Hartford, Connecticut
THE TRAVELERS TIMED BOND ACCOUNT FOR VARIABLE ANNUITIES

Independent Accountants
-----------------------
COOPERS & LYBRAND L.L.P.
Hartford, Connecticut

Custodian
---------
THE CHASE MANHATTAN BANK, N.A.
New York, New York

The financial information included herein has been taken from the records of 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 and The Travelers Timed
Bond Account for Variable Annuities. This financial information has not been
audited by the Accounts' independent accountants, who therefore express no
opinion concerning its accuracy. However, it is management's opinion that all
proper adjustments have been made.

This report is prepared for the general information of contract owners and is
not an offer of units of 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
and The Travelers Timed Bond Account for Variable Annuities. It should not be
used in connection with any offer except in conjunction with the Universal
Annuity Prospectus which contains all pertinent information, including the
applicable sales commissions.

VG-182 (Semi-Annual) (6-98) Printed in U.S.A.