TRAVELERS TIMED GROWTH & INCOME STOCK ACC FOR VARIABLE ANNU, N-30D, 1999-02-25

TRAVELERS TIMED GROWTH & INCOME STOCK ACC FOR VARIABLE ANNU
N-30D, 1999-02-25

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<PAGE> 1
UNIVERSAL ANNUITY

ANNUAL REPORTS
DECEMBER 31, 1998

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 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 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.

<PAGE> 3

THE TRAVELERS VARIABLE PRODUCT SEPARATE ACCOUNTS
INVESTMENT ADVISORY COMMENTARY AS OF DECEMBER 31, 1998

ECONOMIC REVIEW AND OUTLOOK

The year 1998 saw a widely gyrating U.S. stock market with sector performance
varying. The large-cap oriented Standard & Poor's 500 Stock Index ("S&P 500")
returned 28.6% for the year. The Standard & Poor's 400 Midcap Stock Index had a
gain of 19.1% while the Russell 2000 Stock Index ("Russell 2000") of smaller
companies had a negative return of 2.6% for the year. Dividend-paying defensive
stocks such as utilities performed better than the average small- and mid-cap
stocks. While technology stocks were adversely impacted by the global financial
crisis which began in late 1997, they have since rebounded, led by
Internet-related names.

The economies of the developed world flourished in 1998 while emerging markets
generally suffered. Low interest rates, robust consumer spending and benign
inflation fueled economic growth in the U.S. and Europe creating favorable
conditions for corporate profitability. In contrast, Russia's economy collapsed,
Asia's economies remained mired in recession and Brazil's economy faltered at
year-end after $30 billion was spent to defend its currency during the year.

The year 1998 was also a record for mergers and acquisitions, nearly double
1997's total. An example of this trend is the merger of oil giants Exxon and
Mobil announced in December which will result in the creation of the world's
largest company in terms of revenue. In the technology sector, merger activity
between Internet service providers, phone companies, cable companies and
telecommunications firms heated up, as "convergence" became the new mantra.

We remain guardedly optimistic about the U.S. economy's resiliency in the first
half of 1999 and expect interest rates to stay low and the technology - led
revolution to continue. However, the risks from foreign markets cannot be
discounted and future corporate earnings may come under increasing pressure.

EQUITY COMMENTARY

The deepening global financial crisis and its adverse impact on global economies
and leveraged hedge funds sent the U.S. stock market into a tailspin during the
third quarter of 1998. The S&P 500 fell by almost 10% in the third quarter while
the Russell 2000 fared even worse with a decline of 20%.

The third quarter began on a promising note as stock prices rose by almost 5% in
the first half of July. From the all-time highs established on July 17, 1998, a
series of bad news related to political and currency turmoil led the stock
market down through the end of August. The market decline over that period was
close to 20%, which qualifies under most scenarios as a bear market.

The bulk of the bad news in August came from the political and economic crisis
in Russia and the continuing spread of the currency contagion. The collapse of
the Russian ruble and the restructuring of Russian debt triggered trading and
lending losses at brokerage firms and banks. The crisis in the financial sector
took a turn for the worse later in the quarter as several hedge funds disclosed
losses related to the global financial turmoil. Several stocks in the financial
sector saw their market value cut in half during the third quarter.

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<PAGE> 4

Increased uncertainty over Clinton's presidency and the bigger question of the
damage to corporate profits added to the volatility in the stock market. The
increased prospects of a global and U.S. economic slowdown led to some easing of
monetary policy. Japan first decreased short-term interest rates by 20 basis
points and the Federal Reserve Board ("Fed") followed suit with a 25 basis point
rate cut in late September. The U.S. stock market rallied in anticipation of the
rate cut and stock prices rose by almost 6% in September.

In the large capitalization stock universe, high quality growth stocks performed
better than value stocks in the third quarter of 1998. The Utilities sector
produced the only positive performance in the third quarter while the Financial
Services and Energy sectors at the other end of the spectrum fell by over 20%.
Large cap Technology and Health Care stocks held up reasonably well, but
consumer stocks declined sharply against the likely backdrop of an economic
slowdown.

A proactive and aggressive stance by the Fed halted the stock market slide early
in the fourth quarter of 1998 and sent stock prices soaring in November and
December. The fourth quarter rally erased losses from the third quarter and most
market measures reached all-time highs.

The negative sentiment in the stock market persisted through the first week of
October as the S&P 500 fell another 6%. Investor concerns focused on the impact
of the Russian crisis, global lending and trading losses on U.S. economic and
earnings growth.

Sentiment reversed in the second week of October after most market indexes had
declined over 20% from their all-time highs. The reversal in trend turned into a
significant stock market rally when the Fed cut short term rates by an
unexpected 25 basis points in the middle of October. The surprise Fed action
raised hopes that a proactive stimulative monetary policy by most central banks
would avert a global recession.

The stock market rally, triggered by the unexpected Fed rate cut in mid-October,
continued almost unabated through the months of November and December. The
market was also helped by economic reports in the fourth quarter which were well
ahead of expectations. Despite the strength in the economy, interest rates
remained low mainly as a result of low inflation.

In the large cap universe, all sectors except Energy which declined by 3%,
registered strong gains in the fourth quarter. The market rally was led by the
Technology and Health Care sectors which rose by over 30%. The Financial
Services, Transportation and Producer Durables sectors also performed well.

The performance of the U.S. stock market in 1998 proves yet again that interest
rate changes and liquidity flows may have a more dominant influence on stock
prices than most other factors. In a year where earnings growth was close to
zero, most measures of the U.S. stock market have risen by over 20%. Declining
interest rates, which fell from 5.9% to 5.1% during 1998, have triggered a
significant expansion in the market price-to-earnings ratio ("P/E"). The upward
pressure on stock prices has been further amplified by strong money flows as
yields on alternative investments have dwindled.

A notable aspect of the stock market performance in 1998 was the divergence in
returns across different styles and segments of the market. While the S&P 500
rose by 28.6% in 1998, the Russell 2000 actually declined by 2.6%. The gain in
large company growth stocks of 42.2% was well ahead of the 14.7% advance of
large company value stocks and almost out of sight compared to small company
value stocks which fell by 6.5%.

With earnings growth slowing down, the market P/E multiple has now reached 23
times 1998 earnings. It appears that the biggest risk to the stock market still
remains on the earnings front. Earnings estimates for 1999 remain high and it is
quite likely that these earnings forecasts will be revised down. Despite the
overhang of possible downward earnings revisions, we believe that support from
low interest rates should limit an excessive downside.

-2-
<PAGE> 5

FIXED INCOME COMMENTARY

Problems that started with Asia's currency devaluations in the summer of 1997
hit the bond market hard in August and September of 1998. Bond values fell
dramatically and asset-backed bonds, mortgage-backed securities, emerging-market
debt and corporate bonds all were negatively affected. In 1998, the more risk a
bond investor assumed, the more he or she suffered.

For the year ended December 31, 1998, the Lehman Government/Corporate Index
returned 9.47%. During the year, the spreads between different types of bonds
and U.S. Treasuries widened at record speed as investors gravitated to safety
amidst rising stock market volatility and higher investor anxiety about the
global economy. The Fed then changed its monetary policy from one of vigilance
against inflation to one of combating deflation during the reporting period and
cut rates three times. So far in 1999, spreads have tightened, bond market
liquidity has returned and the bond market has stabilized.

Markets and policy makers expect real U.S. economic growth to finally slow to
the 1%-2% level in 1999 after 3 years of 3% plus growth. The slowdown is
expected to be led by a sharp reduction in the growth rate of investment
spending and continued weakness in the export sector. The Conference Board
survey of corporate sentiment indicates that capital-spending plans have not yet
rebounded with the stock market and consumer sentiment. Year 2000 compliance
("Y2K") spending is temporarily boosting capital spending, yet industrial
overcapacity and several years of rapid spending in technology make slower
investment spending highly likely.

However, a drop in the rate of consumer spending growth is essential to any
meaningful forecast of 1%-2% real Gross Domestic Product growth. This has not
happened yet despite two years where consumer spending has been close to
consumer income. The wealth effect from three years of 20% plus stock market
gains is estimated to increase spending 1.5% more than implied by income growth.
Lower interest rates, lower oil and other commodity prices, and declining import
prices have further boosted consumer purchasing power.

The tight employment market has also been a major force behind high consumer
confidence and spending plans. December brought a further sharp drop in oil
prices and continued record high (which substantially exceeded expectations)
auto sales and housing starts. These factors cause us to push any forecast of a
consumer slowdown further out into the future which will delay any further Fed
rate cuts.

There are storm clouds on the horizon that could lead the consumer to retreat.
Latin America has been pushed into recession by last summer's emerging market
meltdown and could be subject to further pressure if a Brazilian crisis erupts.
Latin America has a larger economic impact on the U.S. than Asia and Russia. A
decline in the stock market could rattle the consumer, although the stock
markets continued resilience means that a sustained downturn is required before
spending would be significantly impacted. Japan is also a big question mark.
Economic activity is now declining there after several years of flat growth.

Despite three rate cuts in the second half of 1998, it would be hard to say the
Fed has adopted an easy monetary policy. Short-term interest rates are still
more than 3% above inflation and are high relative to nominal growth. Credit
market spreads are high and banks are tightening credit standards. These factors
create a downward bias for short-term rates over the long-term, but rates are
likely to remain stable until the consumer slows down.

With the Fed on hold, there will be some upward pressure on long-term rates. But
slow growth outside the U.S. and continued low inflation should prevent rates
from rising too much. The fact that so much of the U.S. Treasury curve trades
below the federal-funds rate is a big factor in the continued high spreads in
the investment grade corporate market. Because of this, spreads should move to
offset the change in U.S. Treasury yields - narrowing when yields rise and
widening when yields fall.

DAVID A. TYSON, CFA, PRESIDENT & CHIEF INVESTMENT OFFICER, TRAVELERS ASSET
MANAGEMENT INTERNATIONAL CORPORATION

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

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<PAGE> 6

TABLE OF CONTENTS

[CAPTION]
<TABLE>
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......................................................18

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT FOR VARIABLE ANNUITIES.....................................................27
</TABLE>

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<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"). Account TGIS is managed to provide diversified exposure to the
large-company segment of the U.S. equity market. 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 Standards & 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 twelve months ending December 31, 1998, Account TGIS achieved a total
return of 30.3%, before fees and expenses, ahead of the S&P 500 return of 28.6%.
Net of fees and expenses, Account TGIS's total return of 26.7% for the year
compared favorably to the 15.6% average return for variable annuity stock
accounts in the Lipper Growth & Income category.

During the third quarter of 1998, stock selection in the Consumer Discretionary,
Financial Services and Producer Durables sectors had an adverse impact on
relative performance. Media stocks such as New York Times, Meredith Corp. and
Clear Channel Communications and our holdings in the retail sector such as Jones
Apparel and General Nutrition sold off sharply on concerns of future earnings
weakness resulting from a possible recession. The prospect of a slower economy
also hurt Producer Durable stocks like United Technologies and Deere Corp. where
we had a modest overweight position. Trading and lending losses during the third
quarter devastated the Financial Services sector. Our overweight positions in
BankBoston, Equitable Companies, Morgan Stanley Dean Witter and Merrill Lynch
hurt performance.

Our stock selection in the Technology and Energy sectors contributed positively
to performance in the third quarter. Our positions in higher growth Technology
stocks such as Cisco Systems, EMC Corp. and Symbol Technologies performed well
in the third quarter. Being underweight in several poorly performing stocks such
as Computer Associates, Parametric Technologies and 3Com Corp. also helped. In
the Energy sector, we gained from underweight positions in stocks such as Royal
Dutch and Occidental Petroleum.

During the fourth quarter of 1998, stock selection was favorable in most
sectors. The biggest contributions to relative performance came from the
Technology, Health Care, Consumer Discretionary, Producer Durables and Utilities
sectors. In the Technology sector, a number of our overweight position in stable
growth companies with rising earnings estimates such as Cisco Systems, Symbol
Technologies, EMC Corp., Dell Computers and Lucent Technologies performed well.
The biggest gain however, came from America Online which rose by 70% in December
alone on the heels of a frenzied pursuit of Internet stocks and its inclusion
into the S&P 500 on the last day of the year. Guidant Corp., a leading
manufacturer of cardiological equipment, and Amgen, the world's largest
biotechnology company, were our top stock picks in the Health Care sector. Both
stocks rose by almost 50% in the fourth quarter on strong revenue growth and
positive earnings surprises.

A strong recovery in retail and media stocks from their lows in the third
quarter helped performance in the Consumer Discretionary sector. Our retail
holdings in Dayton Hudson, Staples Inc. and CVS Corp. performed well and media
stocks such as New York Times and Clear Channel Communications recovered from
near-recession levels as investors felt reassured about economic prospects after
the Federal Reserve Board action to cut interest rates.

-5-
<PAGE> 8

Our good performance in the Producer Durables sector was achieved from a
combination of picking the winners in the sector and avoiding the losers. Our
emphasis on Tyco International, a world leader in security systems, paid off
while we avoided some of the bigger losers within the sector such as Minnesota
Mining and Lockheed Martin.

In the Utilities sector, we have been emphasizing long-distance and cellular
telephone companies such as Airtouch Communications, Sprint PCS and MCI
Worldcomm at the expense of the regional telephone companies and the electric
utilities group. We were rewarded in these positions as investors paid a premium
for the higher growth prospects of these companies within a relatively low
growth sector.

With earnings growth slowing down, the market price-to-earnings ratio has now
reached 23 times 1998 earnings. It appears that the biggest risk to the stock
market still remains on the earnings front. Earnings estimates for 1999 remain
high and it is quite likely that these earnings forecasts will be revised down.
Despite the overhang of possible downward earnings revisions, we believe that
support from low interest rates should limit excessive downside.

In our disciplined approach to stock selection, we screen our research universe
of over 1,000 large-cap securities for companies that offer improving earnings
fundamentals at discounted stock valuations. A small sample of our current
holdings is presented here to illustrate our investment approach. In the
technology sector, we focus on higher growth industries like networking and
software through our positions in Symbol Technologies, EMC Corp., Cisco Systems
and Oracle which are still trading at reasonable valuations. Our emphasis on
Amgen and Guidant Corp., leaders in the biotechnology and medical devices
industries respectively, also seeks growth at a reasonable price.

PORTFOLIO MANAGER: SANDIP A. BHAGAT, CFA

-6-

<PAGE> 9

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1998

<TABLE>
<S> <C>
ASSETS:
Investment securities, at market value (cost $94,534,985).................................. $ 112,191,273
Receivables:
Dividends.............................................................................. 104,743
Investment securities sold............................................................. 1,914,583
Purchase payments and transfers from other Travelers accounts.......................... 11,365
Variation on futures margin............................................................ 17,000
----------------

Total Assets........................................................................ 114,238,964
----------------

LIABILITIES:
Cash overdraft............................................................................. 48,379
Payables:
Investment securities purchased........................................................ 1,520,413
Contract surrenders and transfers to other Travelers accounts.......................... 48,252
Investment management and advisory fees................................................ 7,983
Market timing fees..................................................................... 30,721
Accrued liabilities........................................................................ 30,820
----------------

Total Liabilities................................................................... 1,686,568
----------------

NET ASSETS:
(Applicable to 25,191,932 units outstanding at $4.468 per unit)............................ $ 112,552,396
================
</TABLE>

See Notes to Financial Statements

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<PAGE> 10

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends............................................................... $ 1,759,757
Interest................................................................ 593,002
-----------------
Total income........................................................ $ 2,352,759

EXPENSES:
Market timing fees...................................................... 1,775,228
Investment management and advisory fees................................. 461,300
Insurance charges....................................................... 1,775,228
-----------------
Total expenses...................................................... 4,011,756
----------------

Net investment loss.............................................. (1,658,997)
----------------

REALIZED GAIN AND CHANGE IN UNREALIZED GAIN ON
INVESTMENT SECURITIES:
Realized gain from investment security transactions:
Proceeds from investment securities sold............................ 253,007,169
Cost of investment securities sold.................................. 192,658,399
-----------------

Net realized gain................................................ 60,348,770

Change in unrealized gain on investment securities:
Unrealized gain at December 31, 1997................................ 49,281,960
Unrealized gain at December 31, 1998................................ 17,656,288
--
---------------

Net change in unrealized gain for the year....................... (31,625,672)
----------------

Net realized gain and change in unrealized gain.............. 28,723,098
----------------

Net increase in net assets resulting from operations.................... $ 27,064,101
===============

</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
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997

<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
OPERATIONS:
Net investment loss........................................................ $ (1,658,997) $ (821,937)
Net realized gain from investment security transactions.................... 60,348,770 29,409,972
Net change in unrealized gain on investment securities..................... (31,625,672) 18,381,102
--------------- ---------------

Net increase in net assets resulting from operations................... 27,064,101 46,969,137
--------------- ---------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 1,393,179 and 2,453,311 units, respectively)............ 5,425,118 7,827,231
Participant transfers from other Travelers accounts
(applicable to 1,384,558 and 2,764,694 units, respectively)............ 5,367,961 9,073,766
Market timing transfers from other Travelers timed accounts
(applicable to 10,452,244 and 13,417,785 units, respectively).......... 44,617,650 40,990,167
Administrative charges
(applicable to 31,443 and 67,786 units, respectively).................. (133,088) (224,578)
Contract surrenders
(applicable to 3,370,312 and 5,047,459 units, respectively)............ (13,144,096) (15,992,402)
Participant transfers to other Travelers accounts
(applicable to 2,139,672 and 4,764,847 units, respectively)............ (8,225,358) (14,956,016)
Market timing transfers to other Travelers timed accounts
(applicable to 42,726,533 and 16,465,702 units, respectively).......... (160,776,295) (45,755,486)
Other payments to participants
(applicable to 82,003 and 89,224 units, respectively).................. (319,237) (274,330)
--------------- ---------------

Net decrease in net assets resulting from unit transactions............ (127,187,345) (19,311,648)
--------------- ---------------

Net increase (decrease) in net assets............................... (100,123,244) 27,657,489

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

End of year................................................................ $ 112,552,396 $ 212,675,640
=============== ===============

</TABLE>

See Notes to Financial Statements

-9-
<PAGE> 12

NOTES TO FINANCIAL STATEMENTS

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 Citigroup Inc. (formerly
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 4:00 p.m. eastern standard time closing price of the
New York Stock Exchange on the last business day of the year; securities traded
on the over-the-counter market and listed securities with no reported sales are
valued at the mean between the last-reported bid and asked prices or on the
basis of quotations received from a reputable broker or other recognized source.

Short-term investments for which a quoted market price is available are valued
at market. Short-term investments 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
as of the close of business of the New York Stock Exchange, or in the absence of
such sale, the latest bid quotation.

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<PAGE> 13

NOTES TO FINANCIAL STATEMENTS - 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 year. Actual results could differ from those estimates.

2. INVESTMENTS

The aggregate costs of purchases and proceeds from sales of investments (other
than short-term securities), were $110,332,539 and $203,163,041, respectively;
the cost of purchases and proceeds from sales of direct and indirect U.S.
government securities were $878,904 and $1,396,370, respectively, for the year
ended December 31, 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 $16,676 and $24,649 for the years ended December 31, 1998 and 1997,
respectively.

At December 31, 1998, Account TGIS held 20 open S&P 500 Stock Index futures
contracts expiring in March, 1999. The underlying face value, or notional value,
of these contracts at December 31, 1998 amounted to $6,227,500. 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 $2,707,685 and
$6,907,342 for the years ended December 31, 1998 and 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 December 31, 1998 is shown on the Statement
of Assets and Liabilities as a receivable for variation on futures margin.

-11-
<PAGE> 14

NOTES TO FINANCIAL STATEMENTS - 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
Citigroup 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 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 years) 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 $57,912 and
$94,019 of contingent deferred sales charges for the years ended December 31,
1998 and 1997, respectively.

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

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
------------------------------------------------------------
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income................................ $ .064 $ .075 $ .061 $ .083 $ .064
Operating expenses..................................... .110 .090 .069 .057 .041
---------- ----------- ---------- ---------- -----------

Net investment income (loss)........................... (.046) (.015) (.008) .026 .023

Unit value at beginning of year........................ 3.526 2.717 2.263 1.695 1.776
Net realized and change in unrealized gains (losses)... .988 .824 .462 .542 (.104)
---------- ----------- ---------- ---------- -----------

Unit value at end of year.............................. $ 4.468 $ 3.526 $ 2.717 $ 2.263 $ 1.695
========== =========== ========== ========== ===========

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase (decrease) in unit value.................. $ .94 $ .81 $ .45 $ .57 $ (.08)
Ratio of operating expenses to average net assets*..... 2.82 % 2.82 % 2.82 % 2.82 % 2.82 %
Ratio of net investment income (loss) to average net (1.16) % (.45) % (.34) % 1.37 % 1.58 %
assets*.................................................
Number of units outstanding at end of year 25,192 60,312 68,111 105,044 29,692
(thousands).............................................
Portfolio turnover rate................................ 81 % 63 % 81 % 79 % 19 %
</TABLE>

* Annualized.

-12-
<PAGE> 15

THE TRAVELERS TIMED GROWTH AND INCOME STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF INVESTMENTS
DECEMBER 31, 1998

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
<S> <C> <C>
COMMON STOCKS (94.3%)

AEROSPACE (0.5%)
Boeing Co. 8,800 $ 287,100
General Dynamics Corp. 4,800 281,400
--------------
568,500
--------------
AIRLINES (0.1%)
AMR Corp. (A) 1,860 110,438
--------------

AUTOMOTIVE (1.7%)
Daimlerchrysler AG (A) 1,822 175,026
Ford Motor Co. 15,800 927,262
General Motors Corp. 4,800 343,500
Lear Corp. (A) 4,800 184,800
Navistar International Corp. (A) 9,400 267,900

--------------
1,898,488
--------------
BANKING (7.0%)
Bank One Corp. 6,672 340,689
BankAmerica Corp. 20,803 1,250,780
BankBoston Corp. 7,700 299,819
Capital One Financial Corp. 1,800 207,000
Chase Manhattan Corp. 11,448 779,180
Comerica, Inc. 4,100 279,569
Fifth Third Bancorp 4,100 292,509
First Union Corp. 2,900 176,356
Fleet Financial Group Inc. 9,500 424,531
Golden West Financial Corp. 2,700 247,556
J.P. Morgan & Company 2,400 252,150
M & T Bank Corp. 300 155,681
National City Corp. 6,300 456,750
PNC Bank Corp. 2,900 156,963
Republic New York Corp. 5,200 236,925
State Street Corp. 4,100 285,206
Summit Bancorp. 7,200 314,550
SunTrust Banks, Inc. 6,300 481,950
Washington Mutual 6,050 231,034
Wells Fargo & Co. 23,700 946,519
--------------
7,815,717
--------------
BEVERAGE (2.9%)
Adolph Coors Co. 7,500 423,515
Anheuser-Busch Cos. 4,800 315,000
Coca-Cola Co. 24,900 1,665,188
PepsiCo, Inc. 19,600 802,375
--------------
3,206,078
--------------
BROKERAGE (1.9%)
Lehman Brothers Holdings, Inc. 9,000 396,563
Marsh & McLennan Cos. 5,000 292,187
Merrill Lynch & Co. 9,700 647,475
Morgan Stanley Dean Witter & Co. 11,540 819,340

--------------
2,155,565
--------------
BUILDING MATERIALS (0.3%)
Masco Corp. 11,800 339,250
--------------
CAPITAL GOODS (5.5%)
Applied Materials, Inc. (A) 6,600 $ 281,943
Cordant Technologies, Inc. 5,200 195,000
Crane Co. 8,826 266,435
Deere & Co. 5,400 178,875
Emerson Electric Co. 4,000 250,250
General Electric Co. 35,500 3,623,219
Honeywell, Inc. 3,200 241,000
Pitney Bowes, Inc. 2,700 178,369
Tellabs, Inc. (A) 1,900 130,269
TRW, Inc. 5,000 280,937
United Technologies Corp. 5,100 554,625
--------------
6,180,922
--------------
CHEMICALS (1.3%)
Crompton & Knowles Corp. 8,900 184,119
Dow Chemical Co. 2,200 200,062
E.I. Dupont de Nemours & Co. 9,900 525,319
Lyondell Petrochemical Co. 5,700 102,600
Monsanto Co. 5,300 251,750
Praxair, Inc. 6,100 215,025
--------------
1,478,875
--------------
CONSTRUCTION MACHINE (0.4%)
Caterpillar, Inc. 3,600 165,600
Ingersoll-Rand Co. 6,500 305,094
--------------
470,694
--------------
CONSUMER (3.5%)
Clorox Co. 3,700 432,206
Colgate-Palmolive Co. 3,000 278,625
Eastman Kodak Co. 3,250 234,000
Gillette Co. 6,978 337,125
Kimberly Clark Corp. 5,020 273,590
Maytag Corp. 5,000 311,250
Meredith Corp. 6,700 253,763
Procter & Gamble Co. 14,200 1,296,637
Unilever N.V. 6,700 555,681
--------------
3,972,877
--------------
DEFENSE (0.2%)
Raytheon Co. 3,800 202,350
--------------

ENTERTAINMENT (0.6%)
Viacom, Inc. (A) 3,425 253,450
Walt Disney Co. 14,623 438,690
--------------
692,140
--------------
FINANCE (2.0%)
American Express Co. 6,900 705,525
Associates First Capital Corp. 8,654 366,713
Countrywide Credit Industries, Inc. 4,500 225,844

Household International 10,900 431,912
Pulte Corp. 7,400 205,813
Transamerica Corp. 2,400 277,200
--------------
2,213,007
--------------
</TABLE>

-13-
<PAGE> 16

STATEMENT OF INVESTMENTS - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
<S> <C> <C>
FOOD (1.9%)
Campbell Soup Co. 4,700 $ 258,500
H. J. Heinz Co. 7,500 424,687
Interstate Bakeries Corp. 7,000 185,062
Kellogg Co. 3,800 129,675
Sara Lee Corp. 18,200 513,013
Suiza Foods Corp. (A) 6,100 310,719
Sysco Corp. 12,400 340,225
--------------
2,161,881
--------------
HEALTHCARE (1.5%)
Abbott Laboratories 15,000 735,000
Guidant Corp. 4,300 474,075
Healthsouth Rehabilitation
Corp. (A) 16,000 247,000
Wellpoint Health Networks,
Inc. (A) 2,400 208,800
--------------
1,664,875
--------------
HOME CONSTRUCTION (0.2%)
Kaufman & Broad Home Corp. 6,400 184,000
--------------

INDEPENDENT ENERGY (0.4%)
Burlington Resources, Inc. 5,100 182,644
Entergy Corp. 7,400 230,325
Halliburton Co. 2,500 74,062
--------------
487,031
--------------
INDUSTRIAL (1.6%)
CBS Corp. 12,600 412,650
Mercury General Corp. 2,900 127,056
Sealed Air Corp. (A) 5,200 265,525
Tyco International Ltd. 10,209 770,142
Waste Management, Inc. 5,600 261,100
--------------
1,836,473
--------------
INSURANCE (2.9%)
Allstate Corp. 12,876 497,335
Ambac Financial Group, Inc. 3,200 192,600
American International Group 13,312 1,286,272
ChoicePoint, Inc. (A) 310 19,995
Everest Reinsurance Holdings 5,100 198,581
Hartford Financial Services Group 5,400 296,325
SunAmerica, Inc. 5,150 417,794
Transatlantic Holdings, Inc. 1,890 142,813
20th Century Industries 7,400 171,588
--------------
3,223,303
--------------
INTEGRATED ENERGY (4.8%)
Amoco Corp. 9,500 573,563
Atlantic Richfield Co. 5,900 384,975
Chevron Corp. 5,900 489,331
Exxon Corp. 24,100 1,762,312
Mobil Corp. 8,300 723,137
Royal Dutch Petroleum Co. 15,300 732,487
Texaco, Inc. 8,300 438,863
Unocal Corp. 10,200 297,713
--------------
5,402,381
--------------
MEDIA (2.3%)
Clear Channel
Communications, Inc. (A) 8,200 $ 446,900
Comcast Corp. 7,900 463,878
Gannett Company, Inc. 5,200 344,175
New York Times Co. 6,600 228,938
Tele-Communications, Inc. (A) 4,700 260,115
Time Warner, Inc. 10,200 633,037
Times Mirror Co. 4,000 224,000
--------------
2,601,043
--------------
METALS (0.5%)
Aluminum Company of
America, Inc. 5,812 433,357
Bethlehem Steel Corp. (A) 14,500 121,438
--------------
554,795
--------------
NATURAL GAS PIPELINE (0.8%)
Columbia Energy Group 3,400 196,350
Enron Corp. 2,900 165,481
Sonat, Inc. 4,300 116,369
Williams Cos. 12,200 380,488
--------------
858,688
--------------
OIL FIELD (0.2%)
Schlumberger Ltd. 4,300 198,338
--------------

PAPER (0.7%)
Georgia-Pacific Group 4,300 251,819
International Paper Co. 2,300 103,069
Mead Corp. 5,190 152,132
Weyerhaeuser Co. 1,800 91,462
Willamette Industries, Inc. 5,400 180,900
--------------
779,382
--------------
PHARMACEUTICALS (10.2%)
American Home Products Corp. 16,000 901,000
Amgen, Inc. (A) 5,100 532,950
Baxter International, Inc. 5,900 379,444
Bristol-Myers Squibb Co. 9,700 1,297,981
CVS Corp. 10,200 561,000
Eli Lilly & Co. 10,800 959,850
Johnson & Johnson 14,700 1,232,963
Merck & Co. 12,000 1,772,250
Pfizer, Inc. 13,160 1,650,757
Pharmacia & Upjohn, Inc. 5,000 283,125
Schering-Plough Corp. 15,000 828,750
Warner-Lambert Co. 10,700 804,506
Watson Pharmaceuticals, Inc. (A) 3,200 201,200

--------------
11,405,776
--------------
RAILROADS (0.3%)
CSX Corp. 4,800 199,200
Union Pacific Corp. 1,900 85,619
--------------
284,819
--------------

</TABLE>

-14-
<PAGE> 17

STATEMENT OF INVESTMENTS - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
<S> <C> <C>
RETAILERS (5.6%)
Costco Cos. (A) 5,100 $ 368,953
Dayton Hudson Corp. 10,200 553,350
Gap, Inc. 5,975 336,094
Home Depot, Inc. 18,200 1,113,612
J.C. Penney Company, Inc. 2,500 117,187
KMart Corp. (A) 14,000 214,375
May Department Stores Co. 2,400 144,900
McDonalds Corp. 6,500 498,062
Nordstrom, Inc. 6,300 218,925
Rite Aid Corp. 6,700 332,069
Staples, Inc. (A) 8,800 384,725
TJX Companies, Inc. 11,800 342,200
Wal-Mart Stores, Inc. 20,800 1,693,900
--------------
6,318,352
--------------
SERVICES (4.3%)
Equifax, Inc. 1,300 44,444
HBO & Co. 12,400 356,112
Medtronic, Inc. 7,700 571,725
Microsoft Corp. (A) 27,700 3,837,314
--------------
4,809,595
--------------
SUPERMARKETS (0.8%)
Kroger Co. (A) 5,900 356,950
Safeway Inc. (A) 8,543 520,589
--------------
877,539
--------------
TECHNOLOGY (12.1%)
America Online, Inc. (A) 3,300 511,912
Ceridian Corp. (A) 3,800 265,287
Cisco Systems, Inc. (A) 19,475 1,808,131
Compaq Computer Corp. 17,179 720,423
Computer Sciences Corp. (A) 4,800 309,300
Compuware Corp. (A) 3,600 281,137
Dell Computer Corp. (A) 16,400 1,200,787
EG&G, Inc. 9,500 264,219
EMC Corp. (A) 7,700 654,500
Gateway 2000, Inc. (A) 1,600 81,900
Hewlett-Packard Co. 8,700 594,319
International Business
Machines Corp. 11,000 2,032,250
Intel Corp. 20,600 2,441,743
Motorola, Inc. 5,900 360,269
Oracle Corp. (A) 12,600 543,768
Sun Microsystems, Inc. (A) 2,200 188,238
Symbol Technologies, Inc. 3,500 223,781
Texas Instruments, Inc. 4,100 350,806
3Com Corp. (A) 8,400 376,687
Xerox Corp. 3,000 354,000
--------------
13,563,457
--------------
TELECOMMUNICATIONS (10.1%)
AirTouch Communications, Inc (A) 10,700 $ 771,737
Ameritech Corp. 10,100 640,087
AT&T Corp. 18,500 1,392,125
Bell Atlantic Corp. 16,460 935,134
BellSouth Corp. 18,200 907,725
GTE Corp. 7,800 526,013
Lucent Technologies Inc. 15,368 1,690,480
MCI WorldCom, Inc. (A) 24,151 1,733,588
MediaOne Group, Inc. (A) 9,000 423,000
Nextel Communications, Inc. (A) 12,200 288,606
SBC Communications, Inc. 18,050 967,931
Sprint Corp. - Fon Group 4,570 384,451
Sprint Corp. - PCS Group (A) 16,835 389,309
US West, Inc. 4,286 276,983
--------------
11,327,169
--------------
TEXTILE (0.1%)
Fruit of the Loom (A) 8,400 116,026
--------------

TOBACCO (1.6%)
Loews Corp. 2,200 216,150
Philip Morris Cos. 30,500 1,631,750
--------------
1,847,900
--------------
U.S. AGENCY (1.2%)
Federal Home Loan
Mortgage Corp. 6,700 431,731
Federal National Mortgage
Association 13,100 969,400
--------------
1,401,131
--------------
UTILITIES (2.3%)
AES Corp. (A) 7,700 364,787
Alltel Corp. 6,400 382,800
Central & South West Corp. 12,200 334,737
Edison International 11,100 309,412
FPL Group, Inc. 4,800 295,800
Houston Industries 2,400 77,100
PP&L Resources, Inc. 8,700 242,513
Southern Co. 6,300 183,094
Texas Utilities Co. 8,600 401,513
--------------
2,591,756
--------------
TOTAL COMMON STOCKS
(COST $88,145,770) 105,800,611
--------------

</TABLE>

-15-
<PAGE> 18

STATEMENT OF INVESTMENTS - CONTINUED

<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
------------ ------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (5.7%)

COMMERCIAL PAPER (5.3%)
Eastman Kodak Co.,
5.30% due February 8, 1999 $ 460,000 $ 457,520
Eaton Corp.,
6.11% due January 6, 1999 800,000 799,320
GE Capital Corp.,
5.75% due January 13, 1999 1,600,000 1,597,075
Household Finance Corp.,
5.12% due January 4, 1999 1,421,000 1,420,193
PepsiCo, Inc.,
5.40% due January 27, 1999 1,730,000 1,723,514
--------------
5,997,622
--------------
U.S. TREASURY (0.4%)
United States of America Treasury,
5.32% due May 27, 1999 (B) 400,000 393,040
--------------

TOTAL SHORT-TERM
INVESTMENTS (COST $6,389,215) 6,390,662
--------------

NOTIONAL
VALUE
------------
FUTURES CONTRACTS (0.0%)

S&P 500 Stock Index,
Exp. March, 1999 (C) $ 6,227,500 -
--------------

TOTAL INVESTMENTS (100%)
(COST $94,534,985) (D) $ 112,191,273
==============
</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 December 31, 1998, net unrealized appreciation for all securities was
$17,656,288. This consisted of aggregate gross unrealized appreciation for
all securities in which there was an excess of market value over cost of
$19,270,485 and aggregate gross unrealized depreciation for all securities
in which there was an excess of cost over market value of $1,614,197.

See Notes to Financial Statements

-16-
<PAGE> 19

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Managers and Owners of Variable Annuity Contracts of
The Travelers Timed Growth and Income Stock Account for Variable Annuities

In our opinion, the accompanying statement of assets and liabilities, including
the statement of investments, as of December 31, 1998, and the related statement
of operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and the selected per unit
data and ratios for each of the five years in the period then ended present
fairly, in all material respects, the financial position of The Travelers Timed
Growth and Income Stock Account for Variable Annuities at December 3l, 1998, and
the results of their operations for the year then ended in conformity with
generally accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit, which included
confirmation of securities as of December 31, 1998, by correspondence with the
custodian, provides a reasonable basis for the opinion expressed above.

PRICEWATERHOUSECOOPERS LLP

Hartford, Connecticut
February 15, 1999

-17-
<PAGE> 20

THE TRAVELERS
TIMED SHORT-TERM
BOND ACCOUNT
FOR VARIABLE ANNUITIES

The year 1998 was turbulent for the global financial markets as Asian economies
and currencies imploded, other emerging markets were badly shaken, and fears
spread that a global recession was underway. By year-end however, the Asian
turmoil had lessened and the United States and European economies had weathered
the storm. In fact, it is estimated that the U.S. will experience Gross Domestic
Product growth of 3.75%.

The year ended with the 30-year Treasury Bond yield at 5.09% and the Federal
Reserve Board ("Fed") funds rate at 4.75%. The 30-year Treasury bond was up 12
basis points from the September 30th level of 4.97%, but down 81 basis points
from the beginning of the year. During the fourth quarter, the Fed lowered the
federal funds rate twice by 25 basis points each time, the first time on October
15, 1998 in between it's meetings and the second time at the November 17, 1998
meeting. Further decreases in the Federal funds rate appear unlikely in the
first quarter of 1999, as the Fed changed its stance to neutral at the meeting.

The strategy in management of The Travelers Timed Short-Term Bond Account for
Variable Annuities, will be to extend maturities from the current average life
of 23 days, to between 60 and 90 days. At December 31, 1998 the asset size of
the portfolio was $197.3 million, with an average yield of 5.21%.

PORTFOLIO MANAGER: EMIL J. MOLINARO JR.

-18-
<PAGE> 21

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1998

<TABLE>
<S> <C>
ASSETS:
Investment securities, at market value (cost $197,256,824)................................. $ 197,250,520
Cash....................................................................................... 8,058
Receivables:
Investment securities sold............................................................. 7,839,000
Purchase payments and transfers from other Travelers accounts.......................... 27,149
----------------

Total Assets........................................................................ 205,124,727
----------------

LIABILITIES:
Payables:
Investment securities purchased........................................................ 7,835,601
Contract surrenders and transfers to other Travelers accounts.......................... 93,286
Investment management and advisory fees................................................ 14,025
Market timing fees..................................................................... 53,973
Accrued liabilities........................................................................ 54,499
----------------

Total Liabilities................................................................... 8,051,384
----------------

NET ASSETS:
(Applicable to 137,066,818 units outstanding at $1.437 per unit)........................... $ 197,073,343
===============
</TABLE>

<PAGE> 22

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest................................................................ $ 8,762,846

EXPENSES:
Market timing fees...................................................... $ 1,991,215
Investment management and advisory fees................................. 517,425
Insurance charges....................................................... 1,991,215
-----------------
Total expenses...................................................... 4,499,855
----------------

Net investment income............................................ 4,262,991
----------------

REALIZED GAIN AND CHANGE IN UNREALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES:
Realized gain from investment security transactions:
Proceeds from investment securities sold............................ 96,093,292
Cost of investment securities sold.................................. 96,088,891
-----------------

Net realized gain................................................ 4,401

Change in unrealized gain (loss) on investment securities:
Unrealized gain at December 31, 1997................................ 1,451
Unrealized loss at December 31, 1998................................ (6,304)
---------------

Net change in unrealized gain (loss) for the year................. (7,755)
----------------

Net realized gain and change in unrealized gain (loss)........... (3,354)
----------------

Net increase in net assets resulting from operations.................... $ 4,259,637
================

</TABLE>

See Notes to Financial Statements

-20-
<PAGE> 23

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997

<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
OPERATIONS:
Net investment income...................................................... $ 4,262,991 $ 2,113,331
Net realized gain (loss) from investment security transactions............. 4,401 (336)
Net change in unrealized gain (loss) on investment securities.............. (7,755) 11,785
----------------- ----------------
Net increase in net assets resulting from operations................... 4,259,637 2,124,780
----------------- ----------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 4,899,841 and 2,871,021 units, respectively)............ 6,966,870 3,957,433
Participant transfers from other Travelers accounts
(applicable to 3,275,494 and 1,695,500 units, respectively)............ 4,642,138 2,349,190
Market timing transfers from other Travelers timed accounts
(applicable to 139,179,292 and 46,933,510 units, respectively)......... 197,358,803 64,283,327
Administrative charges
(applicable to 111,227 and 57,421 units, respectively)................. (158,992) (79,709)
Contract surrenders
(applicable to 9,833,684 and 4,875,179 units, respectively)............ (13,984,074) (6,710,909)
Participant transfers to other Travelers accounts
(applicable to 6,135,224 and 5,843,389 units, respectively)............ (8,720,437) (8,038,607)
Market timing transfers to other Travelers timed accounts
(applicable to 41,238,874 and 47,867,671 units, respectively).......... (59,114,111) (65,788,808)
Other payments to participants
(applicable to 230,542 and 159,816 units, respectively)................ (328,066) (219,800)
----------------- ----------------

Net increase (decrease) in net assets resulting from unit transactions. 126,662,131 (10,247,883)
----------------- ----------------

Net increase (decrease) in net assets............................... 130,921,768 (8,123,103)

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

End of year................................................................ $ 197,073,343 $ 66,151,575
================= ================

</TABLE>

See Notes to Financial Statements

-21-
<PAGE> 24

NOTES TO FINANCIAL STATEMENTS

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 Citigroup Inc. (formerly
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.

-22-
<PAGE> 25

NOTES TO FINANCIAL STATEMENTS - 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
Citigroup 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 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 years) 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 $72,123 and
$56,053 of contingent deferred sales charges for the years ended December 31,
1998 and 1997, respectively.

-23-
<PAGE> 26

NOTES TO FINANCIAL STATEMENTS - CONTINUED

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

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
------------------------------------------------------------
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income............................... $ .078 $ .077 $ .057 $ .074 $ .055
Operating expenses.................................... .040 .039 .030 .035 .036
--------- ---------- ---------- --------- ----------

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

Unit value at beginning of year....................... 1.399 1.361 1.333 1.292 1.275
Net realized and change in unrealized gains (losses)*. .000 .000 .001 .002 (.002)
--------- ---------- ---------- --------- ----------
Unit value at end of year............................. $ 1.437 $ 1.399 $ 1.361 $ 1.333 $ 1.292
========= ========== ========== ========= ==========

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase in unit value............................ $ .04 $ .04 $ .03 $ .04 $ .02
Ratio of operating expenses to average net assets**... 2.82 % 2.82 % 2.82 % 2.82 % 2.82 %
Ratio of net investment income to average net assets** 2.71 % 2.77 % 2.47 % 3.17 % 1.45 %
Number of units outstanding at end of year (thousands) 137,067 47,262 54,565 - 216,713

</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.

-24-
<PAGE> 27

THE TRAVELERS TIMED SHORT-TERM BOND ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF INVESTMENTS
DECEMBER 31, 1998

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

COMMERCIAL PAPER (100%)
Asset Securitization Corp.,
5.54% due January 21, 1999 $ 12,850,000 $ 12,812,337
Associates Corp. of North America,
5.16% due January 12, 1999 12,900,000 12,878,212
Becton Dickinson & Company,
5.20% due February 26, 1999 2,300,000 2,281,897
Becton Dickinson & Company,
5.17% due March 5, 1999 6,000,000 5,947,020
Coca-Cola Co.,
5.16% due February 23, 1999 9,850,000 9,776,539
E.I. Dupont de Nemours & Co.,
5.11% due January 13, 1999 12,900,000 12,876,419
Eastman Kodak Co.,
5.24% due January 26, 1999 9,500,000 9,465,676
Eaton Corp.,
6.11% due January 6, 1999 6,500,000 6,494,475
Ford Motor Credit Co.,
5.17% due January 15, 1999 12,900,000 12,872,845
Gannett Company, Inc.,
5.25% due January 14, 1999 9,500,000 9,481,323
GE Capital Corp.,
5.61% due February 4, 1999 5,500,000 5,473,374
H.J. Heinz Co.,
5.21% due February 3, 1999 9,850,000 9,803,675
Household Finance Corp.,
5.12% due January 4, 1999 7,840,000 7,835,547
Marsh & McLennan Cos.,
5.22% due January 28, 1999 12,800,000 12,750,285
Motorola, Inc.,
5.14% due February 25, 1999 2,535,000 2,515,397
National Rural Utilities Coop
Finance Corp.,
5.13% due January 15, 1999 8,000,000 7,983,160
Paccar Financial Corp.,
5.31% due February 5, 1999 11,000,000 10,945,231
PepsiCo, Inc.,
5.40% due January 27, 1999 4,880,000 4,861,705
Procter & Gamble Co.,
5.22% due January 22, 1999 4,190,000 4,177,145
Providian Master Trust,
5.41% due January 14, 1999 5,000,000 4,990,170
Providian Master Trust,
5.35% due January 28, 1999 5,215,000 5,194,745
Prudential Funding Corp.,
5.46% due January 20, 1999 12,900,000 12,863,957
TECO Finance, Inc.,
5.13% due January 19, 1999 3,200,000 3,191,498
Transamerica Financial Corp.,
5.11% due February 22, 1999 9,850,000 9,777,888
--------------
TOTAL INVESTMENTS (100%)
(COST $197,256,824) $ 197,250,520
==============
</TABLE>

See Notes to Financial Statements

-25-
<PAGE> 28

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Managers and Owners of Variable Annuity Contracts of
The Travelers Timed Short-Term Bond Account for Variable Annuities

In our opinion, the accompanying statement of assets and liabilities, including
the statement of investments, as of December 31, 1998, and the related statement
of operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and the selected per unit
data and ratios for each of the five years in the period then ended present
fairly, in all material respects, the financial position of The Travelers Timed
Short-Term Bond Account for Variable Annuities at December 3l, 1998, and the
results of their operations for the year then ended in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit, which included
confirmation of securities as of December 31, 1998, by correspondence with the
custodian, provides a reasonable basis for the opinion expressed above.

PRICEWATERHOUSECOOPERS LLP

Hartford, Connecticut
February 15, 1999

-26-
<PAGE> 29

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").
Account TAS is managed 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 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 TAS to mirror the overall risk, sector weightings
and growth/value style characteristics of the Standard & Poor's 400 Stock Index
("S&P 400"). The S&P 400 is a value-weighted equity index comprised of midand
small-company stocks.

For the twelve months ending December 31, 1998, Account TAS had a total return
of 18.6%, before fees and expenses, slightly lagging the 19.1% total return of
S&P 400. Net of fees and expenses, Account TAS's total return of 15.3% for the
year was behind the 17.8% median return achieved by variable annuity stock funds
in the Lipper Mid Cap Category.

During the third quarter of 1998, stock selection in the Consumer Discretionary,
Financial Services and Utilities sectors had an adverse impact on relative
performance. The prospects of an economic slowdown and even a recession in the
near future hurt several retailing stocks such as Family Dollar Stores, General
Nutrition and Viking Office Products. Specialty retailers such as Liz Claiborne
and Neiman Marcus Group performed especially poorly during the month of August
as the Russian crisis unfolded. The Utilities sector was the best performing
sector in the third quarter and a small underweight position in the sector hurt
performance. In addition, several positions such as Winstar Communications,
Nextel Communications and AES Corp. fell sharply because of downward revisions
in earnings estimates.

In the Financial Services sector, our positions in Bear Stearns and Capital One
Financial hurt relative performance. Brokerage firms were hit hard in the third
quarter as trading and lending losses mounted and the perception of consumer
weakness sent Capital One Financial, a leading player in the credit card and
consumer banking business, into a tailspin.

Relative performance was enhanced by our stock selection in the Producer
Durables sector. Our position in American Power Conversion helped performance as
the company confirmed strong revenue growth of 25% to 30% for 1998. Cordant
Technologies also rose sharply at the end of the quarter to boost performance.
We also avoided several under performing stocks such as American Standard,
Danaher Corp. and Harsco Corp. which helped performance.

During the fourth quarter of 1998, stock selection in the Technology, Health
Care and Financial Services sectors had an adverse impact on relative
performance. Stock selection was positive in the Utilities, Materials and
Processing sectors. The severe volatility in the Technology sector during the
first two weeks of October contributed to our underperformance as we were unable
to match the timing of our purchases and sales. While we remained neutral to the
sector on average, we were unable to execute our purchases in a rising market
quickly enough to replace the exposure that we had sold during the period of
falling prices. In addition, we were hurt by our positions in software companies
such as Peoplesoft, BMC Software and Cadence Design which turned in
disappointing earnings performance.

-27-
<PAGE> 30

We were hurt in the Health Care sector by our underweight position in a number
of better performing stocks such as Forest Laboratories and Sybron International
and biotechnology securities such as Genzyme and Chiron. Our modest position in
Pharmerica, which reported a negative earnings surprise, also hurt performance.
The theme of being underweight stocks which performed well in the fourth quarter
despite poor earnings fundamentals also held true in the Financial Services
sector. Several less liquid stocks such as Zion Bancorporation, Old Kent
Financial and Reliastar Financial produced strong gains which we missed.

In the Materials and Processing sector, we were helped by our positions in
construction companies such as Southdown and Vulcan Materials which responded
well to the prospects of economic stability as a result of the Federal Reserve
Board action to lower interest rates. In the Utilities sector, we have been
emphasizing telecommunications and cellular telephone companies such as Aliant
Communication and Century Telephone at the expense of the local/regional
telephone companies and the electric utilities group. We were rewarded in these
positions as investors paid a premium for the higher growth prospects of these
companies within a relatively low growth sector.

In our disciplined approach to stock selection, we screen our research universe
of over 800 mid-cap securities for companies that offer improving earnings
fundamentals at discounted stock valuations. A small sample of our current
holdings is presented here to illustrate our investment approach. In the
Technology sector, we focus on higher growth industries like computer services
and software through our positions in Comverse Technology, Concord EFS, Siebel
Systems and Legato Systems which are still trading at reasonable valuations. Our
emphasis on Watson Pharmaceuticals and Guidant Corp., leaders in the generic
drugs and medical devices industries respectively, also seeks growth at a
reasonable price.

PORTFOLIO MANAGER: SANDIP A. BHAGAT, CFA

-28-
<PAGE> 31

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1998

<TABLE>
<S> <C>
ASSETS:
Investment securities, at market value (cost $51,781,470).................................. $ 59,515,014
Cash .................................................................................... 260,737
Receivables:
Dividends.............................................................................. 43,846
Investment securities sold............................................................. 6,678,811
Purchase payments and transfers from other Travelers accounts.......................... 15,281
Variation on futures margin............................................................ 2,028
----------------

Total Assets........................................................................ 66,515,717
----------------

LIABILITIES:
Payables:
Investment securities purchased........................................................ 2,151,441
Contract surrenders and transfers to other Travelers accounts.......................... 48,984
Investment management and advisory fees................................................ 4,666
Market timing fees..................................................................... 16,665
Accrued liabilities........................................................................ 16,818
----------------

Total Liabilities................................................................... 2,238,574
----------------

NET ASSETS:
(Applicable to 16,452,224 units outstanding at $3.907 per unit)........................... $ 64,277,143
================

</TABLE>

See Notes to Financial Statements

-29-
<PAGE> 32

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends............................................................... $ 655,664
Interest................................................................ 574,546
-----------------

Total Income........................................................ $ 1,230,210

EXPENSES:
Market timing fees...................................................... 914,432
Investment management and advisory fees................................. 256,041
Insurance charges....................................................... 914,432
-----------------
Total expenses...................................................... 2,084,905
----------------

Net investment loss.............................................. (854,695)
----------------

REALIZED GAIN AND CHANGE IN UNREALIZED GAIN ON
INVESTMENT SECURITIES:
Realized gain from investment security transactions:
Proceeds from investment securities sold............................ 110,734,105
Cost of investment securities sold.................................. 96,780,596
-----------------

Net realized gain................................................ 13,953,509

Change in unrealized gain on investment securities:
Unrealized gain at December 31, 1997................................ 15,078,427
Unrealized gain at December 31, 1998................................ 7,733,544
-----------------

Net change in unrealized gain for the year....................... (7,344,883)
----------------

Net realized gain and change in unrealized gain.............. 6,608,626
----------------

Net increase in net assets resulting from operations.................... $ 5,753,931
================
</TABLE>

See Notes to Financial Statements

-30-
<PAGE> 33

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997

<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
OPERATIONS:
Net investment loss........................................................ $ (854,695) $ (591,046)
Net realized gain from investment security transactions.................... 13,953,509 14,770,772
Net change in unrealized gain on investment securities..................... (7,344,883) 5,613,596
----------------- ----------------

Net increase in net assets resulting from operations................... 5,753,931 19,793,322
----------------- ----------------

UNIT TRANSACTIONS:
Participant purchase payments
(applicable to 1,162,073 and 1,773,947 units, respectively)............ 4,076,993 5,233,718
Participant transfers from other Travelers accounts
(applicable to 285,187 and 343,016 units, respectively)................ 1,020,435 1,050,497
Market timing transfers from other Travelers timed accounts
(applicable to 4,085,482 and 6,455,170 units, respectively)............ 14,496,461 17,684,347
Administrative charges
(applicable to 25,033 and 38,438 units, respectively).................. (91,340) (117,747)
Contract surrenders
(applicable to 1,541,603 and 1,793,810 units, respectively)............ (5,452,058) (5,349,748)
Participant transfers to other Travelers accounts
(applicable to 1,838,385 and 3,726,120 units, respectively)............ (6,504,181) (11,042,553)
Market timing transfers to other Travelers timed accounts
(applicable to 11,517,409 and 7,255,179 units, respectively)........... (36,582,507) (18,527,841)
Other payments to participants
(applicable to 22,628 and 61,544 units, respectively).................. (81,663) (201,368)
----------------- ----------------

Net decrease in net assets resulting from unit transactions............ (29,117,860) (11,270,695)
----------------- ----------------

Net increase (decrease) in net assets............................... (23,363,929) 8,522,627

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

End of year................................................................ $ 64,277,143 $ 87,641,072
=============== ===============
</TABLE>

See Notes to Financial Statements

-31-
<PAGE> 34

NOTES TO FINANCIAL STATEMENTS

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 Citigroup Inc. (formerly
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 market 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
as of the close of business of the New York Stock Exchange, or, in the absence
of such sale, the latest bid quotation.

-32-
<PAGE> 35

NOTES TO FINANCIAL STATEMENTS - 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 $71,772,819 and $89,510,232, respectively; the
costs of purchases and proceeds from sales of direct and indirect U.S.
government securities were $653,839 and $1,356,018, respectively, for the year
ended December 31, 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 $9,682 and $7,564 for the years ended December 31, 1998 and 1997,
respectively.

At December 31, 1998, Account TAS held 21 open S&P 400 MidCap Index futures
contracts expiring in March, 1999. The underlying face value, or notional value,
of these contracts at December 31, 1998 amounted to $4,113,375.

Net realized gains resulting from futures contracts were $277,383 and $3,766,611
for the years ended December 31, 1998 and 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 December 31, 1998 is shown on the Statement of Assets and
Liabilities as a receivable for variation on futures margin.

-33-
<PAGE> 36

NOTES TO FINANCIAL STATEMENTS - 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
Citigroup 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 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 years) 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 $58,013 and
$69,828 of contingent deferred sales charges for the years ended December 31,
1998 and 1997, respectively.

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

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
-------------------------------------------------------------
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
SELECTED PER UNIT DATA:
Total investment income............................... $ .056 $ .063 $ .041 $ .042 $ .036
Operating expenses.................................... .098 .085 .069 .057 .049
----------- ---------- ---------- ---------- ----------

Net investment loss................................... (.042) (.022) (.028) (.015) (.013)

Unit value at beginning of year....................... 3.389 2.623 2.253 1.706 1.838
Net realized and change in unrealized gains (losses).. .560 .788 .398 .562 (.119)
----------- ---------- ---------- ---------- ----------

Unit value at end of year............................. $ 3.907 $ 3.389 $ 2.623 $ 2.253 $ 1.706
=========== ========== ========== ========== ==========

SIGNIFICANT RATIOS AND ADDITIONAL DATA:
Net increase (decrease) in unit value................. $ .52 $ .77 $ .37 $ .55 $ (.13)
Ratio of operating expenses to average net assets*.... 2.85 % 2.85 % 2.84 % 2.83 % 2.80 %
Ratio of net investment loss to average net assets*... (1.21) % (.76) % (1.13) % (.74) % (.72) %
Number of units outstanding at end of year (thousands) 16,452 25,865 30,167 45,575 25,109
Portfolio turnover rate............................... 113 % 92 % 98 % 113 % 142 %

</TABLE>

* Annualized.

-34-
<PAGE> 37

THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES

STATEMENT OF INVESTMENTS
DECEMBER 31, 1998

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
COMMON STOCKS (99.6%)

<S> <C> <C>
AEROSPACE (1.4%)
Gulfstream Aerospace Corp. (A) 4,900 $ 260,925
Precision Castparts Corp. 4,800 212,400
Sundstrand Corp. 7,400 383,875
--------------
857,200
--------------
AIRLINES (0.4%)
Alaska Air Group, Inc. (A) 3,200 141,600
Continental Airlines, Inc. (A) 2,400 80,400
--------------
222,000
--------------
AUTOMOTIVE (1.8%)
Arvin Industries, Inc. 6,200 258,462
Harley Davidson, Inc. 6,240 295,620
Hertz Corp. 3,000 136,875
Lear Corp. (A) 7,000 269,500
Navistar International Corp. (A) 4,000 114,000
--------------
1,074,457
--------------
BANKING (7.3%)
AmSouth Bancorporation 3,575 163,109
Associated Banc-Corp. 7,475 255,317
Capital One Financial Corp. 1,600 184,000
City National Corp. 7,000 291,375
Dime Savings Bank, Inc. 7,800 206,212
First Security Corp. 17,550 409,682
First Tennesse National Corp. 7,900 300,446
First Virginia Banks, Inc. 3,200 150,400
Hibernia Corp. 21,100 366,613
M & T Bank Corp. 333 172,806
Marshall & Ilsley Corp. 6,400 370,600
Mercantile Bankshares Corp. 7,950 305,826
North Fork Bancorp, Inc. 13,400 320,762
Old Kent Financial Corp. 2,800 130,200
Southtrust Corp. 9,350 345,073
Sovereign Bancorp, Inc. 18,200 258,212
Wilmington Trust Co. 2,000 123,187
--------------
4,353,820
--------------
BEVERAGE (0.5%)
Brown-Forman Corp. 4,000 302,750
--------------

BROKERAGE (1.7%)
A.G. Edwards, Inc. 9,050 337,112
Paine Webber Group, Inc. 9,100 351,488
Price T Rowe & Associate, Inc. 9,300 316,780
--------------
1,005,380
--------------
BUILDING MATERIALS (2.2%)
Centex Corp. 5,600 252,350
Masco Corp. 6,300 181,125
Southdown, Inc. 5,900 349,206
Vulcan Materials Co. 4,000 526,250
--------------
1,308,931
--------------

CAPITAL GOODS (1.9%)
Allied Waste Industries, Inc. (A) 10,300 $ 243,337
Cordant Technologies, Inc. 6,320 237,000
Crane Co. 3,925 118,486
Leggett & Platt, Inc. 17,300 380,600
Thomas & Betts Corp. 3,500 151,594
--------------
1,131,017
--------------
CHEMICALS (2.0%)
Albemarle Corp. 11,400 270,750
Crompton & Knowles Corp. 12,400 256,525
Mylan Laboratories, Inc. 7,900 248,850
Solutia, Inc. 19,500 436,312
--------------
1,212,437
--------------
CONSTRUCTION MACHINE (0.3%)
Ingersoll-Rand Co. 4,000 187,750
--------------

CONSUMER (1.1%)
Furniture Brands, Inc. (A) 7,800 212,550
Hon Industries, Inc. 7,880 188,627
Meredith Corp. 3,400 128,775
Whirlpool Corp. 1,900 105,212
--------------
635,164
--------------
CONSUMER SERVICES (0.2%)
Knight-Ridder, Inc. 2,300 117,588
--------------

ENTERTAINMENT (0.5%)
International Game
Technology, Inc. 12,400 301,475
--------------

ENVIROMENTAL (0.5%)
United States Filter Corp. (A) 13,600 311,100
--------------

FINANCE (1.8%)
Comdisco, Inc. 18,800 317,250
Countrywide Credit Industries, Inc. 2,700 135,506
Finova Group, Inc. 6,000 323,625
Greenpoint Financial Co. 8,900 312,613
--------------
1,088,994
--------------
FOOD (5.0%)
Brinker International, Inc. (A) 10,700 308,962
Cracker Barrel Old Country
Store, Inc. 7,700 179,265
Dean Foods Co. 5,490 224,060
Flowers Industries, Inc. 10,700 256,131
IBP, Inc. 12,400 361,150
Interstate Bakeries Corp. 10,300 272,306
Starbucks Corp. (A) 5,500 308,000
Suiza Foods Corp. (A) 7,300 371,843
Tyson Foods, Inc. 15,900 337,875
US Foodservice, Inc. (A) 7,000 343,000
--------------
2,962,592
--------------
</TABLE>

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<PAGE> 38

STATEMENT OF INVESTMENTS - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
<S> <C> <C>
HEALTHCARE (3.4%)
Covance, Inc. (A) 3,500 $ 101,938
Foundation Health
Systems, Inc. (A) 8,300 99,081
Guidant Corp. 3,000 330,750
Health Management
Associates, Inc. (A) 26,875 581,172
Pacificare Health Systems, Inc. (A) 4,400 349,662
Quintiles Transnational Corp. (A) 5,000 266,719
Total Renal Care Holdings, Inc. (A) 9,400 277,888
--------------
2,007,210
--------------
HOME CONSTRUCTION (0.2%)
Clayton Homes, Inc. 9,437 130,349
--------------

INDUSTRIAL (5.0%)
Allegiance Corp. 7,900 368,338
Cintas Corp. 10,700 753,346
Convegys Corp. (A) 6,100 136,488
Hillenbrand Industries, Inc. 2,200 125,125
Miller (Herman), Inc. 10,100 270,806
Minerals Technologies, Inc. 2,600 106,438
Modis Professional
Services, Inc. (A) 6,600 95,700
National Service Industries, Inc. 5,500 209,000
Noble Drilling Corp. (A) 15,600 201,825
Pentair, Inc. 5,500 218,969
Robert Half International, Inc. (A) 5,800 259,188
Teleflex, Inc. 5,500 250,938
--------------
2,996,161
--------------
INSURANCE (3.7%)
AFLAC, Inc. 18,600 818,400
Ambac Financial Group, Inc. 4,200 252,787
Enhance Financial Services
Group, Inc. 4,000 120,000
Hartford Life, Inc. 3,000 174,750
Old Republic International Corp. 13,650 307,125
Oxford Health Plans, Inc. (A) 10,200 151,087
PMI Group, Inc. 1,900 93,812
Protective Life Corp. 7,000 278,687
--------------
2,196,648
--------------
INTERGRATED ENERGY (0.3%)
Pennzoil-Quaker State Co. (A) 10,911 160,942
--------------

MEDIA (1.8%)
Cox Radio, Inc. (A) 3,900 164,775
Interpublic Group Companies, Inc. 2,100 167,475
New York Times Co. 6,700 232,406
TCA Cable TV, Inc. 3,000 106,969
Valassis Communications, Inc. (A) 3,200 165,200
Washington Post Co. 370 213,837
--------------
1,050,662
--------------
METALS (0.1%)
U.S. Steel Group 3,900 89,700
--------------

NATURAL GAS DISTRIBS (1.5%)
El Paso Energy Corp. 9,800 $ 341,163
Keyspan Energy Corp. 7,900 244,900
MCN Energy Group, Inc. 4,200 80,063
National Fuel Gas Co. 5,000 225,938
--------------
892,064
--------------
OIL FIELD (1.4%)
ENSCO International, Inc. 11,800 126,113
Global Marine, Inc. (A) 10,900 100,144
Smith International, Inc. (A) 4,800 120,900
Tidewater, Inc. 3,900 90,431
Transocean Offshore, Inc. 11,700 313,706
Varco International, Inc. (A) 11,700 90,675
--------------
841,969
--------------
PAPER (1.1%)
Mead Corp. 6,600 193,463
P.H. Glatfelter Co. 10,700 132,413
Reynolds & Reynolds Co. 5,100 116,981
Sonoco Products Co. 6,950 205,894
--------------
648,751
--------------
PHARMACEUTICALS (5.3%)
Bergen Brunswig Corp. 12,550 437,680
Centocor, Inc. (A) 7,700 346,981
Chiron Corp. (A) 11,900 311,258
CVS Corp. 5,148 283,140
ICN Pharmaceuticals, Inc. 10,800 244,350
McKesson Corp. 9,000 711,562
Omnicare, Inc. 6,000 208,500
Watson Pharmaceuticals, Inc. (A) 9,660 607,372
--------------
3,150,843
--------------
RAILROADS (0.9%)
Kansas City Southern
Industries, Inc. 5,500 270,531
Trinity Industries, Inc. 6,700 257,950
--------------
528,481
--------------
REFINING (1.1%)
Ashland, Inc. 3,400 164,475
Murphy Oil Corp. 3,000 123,750
Tosco Corp. 10,300 266,513
Valero Energy Corp. 3,600 76,500
--------------
631,238
--------------
RETAILERS (6.3%)
Abercrombie & Fitch Co. (A) 5,600 396,200
AutoZone, Inc. (A) 4,000 131,750
Bed Bath & Beyond, Inc. (A) 16,800 572,774
Best Buy Company, Inc. (A) 6,300 386,662
Borders Group, Inc. (A) 4,000 99,750
Ethan Allen Interiors, Inc. 2,700 110,700
Family Dollar Stores, Inc. 22,800 501,600
Office Depot, Inc. (A) 21,400 790,462
OfficeMax, Inc. (A) 7,880 95,545
Payless ShoeSource, Inc. (A) 3,200 151,600
Ross Stores, Inc. 3,200 125,900
Saks, Inc. (A) 4,300 135,719
TJX Companies, Inc. 7,800 226,200
--------------
3,724,862
--------------

</TABLE>

-36-
<PAGE> 39

STATEMENT OF INVESTMENTS - CONTINUED

<TABLE>
<CAPTION>
NO. OF MARKET
SHARES VALUE
------------ ------------
<S> <C> <C>
SERVICES (7.5%)
Altera Corp. (A) 9,400 $ 571,638
Biogen, Inc. (A) 7,400 613,738
Biomet, Inc. 4,800 193,050
Cadence Design Systems, Inc. (A) 19,550 581,613
Concord EFS, Inc. (A) 5,100 216,113
Ecolab, Inc. 6,900 249,694
Lincare Holdings, Inc. (A) 5,300 214,815
Mail-Well, Inc. (A) 25,800 295,088
Maytag Corp. 2,600 161,850
Olsten Corp. 24,500 180,688
Stryker Corp. 5,800 319,363
SunGard Data Systems, Inc. (A) 10,900 432,594
Xilinx, Inc. (A) 6,700 436,128
--------------
4,466,372
--------------
SUPERMARKETS (0.9%)
Hannaford Brothers Co. 5,800 307,400
Kroger Co. (A) 3,900 235,950
--------------
543,350
--------------
TECHNOLOGY (15.9%)
Affiliated Computer
Service, Inc. (A) 3,100 139,500
American Power
Conversion Corp. (A) 9,900 479,221
Analog Devices, Inc. (A) 5,800 181,975
Atmel Corp. (A) 16,500 252,140
Citrix Systems, Inc. (A) 2,100 203,765
Compuware Corp. (A) 14,500 1,132,359
Comverse Technology, Inc. (A) 5,300 376,134
Fiserv, Inc. (A) 5,350 275,023
General Instrument Corp. (A) 5,800 196,837
Intuit, Inc. (A) 4,000 290,000
Keane, Inc. (A) 7,000 279,562
Legato Systems, Inc. (A) 3,300 217,594
Lexmark International
Group, Inc. (A) 7,100 713,550
Linear Technology Corp. 5,500 492,421
Maxim Integrated Products, Inc. (A) 7,700 336,153
Molex, Inc. 9,000 342,843
Networks Associates, Inc. (A) 10,150 673,388
Parker-Hannifin Corp. 4,400 144,100
Sanmina Corp. (A) 4,200 261,975
Siebel System, Inc. (A) 10,200 346,163
Sterling Commerce, Inc. (A) 7,000 315,000
Storage Technology Corp. (A) 9,100 323,619
Symbol Technologies, Inc. 6,900 441,169
Synopsys, Inc. (A) 4,000 216,750
Tech Data Corp. (A) 7,300 293,369
Teradyne, Inc. (A) 5,600 237,300
Transaction System
Architects, Inc. (A) 3,200 161,000
Veritas Software Corp. (A) 2,000 119,750
--------------
9,442,660
--------------
TELECOMMUNICATIONS (3.0%)
ADC Telecommunications, Inc. (A) 8,900 $ 308,162
Aliant Communications, Inc. 9,100 371,109
Century Telephone Enterprises, Inc. 10,650 718,875
Qualcomm, Inc. (A) 4,400 227,700
Winstar Communications, Inc. (A) 3,900 151,978
--------------
1,777,824
--------------
TEXTILE (0.5%)
Jones Apparel Group, Inc. (A) 7,000 154,438
VF Corp. 2,600 121,875
--------------
276,313
--------------
TOBACCO (0.1%)
Universal Corp. 2,300 80,788
--------------

TRANSPORTATION (1.3%)
Airborne Freight Corp. 8,273 298,345
GATX Corp. 7,800 295,425
J.B. Hunt Transportation
Services, Inc. 7,000 160,781
--------------
754,551
--------------
UTILITIES (9.7%)
AES Corp. (A) 4,300 203,713
Alltel Corp. 5,246 313,776
Baltimore Gas & Electric Co. 4,600 142,025
CalEnergy Company, Inc. (A) 9,200 319,125
CMS Energy Corp. 3,100 150,157
Dominion Resources, Inc. 3,400 158,950
FirstEnergy Corp. 7,900 257,244
GPU, Inc. 3,400 150,238
Inland Steel Industries, Inc. 9,600 162,000
Minnesota Power, Inc. 6,400 281,600
Montana Power Co. 8,300 469,469
New England Electric System 7,300 351,313
NIPSCO Industries, Inc. 15,000 456,563
Northeast Utilities (A) 8,500 136,000
OGE Energy Corp. 8,700 252,300
Peco Energy Co. 4,300 178,988
Pinnacle West Capital Corp. 10,100 427,988
Pubic Service of New Mexico 13,600 277,950
SCANA Corp. 12,400 399,900
TECO Energy, Inc. 12,800 360,800
Wisconsin Energy Corp. 10,900 342,669
--------------
5,792,768
--------------
TOTAL COMMON STOCKS
(COST $51,523,579) 59,257,161
--------------
</TABLE>

-37-
<PAGE> 40

STATEMENT OF INVESTMENTS - CONTINUED

<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
------------ ------------
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS (0.4%)

COMMERCIAL PAPER (0.4%)
Household Finance Corp.,
5.12% due January 4, 1999 $ 258,000 $ 257,853
--------------

TOTAL SHORT-TERM
INVESTMENTS (COST $257,891) 257,853
--------------

NOTIONAL
VALUE
------------
FUTURES CONTRACTS (0.0%)

S&P 400 MidCap Index,
Exp. March, 1999 (B) $ 4,113,375 -
--------------

TOTAL INVESTMENTS (100%)
(COST $51,781,470) (C) $ 59,515,014
==============
</TABLE>

NOTES

(A) Non-income Producing Security.

(B) 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.

(C) At December 31, 1998, net unrealized appreciation for all securities was
$7,733,544. This consisted of aggregate gross unrealized appreciation for
all securities in which there was an excess of market value over cost of
$10,028,031 and aggregate gross unrealized depreciation for all securities
in which there was an excess of cost over market value of $2,294,487.

See Notes to Financial Statements

-38-
<PAGE> 41

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Managers and Owners of Variable Annuity Contracts of
The Travelers Timed Aggressive Stock Account for Variable Annuities

In our opinion, the accompanying statement of assets and liabilities, including
the statement of investments, as of December 31, 1998, and the related statement
of operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and the selected per unit
data and ratios for each of the five years in the period then ended present
fairly, in all material respects, the financial position of The Travelers Timed
Aggressive Stock Account for Variable Annuities at December 3l, 1998, and the
results of their operations for the year then ended in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit, which included
confirmation of securities as of December 31, 1998, by correspondence with the
custodian, provides a reasonable basis for the opinion expressed above.

PRICEWATERHOUSECOOPERS LLP

Hartford, Connecticut
February 15, 1999

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<PAGE> 42

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<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

Independent Accountants
PRICEWATERHOUSECOOPERS LLP
Hartford, Connecticut

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

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, or The Travelers Timed Aggressive Stock 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 (Annual) (12-98) Printed in U.S.A.