UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 1997
Commission file numbers: 33-62791, 33-62953, 33-88360, 33-89566,
33-89676, 33-89678, 33-91400,
333-00941, 333-00995, 333-01021, 333-02867 and 333-08743
American Skandia Life Assurance Corporation
Incorporated in the State of Connecticut 06-1241288
(IRS Employer Identification No.)
One Corporate Drive
Shelton, Connecticut 06484
Telephone Number (203) 926-1888
Indicate by check mark whether the registrant (1) has filed all reports to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months and (2) has been subject to such filing requirements for the
past 90 days. Yes x No __
As of April 30, 1997, there were 25,000 shares of outstanding common stock, par
value $80 per share, of the registrant, consisting of 100 shares of voting and
24,900 shares of non-voting common stock, all of which were owned by American
Skandia Investment Holding Corporation, a wholly-owned subsidiary of Skandia
Insurance Company Ltd., a Swedish corporation.
<PAGE>
American Skandia Life Assurance Corporation
Table of Contents
Page
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements:
Consolidated Statements of Financial Condition -
March 31, 1997 (unaudited)
and December 31, 1996 4
Consolidated Statements of Operations (unaudited) -
Three months ended March 31, 1997
and March 31, 1996 5
Consolidated Statements of Cash Flows (unaudited) -
Three months ended March 31, 1997
and March 31, 1996 6
Notes to Unaudited Consolidated Financial Statements 7
Item 2.
Management's Discussion and Analysis
of Financial Condition and Results of
Operations - Three months ended
March 31, 1997 11
PART II. OTHER INFORMATION:
Item 4. Action Taken by Shareholder 15
Item 6. Exhibits and Reports on Form 8-K 15
Signature 16
Exhibit Index 17
(2)
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1.
FINANCIAL STATEMENTS
(3)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(a wholly-owned subsidiary of Skandia Insurance Company Ltd.)
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
<S> <C> <C>
MARCH 31, DECEMBER 31,
1997 1996
---------------- ---------------
(unaudited)
ASSETS
Investments:
Fixed maturities - at amortized cost $ 9,582,613 $ 10,090,369
Fixed maturities - at market value 85,520,736 87,369,724
Investment in mutual funds - at market value 3,859,138 2,637,731
Short-term investments - at amortized cost 22,986,075 18,100,000
------------- -------------
Total investments 121,948,562 118,197,824
Cash and cash equivalents 14,385,617 14,199,412
Accrued investment income 1,682,759 1,958,546
Fixed assets 241,635 229,780
Deferred acquisition costs 488,155,985 438,640,918
Reinsurance receivable 3,637,067 2,167,818
Receivable from affiliates 975,373 691,532
Deferred income taxes 18,190,845 17,217,582
State insurance licenses 4,675,000 4,712,500
Other assets 2,518,421 2,207,171
Separate account assets 8,335,701,439 7,734,439,793
------------- -------------
Total Assets $ 8,992,112,703 $ 8,334,662,876
============= =============
LIABILITIES AND SHAREHOLDER'S EQUITY
LIABILITIES:
Reserve for future contractowner benefits $ 34,571,374 $ 36,245,936
Annuity policy reserves 23,707,939 21,238,749
Income taxes payable 4,638,536 1,124,151
Accounts payable and accrued expenses 55,965,044 65,198,965
Payable to affiliates 53,025,080 685,724
Future fees payable to parent 44,842,187 47,111,936
Payable to reinsurer 82,340,890 79,000,262
Short-term borrowing 10,000,000 10,000,000
Surplus notes 213,000,000 213,000,000
Deferred contract charges 272,329 272,329
Separate account liabilities 8,335,701,439 7,734,439,793
------------- -------------
Total Liabilities 8,858,064,818 8,208,317,845
------------- -------------
SHAREHOLDER'S EQUITY:
Common stock, $80 par, 25,000 shares
authorized, issued and outstanding 2,000,000 2,000,000
Additional paid-in capital 122,380,117 122,250,117
Unrealized investment gains and losses, net (1,767,713) (319,631)
Foreign currency translation, net (238,745) (263,706)
Retained earnings 11,674,226 2,678,251
-------------- -------------
Total Shareholder's Equity 134,047,885 126,345,031
-------------- -------------
Total Liabilities and Shareholder's Equity $ 8,992,112,703 $ 8,334,662,876
============= =============
</TABLE>
See notes to unaudited consolidated financial statements.
(4)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(a wholly-owned subsidiary of Skandia Insurance Company Ltd.)
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
<S> <C> <C>
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, 1997 MARCH 31, 1996
---------------- ----------------
REVENUES:
Annuity charges & fees $ 24,368,624 $ 13,429,275
Fee income 5,524,257 3,162,040
Net investment income 1,368,683 455,022
Net realized capital gains 20,604 92,072
Annuity premium income 275,000 0
Other 17,939 14,450
-------------- -------------
Total Revenues 31,575,107 17,152,859
-------------- -------------
BENEFITS AND EXPENSES:
Benefits:
Annuity benefits 144,687 117,986
Increase in annuity policy reserves 783,550 173,873
Cost of minimum death benefit reinsurance 876,078 643,610
Return credited to contractowners (6,745,574) 1,004,430
-------------- -------------
(4,941,259) 1,939,899
-------------- -------------
Expenses:
Underwriting, acquisition and other insurance expenses 17,683,466 8,516,327
Amortization of state insurance licenses 37,500 37,500
Interest expense 5,539,574 2,231,685
-------------- -------------
23,260,540 10,785,512
-------------- -------------
Total Benefits and Expenses 18,319,281 12,725,411
-------------- -------------
Income from operation
before income taxes 13,255,826 4,427,448
Income taxes 4,259,851 1,768,507
-------------- -------------
Net income $ 8,995,975 $ 2,658,941
============== =============
</TABLE>
See notes to unaudited consolidated financial statements.
(5)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(wholly-owned subsidiary of Skandia Insurance Company Ltd.)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
<S> <C> <C>
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, 1997 MARCH 31, 1996
CASH FLOW FROM OPERATING ACTIVITIES:
Net income $ 8,995,975 $ 2,658,941
Adjustments to reconcile net income (loss) to net cash
used in operating activities:
Increase in annuity policy reserves 2,469,190 480,579
Amortization of bond discount 18,153 4,769
Amortization of insurance licenses 37,500 37,500
Change in due to/due from affiliates 52,055,515 (369,261)
Change in income tax payable/receivable 3,514,385 1,756,351
Increase in other assets (323,105) (2,888)
Change in accrued investment income 275,787 (46,063)
Increase in reinsurance receivable (1,469,249) (120,547)
Decrease in accounts payable and accrued expenses (9,233,922) (287,155)
Increase in deferred acquisition cost (49,515,067) (33,500,335)
Decrease in deferred contract charges 0 (20,047)
Decrease in foreign currency translation, net 26,822 19,514
Deferred income taxes (228,711) 0
Realized gain on sale of investments (20,604) (92,072)
------------- -------------
Net cash provided by (used in) operating activities 6,602,669 (29,480,714)
------------- -------------
CASH FLOW FROM INVESTING ACTIVITIES:
Proceeds from maturity of fixed maturity investments 200,000 0
Purchase of shares in mutual funds (1,434,810) (937,792)
Proceeds from sale of mutual funds 178,104 834,949
Purchase of short-term investments (4,886,075) (78,000,000)
Proceeds from sale of short-term investments 0 93,700,000
Change in investments of separate account assets (867,715,012) (562,205,959)
------------- -------------
Net cash used in investing activities (873,657,793) (546,608,802)
------------- -------------
CASH FLOW FROM FINANCING ACTIVITIES:
Capital contributions from parent 130,000 74,212
Decrease in future payable fees to parent (2,269,749) 0
Increase in payable to reinsurer 3,340,628 4,753,077
Proceeds from annuity sales 866,040,450 561,231,341
------------- -------------
Net cash provided by financing activities 867,241,329 566,058,630
------------- -------------
Net decrease in cash and cash equivalents 186,205 (10,030,886)
------------- -------------
Cash and cash equivalents at beginning of period 14,199,412 13,146,384
------------- -------------
Cash and cash equivalents at end of period $ 14,385,617 $ 3,115,498
============= =============
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Income taxes paid $ 43,000 $ 12,156
============= =============
Interest paid $ 3,180,309 $ 341,250
============= =============
</TABLE>
See notes to unaudited consolidated financial statements.
(6)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(a wholly-owned subsidiary of
Skandia Insurance Company Ltd.)
Notes to Unaudited Consolidated Financial Statements
March 31, 1997
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements of
American Skandia Life Assurance Corporation (the Company) have been
prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been
included. Operating results for the three month period ended March 31,
1997 are not necessarily indicative of the results that may be expected
for the year ending December 31, 1997. For further information, refer
to the consolidated financial statements and footnotes thereto in the
Company's audited consolidated financial statements for the year ended
December 31, 1996.
2. FOREIGN ENTITY
As of July 1995, Skandia Vida, S.A. de C.V. was formed by the ultimate
parent, Skandia Insurance Company, Ltd., a Swedish corporation. The
Company has a 99.9% ownership in Skandia Vida, S.A. de C.V. which is a
life insurance company domiciled in Mexico. This Mexican life insurer
is a start up company with expectations of selling long term savings
products within Mexico. Total shareholder's equity of Skandia Vida,
S.A. de C.V. is $1,358,906 as of March 31, 1997.
(7)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(a wholly-owned subsidiary of
Skandia Insurance Company Ltd.)
Notes to Unaudited Consolidated Financial Statements
March 31, 1997
3. SURPLUS NOTES
The Company has issued surplus notes to American Skandia Investment
Holding Corporation (the "Parent") in exchange for cash. Surplus notes
outstanding as of March 31, 1997 were as follows.
Issue Date Amount Interest Rate
December 29, 1993 $ 20,000,000 6.84%
February 18, 1994 10,000,000 7.28%
March 28, 1994 10,000,000 7.90%
September 30, 1994 15,000,000 9.13%
December 28, 1994 14,000,000 9.78%
December 19, 1995 10,000,000 7.52%
December 20, 1995 15,000,000 7.49%
December 22, 1995 9,000,000 7.47%
June 28, 1996 40,000,000 8.41%
December 30, 1996 70,000,000 8.03%
-------------
Total $ 213,000,000
Payment of interest and repayment of principal for these notes is
subject to certain conditions and requires approval by the Insurance
Commissioner of the State of Connecticut.
Interest accrued at March 31, 1997 amounted to $5,857,175, of
which $774,107 has been approved for payment. The remaining $5,083,068
has not been approved for payment.
4. FUTURE FEES PAYABLE TO PARENT
On December 17, 1996 the Company sold to its Parent, effective
September 1, 1996, certain rights to receive future fees and charges
expected to be realized on the variable portion of a designated block
of deferred annuity contracts issued during the period January 1, 1994
through June 30, 1996. In connection with this transaction, the Parent
issued collateralized notes in a private placement which are secured
by the rights to receive future fees and charges purchased from the
Company.
(8)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(a wholly-owned subsidiary of
Skandia Insurance Company Ltd.)
Notes to Unaudited Consolidated Financial Statements
March 31, 1997
Under the terms of the Purchase Agreement, the rights sold provide for
the Parent to receive 80% of future mortality and expense charges and
contingent deferred sales charges, after reinsurance, expected to be
realized over the remaining surrender charge period of the designated
contracts (generally, 6.5 years). The Company did not sell the right to
receive future fees and charges after the expiration of the surrender
charge period.
The proceeds from the sale have been recorded as a liability and are
being amortized over the remaining surrender charge period of the
designated contracts using the interest method. The present value at
September 1, 1996 (discounted at 7.5%), of future fees and charges
expected to be realized on the designated contracts was $50,221,438.
Payments representing fees and charges realized during the period ended
March 31, 1997 in the aggregate amount of $2,269,749, were made by the
Company to the Parent. Interest expense of $1,087,232 has been included
in the statement of operations.
Expected payments of future fees payable to Parent are as follows:
Period Ending
December 31, Amount
1997 $ 7,038,778
1998 9,782,558
1999 10,002,274
2000 10,061,058
2001 6,412,114
2002 1,392,003
2003 153,402
-----------
Total $44,842,187
The Commissioner of the State of Connecticut has approved the sale of
future fees and charges; however, in the event that the Company becomes
subject to an order of liquidation or rehabilitation, the Commissioner
has the ability to stop the payments due to the Parent under the
Purchase Agreement, subject to certain terms and conditions.
(9)
<PAGE>
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(a wholly-owned subsidiary of
Skandia Insurance Company Ltd.)
Notes to Unaudited Consolidated Financial Statements
March 31, 1997
5. REINSURANCE
The Company cedes reinsurance under modified co-insurance arrangements.
The reinsurance arrangements provide additional capacity for growth in
supporting the cash flow strain from the Company's variable annuity
business. The reinsurance is effected under quota share contracts.
The Company reinsures certain mortality risks pertaining to the
Guaranteed Minimum Death Benefit feature in the variable annuity
products.
The effect of the reinsurance agreements on the Company's operations
was to reduce annuity charges and fee income, death benefit expense,
and reserve exposure. The effect of reinsurance is summarized as
follows:
<TABLE>
<CAPTION>
Annuity Increase in Annuity Return Credited
Charges & Fees Policy Reserves to Contractowners
Period Ended March 31, 1997
<S> <C> <C> <C>
Gross $29,686,298 $2,252,799 ($6,724,793)
Ceded 5,317,674 1,469,249 20,781
----------- ----------- ------------
Net $24,368,624 $ 783,550 ($6,745,574)
=========== =========== ===========
Period Ended March 31, 1996
Annuity Increase in Annuity Return Credited
Charges & Fees Policy Reserves to Contractowners
Gross $17,420,169 $294,420 $1,021,285
Ceded 3,990,894 120,547 16,855
----------- -------- ----------
Net $13,429,275 $173,873 $1,004,430
=========== ======== ==========
</TABLE>
Such ceded reinsurance does not relieve the Company from its
obligations to policyholders. The Company remains liable to its
policyholders for the portion reinsured to the extent that any
reinsurer does not meet the obligations assumed under the reinsurance
agreement.
(10)
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Three months ended March 31, 1997
American Skandia Life Assurance Corporation (the Company) is a stock insurance
company domiciled in Connecticut with licenses in all 50 states. It is a
wholly-owned subsidiary of American Skandia Investment Holding Corporation,
whose ultimate parent is Skandia Insurance Company Ltd., a Swedish company.
The Company is in the business of issuing annuity policies, and has been so
since its business inception in 1988. The Company currently offers the following
annuity products: a) certain deferred annuities that are registered with the
Securities and Exchange Commission, including variable annuities and fixed
interest rate annuities that include a market value adjustment feature; b)
certain other fixed deferred annuities that are not registered with the
Securities and Exchange Commission; and c) fixed and adjustable immediate
annuities.
The Company markets its products through an internal field marketing staff to
broker-dealers, financial planners and in conjunction with financial
institutions such as banks that are permitted directly, or through affiliates,
to sell annuities.
Results of Operations
The Company's long term business plan was developed reflecting the current sales
and marketing approach. The sales volume for the three month period ended March
31, 1997 and 1996 was $866 million and $561 million, respectively. This
represents an increase of 54% compared to the same period last year. This
increase is a direct result of the marketing efforts by the Company coupled with
an overall increase in the variable annuity marketplace. Assets grew $657
million or 8% since December 31, 1996. This increase is a direct result of the
sales volume increasing separate account assets and deferred acquisition costs.
Liabilities grew $650 million or 8% since December 31, 1996 as a result of the
reserves required for the increased sales activity as well as an increase in the
amounts payable to affiliates and reinsurance to support the acquisition costs
of the Company's variable annuity business.
(11)
<PAGE>
The Company experienced a net gain of $9.0 million after tax for the current
period which was $6.3 million greater than the same period last year, and in
excess of plan. This gain is a result of the strong sales activity for the three
months ended March 31, 1997, favorable expense levels relative to sales activity
and an increased asset base, which generates additional fee revenue.
Revenues:
Increasing annuity sales volume results in greater assets under management.
Growth in assets under management has resulted in an 81% increase in annuity
charges & fees for the three month period ended March 31, 1997. This is compared
to an increase of 72% for the three month period ended March 31, 1996.
Fee income includes income earned for transfer agency type activities. This
income increased 75% for the three month period ended March 31, 1997 compared to
an increase of 202% for the three month period ended March 31, 1996. These
increases are driven by the continued increase in assets under management.
Net investment income increased 201% for the three month period ended March 31,
1997. This is compared to a decrease of 18% for the three month period ended
March 31, 1996. The current period increase is the result of increased
investment holdings for the quarter. The prior period decrease is a result of
the need to liquidate short term investments to support cash needs.
Annuity premium income represents sales of immediate annuities with life
contingencies.
Benefits:
Annuity benefits represent payments on annuity contracts with mortality risks:
immediate annuities with life contingencies and supplementary contracts with
life contingencies.
Increase in annuity policy reserves represents the change in reserves for
immediate annuities with life contingencies, supplementary contracts with life
contingencies and the guaranteed minimum death benefit on variable annuities. In
September 1995, the Company entered into an agreement to reinsure the guaranteed
minimum death benefit exposure on most of its variable annuity contracts. The
change in the minimum death benefit reserve exceeded the costs associated with
reinsuring the minimum death benefit by $0.6 million for the period ended March
31, 1997. For the same period last year, the costs associated with reinsuring
the minimum death benefit reserve exceeded the change in the minimum death
benefit reserve by approximately $0.5 million.
(12)
<PAGE>
Return credited to contractowners represents revenues on variable and market
value adjusted annuities offset by benefit payments and change in reserves
required on this business. Also included are benefit payments and change in
reserves on immediate annuities and supplemental contracts without significant
mortality risks. The result for the current period reflects a higher than
expected separate account investment return on the market value adjusted
contracts in support of the benefits and required reserves combined with the
reversal of the effect of December 31, 1996 bond market fluctuations which had
adversely impacted 1996 results by $1.8 million. While the assets relating to
the market value adjusted contracts reflected the market interest rate
fluctuations which occurred on December 31, 1996, the liabilities were based on
interest rates set for new contracts which are generally based on the prior
day's interest rates. During the first week of 1997, interest rates were
established for new contracts, thereby bringing the liabilities relating to the
market value adjusted contracts in line with the related assets.
Expenses:
Underwriting, acquisition and other insurance expenses consists of $42.9 million
of commissions and $21.2 million of general expenses offset by the net
capitalization of deferred acquisition costs totaling $46.4 million. This
compares to $25.7 million of commissions and $11.9 million of general expenses
offset by the net capitalization of deferred acquisition costs totaling $29.1
million for the same period last year.
Interest expense increased 148% over the same period last year as a result of
the 1996 increase in surplus notes of $110 million.
Income tax expense was $4.3 million for the quarter ended March 31, 1997,
compared with $1.8 million for the same period last year. The effective Federal
income tax rates for the periods were 32% and 40% respectively. The 1997
effective rate was lower than the Federal statutory income tax rate (35%)
primarily due to permanent differences. The 1996 effective rate was higher than
the Federal statutory income tax rate due to an increase in the deferred tax
valuation allowance. Such allowance was released at December 31, 1996.
Management believes that based on the taxable income produced in 1996 and the
first quarter of 1997 as well as the continued growth in annuity products, the
Company will produce sufficient taxable income in the future to realize its
deferred tax assets.
Liquidity and Capital Resources
The liquidity requirement of the Company was met by cash from insurance
operations, investment activities and advances from the parent.
(13)
<PAGE>
The Company had significant growth during the three month period in 1997. The
sales volume of $866 million was made up of approximately 94% variable
annuities, which carry a contingent, deferred sales charge. This type of product
causes a temporary cash strain in that 100% of the proceeds are invested in
separate accounts supporting the product leaving a cash (but not capital) strain
caused by the acquisition costs for the new business. This cash strain required
the Company to look beyond the insurance operations and investments of the
Company. To this end, the Company extended its reinsurance agreements (initiated
in 1993, 1994 and 1995) and was advanced $52 million by the parent. It is
anticipated that during 1997 this advance will be repaid with the proceeds from
additional sales of future fee revenues, similar to the transaction which closed
on December 17, 1996 (as described in footnote 4). The reinsurance agreements
are modified coinsurance arrangements where the reinsurer shares in the
experience of a specific book of business. The income and expense items
presented above are net of reinsurance.
The Company expects to use borrowing, reinsurance and the sale of future fee
revenues to fund the cash strain anticipated from the acquisition costs on
expected future sales volume.
The tremendous growth of this young organization has depended on capital support
from its parent.
As of March 31, 1997 and 1996, shareholder's equity was $134.0 million and
$126.3 million, respectively, which includes the carrying value of the state
insurance licenses in the amount of $4.7 million.
The Company has long term surplus notes and short term borrowing with its
parent. No dividends have been paid to its parent company.
(14)
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. ACTION TAKEN BY SHAREHOLDER
Not applicable for this quarter.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) See Exhibit Index
(b) American Skandia Life Assurance Corporation did not
file any Report on Form 8-K during the quarter
covered by this report.
(15)
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
American Skandia Life
Assurance Corporation
(Registrant)
by s/Thomas M. Mazzaferro
Thomas M. Mazzaferro
Executive Vice President and
Chief Financial Officer
May 14, 1997
(16)
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description Location
(2) Plan of acquisition, reorganization,
arrangement, liquidation or succession None
(4) Instruments defining the rights of
security holders, including indentures None
(10) Material Contracts None
(11) Statement re computation of per share
earnings None
(15) Letter re unaudited interim financial
information None
(18) Letter re change in accounting
principles None
(19) Report furnished to security holders None
(22) Published report regarding matters
submitted to vote of security holders None
(23) Consents of experts and counsel None
(24) Power of attorney None
(99) Additional exhibits None
(17)
<TABLE> <S> <C>
<ARTICLE> 7
<CIK> 881453
<NAME> ASLAC397
<MULTIPLIER> 1
<CURRENCY> U.S Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> Mar-31-1997
<PERIOD-START> Jan-01-1997
<PERIOD-END> Mar-31-1997
<EXCHANGE-RATE> 1
<DEBT-HELD-FOR-SALE> 85,520,736
<DEBT-CARRYING-VALUE> 97,732,715
<DEBT-MARKET-VALUE> 95,103,349
<EQUITIES> 3,859,138
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 121,948,562
<CASH> 14,385,617
<RECOVER-REINSURE> 3,637,067
<DEFERRED-ACQUISITION> 488,155,985
<TOTAL-ASSETS> 8,992,112,703 <F1>
<POLICY-LOSSES> 58,279,313
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 0
<NOTES-PAYABLE> 213,000,000
<COMMON> 2,000,000
0
0
<OTHER-SE> 132,047,885
<TOTAL-LIABILITY-AND-EQUITY> 8,992,112,703 <F2>
275,000
<INVESTMENT-INCOME> 1,368,683
<INVESTMENT-GAINS> 20,604
<OTHER-INCOME> 29,910,820 <F3>
<BENEFITS> (4,941,259)
<UNDERWRITING-AMORTIZATION> 5,602,764
<UNDERWRITING-OTHER> 12,080,702
<INCOME-PRETAX> 13,255,826
<INCOME-TAX> 4,259,851
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,995,975
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
<FN>
<F1> Included in Total Assets are Assets Held in Separate Accounts of $8,335,701,439.
<F2> Included in Total Liabilities and Equity are Liabilities Related to Separate Accounts of $8,335,701,439.
<F3> Other income includes annuity charges and fees of $24,368,624 and fee income of $5,524,257.
</FN>
</TABLE>
