NWNL'S
SELECT*LIFE VARIABLE ACCOUNT
SEMI-ANNUAL REPORT
FOR THE PERIOD ENDED
JUNE 30, 1996
(UNAUDITED)
[LOGO]
This report provides information to Northwestern National Life Insurance
Company's Select*Life Policy Owners. If it is used for any other purpose, it
must be accompanied or preceded by a current NWNL Select*Life Variable Account
Prospectus which discloses any charges and other important information about the
Account, together with the current Prospectuses for Northstar, Fidelity's
Variable Insurance Products Fund (VIPF), Variable Insurance Products Fund II
(VIPF II) and the Putnam Capital Manager Trust (PCM).
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1996
(In Thousands, Except Share and Unit Data)
(UNAUDITED)
<TABLE>
<CAPTION>
Fidelity's VIPF Fidelity's VIPF Fidelity's VIPF Fidelity's VIPF II
ASSETS: Money Market High Income Equity-Income Growth
- ------- Portfolio Portfolio Portfolio Portfolio
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investments in mutual funds at market value:
FIDELITY'S VIPF AND VIPF II:
Money Market Portfolio
7,605,965 shares (cost $7,606) $7,606
High Income Portfolio
1,043,347 shares (cost $11,619) $12,291
Equity-Income Portfolio
2,519,960 shares (cost $38,217) $49,089
Growth Portfolio
2,263,328 shares (cost $51,197) $68,036
Overseas Portfolio
1,134,607 shares (cost $17,894)
Asset Manager Portfolio
1,637,852 shares (cost $23,637)
Investment Grade Bond Portfolio
248,041 shares (cost $2,870)
Index 500 Portfolio
56,472 shares (cost $3,943)
Contrafund Portfolio
379,633 shares (cost $5,334)
PUTNAM'S PCM:
Diversified Income Fund
100,482 shares (cost $1,049)
Growth and Income Fund
315,516 shares (cost $6,329)
Utilities Growth and Income Fund
90,172 shares (cost $1,079)
Voyager Fund
622,723 shares (cost $17,262)
Asia Pacific Growth Fund
87,820 shares (cost $920)
New Opportunities Fund
301,083 shares (cost $4,968)
NORTHSTAR'S:
Income and Growth Fund
23,301 shares (cost $267)
Multi-Sector Bond Fund
29,868 shares (cost $153)
---------- ---------- ---------- ----------
Total Assets $7,606 $12,291 $49,089 $68,036
====== ======= ======= =======
LIABILITIES AND POLICYOWNERS' EQUITY:
- -------------------------------------
Due to (from) Northwestern National Life Insurance Company
for accrued mortality and expense risk: $2 $5 $13 $29
Policyowners' Equity: 7,604 12,286 49,076 68,007
---------- ---------- ---------- ----------
Total Liabilities and Policyowners' Equity $7,606 $12,291 $49,089 $68,036
====== ======= ======= =======
Units Outstanding: 612,832.652 654,207.290 2,302,260.182 3,044,439.649
Net Asset Value per Unit:
Select*Life I $15.535370 $24.243187 $25.658715 $28.589955
Select*Life Series 2000 $11.324614 $12.634442 $15.242276 $14.979209
</TABLE>
The accompanying notes are an integral part of the financial statements.
i
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
Fidelity's
Fidelity's VIPF II Fidelity's Fidelity's
Fidelity's VIPF VIPF II Investment VIPF II VIPF II
ASSETS: Overseas Asset Manager Grade Bond Index 500 Contrafund
- ------- Portfolio Portfolio Portfolio Portfolio Portfolio
-------------- -------------- -------------- ------------ -----------
<S> <C> <C> <C> <C> <C>
Investments in mutual funds at market value:
FIDELITY'S VIPF AND VIPF II:
Money Market Portfolio
7,605,965 shares (cost $7,606)
High Income Portfolio
1,043,347 shares (cost $11,619)
Equity-Income Portfolio
2,519,960 shares (cost $38,217)
Growth Portfolio
2,263,328 shares (cost $51,197)
Overseas Portfolio
1,134,607 shares (cost $17,894) $20,287
Asset Manager Portfolio
1,637,852 shares (cost $23,637) $25,599
Investment Grade Bond Portfolio
248,041 shares (cost $2,870) $2,897
Index 500 Portfolio
56,472 shares (cost $3,943) $4,513
Contrafund Portfolio
379,633 shares (cost $5,334) $5,611
PUTNAM'S PCM:
Diversified Income Fund
100,482 shares (cost $1,049)
Growth and Income Fund
315,516 shares (cost $6,329)
Utilities Growth and Income Fund
90,172 shares (cost $1,079)
Voyager Fund
622,723 shares (cost $17,262)
Asia Pacific Growth Fund
87,820 shares (cost $920)
New Opportunities Fund
301,083 shares (cost $4,968)
NORTHSTAR'S:
Income and Growth Fund
23,301 shares (cost $267)
Multi-Sector Bond Fund
29,868 shares (cost $153)
---------- ---------- ---------- ---------- ----------
Total Assets $20,287 $25,599 $2,897 $4,513 $5,611
======= ======= ====== ====== ======
LIABILITIES AND POLICYOWNERS' EQUITY:
- -------------------------------------
Due to (from) Northwestern National Life Insurance Company
for accrued mortality and expense risk: $11 $9 $1 $1 ($2)
Policyowners' Equity: 20,276 25,590 2,896 4,512 5,613
---------- ---------- ---------- ---------- ----------
Total Liabilities and Policyowners' Equity $20,287 $25,599 $2,897 $4,513 $5,611
======= ======= ====== ====== ======
Units Outstanding: 1,401,171.280 1,806,081.648 230,322.359 292,522.169 424,430.189
Net Asset Value per Unit:
Select*Life I $17.279536 $16.477306 $14.026298 $15.958293 -
Select*Life Series 2000 $11.880393 $11.538435 $11.098987 $15.236095 $13.225129
</TABLE>
The accompanying notes are an integral part of the financial statements.
ii
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
STATEMENT OF ASSETS AND LIABILITIES, CONTINUED
June 30, 1996
(in Thousands, Except Share and Unit Data)
(UNAUDITED)
<TABLE>
<CAPTION>
Putnam's PCM Putnam's PCM Putnam's PCM
Diversified Growth and Utilities Growth Putnam's PCM
ASSETS: Income Income and Income Voyager
- ------- Fund Fund Fund Fund
------------- ------------- ----------------- ------------
<S> <C> <C> <C> <C>
Investments in mutual funds at market value:
FIDELITY'S VIPF AND VIPF II:
Money Market Portfolio
7,605,965 shares (cost $7,606)
High Income Portfolio
1,043,347 shares (cost $11,619)
Equity-Income Portfolio
2,519,960 shares (cost $38,217)
Growth Portfolio
2,263,328 shares (cost $51,197)
Overseas Portfolio
1,134,607 shares (cost $17,894)
Asset Manager Portfolio
1,637,852 shares (cost $23,637)
Investment Grade Bond Portfolio
248,041 shares (cost $2,870)
Index 500 Portfolio
56,472 shares (cost $3,943)
Contrafund Portfolio
379,633 shares (cost $5,334)
PUTNAM'S PCM:
Diversified Income Fund
100,482 shares (cost $1,049) $1,055
Growth and Income Fund
315,516 shares (cost $6,329) $6,938
Utilities Growth and Income Fund
90,172 shares (cost $1,079) $1,217
Voyager Fund
622,723 shares (cost $17,262) $20,076
Asia Pacific Growth Fund
87,820 shares (cost $920)
New Opportunities Fund
301,083 shares (cost $4,968)
NORTHSTAR'S:
Income and Growth Fund
23,301 shares (cost $267)
Multi-Sector Bond Fund
29,868 shares (cost $153)
---------- ---------- ---------- ----------
Total Assets $1,055 $6,938 $1,217 $20,076
====== ====== ====== =======
LIABILITIES AND POLICYOWNERS' EQUITY:
- -------------------------------------
Due to (from) Northwestern National Life Insurance Company
for accrued mortality and expense risks: $- $1 $- $1
Policyowners' Equity: 1,055 6,937 1,217 20,075
---------- ---------- ---------- ----------
Total Liabilities and Policyowners' Equity $1,055 $6,938 $1,217 $20,076
====== ====== ====== =======
Units Outstanding: 91,231.008 464,127.831 92,982.819 1,249,462.649
Net Asset Value per Unit:
Select*Life I $11.784494 $14.986345 $13.357462 $16.340655
Select*Life Series 2000 $11.531815 $14.941785 $13.037202 $16.028325
</TABLE>
The accompanying notes are an integral part of the financial statements.
iii
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
Putnam's PCM Putnam's PCM Northstar's
Asia Pacific New Income Northstar's
ASSETS: Growth Opportunities and Growth Multi-Sector Bond
- ------- Fund Fund Fund Fund Total
------------- ------------- ------------ ------------------ ---------
<S> <C> <C> <C> <C> <C>
Investments in mutual funds at market value:
FIDELITY'S VIPF AND VIPF II:
Money Market Portfolio
7,605,965 shares (cost $7,606) $ 7,606
High Income Portfolio
1,043,347 shares (cost $11,619) 12,291
Equity-Income Portfolio
2,519,960 shares (cost $38,217) 49,089
Growth Portfolio
2,263,328 shares (cost $51,197) 68,036
Overseas Portfolio
1,134,607 shares (cost $17,894) 20,287
Asset Manager Portfolio
1,637,852 shares (cost $23,637) 25,599
Investment Grade Bond Portfolio
248,041 shares (cost $2,870) 2,897
Index 500 Portfolio
56,472 shares (cost $3,943) 4,513
Contrafund Portfolio
379,633 shares (cost $5,334) 5,611
PUTNAM'S PCM:
Diversified Income Fund
100,482 shares (cost $1,049) 1,055
Growth and Income Fund
315,516 shares (cost $6,329) 6,938
Utilities Growth and Income Fund
90,172 shares (cost $1,079) 1,217
Voyager Fund
622,723 shares (cost $17,262) 20,076
Asia Pacific Growth Fund
87,820 shares (cost $920) $940 940
New Opportunities Fund
301,083 shares (cost $4,968) $5,459 5,459
NORTHSTAR'S:
Income and Growth Fund
23,301 shares (cost $267) $272 272
Multi-Sector Bond Fund
29,868 shares (cost $153) $154 154
---------- ---------- ---------- ---------- ----------
Total Assets $940 $5,459 $272 $154 $232,040
==== ====== ==== ==== ========
LIABILITIES AND POLICYOWNERS' EQUITY:
- -------------------------------------
Due to (from) Northwestern National Life Insurance Company
for accrued mortality and expense risks: $- $- $- $- $71
Policyowners' Equity: 940 5,459 272 154 231,969
---------- ---------- ---------- ---------- ----------
Total Liabilities and Policyowners' Equity $940 $5,459 $272 $154 $232,040
==== ====== ==== ==== ========
Units Outstanding: 86,624.361 349,228.411 21,457.681 12,716.988 13,136,099.166
Net Asset Value per Unit:
Select*Life I $- $- $- $-
Select*Life Series 2000 $10.846918 $15.629306 $12.643361 $12.179693
</TABLE>
The accompanying notes are an integral part of the financial statements.
iv
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
STATEMENT OF OPERATIONS AND CHANGES
IN POLICYOWNERS' EQUITY
(In Thousands)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED YEAR ENDED
ENDED DECEMBER 31, DECEMBER 31,
JUNE 30, 1996 1995 1994
--------------- ----------- ------------
<S> <C> <C> <C>
Net investment income:
Reinvested dividend income ............... $2,727 $ 2,259 $ 1,454
Reinvested capital gains ................. 8,068 1,456 2,880
Mortality and expense risk charge ....... (879) (1,186) (692)
--------- --------- ---------
Net investment income and capital gains 9,916 2,529 3,642
--------- --------- ---------
Realized and unrealized gains (losses):
Net realized gains on
redemptions of fund shares ............. 1,379 1,345 896
Increase (decrease) in unrealized
appreciation of investments ............ 3,468 27,857 (4,458)
--------- --------- ---------
Net realized and unrealized gains (losses) 4,847 29,202 (3,562)
--------- --------- ---------
Additions from operations ......... 14,763 31,731 80
--------- --------- ---------
Policyowner transactions:
Net premium payments ..................... 50,376 66,506 49,268
Transfers (to) from Fixed Accounts ....... (50) (401) (35)
Policy loans ............................. (954) (1,582) (781)
Loan collateral interest crediting ....... 72 101 69
Surrenders ............................... (2,157) (3,576) (2,080)
Death benefits ........................... (37) (220) (87)
Cost of insurance charges ................ (8,573) (12,860) (8,762)
Death benefit guarantee charges .......... (229) (488) (531)
Monthly expense charges .................. (1,299) (1,831) (1,057)
--------- --------- ---------
Additions for policyowner transactions . 37,149 45,649 36,004
--------- --------- ---------
Net additions for the period....... 51,912 77,380 36,084
Policyowners' Equity, beginning of the year 180,057 102,677 66,593
--------- --------- ---------
Policyowners' Equity, end of the period .... $231,969 $180,057 $102,677
======== ======== ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
v
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
ORGANIZATION AND CONTRACTS:
NWNL Select*Life Variable Account (the "Account") is a separate account of
Northwestern National Life Insurance Company ("NWNL" or "Northwestern"), a
wholly owned subsidiary of ReliaStar Financial Corp. (formerly The NWNL
Companies, Inc.). The Account is registered as a unit investment trust under
the Investment Company Act of 1940.
Payments received under the contracts are allocated to Sub-Accounts of the
Account, each of which invested in one of the Funds listed below during the
period (see note 4):
<TABLE>
<CAPTION>
FIDELITY'S VIPF AND VIPF II: PUTNAM'S PCM: NORTHSTAR FUNDS:
---------------------------- ------------- ----------------
<S> <C> <C>
Money Market Portfolio Diversified Income Fund Income and Growth Fund
High Income Portfolio Growth and Income Fund Multi-Sector Bond Fund
Equity-Income Portfolio Utilities Growth and Income Fund
Growth Portfolio Voyager Fund
Overseas Portfolio Asia Pacific Growth Fund
Asset Manager Portfolio New Opportunities Fund
Investment Grade Bond Portfolio
Index 500 Portfolio
Contrafund Portfolio
</TABLE>
Northstar Investment Management Corporation, an affiliate of NWNL, is the
investment adviser for the two Northstar Funds and is paid fees for its
services by the Northstar Funds. Fidelity Management & Research Company is
the investment adviser for Fidelity's VIPF and VIPF II and is paid for its
services by the VIPF and VIPF II Portfolios. Putnam Investment Management,
Inc. is the investment adviser for the PCM Funds and is paid fees for its
services by the PCM Funds. On May 3, 1993, NWNL added the Sub-Account
investing in the VIPF II Index 500 Portfolio. On January 1, 1994,
Sub-Accounts investing in PCM's Diversified Income Fund, Growth and Income
Fund, Utilities Growth and Income Fund and Voyager Fund were made available
through the Select*Life Series 2000 policies and on May 2, 1994, Sub-Accounts
investing in these PCM Funds were made available to Select*Life I policies.
On December 30, 1994, Sub-Accounts investing in the Northstar Funds were made
available to Select*Life Series 2000 policies. On April 30, 1995 Sub-Accounts
investing in the VIPF II Contrafund Portfolio, the PCM Asia Pacific Growth
Fund and the PCM New Opportunities Fund were made available to Select*Life
Series 2000 policies.
SECURITIES VALUATION AND TRANSACTIONS:
The market value of investments in the Sub-Accounts is based on the closing
net asset values of the Fund shares held at the end of the period. Investment
transactions are accounted for on the trade date (date the order to purchase
or redeem is executed) and dividend income and capital distributions are
recorded on the ex-dividend date. Net realized gains and losses on
redemptions of shares of the Funds are determined on the basis of specific
identification of Fund's share costs. Net investment income and realized and
unrealized gains (losses) on investments of each Sub-Account are allocated to
the Policies on each valuation date based on each policy's pro-rata share of
the net assets of each Sub-Account as of the beginning of the valuation
period.
2. FEDERAL INCOME TAXES:
Under current tax law, the income, gains and losses from the separate account
investments are not taxable to either the Account or NWNL.
3. POLICY CHARGES:
Certain charges are made by NWNL to Policyowners' Variable Accumulation
Values in the Account in accordance with the terms of the Policies. These
charges may include: Cost of Insurance, computed as set forth in the
Policies; a Monthly Expense Charge as set forth in the Policies; Death
Benefit Guarantee Charge; Optional Insurance benefit charges based upon the
policy terms for optional benefits; and Surrender Charges and Sales Charge
Refunds, as set forth in the Policies.
NWNL assumes mortality and expense risks and, to cover these risks, deducts
charges in accordance with the terms of the policies from the assets of the
Account to compensate for these expenses and risks.
4. NORTHWESTERN'S SELECT FUNDS:
On May 1, 1995, Select Capital Growth Fund, Inc. ("SCG") and Select Managed
Fund, Inc. ("SMF") were liquidated, and Policy Owners' values in the
Sub-Accounts investing in SCG and SMF were transferred to the Sub-Accounts
investing in shares of the VIPF Growth Portfolio and VIPF II Asset Manager
Portfolio, respectively.
vi
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
5. INVESTMENTS:
The net realized gains (losses) on redemptions of fund shares during the six
months ended June 30, 1996 and the years ended December 31, 1995 and 1994
were as follows, (in thousands):
<TABLE>
<CAPTION>
FIDELITY'S VIPF
MONEY MARKET
TOTAL PORTFOLIO
--------------------------------------------- ---------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $8,123 $18,128 $7,424 $2,400 $2,499 $1,572
Cost ............... 6,744 16,783 6,528 2,400 2,499 1572
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ..... $1,379 $ 1,345 $ 896 $- $ - $ -
====== ======== ======= ======= ======== ========
<CAPTION>
FIDELITY'S VIPF FIDELITY'S VIPF
GROWTH OVERSEAS
PORTFOLIO PORTFOLIO
---------------------------------------------- --------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $1,023 $967 $1,007 $555 $1,486 $729
Cost ............... 549 538 717 432 1,219 606
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $474 $429 $ 290 $123 $ 267 $123
======= ======== ======= ======= ======= =======
<CAPTION>
FIDELITY'S VIPF II FIDELITY'S VIPF II
INDEX 500 CONTRAFUND
PORTFOLIO PORTFOLIO
---------------------------------------------- -------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $105 $208 $53 $55 $92 $-
Cost ............... 77 168 53 49 79 -
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $28 $ 40 $ - $6 $13 $-
======= ======== ======= ======= ======= =======
</TABLE>
vii
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
FIDELITY'S VIPF FIDELITY'S VIPF
HIGH-INCOME EQUITY-INCOME
PORTFOLIO PORTFOLIO
---------------------------------------------- ------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
---------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $826 $1,149 $551 $1,253 $1,111 $1,079
Cost ............... 724 947 407 805 821 877
-------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ..... $102 $ 202 $144 $448 $ 290 $ 202
======= ======== ======= ======= ======= =======
<CAPTION>
FIDELITY'S VIPF II FIDELITY'S VIPF II
ASSET MANAGER INVESTMENT GRADE
PORTFOLIO BOND PORTFOLIO
------------------------------------------------ ------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31 ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $982 $2,494 $941 $237 $329 $247
Cost ............... 895 2,326 839 233 327 254
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $87 $ 168 $102 $4 $2 ($7)
======= ======== ======= ======= ======= =======
<CAPTION>
PUTNAM'S PCM PUTNAM'S PCM
DIVERSIFIED INCOME GROWTH AND INCOME
FUND FUND
------------------------------------------------ ------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $168 $40 $9 $136 $102 $7
Cost ............... 162 38 9 98 85 7
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $6 $ 2 $- $38 $ 17 $-
======= ======== ======= ======= ======= =======
</TABLE>
viii
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
5. INVESTMENTS (CONTINUED):
The net realized gains (losses) on redemptions of fund shares during the six
months ended June 30, 1996 and the years ended December 31, 1995 and 1994
were as follows, (in thousands):
<TABLE>
<CAPTION>
PUTNAM'S PCM PUTNAM'S PCM
UTILITIES GROWTH AND INCOME VOYAGER
FUND FUND
---------------------------------------------- ------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $198 $184 $49 $58 $154 $13
Cost................ 162 164 48 40 126 13
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $36 $ 20 $ 1 $18 $ 28 $ -
======= ======== ======= ======= ======= =======
<CAPTION>
NORTHSTAR'S NORTHSTAR'S
INCOME AND GROWTH MULTI-SECTOR BOND
FUND FUND
----------------------------------------------- ------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $6 $3 $- $11 $44 $-
Cost ............... 6 3 - 11 44 -
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $- $- $- $- $- $-
======= ======== ======= ======= ======= =======
</TABLE>
ix
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
PUTNAM'S PCM PUTNAM'S PCM
ASIA PACIFIC NEW OPPORTUNITIES
GROWTH FUND FUND
------------------------------------------------ ------------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from
redemptions ...... $89 $23 $- $21 $113 $-
Cost................ 84 23 - 17 91 -
----------- ----------- ----------- ----------- ----------- -----------
Net realized gains
(losses) on
redemptions of
fund shares ...... $5 $- $- $4 $ 22 $-
======= ======== ======= ======= ======= =======
</TABLE>
x
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
6. POLICYOWNERS' TRANSACTIONS:
Unit transactions in each Sub-Account for the six months ended June 30, 1996
and the years ended December 31, 1995 and 1994 were as follows:
<TABLE>
<CAPTION>
FIDELITY'S VIPF FIDELITY'S VIPF
MONEY MARKET HIGH INCOME
PORTFOLIO PORTFOLIO
---------------------------------------- ---------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year........... 454,516.667 240,089.964 156,045.604 577,083.123 397,251.963 254,797.519
Units purchased ............... 352,311.552 409,244.895 165,487.964 152,820.970 262,813.321 211,773.478
Units redeemed ................ (40,174.942) (51,202.041) (28,807.773) (43,003.146) (82,813.141) (56,358.865)
Units transferred between
Sub-Accounts and/or
Fixed Account............... (153,820.625) (143,616.151) (52,635.831) (32,693.657) (169.020) (12,960.169)
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period .............. 612,832.652 454,516.667 240,089.964 654,207.290 577,083.123 397,251.963
=========== =========== =========== =========== =========== ===========
<CAPTION>
FIDELITY'S VIPF II FIDELITY'S VIPF II
ASSET MANAGER INVESTMENT GRADE
PORTFOLIO BOND PORTFOLIO
----------------------------------------- ----------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year......... 1,704,151.254 1,132,373.018 397,491.821 214,771.624 153,890.893 73,061.118
Units purchased ............. 274,970.969 711,584.303 860,156.216 40,423.227 89,695.793 93,970.791
Units redeemed .............. (112,655.207) (245,931.324) (135,570.699) (12,033.508) (25,144.781) (15,634.489)
Units transferred between
Sub-Accounts and/or
Fixed Account............. (60,385.368) 106,125.257 10,295.680 (12,838.985) (3,670.281) 2,493.473
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period............ 1,806,081.648 1,704,151.254 1,132,373.018 230,322.359 214,771.624 153,890.893
============= ============= ============= =========== =========== ===========
</TABLE>
xi
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
FIDELITY'S VIPF FIDELITY'S VIPF
EQUITY-INCOME GROWTH
PORTFOLIO PORTFOLIO
----------------------------------------- -------------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- -------------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year........... 2,023,713.030 1,463,010.155 1,055,644.747 2,622,289.757 1,761,649.810 1,096,817.909
Units purchased ............... 451,146.336 749,089.473 601,244.662 618,092.091 1,030,790.587 953,158.878
Units redeemed ................ (131,531.586) (256,323.181) (192,736.128) (200,850.516) (342,106.549) (244,337.361)
Units transferred between
Sub-Accounts and/or
Fixed Account............... (41,067.598) 67,936.583 (1,143.126) 4,908.316 171,955.909 (43,989.616)
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period .............. 2,302,260.182 2,023,713.030 1,463,010.155 3,044,439.649 2,622,289.757 1,761,649.810
============= ============= ============= ============= ============= =============
<CAPTION>
FIDELITY'S VIPF II FIDELITY'S VIPF II
INDEX 500 CONTRAFUND
PORTFOLIO PORTFOLIO
----------------------------------------- ----------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year......... 181,509.017 70,686.713 23,356.992 160,147.180 - -
Units purchased ............. 111,767.270 108,548.505 53,563.087 257,771.264 131,616.362 -
Units redeemed .............. (16,764.483) (20,962.032) (8,321.224) (30,283.155) (12,028.370) -
Units transferred between
Sub-Accounts and/or
Fixed Account............. 16,010.365 23,235.831 2,087.858 36,794.900 40,559.188 -
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period............ 292,522.169 181,509.017 70,686.713 424,430.189 160,147.180 -
=========== =========== ========== =========== =========== ===========
</TABLE>
xii
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
FIDELITY'S VIPF
OVERSEAS
PORTFOLIO
-----------------------------------------
Six months Year ended Year ended
ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994
----------- ----------- -----------
Units outstanding,
beginning of year........... 1,229,928.330 900,424.038 379,052.212
Units purchased ............... 269,629.065 617,148.362 556,399.917
Units redeemed ................ (88,890.366) (177,939.623) (111,750.664)
Units transferred between
Sub-Accounts and/or
Fixed Account............... (9,495.748) (109,704.447) 76,722.573
----------- ----------- -----------
Units outstanding,
end of period .............. 1,401,171.280 1,229,928.330 900,424.038
============= ============= ===========
PUTNAM'S PCM
DIVERSIFIED INCOME
FUND
------------------------------------------
Six months Year ended Year ended
ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994
----------- ----------- -----------
Units outstanding,
beginning of year......... 70,401.445 25,076.593 -
Units purchased ............. 33,117.103 37,489.819 18,122.626
Units redeemed .............. (5,538.738) (7,437.939) (1,598.271)
Units transferred between
Sub-Accounts and/or
Fixed Account............. (6,748.802) 15,272.972 8,552.238
----------- ----------- -----------
Units outstanding,
end of period............ 91,231.008 70,401.445 25,076.593
========== ========== ==========
xii
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
6. POLICYOWNERS' TRANSACTIONS (CONTINUED):
Unit transactions in each Sub-Account for the six months ended June 30, 1996
and the years ended December 31, 1995 and 1994 were as follows:
<TABLE>
<CAPTION>
PUTNAM'S PCM PUTNAM'S PCM
GROWTH AND INCOME UTILITIES GROWTH AND
FUND INCOME FUND
--------------------------------------- ---------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year......... 282,045.753 64,421.965 - 81,748.531 46,807.467 -
Units purchased ............. 186,368.575 209,131.345 61,265.475 23,724.765 47,951.821 30,500.830
Units reedeemed ............. (30,952.988) (32,341.113) (6,093.938) (7,235.035) (10,123.479) (3,408.255)
Units transferred between
Sub-Accounts and/or
Fixed Account ............ 26,666.490 40,833.556 9,250.428 (5,255.443) (2,887.278) 19,714.892
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period............. 464,127.831 282,045.753 64,421.965 92,982.819 81,748.531 46,807.467
=========== =========== ========== ========== ========== ==========
<CAPTION>
NORTHSTAR'S NORTHSTAR'S
INCOME AND GROWTH MULTI-SECTOR BOND
FUND FUND
--------------------------------------- --------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year......... 8,746.326 - - 9,904.096 - -
Units purchased ............. 10,718.703 6,057.272 - 3,344.599 3,255.666 -
Units redeemed .............. (1,338.475) (537.367) - (503.986) (424.093) -
Units transferred between
Sub-Accounts and/or
Fixed Account ............ 3,331.127 3,226.421 - (27.721) 7,072.523 -
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period............. 21,457.681 8,746.326 - 12,716.988 9,904.096 -
========== ========= =========== ========== ========= ==========
</TABLE>
xiii
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
PUTNAM'S PCM PUTNAM'S PCM
VOYAGER ASIA PACIFIC GROWTH
FUND FUND
---------------------------------------- ----------------------------------------
Six months Year ended Year ended Six months Year ended Year ended
ended Dec. 31, Dec. 31, ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994 June 30, 1996 1995 1994
----------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Units outstanding,
beginning of year......... 781,013.273 199,880.663 - 29,436.771 - -
Units purchased ............. 479,322.212 611,602.541 191,562.886 46,542.658 25,202.823 -
Units reedeemed ............. (91,922.443) (101,392.794) (18,498.061) (5,881.235) (2,640.223) -
Units transferred between
Sub-Accounts and/or
Fixed Account ............ 81,049.607 70,922.863 26,815.838 16,526.167 6,874.171 -
----------- ----------- ----------- ----------- ----------- -----------
Units outstanding,
end of period............. 1,249,462.649 781,013.273 199,880.663 86,624.361 29,436.771 -
============= =========== =========== ========== ========== ===========
</TABLE>
xiv
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
PUTNAM'S PCM
NEW OPPORTUNITIES
FUND
-----------------------------------------
Six months Year ended Year ended
ended Dec. 31, Dec. 31,
June 30, 1996 1995 1994
----------- ----------- -----------
Units outstanding,
beginning of year......... 110,223.166 - -
Units purchased ............. 187,436.760 86,605.419 -
Units reedeemed ............. (21,860.901) (8,233.093) -
Units transferred between
Sub-Accounts and/or
Fixed Account ............ 73,429.387 31,850.840 -
----------- ----------- -----------
Units outstanding,
end of period............. 349,228.411 110,223.166 -
=========== =========== ===========
xiv
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
7. COMBINING STATEMENT OF OPERATIONS AND CHANGES IN POLICYOWNERS' EQUITY:
Operations and changes in Policyowners' equity for the six months ended
June 30, 1996 were as follows, (in thousands):
<TABLE>
<CAPTION>
FIDELITY'S FIDELITY'S FIDELITY'S
VIPF VIPF VIPF FIDELITY'S
MONEY HIGH EQUITY- VIPF
MARKET INCOME INCOME GROWTH
TOTAL PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net investment income:
Reinvested dividend income.... $2,727 $172 $832 $67 $156
Reinvested capital gains ...... 8,068 - 163 1,929 3,939
Mortality and expense risk charge (879) (30) (48) (193) (258)
--------- --------- --------- --------- ---------
Net investment income
and capital gains (losses) 9,916 142 947 1,803 3,837
--------- --------- --------- --------- ---------
Realized and unrealized gains (losses):
Net realized gains (losses) on
redemptions of fund shares.. 1,379 - 102 448 474
Increase in unrealized
appreciation on investments . 3,468 - (292) 108 1,696
--------- --------- --------- --------- ---------
Net realized and
unrealized gains (losses) 4,847 - (190) 556 2,170
--------- --------- --------- --------- ---------
Net additions (deductions)
from operations.... 14,763 142 757 2,359 6,007
--------- --------- --------- --------- ---------
Policyowner transactions:
Net premium payments.......... 50,376 3,972 2,096 7,622 10,369
Transfers (to) from Fixed Account (50) (1,747) (460) (776) 224
Policy loans .................. (954) (74) (18) (185) (372)
Loan collateral interest crediting 72 3 5 19 24
Surrenders .................... (2,157) (47) (140) (408) (864)
Death benefits ................ (37) (1) (5) (14) (5)
Cost of insurance charges ..... (8,573) (317) (454) (1,596) (2,300)
Death benefit guarantee charges (229) (4) (16) (58) (86)
Monthly expense charges ....... (1,299) (27) (57) (222) (344)
--------- --------- --------- --------- ---------
Net additions (reductions) for
policyowner transactions .. 37,149 1,758 951 4,382 6,646
--------- --------- --------- --------- ---------
Net additions (reductions)
for the period........ 51,912 1,900 1,708 6,741 12,653
Policyowners' Equity,
beginning of the year ........ 180,057 5,704 10,578 42,335 55,354
--------- --------- --------- --------- ---------
Policyowners' Equity,
end of the period............. $231,969 $7,604 $12,286 $49,076 $68,007
======== ====== ======= ======= =======
</TABLE>
xv
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>
FIDELITY'S
FIDELITY'S VIPF II PUTNAM'S PUTNAM'S
FIDELITY'S VIPF II INVESTMENT FIDELITY'S FIDELITY'S PCM PCM
VIPF ASSET GRADE VIPF II VIPF II DIVERSIFIED GROWTH AND
OVERSEAS MANAGER BOND INDEX 500 CONTRAFUND INCOME INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO FUND FUND
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net investment income:
Reinvested dividend income.... $202 $840 $139 $33 $- $63 $117
Reinvested capital gains ...... 223 692 - 84 23 - 204
Mortality and expense risk charge (78) (101) (12) (16) (18) (5) (23)
--------- --------- --------- --------- --------- --------- ---------
Net investment income
and capital gains (losses) 347 1,431 127 101 5 58 298
--------- --------- --------- --------- --------- --------- ---------
Realized and unrealized gains (losses)
Net realized gains (losses) on
redemptions of fund shares.. 123 87 4 28 6 6 38
Increase in unrealized
appreciation on investments . 776 (251) (186) 176 248 (56) 80
-------- --------- --------- --------- --------- --------- ---------
Net realized and
unrealized gains (losses) 899 (164) (182) 204 254 (50) 118
--------- --------- --------- --------- --------- --------- ---------
Net additions (deductions)
from operations.... 1,246 1,267 (55) 305 259 8 416
--------- --------- --------- --------- --------- --------- ---------
Policyowner transactions:
Net premium payments.......... 3,439 3,450 479 1,628 3,280 378 2,655
Transfers (to) from Fixed Account (93) (756) (158) 249 486 (77) 431
Policy loans .................. (84) (81) (5) (1) (1) (3) (23)
Loan collateral interest crediting 7 12 - - - - -
Surrenders .................... (224) (241) (17) (15) (9) (7) (45)
Death benefits ................ (6) (1) (1) (2) - (1) -
Cost of insurance charges ..... (723) (950) (104) (174) (302) (42) (307)
Death benefit guarantee charges (24) (31) (3) (2) - - (1)
Monthly expense charges ....... (110) (129) (13) (33) (56) (7) (53)
--------- --------- --------- --------- --------- --------- ---------
Net additions (reductions) for
policyowner transactions .. 2,182 1,273 178 1,650 3,398 241 2,657
--------- --------- --------- --------- --------- --------- ---------
Net additions (reductions)
for the period........ 3,428 2,540 123 1,955 3,657 249 3,073
Policyowners' Equity,
beginning of the year ........ 16,848 23,050 2,773 2,557 1,956 806 3,864
--------- --------- --------- --------- --------- --------- ---------
Policyowners' Equity,
end of the period............. $20,276 $25,590 $2,896 $4,512 $5,613 $1,055 $6,937
======= ======= ====== ====== ====== ====== ======
</TABLE>
xvi
<PAGE>
SELECT*LIFE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(UNAUDITED)
7. COMBINING STATEMENT OF OPERATIONS AND CHANGES IN POLICYOWNERS' EQUITY
(CONTINUED):
Operations and changes in Policyowners' equity for the six months ended
June 30, 1996 were as follows, (in thousands):
<TABLE>
<CAPTION>
PUTNAM'S PUTNAM'S PUTNAM'S
PCM PUTNAM'S PCM PCM NORTHSTAR'S NORTHSTAR'S
UTILITIES GROWTH PCM ASIA PACIFIC NEW INCOME AND MULTI-SECTOR
AND INCOME VOYAGER GROWTH OPPORTUNITIES GROWTH BOND
FUND FUND FUND FUND FUND FUND
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net investment income:
Reinvested dividend income....... $41 $48 $8 $- $3 $6
Reinvested capital gains ......... - 811 - - - -
Mortality and expense risk charge (5) (71) (3) (16) (1) (1)
--------- --------- --------- --------- --------- ---------
Net investment income
and capital gains (losses) .. 36 788 5 (16) 2 5
--------- --------- --------- --------- --------- ---------
Realized and unrealized gains:
Net realized gains on
redemptions of fund shares .... 36 18 5 4 - -
Increase in unrealized
appreciation on investments .... (16) 797 12 371 4 1
--------- --------- --------- --------- --------- ---------
Net realized and
unrealized gains (losses) .. 20 815 17 375 4 1
--------- --------- --------- --------- --------- ---------
Net additions (deductions)
from operations........ 56 1,603 22 359 6 6
--------- --------- --------- --------- --------- ---------
Policyowner transactions:
Net premium payments ............. 298 7,260 496 2,798 131 40
Transfers (to) from Fixed Account (65) 1,339 181 1,128 43 -
Policy loans ..................... (19) (85) - (3) - -
Loan collateral interest crediting - 2 - - - -
Surrenders ....................... (6) (128) (1) (10) - -
Death benefits ................... - (1) - - - -
Cost of insurance charges ........ (53) (941) (51) (250) (13) (5)
Death benefit guarantee charges .. - (4) - - - -
Monthly expense charges .......... (9) (180) (8) (48) (2) (1)
--------- --------- --------- --------- --------- --------
Net additions for
policyowner transactions ..... 146 7,262 617 3,615 159 34
--------- --------- --------- --------- --------- --------
Net additions
for the period ......... 202 8,865 639 3,974 165 40
Policyowners' Equity,
beginning of the year............ 1,015 11,210 301 1,485 107 114
--------- --------- --------- --------- --------- --------
Policyowners' Equity,
end of the period ............... $1,217 $20,075 $940 $5,459 $272 $154
====== ======= ==== ====== ==== ====
</TABLE>
xvii
<PAGE>
NWNL's SELECT*LIFE VARIABLE ACCOUNT
[LOGO] 20 Washington Avenue South
Minneapolis, Minnesota 55401
(612) 372-5507
38778i
(Select*Life)
