<PAGE>
ACCRU
VARIABLE ANNUITY
VARIABLE UNIVERSAL LIFE
SEMI ANNUAL REPORT 6/30/95
CAPITAL STRATEGIES FOR
THE SAVVY INVESTOR
FROM CIGNA
<PAGE>
THOMAS C. JONES
President
CIGNA Individual Insurance
August 16, 1995
Dear Client:
This report reviews the performance of the ACCRU Variable Annuity and ACCRU
Variable Universal Life products for the period from the date each sub-account
was initially funded through June 30, 1995. This was a period of considerable
economic and financial volatility. It is a pleasure to report that virtually
all of the active investment vehicles underlying these ACCRU products gained
ground for the period, with some achieving substantial growth in a period of
rapidly rising equity markets.
A number of disappointing economic indicators in 1995's first half led to a
foreboding that the economy might well be in for a "soft landing" or worse,
rather than unbridled expansion as experienced in late 1994. There was softness
in consumer and housing spending and a perceived risk to business investment
spending. In response to these and other signs of softness, the Federal Reserve
reduced short-term interest rates during the first week of July for the first
time in nearly three years.
Gross Domestic Product (GDP) growth in the first half of 1995 was in the 2.5%
range. This is down sharply from the 5.1% growth of the last quarter of 1994.
Growth continued to derive primarily from continued increases in productivity,
which should help to sustain U.S. industry's profitability recovery. Liquidity
was abundant and the dollar was cheap, helping the U.S. to gain market share in
key export markets. Mortgage rates have fallen sharply since the peak late last
year. As a result, a modest refinancing surge is now under way.
The domestic equity market was strong in the first half of 1995, returning
20.21% as measured by the Standard & Poor's Composite Index of 500 stocks. The
return for the second quarter of 1995 was 9.54%, the closest period to our ACCRU
history for which S&P data was available. The investment grade bond market, as
represented by the Lehman Brothers Government/Corporate Bond Index, had a return
of 11.80% in the half and 6.49% for the second quarter.
Despite some confusing signs, the outlook is for reacceleration of economic
growth into the second half of 1995 and early 1996. It should be noted that it
has now been almost five years since the S&P 500 Index has experienced a
correction of 10% or more, compared to an average interval of about 18 months,
and the U.S. equity market appears to be at a level that provides little
tolerance for bad news of any kind.
World financial markets rallied broadly in recent months in response to easing
credit market conditions, rising liquidity trends, steadily improving corporate
profitability, and declining interest rates worldwide.
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Following is a summary of sub-account performances for the period from the date
each sub-account was initially funded through June 30, 1995:
<TABLE>
<CAPTION>
Date Initially Funded Beginning AUV (1) Ending AUV
VARIABLE ANNUITY (Inception Date) as of Inception Date as of 6/30/95 (2) % Change
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alger American Growth Portfolio 4/12/95 $10.00 11.4426010 14.43%
Alger American Leveraged AllCap Portfolio 6/2/95 $10.00 11.5788120 15.79%
Alger American MidCap Growth Portfolio 4/10/95 $10.00 11.6179000 16.18%
Alger American Small Capital Portfolio 4/10/95 $10.00 12.0443400 20.44%
- ------------------------------------------------------------------------------------------------------------------------------
Fidelity VIP Equity Income Portfolio 4/10/95 $10.00 10.5864240 5.86%
Fidelity VIP Money Market Portfolio 6/8/95 $10.00 10.0273470 0.27%
Fidelity VIP II: Asset Manager Portfolio 4/12/95 $10.00 10.3043070 3.04%
Fidelity VIP II: Investment Grade Bond Portfolio (3) (3) (3) (3)
- ------------------------------------------------------------------------------------------------------------------------------
MFS Total Return Series (3) (3) (3) (3)
MFS Utilities Series (3) (3) (3) (3)
MFS World Government Series (3) (3) (3) (3)
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Neuberger & Berman AMT Balanced Portfolio (3) (3) (3) (3)
Neuberger & Berman AMT Limited
Maturity Bond Portfolio 5/3/95 $10.00 10.1761330 1.76%
Neuberger & Berman AMT Partners Portfolio 4/12/95 $10.00 10.8271750 8.27%
- ------------------------------------------------------------------------------------------------------------------------------
Quest for Value Global Equity Portfolio 4/10/95 $10.00 10.8940530 8.94%
Quest for Value Managed Portfolio 6/19/95 $10.00 9.9960500 -0.04%
Quest for Value Small Cap Portfolio 6/27/95 $10.00 10.0428290 0.43%
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<CAPTION>
Date Initially Funded Beginning AUV Ending AUV
VARIABLE UNIVERSAL LIFE (Inception Date) as of Inception Date as of 6/30/95 % Change
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alger American Growth Portfolio 5/2/95 $10.00 11.1999150 12.00%
Alger American Leveraged AllCap Portfolio 5/2/95 $10.00 12.2511200 22.51%
Alger American MidCap Growth Portfolio 5/2/95 $10.00 11.4447310 14.45%
Alger American Small Capital Portfolio 5/2/95 $10.00 11.7665710 17.67%
- ------------------------------------------------------------------------------------------------------------------------------
Fidelity VIP Equity Income Portfolio 5/2/95 $10.00 10.4033980 4.03%
Fidelity VIP II: Asset Manager Portfolio (3) (3) (3) (3)
Fidelity VIP II: Investment Grade Bond Portfolio (3) (3) (3)
- ------------------------------------------------------------------------------------------------------------------------------
MFS Total Return Series (3) (3) (3) (3)
MFS Utilities Series (3) (3) (3) (3)
MFS World Government Series 5/2/95 $10.00 10.1414790 1.41%
- ------------------------------------------------------------------------------------------------------------------------------
Neuberger & Berman AMT Balanced Portfolio (3) (3) (3) (3)
Neuberger & Berman AMT Limited
Maturity Bond Portfolio (3) (3) (3) (3)
Neuberger & Berman AMT Partners Portfolio 5/2/95 $10.00 10.7431310 7.43%
- ------------------------------------------------------------------------------------------------------------------------------
Quest for Value Global Equity Portfolio (3) (3) (3) (3)
Quest for Value Managed Portfolio 5/2/95 $10.00 10.9419360 9.42%
Quest for Value Small Cap Portfolio (3) (3) (3) (3)
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<FN>
(1) AUV - Accumulation Unit Value
(2) Variable Annuity unit values reflect the Company's waiver of its mortality
and expense risk charges at a rate of 1.20% per year throughout the April
10 - June 30 period. Had these charges been imposed, ending accumulation
unit values would have been lower.
(3) As of June 30, 1995, no premium payments had yet been allocated to these
funds.
</TABLE>
To review the performances and portfolios of mutual funds used in the ACCRU
Variable Annuity and Variable Universal Life contracts, please consult the
financial statements following the Table of Contents.
We continue to do our utmost to assist in providing for your long-term financial
security.
Respectfully submitted,
/s/ Thomas C. Jones
Thomas C. Jones
President
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TABLE OF CONTENTS
THE ALGER AMERICAN FUND
SEMI-ANNUAL REPORT
ALGER AMERICAN GROWTH PORTFOLIO
ALGER AMERICAN SMALL CAPITALIZATION PORTFOLIO
ALGER AMERICAN MIDCAP GROWTH PORTFOLIO
ALGER AMERICAN LEVERAGED ALLCAP PORTFOLIO
FIDELITY INVESTMENTS VARIABLE INSURANCE
PRODUCTS SEMI-ANNUAL REPORT*
MONEY MARKET PORTFOLIO
EQUITY-INCOME PORTFOLIO
INVESTMENT GRADE BOND PORTFOLIO
ASSET MANAGER PORTFOLIO
MFS VARIABLE INSURANCE TRUST
SEMI-ANNUAL REPORT
MFS TOTAL RETURN SERIES
MFS UTILITIES SERIES
MFS WORLD GOVERNMENTS SERIES
NEUBERGER & BERMAN ADVISERS
MANAGEMENT TRUST SEMI-ANNUAL REPORT
AMT BALANCED PORTFOLIO
AMT LIMITED MATURITY BOND PORTFOLIO
AMT PARTNERS PORTFOLIO
QUEST FOR VALUE ACCUMULATION TRUST
SEMI-ANNUAL REPORT
QUEST FOR VALUE GLOBAL EQUITY PORTFOLIO
QUEST FOR VALUE MANAGED PORTFOLIO
QUEST FOR VALUE SMALL CAP PORTFOLIO
* PLEASE NOTE THAT THE FIDELITY MONEY MARKET PORTFOLIO IS [LOGO-CIGNA
USED IN CONNECTION WITH CONNECTICUT GENERAL LIFE'S VARIABLE INDIVIDUAL
ANNUITY CONTRACT BUT NOT ITS VARIABLE LIFE INSURANCE CONTRACTS. INSURANCE]
IN ADDITION, THE FIDELITY MATERIAL CONTAINED IN THIS SEMI-ANNUAL
REPORT DISCUSS FUNDS NOT AVAILABLE TO FUND CONNECTICUT GENERAL
LIFE'S CONTRACTS.
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There are incorporated herein by reference the following exhibits, each of which
has been filed with the Securities and Exchange Commission in connection with
the named entity's status as a registered investment company under the
Investment Company Act of 1940.
Exhibit 1. The Alger American Fund Semi-Annual Report, June 30, 1995, consisting
of 23 numbered pages.
Exhibit 2. Variable Insurance Products Fund and Variable Insurance Products Fund
II Semi-Annual Reports, June 30, 1995, consisting of 49 and 52 numbered pages,
respectively, in a single booklet, and an inside back cover common to both.
Exhibit 3. MFS -Registered Trademark- Variable Insurance Trust
3(a) MFS -Registered Trademark- Total Return Series Semiannual Report,
June 30, 1995, consisting of 14 unnumbered pages;
3(b) MFS -Registered Trademark- Utilities Series Semiannual Report, June
30, 1995, consisting of 14 unnumbered pages;
3(c) MFS -Registered Trademark- World Governments Series Semiannual
Report, June 30, 1995, consisting of 17 unnumbered pages.
Exhibit 4. Neuberger&Berman Advisers Management Trust
4(a) Balanced Portfolio Only, Semi-Annual Report, June 30, 1995,
consisting of 23 numbered pages;
4(b) Limited Maturity Bond Portfolio Only, Semi-Annual Report, June 30,
1995, consisting of 20 numbered pages;
4(c) Partners Portfolio Only, Semi-Annual Report, June 30, 1995,
consisting of 19 numbered pages.
Exhibit 5. Quest for Value Accumulation Trust semi-annual report, June 30, 1995
5(a) Global Equity Portfolio, consisting of 13 partially numbered pages;
5(b) Managed Portfolio, consisting of 10 unnumbered pages;
5(c) Small Cap Portfolio, consisting of 13 unnumbered pages;
and a back cover common to all three of these portfolios.
