<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
---
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________
COMMISSION FILE NUMBER 33-58677
THE TRAVELERS LIFE AND ANNUITY COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
CONNECTICUT 06-0904249
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
ONE TOWER SQUARE, HARTFORD, CONNECTICUT 06183
(Address of principal executive offices) (Zip Code)
(860) 277-0111
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--------- ---------
As of the date hereof, there were outstanding 30,000 shares of common stock, par
value $100 per share, of the registrant, all of which were owned by The
Travelers Insurance Company, an indirect wholly owned subsidiary of Citigroup
Inc.
REDUCED DISCLOSURE FORMAT
The registrant meets the conditions set forth in General Instruction H(1)(a) and
(b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced
disclosure format.
<PAGE> 2
THE TRAVELERS LIFE AND ANNUITY COMPANY
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page
ITEM 1. FINANCIAL STATEMENTS
<S> <C>
Condensed Statements of Income and Retained Earnings for the
Three and Nine Months Ended September 30, 1998 and 1997 (unaudited)..............3
Condensed Balance Sheets as of September 30, 1998 (unaudited) and
December 31, 1997................................................................4
Condensed Statements of Cash Flows for the
Nine Months Ended September 30, 1998 and 1997 (unaudited)........................5
Notes to Condensed Financial Statements (unaudited)..............................6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS....................................8
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.......................................11
SIGNATURES......................................................................12
</TABLE>
2
<PAGE> 3
THE TRAVELERS LIFE AND ANNUITY COMPANY
CONDENSED STATEMENTS OF INCOME AND RETAINED EARNINGS (UNAUDITED)
($ IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
- --------------------------------------------------------------------------------------------------
1998 1997 1998 1997
---- ---- ---- ----
REVENUES
<S> <C> <C> <C> <C>
Premiums $ 5,459 $ 13,175 $ 17,989 $ 24,784
Net investment income 44,266 42,505 126,047 122,280
Realized investment gains 8,558 7,806 15,773 20,690
Other revenues 8,673 1,408 20,232 4,863
- --------------------------------------------------------------------------------------------------
Total Revenues 66,956 64,894 180,041 172,617
- --------------------------------------------------------------------------------------------------
BENEFITS AND EXPENSES
Current and future insurance benefits 19,786 28,655 60,958 72,047
Interest credited to contractholders 13,275 8,816 37,637 22,804
Amortization of deferred acquisition costs
and value of insurance in force and other
operating expenses 2,497 3,700 16,601 10,933
- --------------------------------------------------------------------------------------------------
Total Benefits and Expenses 35,558 41,171 115,196 105,784
- --------------------------------------------------------------------------------------------------
Income before federal income taxes 31,398 23,723 64,845 66,833
Federal income taxes 10,861 8,213 22,541 23,272
- --------------------------------------------------------------------------------------------------
Net income 20,537 15,510 42,304 43,561
Retained earnings at beginning of period 246,837 195,749 225,070 167,698
- --------------------------------------------------------------------------------------------------
Retained earnings at end of period $267,374 $211,259 $267,374 $211,259
==================================================================================================
</TABLE>
See Notes to Condensed Financial Statements.
3
<PAGE> 4
THE TRAVELERS LIFE AND ANNUITY COMPANY
CONDENSED BALANCE SHEETS
($ IN THOUSANDS)
<TABLE>
<CAPTION>
SEPTEMBER 30, 1998 DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------
ASSETS (UNAUDITED)
<S> <C> <C>
Investments $2,459,140 $2,145,127
Separate and variable accounts 1,525,641 812,059
Deferred acquisition costs and value of
insurance in force 157,511 90,966
Other assets 84,061 104,853
- ---------------------------------------------------------------------------------------
Total Assets $4,226,353 $3,153,005
- ---------------------------------------------------------------------------------------
LIABILITIES
Future policy benefits $965,445 $971,602
Contractholder funds 936,919 818,971
Separate and variable accounts 1,525,641 812,059
Other liabilities 244,539 84,712
- ---------------------------------------------------------------------------------------
Total Liabilities 3,672,544 2,687,344
- ---------------------------------------------------------------------------------------
SHAREHOLDER'S EQUITY
Common stock, par value $100; 100,000 shares
authorized; 30,000 issued and outstanding 3,000 3,000
Additional paid-in capital 167,314 167,314
Retained earnings 267,374 225,070
Accumulated other changes in equity from
nonowner sources 116,121 70,277
- ---------------------------------------------------------------------------------------
Total Shareholder's Equity 553,809 465,661
- ---------------------------------------------------------------------------------------
Total Liabilities and Shareholder's Equity $4,226,353 $3,153,005
=======================================================================================
</TABLE>
See Notes to Condensed Financial Statements.
4
<PAGE> 5
THE TRAVELERS LIFE AND ANNUITY COMPANY
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
INCREASE (DECREASE) IN CASH
($ IN THOUSANDS)
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, 1998 1997
- --------------------------------------------------------------------------------------
<S> <C> <C>
Net cash provided by (used in) operating activities $ (8,440) $ 20,808
- --------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities of investments
Fixed maturities 80,619 81,423
Mortgage loans 22,477 5,585
Proceeds from sales of investments
Fixed maturities 559,939 540,058
Equity securities 6,449 9,579
Mortgage loans -- 3,913
Real estate held for sale -- 4,493
Purchases of investments
Fixed maturities (768,359) (717,358)
Equity securities (13,322) (6,259)
Mortgage loans (18,305) (30,584)
Policy loans, net (1,636) (597)
Short-term securities purchases, net (82,680) (55,096)
Other investments proceeds (purchases), net 3,632 (2,576)
Securities transactions in course of settlement, net 100,131 14,419
- --------------------------------------------------------------------------------------
Net cash used in investing activities (111,055) (153,000)
- --------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Contractholder fund deposits 175,924 190,334
Contractholder fund withdrawals (57,975) (58,138)
- --------------------------------------------------------------------------------------
Net cash provided by financing activities 117,949 132,196
- --------------------------------------------------------------------------------------
Net increase (decrease) in cash (1,546) 4
Cash at beginning of period 1,563 --
- --------------------------------------------------------------------------------------
Cash at end of period $ 17 $ 4
======================================================================================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Income taxes paid $ 25,959 $ 21,655
======================================================================================
</TABLE>
See Notes to Condensed Financial Statements.
5
<PAGE> 6
THE TRAVELERS LIFE AND ANNUITY COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION
The interim financial statements of The Travelers Life and Annuity Company
(the Company), a wholly owned subsidiary of The Travelers Insurance Company,
an indirect wholly owned subsidiary of Citigroup Inc. (Citigroup), have been
prepared in conformity with generally accepted accounting principles (GAAP)
and are unaudited. In the opinion of management, the interim financial
statements reflect all adjustments necessary (all of which were normal
recurring adjustments), for a fair statement of results for the periods
reported. The accompanying condensed financial statements should be read in
conjunction with the financial statements and related notes included in the
Company's Form 10-K for the year ended December 31, 1997.
Certain financial information that is normally included in financial
statements prepared in accordance with GAAP but is not required for interim
reporting purposes has been condensed or omitted.
Certain reclassifications have been made to the prior year's financial
statements to conform to the current year's presentation.
ACCOUNTING CHANGES
Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities
Effective January 1, 1998, the Company adopted Statement of Financial
Accounting Standards No. 127, "Deferral of the Effective Date of Certain
Provisions of SFAS 125" (FAS 127), which was effective for transfers and
pledges of certain financial assets and collateral made after December 31,
1997. The adoption of FAS 127 created additional assets and liabilities on
the Company's condensed statement of financial position related to the
recognition of securities provided and received as collateral. At September
30, 1998, the impact of FAS 127 on the Company's condensed statement of
financial position was not significant.
Reporting Comprehensive Income
Effective January 1, 1998, the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income" (FAS 130). FAS
130 establishes standards for the reporting and display of comprehensive
income and its components in a full set of general-purpose financial
statements. All items that are required to be recognized under accounting
standards as components of comprehensive income are required to be reported
in an annual financial statement that is displayed with the same prominence
as other financial statements. FAS 130 stipulates that comprehensive income
reflect the change in equity of an enterprise during a period from
transactions and other events and circumstances from nonowner sources.
Comprehensive income will accordingly represent the sum of net income and
other changes in stockholder's equity from nonowner sources. The accumulated
balance of other changes in equity from nonowner sources is required to be
displayed separately from retained earnings and additional paid-in capital in
the condensed balance sheet. The adoption of FAS 130 resulted primarily in
the Company reporting unrealized gains and losses on investments in debt and
equity securities in changes in equity from nonowner sources. The Company's
total changes in equity from nonowner sources are as follows:
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
($ in thousands) 1998 1997 1998 1997
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net income $20,537 $15,510 $42,304 $43,561
Other changes in equity from nonowner sources 27,746 30,897 45,844 26,436
------- ------- ------- -------
Total Changes in Equity from Nonowner Sources $48,283 $46,407 $88,148 $69,997
======= ======= ======= =======
</TABLE>
6
<PAGE> 7
THE TRAVELERS LIFE AND ANNUITY COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)
Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use
On July 1, 1998, the Company adopted (effective January 1, 1998) the
Accounting Standards Executive Committee of the American Institute of
Certified Public Accountants' Statement of Position 98-1, "Accounting for the
Costs of Computer Software Developed or Obtained for Internal Use" (SOP
98-1). SOP 98-1 provides guidance on accounting for the costs of computer
software developed or obtained for internal use and for determining when
specific costs should be capitalized or expensed. The adoption of SOP 98-1
did not have a material impact on the Company's financial condition,
statement of operations or liquidity.
FUTURE APPLICATION OF ACCOUNTING STANDARDS
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (FAS 133). This statement establishes
accounting and reporting standards for derivative instruments, including
certain derivative instruments embedded in other contracts, (collectively
referred to as derivatives) and for hedging activities. It requires that an
entity recognize all derivatives as either assets or liabilities in the
balance sheet and measure those instruments at fair value. If certain
conditions are met, a derivative may be specifically designated as (a) a
hedge of the exposure to changes in the fair value of a recognized asset or
liability or an unrecognized firm commitment, (b) a hedge of the exposure to
variable cash flows of a forecasted transaction, or (c) a hedge of the
foreign currency exposure of a net investment in a foreign operation, an
unrecognized firm commitment, an available-for-sale security, or a
foreign-currency-denominated forecasted transaction. The accounting for
changes in the fair value of a derivative (that is, gains and losses) depends
on the intended use of the derivative and the resulting designation. FAS 133
is effective for all fiscal quarters of fiscal years beginning after June 15,
1999. Upon initial application of FAS 133, hedging relationships must be
designated anew and documented pursuant to the provisions of this statement.
The Company has not yet determined the impact that FAS 133 will have on its
financial statements.
2. MERGER
On October 8, 1998, Citicorp merged with and into a newly formed, wholly
owned subsidiary of Travelers Group Inc. (Travelers Group) (the Merger) and
subsequently, Travelers Group changed its name to Citigroup Inc.
Upon consummation of the Merger, Citigroup became a bank holding company
subject to the provisions of the Bank Holding Company Act of 1956 (the BHCA)
and the terms of an Order of the Federal Reserve Board effective September
23, 1998 (the Order).
The BHCA precludes a bank holding company and its affiliates from engaging in
certain activities, generally including insurance underwriting. Under the
BHCA in its current form, Citigroup has two years from October 8, 1998 to
comply with all applicable provisions of the BHCA. Such period may be
extended, at the discretion of the Federal Reserve Board, for three
additional one-year periods so long as the extension is not deemed to be
detrimental to the public interest (the BHCA Compliance Period).
It is not expected that the restrictions of the BHCA or the Order will impede
the Company's existing business in any material respect, although the Company
may be limited in its ability to make certain acquisitions. At this time, the
Company believes that its compliance with applicable law and the Order will
not have a material adverse effect on the Company's financial condition or
results of operations.
7
<PAGE> 8
THE TRAVELERS LIFE AND ANNUITY COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)
Before the expiration of the BHCA Compliance Period, each of the Company and
Citigroup will evaluate its alternatives in order to comply with the laws
applicable at the expiration of the BHCA Compliance Period.
3. SHAREHOLDER'S EQUITY
Statutory capital and surplus of the Company was $328.2 million at December
31, 1997. The Company is currently subject to various regulatory restrictions
that limit the maximum amount of dividends available to be paid to its parent
without prior approval of insurance regulatory authorities. The maximum
amount available in 1998 for dividend payments by the Company without
prior approval of the Connecticut Insurance Department is $63.6 million. The
Company has not paid dividends to its parent during the nine months ended
September 30, 1998.
4. COMMITMENTS AND CONTINGENCIES
The Company is a defendant in various litigation matters in the normal course
of business. Although there can be no assurances, as of September 30, 1998,
the Company believes, based on information currently available, that the
ultimate resolution of these legal proceedings would not be likely to have a
material adverse effect on its results of operations, financial condition or
liquidity.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Management's narrative analysis of the results of operations is presented in
lieu of Management's Discussion and Analysis of Financial Condition and Results
of Operations, pursuant to General Instruction H(2)(a) of Form 10-Q.
RESULTS OF OPERATIONS ($ in millions)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 1997
---- ----
<S> <C> <C>
Revenues $180.0 $172.6
====== ======
Net income (1) $42.3 $43.6
====== ======
</TABLE>
(1) Net income includes $10.3 million and $13.4 million of reported net
after-tax investment portfolio gains in 1998 and 1997, respectively.
The Travelers Life and Annuity Company (the Company) offers fixed and variable
deferred annuities and individual life insurance to individuals and small
businesses. It also provides traditional life insurance and single premium group
annuity close-out contracts.
The individual life and deferred annuity business is marketed primarily through
the Financial Consultants of Salomon Smith Barney Inc., an affiliate of the
Company, and a nationwide network of independent agents. The majority of the
annuity business and a substantial portion of the individual life business
written by the Company is accounted for as investment contracts, with the result
that the deposits collected from contractholders are reported as liabilities and
not included in revenues.
8
<PAGE> 9
THE TRAVELERS LIFE AND ANNUITY COMPANY
The Company has reserves related to structured settlement contracts that provide
guarantees for the contractholders independent of the investment performance of
the assets held in the related separate account. The assets held in the separate
account are owned by the Company and contractholders do not share in their
investment performance. These contracts were purchased by the insurance
subsidiaries of Travelers Property Casualty Corp. (TAP), an affiliate of the
Company, in connection with the settlement of certain of their policyholder
obligations. Effective April 1, 1998, new contracts have been written out of the
Company's parent, The Travelers Insurance Company (TIC), an indirect wholly
owned subsidiary of Citigroup Inc. (Citigroup).
Net income for the nine months ended September 30, 1998 was $42.3 million,
compared to $43.6 million for the nine months ended September 30, 1997.
Excluding net realized investment gains and losses, operating earnings increased
from $30.1 million in 1997 to $32.1 million in 1998. This increase was driven by
strong results in the deferred annuity and universal life businesses, partially
offset by the run-off of the structured settlement business.
PREMIUMS AND DEPOSITS ($ in thousands)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 1997
-------- --------
<S> <C> <C>
Deferred annuities $766,061 $365,691
Structured settlements 9,127 50,312
Universal life 63,204 24,501
Traditional life 12,248 7,721
Single premium group close-out 608 359
-------- --------
Total $851,248 $448,584
======== ========
</TABLE>
The increase in deferred annuity and universal life deposits is attributable to
strong sales of products distributed by the Financial Consultants of Salomon
Smith Barney Inc., an affiliate of the Company. The structured settlement
decrease reflects a change in Company policy that all new structured settlements
be sold by TIC.
Policyholders benefit reserves, contractholder funds and separate account
reserves totaled $3.4 billion at September 30, 1998, up from $2.3 billion at
September 30, 1997, primarily as a result of growth in the individual life and
deferred annuity business.
MERGER
On October 8, 1998, Citicorp merged with and into a newly formed, wholly owned
subsidiary of Travelers Group Inc. (Travelers Group) (The Merger) and
subsequently Travelers Group changed its name to Citigroup Inc.
See Note 2 to the Condensed Financial Statements for a discussion of the Merger.
INSURANCE REGULATIONS
Risk-based capital requirements are used as early warning tools by the National
Association of Insurance Commissioners and the states to identify companies that
merit further regulatory action. At September 30, 1998, the Company had adjusted
capital in excess of amounts requiring any regulatory action.
The Company is subject to various regulatory restrictions that limit the maximum
amount of dividends available to be paid to its parent without prior approval of
insurance regulatory authorities in the state of domicile.
9
<PAGE> 10
THE TRAVELERS LIFE ANNUITY COMPANY
The maximum amount of dividends available to be paid to the Company's
shareholder in 1998 without prior approval of the Connecticut Insurance
Department is $63.6 million. The Company has not paid any dividends to its
parent during the nine months ended September 30, 1998.
YEAR 2000
The Company is highly dependent on computer systems and systems applications for
conducting its ongoing business functions. In 1996, the Company began the
process of identifying, assessing and implementing changes to computer programs
to address the year 2000 issue and developed a comprehensive plan to address the
issue. The issue involves the ability of computer systems that have time
sensitive programs to recognize properly the year 2000. The inability to do so
could result in major failures or miscalculations that would disrupt the
Company's ability to meet its customer and other obligations on a timely basis.
The Company is in the process of implementing necessary changes, in accordance
with its Year 2000 plan, to bring all its critical business systems into year
2000 compliance by early 1999. As part of, and following, achievement of year
2000 compliance, systems have been, and will continue to be, subjected to a
certification process which validates the renovated code before it is certified
for use in production. In addition, the Company is developing contingency plans
to be used in the event of an unexpected failure, which may result from the
complex interrelationships among our clients, business partners, and other
parties upon whom it relies. These plans are expected to be in place by December
31, 1998.
The total pre-tax cost associated with the required modifications and
conversions is expected to be insignificant and is being expensed as incurred in
the period 1996 through 1999, and is not expected to have a material effect on
its financial position, results of operations or liquidity. The Company also has
third party customers, financial institutions, vendors and others with which it
conducts business and has communicated with them on their plans to address and
resolve year 2000 issues on a timely basis. While it is likely that these
efforts by third party vendors will be successful, it is possible that a series
of failures by third parties could have a material adverse effect on the
Company's results of operations in future years.
FUTURE APPLICATIONS OF ACCOUNTING STANDARDS
See Note 1 to the Condensed Financial Statements for a discussion of recently
issued accounting pronouncements.
FORWARD-LOOKING STATEMENTS
Certain of the statements contained herein that are not historical facts are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act. The Company's actual results may differ materially from
those included in the forward-looking statements. Forward-looking statements are
typically identified by the words "believe," "expect," "anticipate," "intend,"
"estimate," and similar expressions. These forward-looking statements involve
risks and uncertainties including, but not limited to, the resolution of legal
proceedings, the conduct of the Company's business following the Merger and the
ability of the Company and third party vendors to modify computer systems for
the year 2000 data conversion in a timely manner.
10
<PAGE> 11
THE TRAVELERS LIFE AND ANNUITY COMPANY
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<S> <C>
3.01 Charter of The Travelers Life and Annuity Company (the
"Company"), as amended on April 10, 1990, incorporated herein by
reference to Exhibit 6(a) to the Registration Statement on Form
N-4, File No. 33-58131, filed on March 17, 1995.
3.02 By-laws of the Company, as amended on October 20, 1994,
incorporated herein by reference to Exhibit 6(b) to the
Registration Statement on Form N-4, File No. 33-58131, filed on
March 17, 1995.
27.01+ Financial Data Schedule
</TABLE>
- -------------------------
+ Filed herewith.
(b) REPORTS ON FORM 8-K.
None.
11
<PAGE> 12
THE TRAVELERS LIFE AND ANNUITY COMPANY
SIGNATURES
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.
THE TRAVELERS LIFE AND ANNUITY COMPANY
(Registrant)
Date November 13, 1998 /s/ Ian R. Stuart
-------------------------- -----------------------
Ian R. Stuart
Chief Financial Officer and Chief
Accounting Officer
(Principal Financial Officer)
12
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of the Travelers Life and Annuity Company and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000929498
<NAME> THE TRAVELERS LIFE AND ANNUITY COMPANY
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<EXCHANGE-RATE> 1
<DEBT-HELD-FOR-SALE> 0
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 0
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 2,459,140
<CASH> 17
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 157,511
<TOTAL-ASSETS> 4,226,353
<POLICY-LOSSES> 965,445
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 2,462,560
<NOTES-PAYABLE> 0
0
0
<COMMON> 3,000
<OTHER-SE> 550,809
<TOTAL-LIABILITY-AND-EQUITY> 4,226,353
17,989
<INVESTMENT-INCOME> 126,047
<INVESTMENT-GAINS> 15,773
<OTHER-INCOME> 20,232
<BENEFITS> 98,595
<UNDERWRITING-AMORTIZATION> 11,543
<UNDERWRITING-OTHER> 5,058
<INCOME-PRETAX> 64,845
<INCOME-TAX> 22,541
<INCOME-CONTINUING> 42,304
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 42,304
<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
</TABLE>
