<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, 1999
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.
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THE TRAVELERS LIFE AND ANNUITY COMPANY
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page
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<S> <C>
ITEM 1. FINANCIAL STATEMENTS
Condensed Statements of Income for the Three and
Nine Months Ended September 30, 1999 and 1998 (unaudited)..............................................................3
Condensed Balance Sheets as of September 30, 1999 (unaudited) and
December 31, 1998......................................................................................................4
Condensed Statements of Changes in Retained Earnings and
Accumulated Other Changes in Equity from Non-Owner Sources
for the Three and Nine Months Ended September 30, 1999 and 1998 (unaudited)............................................5
Condensed Statements of Cash Flows for the
Nine Months Ended September 30, 1999 and 1998 (unaudited)..............................................................6
Notes to Condensed Financial Statements (unaudited)....................................................................7
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.............................................................................12
SIGNATURES............................................................................................................13
</TABLE>
2
<PAGE> 3
THE TRAVELERS LIFE AND ANNUITY COMPANY
CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
($ IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
- --------------------------------------------------------------------------------------------------------------
1999 1998 1999 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
REVENUES
Premiums $ 6,542 $ 5,459 $ 18,157 $ 17,989
Net investment income 46,444 44,266 133,523 126,047
Realized investment gains 1,166 8,558 7,893 15,773
Fee income 13,815 4,980 32,778 11,768
Other revenues 2,491 3,693 11,620 8,464
-------- -------- -------- --------
Total revenues 70,458 66,956 203,971 180,041
-------- -------- -------- --------
BENEFITS AND EXPENSES
Current and future insurance benefits 18,910 19,786 60,478 60,958
Interest credited to contractholders 14,381 13,275 40,512 37,637
Amortization of deferred acquisition costs and
operating expenses 7,298 2,497 21,483 16,601
-------- -------- -------- --------
Total benefits and expenses 40,589 35,558 122,473 115,196
-------- -------- -------- --------
Income before federal income taxes 29,869 31,398 81,498 64,845
-------- -------- -------- --------
Federal income taxes 10,382 10,861 28,425 22,541
-------- -------- -------- --------
Net income $ 19,487 $ 20,537 $ 53,073 $ 42,304
======== ======== ======== ========
</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, 1999 DECEMBER 31,
(UNAUDITED) 1998
----------- -----------
<S> <C> <C>
ASSETS
Investments $ 2,217,601 $ 2,302,229
Separate accounts 3,655,477 2,178,474
Deferred acquisition costs 307,404 177,808
Other assets 156,541 85,993
----------- -----------
Total assets $ 6,337,023 $ 4,744,504
----------- -----------
LIABILITIES
Future policy benefits $ 952,706 $ 963,171
Contractholder funds 1,083,390 947,411
Separate accounts 3,655,477 2,178,474
Other liabilities 157,619 114,690
----------- -----------
Total liabilities 5,849,192 4,203,746
----------- -----------
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 167,316 167,314
Retained earnings 335,628 282,555
Accumulated other changes in equity from non-owner sources (18,113) 87,889
----------- -----------
Total shareholder's equity 487,831 540,758
----------- -----------
Total liabilities and shareholder's equity $ 6,337,023 $ 4,744,504
=========== ===========
</TABLE>
See Notes to Condensed Financial Statements.
4
<PAGE> 5
THE TRAVELERS LIFE AND ANNUITY COMPANY
CONDENSED STATEMENTS OF CHANGES IN RETAINED EARNINGS AND
ACCUMULATED OTHER CHANGES IN EQUITY FROM NON-OWNER SOURCES
(UNAUDITED)
($ IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
- --------------------------------------------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN RETAINED EARNINGS 1999 1998 1999 1998
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Balance, beginning of period $ 316,141 $ 246,837 $ 282,555 $ 225,070
Net income 19,487 20,537 53,073 42,304
--------- --------- --------- ---------
Balance, end of period $ 335,628 $ 267,374 $ 335,628 $ 267,374
========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
STATEMENTS OF ACCUMULATED OTHER CHANGES
IN EQUITY FROM NON-OWNER SOURCES
- --------------------------------------------------------------------------------------------------------------------------------
Balance, beginning of period $ 2,645 $ 88,375 $ 87,889 $ 70,277
Unrealized gains (losses), net of tax (20,758) 27,746 (106,002) 45,844
--------- --------- --------- ---------
Balance, end of period $ (18,113) $ 116,121 $ (18,113) $ 116,121
========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
SUMMARY OF CHANGES IN EQUITY
FROM NON-OWNER SOURCES
- --------------------------------------------------------------------------------------------------------------------------------
Net income $ 19,487 $ 20,537 $ 53,073 $ 42,304
Other changes in equity from
Non-owner sources (20,758) 27,746 (106,002) 45,844
--------- --------- --------- ---------
Total changes in equity from
Non-owner sources $ (1,271) $ 48,283 $ (52,929) $ 88,148
========= ========= ========= =========
</TABLE>
See Notes to Condensed Financial Statements.
5
<PAGE> 6
THE TRAVELERS LIFE AND ANNUITY COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH
(UNAUDITED)
($ IN THOUSANDS)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
1999 1998
--------- ---------
<S> <C> <C>
NET CASH USED IN OPERATING ACTIVITIES $(118,714) $ (8,440)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities of investments
Fixed maturities 169,354 80,619
Mortgage loans 22,811 22,477
Proceeds from sales of investments
Fixed maturities 522,952 559,939
Equity securities 2,387 6,449
Purchases of investments
Fixed maturities (775,665) (768,359)
Equity securities (9,577) (13,322)
Mortgage loans (7,581) (18,305)
Policy loans (4,683) (1,636)
Short-term securities (purchases) sales, net 51,252 (82,680)
Other investment purchases, net (13,065) 3,632
Securities transactions in course of settlement, net 26,610 100,131
--------- ---------
Net cash used in investing activities (15,205) (111,055)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Contractholder fund deposits 188,154 175,924
Contractholder fund withdrawals (52,176) (57,975)
--------- ---------
Net cash provided by financing activities 135,978 117,949
--------- ---------
Net increase (decrease) in cash 2,059 (1,546)
Cash at beginning of period 624 1,563
--------- ---------
Cash at end of period $ 2,683 $ 17
--------- ---------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Income taxes paid $ 24,726 $ 25,959
========= =========
</TABLE>
See Notes to Condensed Financial Statements.
6
<PAGE> 7
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
(TIC), 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 presentation 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,
1998.
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 prior year amounts have been reclassified to conform with the
current year's presentation.
ACCOUNTING CHANGES
In January 1999, the Company adopted Statement of Position 97-3,
"Accounting by Insurance and Other Enterprises for Insurance-Related
Assessments" (SOP 97-3). SOP 97-3 provides guidance for determining when an
entity should recognize a liability for guaranty-fund and other
insurance-related assessments, how to measure that liability, and when an
asset may be recognized for the recovery of such assessments through
premium tax offsets or policy surcharges. The adoption of this SOP had no
impact on the Company's financial condition, results of operations or
liquidity.
FUTURE APPLICATION OF ACCOUNTING STANDARDS
In June 1998, the Financial Accounting Standards Board (FASB) 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. Upon initial application of FAS 133, hedging relationships
must be designated anew and documented pursuant to the provisions of this
statement. FAS 133 was to be effective for all fiscal quarters of fiscal
years beginning after June 15, 1999. However, in June 1999 the FASB issued
Statement of Financial Standards No. 137, "Deferral of the Effective Date
of FASB Statement No. 133" (FAS 137) which allows entities that have not
adopted FAS 133 to defer its effective date to all fiscal quarters of all
fiscal years beginning after June 15, 2000. The Company expects to adopt
the deferral provisions of FAS 137 and has not yet determined the impact
that FAS 133 will have on its consolidated financial statements.
7
<PAGE> 8
THE TRAVELERS LIFE AND ANNUITY COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
(CONTINUED)
2. SHAREHOLDER'S EQUITY
Statutory capital and surplus of the Company was $328.2 million at December
31, 1998. 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. Statutory surplus of $32.8 million is available in 1999 for
dividend payments by the Company without prior approval of the Connecticut
Insurance Department. The Company did not pay any dividends to its parent
during the nine months ended September 30, 1999 and 1998.
3. COMMITMENTS AND CONTINGENCIES
The Company is a defendant in various litigation matters in the normal
course of business. Although there can be no assurances, as of September
30, 1999, the Company believes, based on information currently available,
that the ultimate resolution of these legal proceedings would not be likely
to have a material adverse effect on its results of operations, financial
condition or liquidity. This statement is a forward-looking statement
within the meaning of the Private Securities Litigation Reform Act. See
"Forward-Looking Statements" on page 11.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Management's narrative analysis of the results of operations is presented in
lieu of Management's Discussion and Analysis of Financial Condition and Results
of Operations, pursuant to General Instruction H(2)(a) of Form 10-Q.
RESULTS OF OPERATIONS ($ in millions)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 1998
---- ----
<S> <C> <C>
Revenues (1) $204.0 $180.0
------ ------
Net income (2) $53.1 $42.3
===== =====
</TABLE>
- --------------------------
(1) Revenues include pre-tax investment portfolio gains of $7.9 million and
$15.8 million in 1999 and 1998, respectively.
(2) Net income includes $5.1 million and $10.3 million of reported
after-tax investment portfolio gains in 1999 and 1998, respectively.
The Travelers Life and Annuity Company (the Company) offers fixed and variable
deferred annuities and individual life insurance to individuals and small
businesses. These products are marketed primarily through the Financial
Consultants of Salomon Smith Barney Inc., an affiliate of the Company, and a
nationwide network of independent agents. During 1998 and 1999, Copeland
Companies (Copeland), Primerica Financial Services (Primerica) and Citibank,
affiliates of the Company, also began marketing these products. 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
are 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 this
separate account are owned by the Company and contractholders do not share in
their investment performance. The assets and liabilities of this separate
account are included in investments, future policy benefits and contractholder
funds for financial reporting purposes. 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, all new structured settlement
contracts have been written by TIC.
The Company offers a variety of variable annuity products where the investment
risk is borne by the contractholder, not the Company, and the majority of
benefits are not guaranteed. The premiums and deposits related to these products
are reported in separate accounts. The Company considers it necessary to
differentiate, for financial statement purposes, the results of the risks it has
assumed from those it has not.
Operating earnings for the nine months ended September 30, 1999 were $48.0
million compared with $32.0 million for the prior year period. This increase was
primarily driven by business volume. The impact of this volume growth is
reflected in net investment income and fee income in both the deferred annuity
and universal life businesses.
PREMIUMS AND DEPOSITS ($ in millions)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 1998
------ ------
<S> <C> <C>
Deferred Annuities $1,650 $ 767
Universal Life 83 63
Traditional Life 17 12
Structured Settlements -- 9
------ ------
Total $1,750 $ 851
====== ======
</TABLE>
The substantial increase in deferred annuity deposits is primarily attributable
to the introduction of the Company's products into the Primerica distribution
channel, $572 million in 1999 compared with $88 million in 1998, and to strong
introductory sales from Citibank and Copeland affiliates of the Company. The
structured settlement decrease reflects a change in Company policy that all new
structured settlements be sold by TIC.
Account balances, which included policyholder benefit reserves, contractholder
funds and separate account reserves totaled $5.7 billion at September 30, 1999,
up from $3.4 billion at September 30, 1998, primarily as a result of growth in
the variable annuity separate account business.
9
<PAGE> 10
THE TRAVELERS LIFE AND ANNUITY COMPANY
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). 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 the date it became a bank holding
company to comply with all applicable provisions.
On November 12, 1999, President Clinton signed into law the Gramm-Leach-Bliley
Act (the "Act"), which will become effective in most significant respects 120
days after enactment. Under the Act, bank holding companies, such as Citigroup,
all of whose depository institutions are "well capitalized" and "well managed"
(as defined in the BHCA) and which obtain satisfactory Community Reinvestment
Act ratings, and their affiliates will have the ability to engage in a broader
spectrum of activities than those currently permitted, including insurance
underwriting and brokerage. Citigroup and its affiliates (including the Company)
will be permitted to continue to operate their insurance businesses as currently
structured and, if they so determined, to expand those businesses through
acquisition or otherwise. Citigroup and its affiliates (including the Company)
will also have increased ability to make investments in companies engaged in
non-financial activities.
INSURANCE REGULATIONS
Risk-based capital requirements are used as minimum capital requirements by the
National Association of Insurance Commissioners and the states to identify
companies that merit further regulatory action. At September 30, 1999, 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. The maximum amount of
dividends available to be paid to the Company's shareholder in 1999 without
prior approval of the Connecticut Insurance Department is $32.8 million. The
Company did not pay any dividends to its parent during the nine months ended
September 30, 1999 and 1998.
YEAR 2000
The Company is highly dependent on computer systems and systems applications for
conducting its ongoing business functions. In 1996, TIC and its subsidiaries,
including the Company, began the process of identifying, assessing and
implementing changes to computer programs to address the Year 2000 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.
10
<PAGE> 11
THE TRAVELERS LIFE AND ANNUITY COMPANY
The Company has achieved compliance with respect to its business critical
systems in accordance with its Year 2000 plan and has completed the process of
certification to validate compliance. An ongoing re-certification process will
continue through fourth quarter 1999 to ensure all business critical systems and
products remain compliant.
The total cost associated with the required modifications and conversions is
being expensed as incurred in the period 1996 through 1999. The Company also has
third party customers, financial institutions, vendors and others with whom it
conducts business and has confirmed their plans to address and resolve Year 2000
issues on a timely basis. While it is likely that these efforts by third party
vendors and customers 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 periods.
In addition, the Company has developed business resumption contingency plans to
address perceived risks associated with the Year 2000 effort. These plans
address the possibility of internal systems failures and the possibility of
failure of systems or processes outside the Company's control. These business
resumption contingency plans would enable business critical units to function
January 1, 2000 in the event of an unexpected failure. Preparations for the
management of the date change will continue through 1999.
Certain information contained in the foregoing paragraphs constitutes
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act. See "Forward-Looking Statements" below.
FUTURE APPLICATIONS OF ACCOUNTING STANDARDS
See Note 1 of Notes to Condensed Financial Statements for Future Application of
Accounting Standards.
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," "may increase," "may fluctuate," and similar expressions, or future
or conditional verbs such as "will," "should," "would," and "could." 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.
11
<PAGE> 12
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.
12
<PAGE> 13
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 12, 1999 /s/ Jay S. Benet
----------------- --------------------------------------
Jay S. Benet
Senior Vice President,
Chief Financial Officer and
Chief Accounting Officer
(Principal Financial Officer)
13
<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> US DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<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> 2,217,601
<CASH> 2,683
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 307,404
<TOTAL-ASSETS> 6,337,023
<POLICY-LOSSES> 952,706
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 4,738,867
<NOTES-PAYABLE> 0
0
0
<COMMON> 3,000
<OTHER-SE> 484,831
<TOTAL-LIABILITY-AND-EQUITY> 6,337,023
18,157
<INVESTMENT-INCOME> 133,523
<INVESTMENT-GAINS> 7,893
<OTHER-INCOME> 44,398
<BENEFITS> 100,990
<UNDERWRITING-AMORTIZATION> 14,351
<UNDERWRITING-OTHER> 7,132
<INCOME-PRETAX> 81,498
<INCOME-TAX> 28,425
<INCOME-CONTINUING> 53,073
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 53,073
<EPS-BASIC> 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>
