-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, COYurKl9GNvLV2wO37ZlxesM9sFqY5btlm4VZmRmoDSGXageE09oA9NBA2Mzqnw6 EnYwFCIrvMytkfUF0vk6bA== 0000930413-99-001118.txt : 19990831 0000930413-99-001118.hdr.sgml : 19990831 ACCESSION NUMBER: 0000930413-99-001118 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19990830 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SEPARATE ACCOUNT I OF WASHINGTON NATIONAL INSURANCE CO CENTRAL INDEX KEY: 0000711501 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 361933760 STATE OF INCORPORATION: IL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-03640 FILM NUMBER: 99702326 BUSINESS ADDRESS: STREET 1: ONE PRESIDENTIAL PARKWAY CITY: KOKOMO STATE: IL ZIP: 46904 BUSINESS PHONE: 7654530602 MAIL ADDRESS: STREET 1: ONE PRESIDENRTIAL PARKWAY CITY: KOKOMO STATE: IL ZIP: 46904 N-30D 1 SEMIANNUAL REPORT TO CONTRACT OWNERS [LOGO] WASHINGTON NATIONAL INSURANCE COMPANY SEMIANNUAL REPORT TO CONTRACT OWNERS JUNE 30, 1999 Separate Account 1 of Washington National Insurance Company SEMIANNUAL REPORT TO CONTRACT OWNERS TABLE OF CONTENTS JUNE 30, 1999
======================================================================================================================== SEPARATE ACCOUNT I OF WASHINGTON NATIONAL INSURANCE COMPANY PAGE Statement of Assets and Liabilities as of June 30, 1999............................................................... 1 Statements of Operations for the Six Months Ended June 30, 1999, and the Year Ended December 31, 1998................. 2 Statements of Changes in Net Assets for the Six Months Ended June 30, 1999, and the Year Ended December 31, 1998...... 2 Notes to Financial Statements......................................................................................... 3
SEPARATE ACCOUNT 1 OF WASHINGTON NATIONAL INSURANCE COMPANY STATEMENT OF ASSETS AND LIABILITIES JUNE 30, 1999 (UNAUDITED)
============================================================================================================================== NET ASSET SHARES COST VALUE ------------------------------------------- Assets: Investments in portfolio shares (Note 2) Scudder Variable Life Portfolio: Bond Portfolio........................................................... 812,802.5 $ 5,410,03 $ 5,258,833 Money Market Portfolio................................................... 377,998.0 377,998 377,998 Capital Growth Portfolio................................................. 1,613,057.7 27,990,790 38,584,340 Growth & Income Portfolio................................................ 213,980.2 2,384,350 2,477,891 - ------------------------------------------------------------------------------------------------------------------------------ Net assets ............................................................ $ 46,699,062 ============================================================================================================================== TOTAL VALUE UNITS UNIT VALUE OF UNITS ------------------------------------------ Net assets attributable to: Contract owners' deferred annuity reserves: Scudder Variable Life Portfolio: Bond Portfolio........................................................... 1,843,526.2 $ 2.852594 $ 5,258,833 Money Market Portfolio................................................... 186,825.3 2.023268 377,998 Capital Growth Portfolio................................................. 5,287,569.4 7.297179 38,584,340 Growth & Income Portfolio................................................ 1,424,501.8 1.739479 2,477,891 - ------------------------------------------------------------------------------------------------------------------------------ Net assets ............................................................ $ 46,699,062 ============================================================================================================================== The accompanying notes are an integral part of these financial statements.
1 SEPARATE ACCOUNT 1 OF WASHINGTON NATIONAL INSURANCE COMPANY STATEMENTS OF OPERATIONS
=============================================================================================================================== SIX MONTHS ENDED YEAR ENDED JUNE 30, 1999 DECEMBER 31, (UNAUDITED) 1998 =============================================================================================================================== Investment income: Dividends from investments in portfolio shares............................................... $ 4,276,604 $ 2,598,105 Expenses: Mortality and expense risk fees.............................................................. 263,054 497,481 - ------------------------------------------------------------------------------------------------------------------------------- Net investment income...................................................................... 4,013,550 2,100,624 - ------------------------------------------------------------------------------------------------------------------------------- Net realized gains (losses) and unrealized appreciation (depreciation) of investments in portfolio shares: Net realized gains on sales of investments in portfolio shares............................... 1,241,542 1,765,635 Net change in unrealized appreciation (depreciation) of investments in portfolio shares...... (1,361,929) 3,315,989 - ------------------------------------------------------------------------------------------------------------------------------- Net gain (loss) on investments in portfolio shares......................................... (120,387) 5,081,624 - ------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets from operations............................................. $ 3,893,163 $ 7,182,248 ===============================================================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
=============================================================================================================================== SIX MONTHS ENDED YEAR ENDED JUNE 30, 1999 DECEMBER 31, (UNAUDITED) 1998 =============================================================================================================================== Changes from operations: Net investment income........................................................................ $ 4,013,550 $ 2,100,624 Net realized gains on sales of investments in portfolio shares............................... 1,241,542 1,765,635 Net change in unrealized appreciation (depreciation) of investments in portfolio shares...... (1,361,929) 3,315,989 - ------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets from operations................................................. 3,893,163 7,182,248 - ------------------------------------------------------------------------------------------------------------------------------- Changes from contract owners' transactions: Net contract purchase payments............................................................... 402,109 986,456 Contract redemptions......................................................................... (3,120,619) (4,443,893) Net transfers................................................................................ 593,948 358,051 - ------------------------------------------------------------------------------------------------------------------------------- Net decrease in net assets from contract owners' transactions............................ (2,124,562) (3,099,386) - ------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets............................................................. 1,768,601 4,082,862 - ------------------------------------------------------------------------------------------------------------------------------- Net assets, beginning of period................................................................. 44,930,461 40,847,599 - ------------------------------------------------------------------------------------------------------------------------------- Net assets, end of period.............................................................. $ 46,699,062 $ 44,930,461 =============================================================================================================================== The accompanying notes are an integral part of these financial statements.
2 SEPARATE ACCOUNT 1 OF WASHINGTON NATIONAL INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS JUNE 30, 1999 (UNAUDITED) ================================================================================ (1) GENERAL The Separate Account I of Washington National Insurance Company (the "Account") was established in 1982 as a segregated investment account for individual annuity contracts which are registered under the Securities Act of 1933. The Account is registered under the Investment Company Act of 1940 (the "Act"), as amended, as a unit investment trust. The Account was originally registered with the U.S. Securities and Exchange Commission as a diversified open-end management investment company under the Act. Effective July 1, 1996, the Account was restructured into a single unit investment trust which invests solely in shares of the portfolios of the Scudder Variable Life Investment Fund (the "Fund"), a diversified open-end management investment company. The investment options available are the Bond, Capital Growth, Growth & Income and Money Market portfolios. The operations of the Account are included in the operations of Washington National Insurance Company ("WNIC") pursuant to the provisions of the Illinois Insurance Code. WNIC is an indirect wholly owned subsidiary of Conseco, Inc., a publicly-held specialized financial services holding company listed on the New York Stock Exchange. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported increases and decreases in net assets during the reporting period. Actual results may differ from these estimates. (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES INVESTMENT VALUATION, TRANSACTIONS, AND INCOME Investments in portfolio shares are valued using the net asset value of the respective portfolios of the Fund at the end of each New York Stock Exchange business day. Investment share transactions are accounted for on a trade date basis (the date the order to purchase or redeem shares is executed) and dividend income is recorded on the ex-dividend date. The cost of investments in portfolio shares sold is determined on a first-in first-out basis. The Account does not hold any investments which are restricted as to resale. Net investment income and net realized gains (losses) and unrealized appreciation (depreciation) on investments are allocated to the contracts on each valuation date based on each contract's pro rata share of the assets of the Account as of the beginning of the valuation date. FEDERAL INCOME TAXES No provision for federal income taxes has been made in the accompanying financial statements because the operations of the Account are included in the total operations of WNIC, which is treated as a life insurance company for federal income tax purposes under the Internal Revenue Code. Net investment income and realized gains (losses) are retained in the Account and are not taxable until received by the contract owner or beneficiary in the form of annuity payments or other distributions. ANNUITY RESERVES Deferred annuity contract reserves are comprised of net contract purchase payments less redemptions and benefits. These reserves are adjusted daily for the net investment income and net realized gains (losses) and unrealized appreciation (depreciation) on investments. (3) PURCHASES AND SALES OF INVESTMENTS IN PORTFOLIO SHARES The aggregate cost of purchases of investments in portfolio shares for the six months ended June 30, 1999, and the year ended December 31, 1998, were $6,233,220 and $6,249,235, respectively. The aggregate proceeds from sales of investments in portfolio shares for the six months ended June 30, 1999, and for the year ended December 31, 1998, were $4,344,075 and $7,247,998, respectively. (4) DEDUCTIONS AND EXPENSES Although periodic retirement payments to contract owners vary according to the investment performance of the portfolios, such payments are not affected by expense or mortality experience because the WNIC assumes the mortality risk and the expense risk under the contracts. The mortality risk assumed by WNIC results from the life annuity payment option in the contracts in which WNIC agrees to make annuity payments regardless of how long a particular annuitant or other payee lives. The annuity payments are determined in accordance with annuity purchase rate provisions established at the time the contracts are issued. Based on the actuarial determination of expected mortality, WNIC is required to fund any deficiency in the annuity payment reserves from its general account assets. The expense risk assumed by WNIC is the risk that the deductions for financial accounting services may prove insufficient to cover the actual expenses. WNIC deducts daily from the Account an annuity rate guarantee charge, which is equal on an annual basis to 0.80 percent of the daily value of the total investments of the Fund, for assuming the mortality and expense risks. These fees were $183,439 and $348,238 for the six months ended June 30, 1999, and for the year ended December 31, 1998, respectively. WNIC deducts daily from the Account a financial accounting charge, which is equal on an annual basis to 0.35 percent of the daily value of the total investments of the Fund, for assuming the expense risk. These fees were $78,915 and $149,243 for the six months ended June 30, 1999, and for the year ended December 31, 1998, respectively. An annual contract administrative charge of $30 is deducted from the accumulated value of each contract on the contract anniversary or on the date of surrender if it occurs between contract anniversaries. This fee does not apply to contracts for individual retirement accounts, or to contracts which at the end of any contract anniversary have received at least $1,200 of payments and in which the accumulated value is at least $20,000. These fees were $8,983 and $19,508 for the six months ended June 30, 1999, and for the year ended December 31, 1998, respectively. WNIC deducts a contingent deferred sales charge of 6% on any amounts withdrawn which are in excess of 10% of the contract's accumulated value on the date of the first withdrawal during the respective year, except that no such charge is made for withdrawals of purchase payments received 72 months prior to the date of withdrawal and no such charge is made if the withdrawal amount is applied to a settlement option after the contract has been in force for five years or if the contract contains life contingencies. These fees were $32,696 and $73,059 for the six months ended June 30, 1999, and for the year ended December 31, 1998, respectively. 3 ================================================================================ THIS PAGE INTENTIONALLY LEFT BLANK. 4 ================================================================================ SEPARATE ACCOUNT 1 OF WASHINGTON NATIONAL INSURANCE COMPANY SPONSOR Washington National Insurance Company - Carmel, Indiana. INDEPENDENT PUBLIC ACCOUNTANTS PricewaterhouseCoopers LLP - Indianapolis, Indiana. 5 WASHINGTON NATIONAL INSURANCE COMPANY IS AN INDIRECT WHOLLY OWNED SUBSIDIARY OF CONSECO, INC., A FINANCIAL SERVICES ORGANIZATION HEADQUARTERED IN CARMEL, INDIANA. CONSECO, THROUGH ITS SUBSIDIARY COMPANIES, IS ONE OF MIDDLE AMERICA'S LEADING SOURCES FOR INSURANCE, INVESTMENT AND LENDING PRODUCTS, HELPING 12 MILLION CUSTOMERS STEP UP TO A BETTER, MORE SECURE FUTURE. WASHINGTON NATIONAL INSURANCE COMPANY 11815 North Pennsylvania Street Carmel, Indiana 46032 (8/99) 06104 (C) 1999 Washington National Insurance Company www.conseco.com Insurance Investments Lending - -------------------------------------------------------------------------[LOGO] -----END PRIVACY-ENHANCED MESSAGE-----