485BPOS 1 a08-10234_3485bpos.htm 485BPOS

 

Pinnacle Plus

As filed with the Securities and Exchange Commission on April 23, 2008

Registration Nos. 333-102575 and 811-04844

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM N-4

 

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

 

Pre-Effective Amendment Number

 

o

Post-Effective Amendment Number:  6

 

x

 

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

 

Amendment Number:  59

 

x

(Check appropriate box or boxes)

 

Separate Account I of Integrity Life Insurance Company

(Exact Name of Registrant)

 

Integrity Life Insurance Company

(Name of Depositor)

 

400 Broadway, Cincinnati, Ohio 45202

(Address of Depositor’s Principal Executive Offices)  (Zip Code)

 

(513) 629-1854

(Depositor’s Telephone Number, including Area Code)

 

The Western and Southern Life Insurance Company

(Name of Guarantor)

 

400 Broadway, Cincinnati, Ohio 45202

(Address of Guarantor’s Principal Executive Offices)  (Zip Code)

 

(513) 629-1854

(Guarantor’s Telephone Number, including Area Code)

 

Rhonda S. Malone, Esq.

Associate Counsel -Securities

Western & Southern Financial Group, Inc.

400 Broadway, Cincinnati, Ohio  45202

(Name and Address of Agent for Service)

 

Approximate Date of Proposed Public Offering:  Continuous

 

It is proposed that this filing will become effective (check appropriate box)

 

o

immediately upon filing pursuant to paragraph (b) of Rule 485

 

x

on May 1, 2008 pursuant to paragraph (b) of Rule 485

 

o

60 days after filing pursuant to paragraph (a)(1) of Rule 485

 

o

on (date) pursuant to paragraph (a)(1) of Rule 485

 

o

75 days after filing pursuant to paragraph (a)(2) of Rule 485

 

o

on (date) pursuant to paragraph (a)(2) of Rule 485

 

If appropriate, check the following box:

 

o

This post-eff amendment designates a new effective date for a previously filed post-eff amendment.

 

Title of Securities Being Registered:  PINNACLEplus flexible premium variable annuity

 

 



 

PINNACLEplus Variable Annuity

May 1, 2008

 

Integrity Life Insurance Company

Separate Account I

 

This prospectus describes the PINNACLEplus flexible premium variable annuity contract and the Investment Options available under the contract.  You may invest your contributions in any of the Investment Options listed below.

 

DWS Investments VIT Fund

DWS Small Cap Index VIP Fund, Class B

 

Fidelity® Variable Insurance Products - all Service Class 2

Fidelity VIP Asset ManagerSM Portfolio

Fidelity VIP Balanced Portfolio

Fidelity VIP Contrafundâ Portfolio

Fidelity VIP Disciplined Small Cap Portfolio

Fidelity VIP Dynamic Capital Appreciation Portfolio

Fidelity VIP Equity-Income Portfolio

Fidelity VIP Freedom 2010 Portfolio

Fidelity VIP Freedom 2015 Portfolio

Fidelity VIP Freedom 2020 Portfolio

Fidelity VIP Freedom 2025 Portfolio

Fidelity VIP Freedom 2030 Portfolio

Fidelity VIP Growth Portfolio

Fidelity VIP Growth & Income Portfolio

Fidelity VIP Growth Opportunities Portfolio

Fidelity VIP High Income Portfolio

Fidelity VIP Index 500 Portfolio

Fidelity VIP Investment Grade Bond Portfolio

Fidelity VIP Mid Cap Portfolio

Fidelity VIP Overseas Portfolio

Fidelity VIP Value Strategies Portfolio

 

Franklin Templeton VIP Trust - all Class 2

FTVIPT Franklin Growth and Income Securities Fund

FTVIPT Franklin Income Securities Fund

FTVIPT Franklin Large Cap Growth Securities Fund

FTVIPT Franklin Small Cap Value Securities Fund

FTVIPT Mutual Shares Securities Fund

FTVIPT Templeton Foreign Securities Fund

FTVIPT Templeton Growth Securities Fund

 

PIMCO Variable Insurance Trust - all Advisor Class

PIMCO VIT All Asset Portfolio

PIMCO VIT CommodityRealReturnTMStrategy Portfolio

PIMCO VIT Low Duration Portfolio

PIMCO VIT Real Return Portfolio

PIMCO VIT Total Return Portfolio

 

Rydex Variable Trust

Rydex VT Absolute Return Strategies Fund

Rydex VT Hedged Equity Fund

Rydex VT Sector Rotation Fund

 

Touchstone Variable Series Trust

Touchstone VST Baron Small Cap Growth Fund

Touchstone VST Core Bond Fund

Touchstone VST High Yield Fund

Touchstone VST Large Cap Core Equity Fund

Touchstone VST Mid Cap Growth Fund

Touchstone VST Money Market Fund, Service Class

Touchstone VST Third Avenue Value Fund

Touchstone VST Aggressive ETF Fund, Service Class

Touchstone VST Conservative ETF Fund, Service Class

Touchstone VST Enhanced ETF Fund, Service Class

Touchstone VST Moderate ETF Fund, Service Class

 

Van Kampen Life Investment Trust and Universal Institutional Funds - all Class II

Van Kampen LIT Comstock Portfolio

Van Kampen LIT Capital Growth Portfolio

Van Kampen UIF Emerging Markets Debt Portfolio

Van Kampen UIF Emerging Markets Equity Portfolio

Van Kampen UIF U.S. Mid Cap Value Portfolio

Van Kampen UIF U.S. Real Estate Portfolio

 

Fixed Accounts

Quarterly Rate Option

Systematic Transfer Option

 

This prospectus contains information about the contract that you should know before investing.  You should read this prospectus and any supplements, and retain them for future reference.

 

PPI - 1



 

The Securities and Exchange Commission (SEC) has not approved or disapproved these securities or determined that this prospectus is adequate.  Any representation to the contrary is a criminal offense.

 

This annuity is not a bank product and is not an obligation of, nor guaranteed by, the financial institution where it is offered.  It is not insured by the FDIC, NCUSIF or other federal entity.  It is subject to investment risks, including possible loss of the principal amount invested.

 

A registration statement relating to this contract, which includes a Statement of Additional Information (SAI) dated May 1, 2008, has been filed with the Securities and Exchange Commission (file numbers 811-04844 and 333-102575).  The SAI is incorporated by reference into this prospectus.  A free copy of the SAI is available by sending in the form at the bottom of this page, or by writing or calling our Administrative Office listed in the Glossary.  The table of contents for the SAI is found in Part 9 of this prospectus.

 

You can review and copy information about this annuity contract at the SEC’s Public Reference Room in Washington, D.C.  For hours of operation of the Public Reference Room, please call 202-551-8090.  You may also obtain information about this annuity contract on the SEC’s Internet site at http://www.sec.gov.  Copies of that information are also available, after paying a duplicating fee, by electronic request to publicinfo@sec.gov or by writing the SEC’s Public Reference Section, 100 F. Street NE, Washington, D.C. 20459-0102.

 

We offer a contract with lower expenses that is otherwise substantially similar to this one.  This contract’s higher expenses are related to factors that include additional features and higher commissions paid on this contract.

 

This prospectus does not constitute an offering in any jurisdiction where such offering may not lawfully be made.  No person is authorized to make any representations in connection with this offering other than those contained in this prospectus.

 

iShares is a registered mark of Barclays Global Investors, N.A. (BGI).  All other trademarks, service marks or registered trademarks are the property of their respective owners.  BGI’s only relationship to Integrity Life Insurance Company (Integrity) is the licensing of certain trademarks and trade names of BGI.  Integrity’s variable annuity products are not sponsored, endorsed, sold or promoted by BGI.  BGI makes no representations or warranties to the owners of Integrity’s variable annuity products or any member of the public regarding the advisability of investing in them.  BGI has no obligation or liability in connection with the operation, marketing or trading of Integrity’s variable annuity products.

 

To request a copy of the Statement of Additional Information for the Integrity PINNACLEplus (May 1, 2008) tear off this section and mail it to us at the Administrative Office listed in the Glossary.

 

Name:

 

 

 

 

Address:

 

 

 

 

 

 

 

 

 

Phone:

 

 

 

PPI - 2



 

TABLE OF CONTENTS

 

 

 

Page PPI-

Glossary

 

5

Part 1 - Fees and Expense Tables and Summary

 

7

Contract Owner Transaction Expenses

 

7

Annual Administrative Charge

 

7

Separate Account Annual Expenses

 

7

Total Annual Portfolio Operating Expenses

 

8

Examples

 

10

Accumulation Unit Values

 

10

Summary of Contract

 

10

Investment Goals and Risks

 

10

Your Rights and Benefits

 

11

Account Value and Surrender Value

 

11

Your Right to Revoke (Free Look Period)

 

11

How Your Contract is Taxed

 

12

Credit Plus

 

12

Part 2 - Integrity and the Separate Account

 

12

Integrity Life Insurance Company

 

12

Separate Account I and the Variable Account Options

 

12

Distribution of Variable Annuity Contracts

 

13

Changes In How We Operate

 

13

Part 3 - Your Investment Options

 

13

The Variable Account Options

 

13

The Fixed Accounts

 

23

Part 4 - Deductions and Charges

 

23

Mortality and Expense Risk Charge

 

23

Annual Administrative Charge

 

24

Reduction of the Mortality and Expense Risk Charge or Annual Administrative Charge

 

24

Portfolio Charges

 

24

Withdrawal Charge

 

24

Reduction or Elimination of the Withdrawal Charge

 

25

Hardship Waiver

 

25

Commission Allowance and Additional Payments to Distributors

 

25

Optional Benefit Charges

 

26

Transfer Charge

 

26

Tax Reserve

 

26

State Premium Tax

 

26

Part 5 - Terms of Your Variable Annuity

 

26

Your Contributions

 

26

Credit Plus Feature and Recapture

 

27

Units in Our Separate Account

 

28

How We Determine Unit Value

 

28

Transfers

 

28

Excessive Trading

 

29

Specific Notice Regarding the Use of this Annuity for Market Timing or Frequent Trading

 

30

Withdrawals

 

31

Assignments

 

32

Death Benefit Paid on Death of Annuitant

 

32

Distribution on Death of Owner

 

33

Spousal Continuation

 

33

Death Claims

 

34

Maximum Retirement Date and Annuity Benefit

 

34

Annuity Benefit Payments

 

35

 

PPI - 3



 

Timing of Payment

 

35

How You Make Requests and Give Instructions

 

35

Part 6 - Optional Benefits

 

35

Highest Anniversary Death Benefit Rider

 

36

Enhanced Earnings Benefit Rider

 

36

Part 7 - Voting Rights

 

37

How Portfolio Shares Are Voted

 

37

How We Determine Your Voting Shares

 

37

Separate Account Voting Rights

 

37

Part 8 - Tax Aspects of the Contract

 

38

Introduction

 

38

Your Contract is an Annuity

 

38

Taxation of Annuities Generally

 

38

Tax-Favored Retirement Programs

 

39

Federal and State Income Tax Withholding

 

40

Impact of Taxes on the Company

 

40

Transfers Among Investment Options

 

40

Part 9 - Additional Information

 

40

Systematic Withdrawal Program

 

40

Income Plus Withdrawal Program

 

41

Choices Plus Required Minimum Distribution Program

 

41

Dollar Cost Averaging Program

 

41

Systematic Transfer Program

 

42

Customized Asset Rebalancing Program

 

42

Systematic Contributions Program

 

42

Legal Proceedings

 

43

Table of Contents of Statement of Additional Information

 

43

 

 

 

Appendix A - Financial Information for Separate Account I of Integrity

 

44

Appendix B - Enhanced Earnings Benefit Calculation Examples

 

52

 

PPI - 4



 

GLOSSARY

 

Account Value - the value of your contract, which consists of the values of your Investment Options added together.

 

Administrative Office - Integrity Life Insurance Company, P.O. Box 5720, Cincinnati, Ohio 45201-5720.  Our express mail address is Integrity Life Insurance Company, 400 Broadway, Cincinnati, Ohio 45202-3341.  You may also call us at 1-800-325-8583.  This is the address you are required to use to make requests and give instructions about your variable annuity.

 

Annuitant -  the person whose life is used to determine the amount of the Annuity Benefit.  The Annuitant must be a natural person, and cannot be changed after the Contract Date.

 

Annuity Benefit - periodic payments beginning on your Retirement Date that you may elect instead of a lump sum.

 

Business Day - any day that the New York Stock Exchange is open.

 

Contract Anniversary - occurs once annually on the same day as the Contract Date.

 

Contract Date - the date we issue you the contract.  It is shown on the schedule page of your contract.

 

Contract Year - a year that starts on your Contract Date or any Contract Anniversary.

 

Credit Plus - additional amount credited to your Account Value equal to a percentage of your contributions made in the first Contract Year.

 

Death Benefit - benefit paid to a named Annuitant’s beneficiary on the death of the Annuitant.

 

Distribution on Death - a distribution paid to a named owner’s beneficiary on the death of the owner.

 

Enhanced Earnings Benefit (EEB) - an optional Death Benefit.

 

Fixed Accounts - Quarterly Rate Option and the Systematic Transfer Option.

 

Free Withdrawal Amount - the amount you may withdraw in any Contract Year without paying withdrawal charges.

 

General Account - the account that contains all of our assets other than those held in Separate Accounts.

 

Highest Anniversary Account Value - an optional Death Benefit.

 

Investment Options - Variable Account Options and Fixed Accounts, collectively.

 

Maximum Retirement Date - the last Annuitant’s 100th birthday, which is the latest date you can begin your Annuity Benefit or receive a lump sum payment.

 

Portfolio - a mutual fund in which a Variable Account Option invests.

 

Quarterly Rate Option (QRO) - a Fixed Account where the interest rate on your investment may change as often as quarterly.

 

Retirement Date – any date before the Maximum Retirement Date that you choose to begin your Annuity Benefit or receive a lump sum payment.

 

PPI - 5



 

Rider - a supplement to your contract that provides an optional benefit at an additional cost.

 

Separate Account - Separate Account I of Integrity Life Insurance Company.  Its assets are segregated by Integrity and invested in Variable Account Options.

 

Surrender Value - your Account Value reduced by any withdrawal charge, Credit Plus recapture and pro rata annual administrative charges and optional benefit charges.

 

Systematic Transfer Option (STO) - a Fixed Account that accepts new contributions, which must be transferred from the STO into other Investment Options within either a six or twelve month period.  The STO provides a guaranteed fixed interest rate that is effective for the STO period selected.

 

Unit - measure of your ownership interest in a Variable Account Option.

 

Unit Value - value of each Unit calculated on any Business Day.

 

Variable Account Options - Investment Options available to you under the contract, other than the Fixed Accounts.  Each Variable Account Option invests in a corresponding Portfolio with the same name.

 

PPI - 6



 

Part 1 – Fees and Expense Tables and Summary

 

The following tables describe the fees and expenses that you will pay when buying, owning, withdrawing from and surrendering the contract.

 

The first table describes the fees and expenses that you will pay at the time you buy the contract, withdraw from or surrender the contract, or transfer value among Investment Options.  State premium tax may also be deducted.(1)

 

Contract Owner Transaction Expenses

 

Maximum Deferred Sales Load (Withdrawal Charge) as a percentage of contributions(2)

 

9

%

Transfer Charge (for each transfer after 12 transfers in one Contract Year)(3)

 

$

20

 

 

The following tables describe the fees and expenses that you will pay periodically during the time that you own the contract, not including Total Annual Portfolio Operating Expenses.

 

Annual Administrative Charge

 

Annual Administrative Charge(4)

 

$

40

 

 

Separate Account Annual Expenses for Contract Years 1-9 as a percentage of value charged

 

Mortality and Expense Risk Charge(5)

 

1.67

%

Optional Highest Anniversary Death Benefit Charge(6)

 

0.20

%

Optional Enhanced Earnings Benefit Charge (maximum charge)(7)

 

0.50

%

Highest Possible Total Separate Account Annual Expenses

 

2.37

%

 

Separate Account Annual Expenses for Contract Years 10 + as a percentage of value charged

 

Mortality and Expense Risk Charge(8)

 

1.15

%

Optional Highest Anniversary Death Benefit Charge(9)

 

0.20

%

Optional Enhanced Earnings Benefit Charge (maximum charge)(10)

 

0.50

%

Highest Possible Total Separate Account Annual Expenses

 

1.85

%

 


 (1) State premium taxes currently range from 0 to 3.5%.

 (2) Withdrawal charges decrease based on the age of each contribution.  See Part 4.

 (3) Does not apply to transfers made in the Dollar Cost Averaging, Customized Asset Rebalancing, or Systematic Transfer programs

 (4) This charge will be waived if the Account Value is at least $75,000 on the last day of the Contract Year.

 (5) Assessed daily in Contract Years 1-9 on the amount allocated to the Variable Account Options

 (6) Assessed quarterly on the amount allocated to the Variable Account Options

 (7) Assessed quarterly on the Account Value and is based on the Annuitant’s age on the Contract Date:

 

Age

 

Charge at annual effective rate

 

Total Charge to Variable Account Options

 

59 or less

 

0.20

%

1.87

%

60-69

 

0.40

%

2.07

%

70-79

 

0.50

%

2.17

%

 

 (8) Assessed daily in Contract Year 10 and after on the amount allocated to the Variable Account Options

 (9) Assessed quarterly on the amount allocated to the Variable Account Options

 (10) Assessed quarterly on the Account Value and is based on the Annuitant’s age on the Contract Date:

 

Age

 

Charge at annual effective rate

 

Total Charge to Variable Account Options

 

59 or less

 

0.20

%

1.35

%

60-69

 

0.40

%

1.55

%

70-79

 

0.50

%

1.65

%

 

PPI - 7



 

The following table shows the total operating expenses charged by the Portfolios that you will pay periodically during the time you own the contract.  More detail concerning each Portfolio’s fees and expenses is contained in the prospectus for each Portfolio.  The range of expenses (prior to reimbursements and fee waivers) that are deducted from the Portfolios’ assets, including management fees, distribution or 12b-1 fees, and other expenses are:

 

Minimum: 0.35%

 

Maximum: 1.93%

 

Total Annual Portfolio Operating Expenses

 

Gross Portfolio annual expenses prior to any waivers and reimbursements as a percentage of average net assets in each Portfolio:

 

Portfolio

 

Management
Fees

 

12b-1
Fee or
Service
Fee

 

Other
Expenses

 

Acquired
Fund 
Fees and
Expenses

 

Total
Annual
Gross
Expenses

 

Total
Annual
Net
Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index VIP Fund, Class B

 

0.35

%

0.25

%

0.15

%

N/A

 

0.75

%

0.75

%

Fidelity VIP Asset Manager Portfolio, Service Class 2

 

0.51

%

0.25

%

0.13

%

N/A

 

0.89

%

0.89

%

Fidelity VIP Balanced Portfolio, Service Class 2

 

0.41

%

0.25

%

0.16

%

N/A

 

0.82

%

0.82

%

Fidelity VIP Contrafund Portfolio, Service Class 2 (1)

 

0.56

%

0.25

%

0.09

%

N/A

 

0.90

%

0.89

%

Fidelity VIP Disciplined Small Cap Portfolio, Service Class 2

 

0.71

%

0.25

%

0.28

%

N/A

 

1.24

%

1.24

%

Fidelity VIP Dynamic Capital Appreciation Portfolio, Service Class 2 (2)

 

0.56

%

0.25

%

0.23

%

N/A

 

1.04

%

1.03

%

Fidelity VIP Equity-Income Portfolio, Service Class 2

 

0.46

%

0.25

%

0.09

%

N/A

 

0.80

%

0.80

%

Fidelity VIP Freedom 2010 Portfolio, Service Class 2 (3)

 

N/A

 

0.25

%

N/A

 

0.56

%

0.81

%

0.81

%

Fidelity VIP Freedom 2015 Portfolio, Service Class 2 (3)

 

N/A

 

0.25

%

N/A

 

0.59

%

0.84

%

0.84

%

Fidelity VIP Freedom 2020 Portfolio, Service Class 2 (3)

 

N/A

 

0.25

%

N/A

 

0.62

%

0.87

%

0.87

%

Fidelity VIP Freedom 2025 Portfolio, Service Class 2 (3)

 

N/A

 

0.25

%

N/A

 

0.63

%

0.88

%

0.88

%

Fidelity VIP Freedom 2030 Portfolio, Service Class 2 (3)

 

N/A

 

0.25

%

N/A

 

0.66

%

0.91

%

0.91

%

Fidelity VIP Growth Portfolio, Service Class 2 (1)

 

0.56

%

0.25

%

0.09

%

N/A

 

0.90

%

0.89

%

Fidelity VIP Growth & Income Portfolio, Service Class 2

 

0.46

%

0.25

%

0.12

%

N/A

 

0.83

%

0.83

%

Fidelity VIP Growth Opportunities Portfolio, Service Class 2

 

0.56

%

0.25

%

0.13

%

N/A

 

0.94

%

0.94

%

Fidelity VIP High Income Portfolio, Service Class 2

 

0.57

%

0.25

%

0.11

%

N/A

 

0.93

%

0.93

%

Fidelity VIP Index 500 Portfolio, Service Class 2 (4)

 

0.10

%

0.25

%

0.00

%

N/A

 

0.35

%

0.35

%

Fidelity VIP Investment Grade Bond Portfolio, Service Class 2

 

0.32

%

0.25

%

0.11

%

N/A

 

0.68

%

0.68

%

Fidelity VIP Mid Cap Portfolio, Service Class 2 (1)

 

0.56

%

0.25

%

0.10

%

N/A

 

0.91

%

0.90

%

Fidelity VIP Overseas Portfolio, Service Class 2 (1)

 

0.71

%

0.25

%

0.14

%

N/A

 

1.10

%

1.07

%

Fidelity VIP Value Strategies Portfolio, Service Class 2

 

0.56

%

0.25

%

0.14

%

N/A

 

0.95

%

0.95

%

FTVIPT Franklin Growth and Income Securities Fund, Class 2 (5)

 

0.48

%

0.25

%

0.04

%

N/A

 

0.77

%

0.77

%

FTVIPT Franklin Income Securities Fund, Class 2 (5)

 

0.45

%

0.25

%

0.02

%

N/A

 

0.72

%

0.72

%

FTVIPT Franklin Large Cap Growth Securities Fund, Class 2 (5)

 

0.70

%

0.25

%

0.04

%

N/A

 

0.99

%

0.99

%

FTVIPT Franklin Small Cap Value Securities Fund, Class 2 (6)

 

0.51

%

0.25

%

0.15

%

0.02

%

0.93

%

0.91

%

FTVIPT Mutual Shares Securities Fund, Class 2

 

0.59

%

0.25

%

0.13

%

N/A

 

0.97

%

0.97

%

FTVIPT Templeton Foreign Securities, Class 2 (6)

 

0.63

%

0.25

%

0.14

%

0.02

%

1.04

%

1.02

%

FTVIPT Templeton Growth Securities, Class 2 (5)

 

0.73

%

0.25

%

0.03

%

N/A

 

1.01

%

1.01

%

PIMCO VIT All Assets Portfolio, Advisor Class (7)

 

0.175

%

0.25

%

0.25

%

0.69

%

1.365

%

1.345

%

PIMCO VIT CommodityRealReturnTM Strategy Portfolio, Advisor Class (8), (9)

 

0.49

%

0.25

%

0.34

%

0.05

%

1.13

%

1.08

%

PIMCO VIT Low Duration Portfolio, Advisor Class (7)

 

0.25

%

0.25

%

0.25

%

N/A

 

0.75

%

0.75

%

PIMCO VIT Real Return Portfolio, Advisor Class (7)

 

0.25

%

0.25

%

0.25

%

N/A

 

0.75

%

0.75

%

PIMCO VIT Total Return Portfolio, Advisor Class (9)

 

0.25

%

0.25

%

0.43

%

N/A

 

0.93

%

0.93

%

Rydex VT Absolute Return Strategies Fund(10), (11)

 

1.15

%

0.00

%

0.54

%

N/A

 

1.69

%

1.69

%

Rydex VT Hedged Equity Fund(10), (11)

 

1.15

%

0.00

%

0.66

%

N/A

 

1.81

%

1.81

%

Rydex VT Sector Rotation Fund

 

0.90

%

0.00

%

0.71

%

N/A

 

1.61

%

1.61

%

Touchstone VST Baron Small Cap Growth Fund (12), (13)

 

1.05

%

0.25

%

0.44

%

N/A

 

1.74

%

1.55

%

Touchstone VST Core Bond Fund (12), (13)

 

0.55

%

0.25

%

0.41

%

N/A

 

1.21

%

1.00

%

 

PPI - 8



 

Portfolio

 

Management
Fees

 

12b-1
Fee or
Service
Fee

 

Other
Expenses

 

Acquired
Fund 
Fees and
Expenses

 

Total
Annual
Gross
Expenses

 

Total
Annual
Net
Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST High Yield Fund (12), (13)

 

0.50

%

0.25

%

0.44

%

N/A

 

1.19

%

1.05

%

Touchstone VST Large Cap Core Equity Fund (12), (13)

 

0.65

%

0.25

%

0.45

%

N/A

 

1.35

%

1.00

%

Touchstone VST Mid Cap Growth Fund (12), (13)

 

0.80

%

0.25

%

0.37

%

0.01

%

1.43

%

1.17

%

Touchstone VST Money Market Fund, Service Class (12), (13)

 

0.18

%

0.25

%

0.29

%

N/A

 

0.72

%

0.72

%

Touchstone VST Third Avenue Value Fund (12), (13)

 

0.79

%

0.25

%

0.28

%

0.03

%

1.35

%

1.09

%

Touchstone VST Aggressive ETF Fund, Service Class (12), (13), (14)

 

0.40

%

0.25

%

0.50

%

0.21

%

1.36

%

0.96

%

Touchstone VST Conservative ETF Fund, Service Class (12), (13), (14)

 

0.40

%

0.25

%

0.51

%

0.20

%

1.36

%

0.95

%

Touchstone VST Enhanced ETF Fund, Service Class (12), (13), (14)

 

0.40

%

0.25

%

0.35

%

0.25

%

1.25

%

1.00

%

Touchstone VST Moderate ETF Fund, Service Class (12), (13), (14)

 

0.40

%

0.25

%

0.37

%

0.21

%

1.23

%

0.96

%

Van Kampen LIT Comstock Portfolio, Class II

 

0.56

%

0.25

%

0.03

%

N/A

 

0.84

%

0.84

%

Van Kampen LIT Capital Growth Portfolio, Class II

 

0.70

%

0.25

%

0.10

%

N/A

 

1.05

%

1.05

%

Van Kampen UIF Emerging Markets Debt Portfolio, Class II (15)

 

0.75

%

0.35

%

0.31

%

N/A

 

1.41

%

1.11

%

Van Kampen UIF Emerging Markets Equity Portfolio, Class II (15)

 

1.21

%

0.35

%

0.37

%

N/A

 

1.93

%

1.63

%

Van Kampen UIF U. S. Mid Cap Value Portfolio, Class II (15)

 

0.72

%

0.35

%

0.29

%

N/A

 

1.36

%

1.11

%

Van Kampen UIF U.S. Real Estate Portfolio, Class II (15), (16)

 

0.74

%

0.35

%

0.28

%

0.01

%

1.37

%

1.28

%

 


(1) A portion of the brokerage commissions that the Portfolio pays may be reimbursed and used to reduce that Portfolio’s expenses.  In addition, through arrangements with the Portfolios’ custodian, credits realized as a result of uninvested cash balances are used to reduce the Portfolio’s custodian expenses.  Including these reductions, the total class operating expenses for these Portfolios would have been as set forth in the Total Annual Net Expenses Column in the above table.  These offsets may be discontinued at any time.

(2) A portion of the brokerage commissions that the Portfolio pays may be reimbursed and used to reduce the Portfolio’s expenses.  Including this reduction, the total class operating expenses for these Portfolios would have been as set forth in the Total Annual Net Expenses Column in the above table.  These offsets may be discontinued at any time.

(3) The advisor has voluntarily agreed to reimburse the Portfolio to the extent that total operating expenses, (excluding interest, taxes, brokerage commissions, extraordinary expenses, 12b-1 fees, and acquired fund fees and expenses) as a percentage of its average net assets, exceed 0.25%.

(4) Management fees for the Portfolio have been reduced to 0.10%, and class expenses are limited to 0.35% (these limits do not apply to interest, taxes, brokerage commissions, security lending fees, or extraordinary expenses).  This expense limit may not be increased without approval of the Portfolio’s shareholders and board of trustees.  Thus, the expense limit is required by contract and is not voluntary on the fund manager’s part.

(5) The Portfolio administration fee is paid indirectly through the management fee.

(6)  The manager has agreed in advance to reduce its fee from assets invested by the Portfolio in a Franklin Templeton money market fund (the Sweep Money Fund which is the “acquired fund” in this case) to the extent of the Portfolio’s fees and expenses of the acquired fund.  This reduction is required by the Trust’s board of trustees and an exemptive order of the SEC; this arrangement will continue as long as the exemptive order is relied upon.

(7)  “Other Expenses” reflect an administrative fee of 0.25%

(8)  PIMCO Cayman Commodity Portfolio I LTD (the Subsidiary) has entered into a separate contract with the advisor for the management of the Subsidiary’s portfolio pursuant to which the Subsidiary pays the advisor at the annual rates of 0.49% for a management fee and 0.20% for an administration fee.  The advisor has contractually agreed to waive the advisory fee and the administration fee, respectively, paid to the advisor by the Subsidiary.  This waiver may not be terminated by the advisor and will remain in effect for as long as the advisor’s contract with the Subsidiary is in place.

(9)  “Other Expenses” reflect an administrative fee of 0.25%, and interest expenses

(10)  The advisor has contractually agreed to pay all operating expenses of the fund, excluding interest expenses and taxes, brokerage commissions and other expenses connected with the execution of portfolio transactions, short dividend expenses, and extraordinary expenses.

(11) “Other Expenses” include short dividend expense.  Short dividend expense occurs because the fund short-sells the equity security to gain the inverse exposure necessary to meet its investment objective.  The fund must pay out the shorted security, thus increasing the fund’s unrealized gain or reducing the fund’s unrealized loss on its short sale transaction.  Short dividend expense is not a fee charged to the shareholder by the advisor or other service provider.  Rather it is more similar to the transaction costs or capital expenditures associated with the day-to-day management of any mutual fund.  If these costs had been treated as transaction costs or capital items rather than as expenses, the expense ratio for the Fund would have equaled 1.17% for the Absolute Return Strategies Fund and 1.18% for the Hedged Equity Fund.

(12)  “Total Annual Portfolio Operating Expenses” are based upon the actual operating history for the fiscal year ended December 31, 2007, except they reflect the commencement of the new 0.25% shareholder services fees and a reduction in distribution (12b-1) fee for the Service Class shares, effective January 1, 2008.

(13)  Effective January 1, 2008, the advisor and the trust have entered into an expense limitation agreement whereby the advisor has contractually agreed to waive a portion of its advisory fee and/or reimburse certain fund expenses in order to limit net expenses to the amount shown in the Total Annual Net Expenses Column in the above table.  This expense limitation will remain in effect until at least May 1, 2009.  Pursuant to this agreement, the advisor has no ability to recoup any previously waived fees or reimbursed expenses from the fund.  For purposes of these waivers, the cost of acquired fund fees and expenses, if any, is excluded from advisor’s waiver obligations for all funds except Mid Cap Growth and Third Avenue Value.

(14)  The “Total Annual Net Expense” after waivers and reimbursements without acquired fund expenses would be 0.75%.

 

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(15)  For the year ended December 31, 2007, the following caps were in effect: 1.35% for Emerging Markets Debt and U.S. Real Estate, 1.65% for the Emerging Markets Equity, and 1.15% for U.S. Mid Cap Value.  The adviser may terminate these voluntary caps at any time at its sole discretion.  Additionally, for the year ending December 31, 2007, the distributor has agreed to waive 0.30% of the 12b-1 fee for the Emerging Markets Equity and Emerging Markets Debt, 0.10% of the 12b-1 fee for the U.S. Real Estate and 0.25% for U.S. Mid Cap Value.  The distributor may terminate these voluntary waivers at any time at its sole discretion.

(16) The “Total Annual Net Expense” after waivers and reimbursements without acquired fund expenses for the U.S. Real Estate Portfolio, Class II were 1.27%.

 

We have entered into agreements with the investment advisors or distributors of each of the Portfolios.  Under the terms of these agreements, we will provide administrative, marketing and distribution services to the Portfolios.  The Portfolios or their investment advisors or distributors pay us fees equal to an annual rate ranging from 0.05% to 0.45% of the average daily net assets invested by the Variable Account Options in the Portfolios.  These fees may be paid by the investment advisors from the investment advisors’ assets or from the Portfolios under distribution and/or servicing plans adopted by the Portfolios pursuant to Rule 12b-1 under the Investment Company Act of 1940 (1940 Act).  In addition, we may receive marketing allowances from investment advisors to support training and distribution efforts.

 

Examples

 

The examples that follow are intended to help you compare the cost of investing in this contract with the cost of investing in other variable annuity contracts.  Each example assumes that you invest $10,000 in the contract for the time period indicated and does not include the credit for the Credit Plus feature nor any recapture of the Credit Plus.  Each example also assumes that your investment has a 5% return each year.  Your actual costs may be higher or lower.

 

The following example includes withdrawal charges, the annual administrative charge, the mortality and expense risk charge, and maximum Portfolio operating expenses.  Based on these assumptions, your costs would be:

 

If you surrender your contract at the end of the applicable period:

 

1 year

 

3 years

 

5 years

 

10 years

 

$

1,315

 

$

2,053

 

$

2,705

 

$

4,237

 

 

If you select an Annuity Benefit with a life contingency at the end of the applicable period:

 

1 year

 

3 years

 

5 years

 

10 years

 

$

415

 

$

1,253

 

$

2,105

 

$

4,237

 

 

If you do not surrender the contract:

 

1 year

 

3 years

 

5 years

 

10 years

 

$

415

 

$

1,253

 

$

2,105

 

$

4,237

 

 

Accumulation Unit Values

 

See Appendix A

 

Summary of Contract

 

“We,” “our,”  “us,”  “the Company” and “Integrity” mean Integrity Life Insurance Company.  “You” and “your” mean the owner.  This variable annuity contract is a contract between you and us.  You, as the owner, have certain rights under the contract.  The Annuitant named by you may be you or another person.  It is important that you carefully select the owner, Annuitant, the owner’s beneficiary and the Annuitant’s beneficiary in order to achieve your objectives.  See Part 5, sections titled “Death Benefits Paid on Death of Annuitant,” “Distribution on Death of Owner” and “Spousal Continuation.”

 

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Investment Goals and Risks

 

This contract allows you to accumulate money for retirement or other long term goals.  An investment in any of the Variable Account Options carries with it certain risks, including the risk that the value of your investment will decline and you could lose money.  The Variable Account Options invest in Portfolios, most of which invest in common stocks.  You could lose money if one of the issuers of the stocks in which your Variable Account Option invests through its underlying Portfolio becomes financially impaired or if the stock market as a whole declines.  There’s also the inherent risk that holders of common stock generally are behind creditors and holders of preferred stock for payments in the event of the bankruptcy of a stock issuer.

 

For a complete discussion of the risks associated with investing in any particular Variable Account Option, see the prospectus of the corresponding Portfolio with the same name.

 

Your Rights and Benefits

 

As the owner of the contract, you have the following rights, subject to the rules and significant limitations stated in this prospectus:

 

·      To contribute, transfer and withdraw money.  See Part 5

·      To invest in the Investment Options.  See Part 3

·      To elect an Annuity Benefit.  See Part 5, section titled “Maximum Retirement Date and Annuity Benefit”

·      To name the Annuitant

·      To name the Annuitant’s beneficiary and the owner’s beneficiary.  The Annuitant’s beneficiary will receive the Death Benefit upon the death of the Annuitant; or the owner’s beneficiary will receive a distribution upon your death, as owner.  If there are joint owners, the death of either one will be treated as the death of both under this contract, which triggers a required Distribution on Death.  See Part 5, sections titled “Death Benefit Paid on Death of Annuitant” and “Distribution on Death of Owner.”

 

Account Value and Surrender Value

 

Your Account Value consists of the values of your Investment Options added together.  Any amount allocated to a Variable Account Option will go up or down in value depending on the investment experience of the corresponding Portfolio.  The value of contributions allocated to the Variable Account Options is not guaranteed.  The value of your contributions allocated to the Fixed Accounts is guaranteed.  Your Account Value is subject to various charges.  See Part 4.

 

Your Surrender Value is equal to your Account Value, minus any withdrawal charge, any Credit Plus recapture and the pro rata portion of the annual administrative charges and optional benefit charges, if applicable.  See Part 4.

 

Your minimum Account Value is $1,000 ($2,000 in Texas).  If the Account Value goes below $1,000 and we have received no contributions from you for two Contract Years, we reserve the right to terminate the contract and pay you the Account Value.  We will notify you in advance and will give you at least 60 days to make additional contributions.

 

Your Right to Revoke (Free Look Period)

 

You may cancel your contract within ten days after you receive it by returning it to our Administrative Office by mail, postmarked within the ten-day period.  We will extend the ten day period if required by state law.  If you cancel your contract, we’ll return your contribution net of any investment performance and applicable charges, which may be more or less than your original contribution depending upon the investment experience of the Investment Options you selected.  You bear the investment risk during the ten-day period, as well as any fees and charges incurred during the period your contract is in force.  See Part 4 for more discussion of the fees and charges.  Some states require that we return at least the

 

PPI - 11



 

amount of your contribution, in which case, we will return the greater of the amount required by state law and your Account Value.

 

How Your Contract is Taxed

 

Your benefits under the contract are controlled by the Internal Revenue Code of 1986, as amended (the Code) and the associated rules and regulations governing annuities, including the deferral of taxes on your investment growth until you actually make a withdrawal.  You should read Part 8, “Tax Aspects of the Contract” for more information, and consult a tax advisor.  Most of the withdrawals you make before you are 59½ years old are subject to a 10% federal tax penalty on the taxable portion of the amounts withdrawn.  This contract can provide benefits under certain tax-favored retirement programs, such as IRAs; however, it provides no additional tax deferral benefit, as these programs already provide tax-deferral.

 

Credit Plus

 

This contract automatically provides the Credit Plus feature.  When you purchase this contract, an amount equal to 5% of your contributions made in the first Contract Year will be added to your Account Value.  Under certain circumstances, this amount may be recaptured by us.  Please see Part 4, “Recapture of Credit Plus” and Part 5, “Credit Plus” for details.

 

Part 2 – Integrity and the Separate Account

 

Integrity Life Insurance Company

 

Integrity is a stock life insurance company organized under the laws of Arizona on May 3, 1966, and redomesticated to Ohio on January 3, 1995.  Our principal executive office is located at 400 Broadway, Cincinnati, Ohio 45202.  We are authorized to sell life insurance and annuities in 46 states and the District of Columbia.  Integrity is a subsidiary of The Western and Southern Life Insurance Company, a life insurance company organized under the laws of the State of Ohio on February 23, 1888.  The Western and Southern Life Insurance Company has guaranteed the insurance obligations of Integrity to its contract owners, including the owners of this contract (the Guarantee).  Insurance obligations include the Account Value invested in the Fixed Account, the Death Benefit and Annuity Benefit.  The Guarantee does not guarantee investment performance on the portion of your Account Value invested in the Variable Account Options.  The Guarantee provides that contract owners can enforce the Guarantee directly.

 

Separate Account I and the Variable Account Options

 

Separate Account I was established in 1986, and is maintained under the insurance laws of the State of Ohio.  The Separate Account is a unit investment trust, which is a type of investment company under the 1940 Act.  The Separate Account invests in the Variable Account Options.  Each Variable Account Option invests in shares of a corresponding Portfolio (or “Fund”) with the same nameWe may add, substitute or close Variable Account Options from time to time.  The Variable Account Options currently available to you are listed in Part 3.

 

Under Ohio law, we own the assets of our Separate Account and use them to support the Variable Account Options of your contract and other variable annuity contracts.  You participate in the Separate Account in proportion to the amounts in your contract.

 

Income, gains and losses, whether realized or unrealized, from assets allocated to the Separate Account are credited to or charged against the Separate Account without regard to our other income, gains or losses.  The assets of the Separate Account may not be charged with the liabilities arising out of our other businesses.  We may allow fees that are owed to us to stay in the Separate Account, and, in that way, we can participate proportionately in the Separate Account.

 

PPI - 12



 

Distribution of Variable Annuity Contracts

 

Touchstone Securities, Inc., an affiliate of Integrity, serves as the principal underwriter for our variable annuity contracts.  The principal business address of Touchstone Securities is 303 Broadway, Cincinnati, Ohio, 45202.  The contracts are sold by individuals who represent us as insurance agents and who are also registered representatives of broker-dealers or financial institutions that have entered into distribution agreements with us.

 

Changes in How We Operate

 

We can change how the Company or our Separate Account operates, subject to your approval when required by the 1940 Act or other applicable laws.  We’ll notify you if any changes result in a material change in the underlying investments of a Variable Account OptionWe may:

 

·      add, remove or combine Investment Options or withdraw assets relating to your contract from one Variable Account Option and put them into another;

·      register or end the registration of the Separate Account under the 1940 Act;

·      operate our Separate Account under the direction of a committee or discharge a committee at any time (the committee may be composed of a majority of persons who are “interested persons” of Integrity);

·      restrict or eliminate any voting rights of owners or others that affect our Separate Account;

·      cause one or more Variable Account Options to invest in a Portfolio other than or in addition to the Portfolios;

·      operate our Separate Account or one or more of the Investment Options in any other form the law allows, including a form that allows us to make direct investments.  We may make any legal investments we wish.

 

Part 3 - Your Investment Options
 

You may invest your contributions to this contract in the Variable Account Options, the Fixed Accounts or both.  Each Variable Account Option (also called a sub account) invests in shares of a mutual fund, referred to as a Portfolio (or “Fund”).  Each Variable Account Option and its corresponding Portfolio share the same name.  The value of your Variable Account Option will vary with the performance of the corresponding Portfolio.  For a full description of each Portfolio, see that Portfolio’s prospectus and Statement of Additional Information.

 

The Variable Account Options

 

A brief description of each Portfolio and the name of the advisor are provided below.  Management fees and other expenses deducted from each Portfolio, as well as the risks of investing, are described in that Portfolio’s prospectus.  For a prospectus containing more complete information on any Portfolio, call our Administrative Office toll-free at 1-800-325-8583.

 

DWS Investments VIT Funds

 

The investment advisor for the DWS Scudder Investments VIP Funds is Deutsche Asset Management, Inc. (DeAM).  DeAM is a broad-based global investment firm that provides asset management capabilities to a variety of institutional clients worldwide.  DeAM’s presence in all of the major investment markets gives its clients a global network and product range.  DeAM manages U.S., international, emerging markets, and fixed income investments and is a leader in index strategies.  Northern Trust, Inc. is the sub advisor of DWS Small Cap Index VIP Fund.

 

Following is a summary of the investment objectives of the DWS Investments VIT Fund.  We can’t guarantee that these objectives will be met.  You should read the DWS Investments VIT Fund’s prospectus carefully before investing.

 

PPI - 13



 

DWS Small Cap Index VIP Fund

 

The Small Cap Index Fund seeks to match, as closely as possible (before expenses are deducted), the performance of the Russell 2000 Index, which emphasizes stocks of small U.S. companies.  The Index includes the reinvestment of all distributions and is not available for direct investment.

 

Fidelity® Variable Insurance Products

 

Each Portfolio is a series of the Trust, which is a mutual fund registered with the SEC.  Fidelity Management & Research Company (FMR) is the investment advisor to each Portfolio, except VIP Disciplined Small Cap and VIP Index 500.  FMR is a registered investment advisor under the Investment Advisors Act of 1940 and is located at 82 Devonshire Street, Boston, MA 02109.  FMR is a manager of managers with respect to VIP Disciplined Small Cap and VIP Index 500, meaning that FMR has the responsibility to oversee sub-advisers and recommend their hiring, termination, and replacement.  Geode Capital Management, LLC, at 53 State Street, Boston, Massachusetts 02109, serves as a sub-adviser for VIP Disciplined Small Cap and VIP Index 500.

 

Below is a summary description of each Fidelity VIP Portfolio.  There are no guarantees that a Portfolio will be able to achieve its objective.  You should read each Fidelity VIP Fund prospectus carefully before investing.

 

Fidelity VIP Asset ManagerSM Portfolio

 

VIP Asset ManagerSM Portfolio seeks high total return with reduced risk over the long term by allocating its assets among stocks, bonds and short-term instruments maintaining a neutral mix over time of 50% of assets in stocks, 40% of assets in bonds, and 10% of assets in short-term and money market instruments.  FMR invests in domestic and foreign issuers.  FMR analyzes issuers using fundamental and/or quantitative factors and evaluates each security’s current price relative to estimated long-term value to select investments.

 

Fidelity VIP Balanced Portfolio

 

VIP Balanced Portfolio seeks income and capital growth consistent with reasonable risk by investing approximately 60% of assets in stocks and other equity securities and the remainder in bonds and other debt securities, including lower-quality debt securities, when its outlook is neutral.  FMR invests at least 25% of the Portfolio’s total assets in fixed-income senior securities, including debt securities and preferred stock.  FMR invests in domestic and foreign issuers.  With respect to equity investments, FMR emphasizes above-average income-producing equity securities, leading to investment in stocks that have more “value” characteristics than “growth” characteristics.  FMR analyzes issuers using fundamental factors and evaluating each security’s current price relative to the estimated long-term value to select investments.  FMR invests in Fidelity’s central funds and engages in transactions that have a leveraging effect on the portfolio.

 

Fidelity VIP ContrafundÒ Portfolio

 

VIP ContrafundÒ Portfolio seeks long-term capital appreciation.  FMR normally invests the Portfolio’s assets primarily in common stocks of domestic and foreign issuers.  FMR invests the Portfolio’s assets in securities of companies whose value FMR believes is not fully recognized by the public.  FMR may invest in “growth” stocks, “value” stocks or both.  FMR uses fundamental analysis of each issuer’s financial condition and industry position and economic and market conditions to select investments.

 

Fidelity VIP Disciplined Small Cap Portfolio

 

VIP Small Cap Portfolio seeks capital appreciation by investing at least 80% of assets in securities of domestic and foreign companies with small market capitalizations, which, for purposes of this fund, are those companies with market capitalizations similar to companies in the Russell 2000® Index or the Standard & Poor’s® SmallCap 600 Index.  FMR invests in either “growth” stocks, “value” stocks or both and uses computer-aided, quantitative analysis of historical valuation, growth, profitability, and other factors.

 

Fidelity VIP Dynamic Capital Appreciation Portfolio

 

VIP Dynamic Capital Appreciation Portfolio seeks capital appreciation.  FMR normally invests the Portfolio’s assets primarily in common stocks of domestic and foreign issuers.  FMR may invest in

 

PPI - 14



 

“growth” stocks, “value” stocks or both.  FMR uses fundamental analysis of each issuer financial condition and industry position and market and economic conditions to select investments.

 

Fidelity VIP Equity-Income Portfolio

 

VIP Equity-Income Portfolio seeks reasonable income.  The Portfolio will also consider the potential for capital appreciation.  The goal is to achieve a yield which exceeds the composite yield on the securities comprising the Standard & Poor’s 500SM Index (S&P 500®).  FMR normally invests 80% of assets in equity securities, primarily in income-producing equity securities, which tends to lead to investments in large cap “value” stocks, and potentially invests in other types of equity securities and debt securities, including lower-quality debt securities.  FMR invests in domestic and foreign issuers using fundamental analysis of each issuer’s financial condition and industry position and market and economic conditions to select investments.

 

Fidelity VIP Freedom 2010 Portfolio

 

VIP Freedom 2010 seeks high total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.  Its principal investment strategies are to invest in a combination of underlying Fidelity VIP equity, fixed-income, and short-term funds using a moderate asset allocation strategy designed for investors expecting to retire around the year 2010 and to allocate assets among underlying Fidelity funds according to an asset allocation strategy that becomes increasingly conservative until it reaches 20% in domestic equity funds, 35% in investment-grade fixed-income funds, 5% in high yield fixed-income funds, and 40% in short-term funds (approximately 10 to 15 years after the year 2010).

 

Fidelity VIP Freedom 2015 Portfolio

 

VIP Freedom 2015 seeks high total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.  Its principal investment strategies are to invest in a combination of underlying Fidelity VIP equity, fixed-income, and short-term funds using a moderate asset allocation strategy designed for investors expecting to retire around the year 2015 and to allocate assets among underlying Fidelity funds according to an asset allocation strategy that becomes increasingly conservative until it reaches 20% in domestic equity funds, 35% in investment-grade fixed-income funds, 5% in high yield fixed-income funds, and 40% in short-term funds (approximately 10 to 15 years after the year 2015).

 

Fidelity VIP Freedom 2020 Portfolio

 

VIP Freedom 2020 seeks high total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.  Its principal investment strategies are to invest in a combination of underlying Fidelity VIP equity, fixed-income, and short-term funds using a moderate asset allocation strategy designed for investors expecting to retire around the year 2020 and to allocate assets among underlying Fidelity funds according to an asset allocation strategy that becomes increasingly conservative until it reaches 20% in domestic equity funds, 35% in investment-grade fixed-income funds, 5% in high yield fixed-income funds, and 40% in short-term funds (approximately 10 to 15 years after the year 2020).

 

Fidelity VIP Freedom 2025 Portfolio

 

VIP Freedom 2025 seeks high total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.  Its principal investment strategies are to invest in a combination of underlying Fidelity VIP equity, fixed-income, and short-term funds using a moderate asset allocation strategy designed for investors expecting to retire around the year 2025 and to allocate assets among underlying Fidelity funds according to an asset allocation strategy that becomes increasingly conservative until it reaches 20% in domestic equity funds, 35% in investment-grade fixed-income funds, 5% in high yield fixed-income funds, and 40% in short-term funds (approximately 10 to 15 years after the year 2025).

 

Fidelity VIP Freedom 2030 Portfolio

 

VIP Freedom 2030 seeks high total return with a secondary objective of principal preservation as the fund approaches its target date and beyond.  Its principal investment strategies are to invest in a combination of underlying Fidelity VIP equity, fixed-income, and short-term funds using a moderate asset allocation strategy designed for investors expecting to retire around the year 2030 and to allocate assets among underlying Fidelity funds according to an asset allocation strategy that becomes increasingly conservative until it reaches 20% in domestic equity funds, 35% in investment-grade fixed-income funds, 5% in high yield fixed-income funds, and 40% in short-term funds (approximately 10 to 15 years after the year 2030).

 

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Fidelity VIP Growth Portfolio

 

VIP Growth Portfolio seeks capital appreciation by investing the Portfolio’s assets in common stocks of domestic and foreign companies FMR believes have above-average growth potential.  FMR uses fundamental analysis of each issuer and its potential for success in light of its current financial condition, its industry position, and market and economic conditions to select investments.

 

Fidelity VIP Growth & Income Portfolio

 

VIP Growth & Income Portfolio seeks high total return through a combination of current income and capital appreciation.  FMR normally invests a majority of the Portfolio’s assets in common stocks of domestic and foreign issuers with a focus on those that pay current dividends and show potential for capital appreciation.  FMR may also invest the Portfolio’s assets in bonds, including lower-quality debt securities, as well as stocks that are not currently paying dividends, but offer prospects for future income or capital appreciation.  FMR may invest in “growth” stocks, “value” stocks or both.  FMR uses fundamental analysis of each issuer and its potential for success in light of its current financial condition, its industry position, and market and economic conditions to select investments.

 

Fidelity VIP Growth Opportunities Portfolio

 

VIP Growth Opportunities Portfolio seeks to provide capital growth by investing primarily in common stocks of domestic and foreign issuers that FMR believes have above average growth potential.  FMR uses fundamental analysis of each issuer and its potential for success in light of its current financial condition, its industry position, and economic and market conditions to select investments.

 

Fidelity VIP High Income Portfolio

 

VIP High Income Portfolio seeks a high level of current income, while also considering growth of capital.  FMR normally invests the Portfolio’s assets primarily in income-producing debt securities, preferred stocks, and convertible securities, with an emphasis on lower-quality debt securities.  FMR may also invest the Portfolio’s assets in non-income producing securities, including defaulted securities and common stocks.  FMR invests in domestic and foreign issuers and may invest in companies that are in troubled or uncertain financial condition.  FMR uses fundamental analysis of each issuer and its potential for success in light of its current financial condition, its industry position, and market and economic conditions to select investments.

 

Fidelity VIP Index 500 Portfolio

 

VIP Index 500 seeks investment results that correspond to the total return of common stocks publicly traded in the United States as represented by the S&P 500.  The Portfolio invests at least 80% of its assets in common stocks included in the S&P 500 and lends securities to earn income.

 

Fidelity VIP Investment Grade Bond Portfolio

 

VIP Investment Grade Bond Portfolio seeks as high a level of current income as is consistent with the preservation of capital by normally investing at least 80% of assets in investment-grade debt securities of all types, including those issued by domestic and foreign issuers, and repurchase agreements for those securities.  The Portfolio may invest in lower-quality debt securities.  FMR manages the Portfolio to have similar overall interest rate risk to an index, which as of December 31, 2005, was the Lehman Brothers® Aggregate Bond Index.  FMR allocates assets across different market sectors and maturities, and analyzes the credit quality of the issuer, security-specific features, current and potential future valuation, and trading opportunities to select investments.  FMR invests in Fidelity’s central funds and engages in transactions that have a leveraging effect on the portfolio.

 

Fidelity VIP Mid Cap Portfolio

 

VIP Mid Cap Portfolio seeks long-term growth of capital by investing the Portfolio’s assets primarily in common stocks of domestic and foreign issuers.  FMR normally invests at least 80% of the Portfolio’s assets in securities of companies with medium market capitalizations.  Medium market capitalization companies are those with market capitalization which, for purposes of this Portfolio are those companies with market capitalizations similar to companies in the Russell Midcap® Index or the Standard & Poor’s® MidCap 400 Index.  FMR may buy “growth” stocks, “value” stocks, or both, and may potentially invest in companies with smaller or larger market capitalizations.  FMR uses fundamental analysis of each

 

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issuer’s financial condition, its industry position, and market and economic conditions to select investments.

 

Fidelity VIP Overseas Portfolio

 

VIP Overseas Portfolio seeks long-term growth of capital primarily through investments in common stock.  FMR normally invests at least 80% of the Portfolio’s assets in non-U.S. securities.  FMR allocates investments across countries and regions considering the size of the market in each country and region relative to the size of the international market as a whole.  FMR uses fundamental analysis of each issuer’s financial condition, its industry position, and market and economic conditions to select investments.

 

Fidelity VIP Value Strategies Portfolio

 

VIP Value Strategies Portfolio seeks capital appreciation, investing primarily in common stocks of domestic and foreign issuers.  FMR invests the Portfolio’s assets in securities of companies that it believes are undervalued in the marketplace in relation to factors such as assets, sales, earnings, or growth potential.  FMR focuses investments in medium sized companies, but also may invest substantially in larger or smaller companies.  FMR uses fundamental analysis of each issuer’s financial condition, its industry position, and market and economic conditions to select investments.

 

Franklin Templeton Variable Insurance Products Trust Funds

 

Each Portfolio is a series of the Trust, which is a mutual fund registered with the SEC.  Affiliates of Franklin Resources, Inc., which operates as Franklin Templeton Investments, serve as the investment advisors for the funds as indicated below.

 

Below is a summary of the investment objectives of the Franklin Templeton Variable Insurance Products Trust Funds.  There are no guarantees that a fund will be able to achieve its objective.  You should read each Franklin Templeton VIPT Fund prospectus carefully before investing.

 

FTVIPT Franklin Growth and Income Securities Portfolio

 

The Franklin Growth and Income Securities Portfolio seeks capital appreciation with current income as a secondary goal.  The Portfolio normally invests predominantly in a broadly diversified portfolio of equity securities, including securities convertible into common stock.  The investment advisor for this Portfolio is Franklin Advisers, Inc.

 

FTVIPT Franklin Income Securities Portfolio

 

The Franklin Income Securities Portfolio seeks to maximize income while maintaining prospects for capital appreciation.  The Portfolio normally invests in both debt and equity securities.  The Portfolio seeks income by investing in corporate, foreign and U.S. Treasury bonds, as well as stocks with dividend yields the advisor believes are attractive.  The investment advisor for this Portfolio is Franklin Advisers, Inc.

 

FTVIPT Franklin Large Cap Growth Securities Portfolio

 

The Franklin Large Cap Growth Securities Portfolio seeks capital appreciation.  The Portfolio normally invests at least 80% of its net assets in investments of large capitalization companies, and normally invests predominantly in equity securities.  The investment advisor for this Portfolio is Franklin Advisers, Inc.

 

FTVIPT Franklin Small Cap Value Securities Portfolio

 

The Franklin Small Cap Value Securities Portfolio seeks long-term total return.  The Portfolio normally invests at least 80% of its net assets in investments of small capitalization companies, and normally invests predominantly in equity securities.  The investment advisor is Franklin Advisory Services, LLC.

 

FTVIPT Mutual Shares Securities Portfolio

 

The Mutual Shares Securities Portfolio seeks capital appreciation, with income as a secondary goal.  The Portfolio normally invests primarily in U.S. and foreign equity securities that the advisor believes are undervalued.  The Portfolio also invests, to a lesser extent, in risk arbitrage securities and distressed companies.  The investment advisor for this Portfolio is Franklin Mutual Advisers, LLC.

 

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FTVIPT Templeton Foreign Securities Portfolio

 

The Templeton Foreign Securities Portfolio seeks long-term capital growth.  The Portfolio normally invests at least 80% of its net assets in investments of issuers located outside the U.S., including those in emerging markets and normally invests predominantly in equity securities.  The investment advisor for this Portfolio is Templeton Investment Counsel, LLC.

 

FTVIPT Templeton Growth Securities Portfolio

 

The Templeton Growth Securities Portfolio seeks long-term capital growth.  The Portfolio normally invests primarily in equity securities of companies located anywhere in the world, including those in the U.S. and in emerging markets.  The investment advisor for this Portfolio is Templeton Global Advisors Limited.

 

PIMCO Variable Insurance Trust

 

Each Portfolio is a series of the Trust, which is a mutual fund registered with the SEC.  Pacific Investment Management Company LLC (PIMCO) is the investment advisor to each Portfolio.  PIMCO is located at 840 Newport Center Drive, Newport beach, California 92660.

 

Below is a summary of the investment objectives of the PIMCO Variable Insurance Trust Portfolios.  There are no guarantees that a fund will be able to achieve its objective.  You should read each PIMCO VIT Fund prospectus carefully before investing.

 

PIMCO VIT All Asset Portfolio

 

The PIMCO VIT All Asset Portfolio seeks maximum real return consistent with preservation of real capital and prudent investment management.  The Portfolio normally invests in the Institutional Class of the underlying PIMCO funds and does not invest directly in stocks or bonds of other issuers.  The Portfolio is a “fund of funds” and bears a proportionate share of the expenses charged by the underlying funds in which it invests.  Research Affiliates LLC, an affiliate of PIMCO, is the Portfolio’s asset allocation sub-advisor.

 

PIMCO VIT CommodityRealReturnTM Strategy Portfolio

 

The PIMCO VIT CommodityRealReturn Strategy Portfolio seeks maximum real return consistent with prudent investment management.  The Portfolio normally invests in the commodity-linked derivative instruments.

 

PIMCO VIT Low Duration Portfolio

 

The PIMCO VIT Low Duration Portfolio seeks maximum total return, consistent with preservation of capital and prudent investment management.  The Portfolio normally invests 65% of its total assets in a diversified portfolio of Fixed Income Instruments of varying maturities.  The average Portfolio duration varies from 1-3 years.

 

PIMCO VIT Real Return

 

The PIMCO VIT Real Return Portfolio seeks maximum real return, consistent with preservation of real capital and prudent investment management.  The Portfolio normally invests at lease 80% of its net assets in inflation-indexed bonds of varying maturities issued by the U.S. and Non-U.S. governments, their agencies or instrumentalities and corporations.

 

PIMCO VIT Total Return

 

The PIMCO VIT Total Return Portfolio seeks maximum total return, consistent with preservation of capital and prudent investment management.  The Portfolio normally invests 65% of its total assets in a diversified portfolio of Fixed Income Instruments of varying maturities.  The average Portfolio duration varies from 3-6 years.

 

Rydex Variable Trust

 

Each Portfolio is a series of the Trust, which is a mutual fund registered with the SEC.  Rydex Investments is the investment advisor to each Portfolio.  The Advisor is located at 9601 Blackwell Road, Suite 500, Rockville, Maryland 20850.

 

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Below is a summary description of the each Rydex VT Portfolio.  There are no guarantees that a Portfolio will be able to achieve its objective.  You should read each Rydex VT Fund prospectus carefully before investing.

 

Rydex VT Absolute Return Strategies Fund

 

The Rydex Absolute Return Strategies Fund seeks to provide capital appreciation consistent with the return and risk characteristics of the hedge fund universe.  The secondary objective is to achieve these returns with low correlation to and less volatility than equity indices.

 

Rydex VT Hedged Equity Fund

 

The Rydex Hedged Equity Fund seeks to provide capital appreciation consistent with the return and risk characteristics of the long/short hedge fund universe.  The secondary objective is to achieve these returns with low correlation to and less volatility than equity indices.

 

Rydex VT Sector Rotation Fund

 

The Rydex Sector Rotation Fund seeks long-term capital appreciation by moving its investments among different sectors or industries.  Each month the advisor uses a quantitative methodology to rank approximately sixty different industries based on price momentum as determined by the recent performance of the various industries over near-term periods.  The fund then invests in the top ranked industries.

 

Touchstone Variable Series Trust

 

Each Portfolio of the Touchstone Variable Series Trust is an open-end management investment company.  Touchstone Advisors, Inc., 303 Broadway, Suite 1100, Cincinnati, Ohio 45202, 303 Broadway, Suite 1100, Cincinnati, Ohio 45202, which is affiliated with Integrity, advises each of the Portfolios, along with a sub-advisor that is listed under each Portfolio description below.

 

Below is a summary of the investment objectives of the Portfolios of Touchstone Variable Series Trust.  There are no guarantees that a Portfolio will be able to achieve its objective.  You should read each Touchstone VST Fund prospectus carefully before investing.

 

Touchstone VST Baron Small Cap Growth Fund

 

BAMCO, Inc., a subsidiary of Baron Capital Group, Inc. is the sub-advisor for the Touchstone VST Baron Small Cap Fund.  The fund seeks long-term capital appreciation.  It invests primarily (at least 80% of assets) in common stocks of smaller companies with market values under $2.5 billion selected for their capital appreciation potential.  In making investment decisions for the fund, the portfolio manager seeks securities believed to have favorable price to value characteristics based on the portfolio manager’s assessment of their prospects for future growth and profitability, and the potential to increase in value at least 100% over four subsequent years.

 

Touchstone VST Core Bond Fund

 

Ft. Washington Investment Advisors, Inc., which is affiliated with Integrity, is the sub-advisor for the Touchstone VST Core Bond Fund.  The fund seeks to provide a high level of current income as is consistent with the preservation of capital by investing at least 80% of its assets in bonds.  The fund invests in mortgage-related securities, asset-backed securities, U.S. government securities and corporate debt securities.  The fund invests at least 65% of assets in investment grade debt securities, but may invest up to 35% of assets in non-investment grade debt securities rated as low as B.  In making investment decisions for the fund, the portfolio manager analyzes the overall investment opportunities and risks in different sectors of the debt securities markets by focusing on maximizing total return while reducing volatility.

 

Touchstone VST High Yield Fund

 

Ft. Washington Investment Advisors, Inc., which is affiliated with Integrity, is the sub-advisor for the Touchstone VST High Yield Fund.  The fund seeks to achieve a high level of current income as its main goal, with capital appreciation as a secondary consideration.  The fund invests at least 80% of its assets

 

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in non-investment grade debt securities of domestic corporations.  Non-investment grade securities are often referred to as “junk bonds” and are considered speculative.

 

Touchstone VST Large Cap Core Equity Fund

 

Todd Investment Advisors, Inc., which is affiliated with Integrity, is the sub-advisor for Touchstone VST Large Cap Core Equity Fund.  The Large Cap Core Equity Fund (formerly the Enhanced Dividend 30 Fund) seeks long-term capital appreciation as its primary goal and income as its secondary goal.  The sub-advisor selects stocks that it believes are attractively valued with active catalysts in place.  The sub-advisor uses a database of 4,000 stocks from which to choose the companies that will be selected for the fund’s portfolio.  A specific process is followed to assist the sub-advisor in its selections.

 

Touchstone VST Mid Cap Growth Fund

 

Westfield Capital Management Company, LLC (Westfield) and TCW Investment Management Company (TWC) are the sub-advisors for the Touchstone VST Mid Cap Growth Fund.  The fund seeks to increase the value of fund shares as a primary goal and to earn income as a secondary goal.  The fund invests at least 80% of its assets in common stocks of mid cap companies.  The fund may also invest in companies in the technology sector.  The fund is sub-advised by two separate management teams that use different style methodologies.  Westfield uses a growth approach and may companies that have earnings that the portfolio manager believes may grow faster than the U.S. economy in general due to new products, management changes at the company or economic shocks such as high inflation or sudden increases or decreases in interest rates.  TCW uses a value approach and may invest in companies that it believes are undervalued, including those with unrecognized asset values, undervalued growth or those undergoing a turnaround.

 

Touchstone VST Money Market Fund

 

Ft. Washington Investment Advisors, Inc., which is affiliated with Integrity, is the sub-advisor for the Touchstone VST Money Market Fund.  The fund seeks high current income, consistent with liquidity and stability of principal by investing primarily in high-quality money market instruments.  The fund is a money market fund and tries to maintain a constant share price of $1.00 per share, although there is no guarantee that it will do so.

 

Touchstone VST Third Avenue Value Fund

 

Third Avenue Management LLC is the sub-advisor for the Touchstone VST Third Avenue Value Fund.  The fund seeks long-term capital appreciation.  It is a non-diversified fund that seeks to achieve its objective mainly by investing in common stocks of well-financed companies (companies without significant debt in comparison to their cash resources) at a discount to what the portfolio manager believes is their liquid value.  The fund invests in companies regardless of market capitalization and invests in both domestic and foreign securities.  The mix of the fund’s investments at any time will depend on the industries and types of securities that the portfolio manager believes hold the most value.

 

Touchstone VST ETF Funds

 

The Touchstone VST ETF Funds (“ETF Funds”) are mutual funds that invest fixed percentages of assets in various exchange-traded funds, including series of the iSharesâ Funds Trust.  Because the ETF Funds invest in other mutual funds rather than in individual securities, each ETF Fund is considered a “fund of funds” and bears a proportionate share of the expenses charged by the underlying funds in which it invests.  You can invest directly in ETF Funds and do not have to invest through a variable annuity or mutual fund.

 

In addition, the underlying exchange-traded funds trade like a stock on a securities exchange and may be purchased and sold throughout the trading day based on their market price.  Each exchange-traded fund that is held by one of the ETF Funds is an “index fund,” which seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of a particular index.  It is not possible to invest directly in the index.

 

Each ETF Fund allocates its assets among a group of exchange-traded funds in different percentages.  Therefore, each ETF Fund has different indirect asset allocations of stocks, bonds, and cash, reflecting varying degrees of potential investment risk and reward for different investment styles and life stages. 

 

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These asset allocations provide four distinct options that can meet a wide variety of investment needs.  The allocation of stocks and bonds in each ETF Fund reflects greater or lesser emphasis on pursuing current income or growth of capital.

 

As a result of market gains or losses by the underlying exchange-traded funds, the percentage of any of the ETF Funds’ assets invested in stocks or bonds at any given time may be different than that ETF Fund’s planned asset allocation model.  Stock and bond markets, and the sub-categories of assets within them, such as value, growth, large cap and small cap, have returns that vary from year to year.  Because the changes in returns for these assets affect their expected return in the future, they require monitoring and potentially some rebalancing of the allocation models.  The sub-advisor will monitor the models and may update and revise the asset allocation percentages employed by each model to reflect changes in the marketplace.  The sub-advisor will rebalance each ETF Fund’s assets annually (except the Enhanced ETF Fund, which will be assessed by the sub-advisor on a semi-annual basis and may be reallocated if market conditions so indicate) in accordance with the asset allocation model then in effect.  The sub-advisor reserves the right to rebalance more or less frequently depending upon market conditions, investment experience, and other factors it deems appropriate.

 

Todd Investment Advisors, Inc. is the sub-advisor for the Touchstone VST Aggressive ETF, Conservative ETF, Enhanced ETF and Moderate ETF Funds.  Todd Investment Advisors, Inc. is affiliated with Integrity.

 

Touchstone VST Aggressive ETF Fund

 

The Touchstone VST Aggressive ETF Fund seeks capital appreciation.  The fund invests primarily in a group of funds of the iShares Trust using a system that prescribes allocations among asset classes intended to minimize expected volatility risk while structuring the portfolio to optimize potential returns based on historical measures on how each asset class performs.  The Fund typically allocates about 80% of its assets in stocks and 20% in bonds.  In selecting a diversified portfolio of underlying funds, the sub-advisor analyzes many factors, including the underlying ETF fund’s investment objectives, total return, volatility, and expenses.  The fund will also hold a minimal amount of cash or cash equivalent positions, such as money market instruments, U.S. government securities, commercial paper, and repurchase agreements.

 

Touchstone VST Conservative ETF Fund

 

The Touchstone VST Conservative ETF Fund seeks total return by investing for income and capital appreciation.  The fund invests primarily in a group of funds of the iShares Trust using a system that prescribes allocations among asset classes intended to minimize expected volatility risk while structuring the portfolio to optimize potential returns based on historical measures on how each asset class performs.  The Fund typically allocates about 65% of its assets in bonds and 35% in stocks.  In selecting a diversified portfolio of underlying funds, the sub-advisor analyzes many factors, including the underlying ETF fund’s investment objectives, total return, volatility, and expenses.  The fund will also hold a minimal amount of cash or cash equivalent positions, such as money market instruments, U.S. government securities, commercial paper, and repurchase agreements.

 

Touchstone VST Enhanced ETF Fund

 

The Touchstone VST Enhanced ETF Fund seeks high capital appreciation.  The fund invests primarily in a group of funds of the iShares Trust using a system that prescribes allocations among asset classes intended to minimize expected volatility risk while structuring the portfolio to optimize potential returns based on historical measures on how each asset class performs.  Those asset classes with the best relative strength, as measured by their relative performance over the prior six months, are overweighted for six months, while the other asset classes are underweighted, thereby increasing the potential for enhanced performance with lower volatility.  In selecting a diversified portfolio of underlying funds, the sub-advisor analyzes many factors, including the underlying ETF fund’s investment objectives, total return, volatility, and expenses.  The fund will also hold a minimal amount of cash or cash equivalent positions, such as money market instruments, U.S. government securities, commercial paper, and repurchase agreements.

 

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Touchstone VST Moderate ETF Fund

 

The Touchstone VST Moderate ETF Fund seeks total return by investing primarily for capital appreciation and secondarily for income.  The fund invests primarily in a group of funds of the iShares Trust using a system that prescribes allocations among asset classes intended to minimize expected volatility risk while structuring the portfolio to optimize potential returns based on historical measures on how each asset class performs.  The Fund typically allocates about 60% of its assets in stocks and 40% in bonds.  In selecting a diversified portfolio of underlying funds, the sub-advisor analyzes many factors, including the underlying ETF fund’s investment objectives, total return, volatility, and expenses.  The fund will also hold a minimal amount of cash or cash equivalent positions, such as money market instruments, U.S. government securities, commercial paper, and repurchase agreements.

 

Van Kampen LIT Portfolios

 

Van Kampen Asset Management is the investment adviser for each of the LIT Portfolios.

 

Below is a summary of the investment objectives of the Portfolios of Van Kampen Life Investment Trust.  There are no guarantees that a Portfolio will be able to achieve its objective.  You should read each Van Kampen LIT Portfolio prospectus carefully before investing.

 

Van Kampen LIT Comstock Portfolio

 

The Portfolio’s investment objective is to seek capital growth and income through investment in equity securities, including common stocks, preferred stocks and securities convertible into common and preferred stocks.  The Portfolio may invest up to 25% of its total assets in securities of foreign issuers.

 

Van Kampen LIT Capital Growth Portfolio

 

The Portfolio’s investment objective is to seek capital appreciation.  Under normal market conditions, the Portfolio’s investment adviser seeks to achieve the Portfolio’s investment objective by investing primarily in a portfolio of common stocks of companies considered by the investment adviser to be strategic growth companies.

 

Van Kampen Universal Institutional Funds, Inc. Portfolios

 

Morgan Stanley Investment Management Inc., doing business as Van Kampen, is the investment advisor for each of the Universal Institutional Funds, Inc. (UIF) Portfolios.

 

Below is a summary of the investment objectives of the Portfolios of The Universal Institutional Funds, Inc.  There are no guarantees that a Portfolio will be able to achieve its objective.  You should read each Van Kampen UIF Portfolio prospectus carefully before investing.

 

Van Kampen UIF Emerging Markets Debt Portfolio

 

The Portfolio seeks high total return by investing primarily in fixed income securities of government and government-related issuers and, to a lesser extent, of corporate issuers in emerging market countries.  Using macroeconomic and fundamental analysis, the advisor seeks to identify developing countries that are believed to be undervalued and have attractive or improving fundamentals.  After the country allocation is determined, the sector and security selection is made within each country.

 

Van Kampen UIF Emerging Markets Equity Portfolio

 

The Portfolio seeks long-term capital appreciation by investing primarily in growth-oriented equity securities of issuers in emerging market countries.  The Portfolio’s investment approach combines top-down country allocation with bottom-up stock selection.  Investment selection criteria include attractive growth characteristics, reasonable valuations and company managements with strong shareholder value orientation.

 

Van Kampen UIF U.S. Mid Cap Value Portfolio

 

The Portfolio seeks above-average total return over a market cycle of three to five years by investing primarily in common stocks and other equity securities.  The Advisor invests primarily in common stocks of companies traded on the United States securities exchange with capitalizations generally in the range of companies included in the Russell Midcap Value Index.  The Portfolio may invest up to 20% of its net assets in real estate investment trusts.  The Portfolio may invest up to 20% of its net assets in securities

 

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of foreign issuers.  The Advisor seeks attractively valued companies experiencing a change that the Adviser believes could have a positive impact on the company’s outlook.

 

Van Kampen UIF U.S. Real Estate Portfolio

 

The Portfolio seeks to provide above-average current income and long-term capital appreciation by investing primarily in equity securities of companies in the U.S. real estate industry, including real estate investment trusts (“REITs”).  The Portfolio focuses on REITs as well as real estate operating companies that invest in a variety of property types and regions.  The Advisor’s approach emphasizes bottom-up stock selection with a top-down asset allocation overlay.

 

The Fixed Accounts

 

Our Fixed Accounts and General Account are not registered under the Securities Act of 1933 (1933 Act) or the 1940 Act.  The General Account supports the Account Value you invest in the Fixed Accounts, the Death Benefit in excess of Account Value and the Annuity Benefit and any guarantees offered under a Rider.  We have been advised that the staff of the SEC has not reviewed the disclosure in this prospectus relating to the Fixed Accounts or the General Account.  Disclosures regarding the Fixed Accounts or the General Account are subject to certain generally applicable provisions of the federal securities laws relating to the accuracy and completeness of statements made in prospectuses.

 

Quarterly Rate Option

 

We offer a QRO, which is a fixed interest rate account.  The QRO may not be available in Massachusetts.  For any contribution you make to the QRO, your interest rate will be effective through the end of the calendar quarter during which you made your contribution.  Additional contributions during that quarter may earn different interest rates, since we declare new rates periodically.  If you do not transfer the allocation from your QRO to another Investment Option, each quarter your QRO will renew for another quarter at the interest rate that applies on the first day of that quarter.  The QRO will never credit less than the minimum interest rate stated in your contract.  We credit interest daily at an annual effective rate equal to the Guaranteed Interest Rate.

 

Only two “round trips” are permitted through the QRO during any 12-month period.  A “round trip” is a transfer into or out of the QRO followed by a transfer out of or back into the QRO within 30 days.  We reserve the right to restrict further transfers into the QRO Account if you exceed this limit.  This restriction does not apply to programs that systematically transfer Account Value into or out of the QRO such as Dollar Cost Averaging or Systematic Transfer Programs, unless we determine, in our sole discretion, that one of those programs is being used as a method of market timing or other abusive trading practice.  We may modify or amend these transfer restrictions at any time and in our sole discretion.

 

Systematic Transfer Option

 

We offer a STO that provides a fixed interest rate on your contributions to the STO that is effective for the STO period selected.  STOs are available for 6 months or 1 year.  All STO contributions must be transferred into other Investment Options within either six months or one year of your STO contribution, depending on which STO you select.  We will automatically transfer installments of $1,000 or more each.  Transfers are made monthly for the 6 month STO and either monthly or quarterly for the one-year STO.  The STO is available for new contributions only.  You can’t transfer from other Investment Options into the STO.  See “Systematic Transfer Program” in Part 9 for more details on this program.

 

Part 4 - Deductions and Charges

 

Mortality and Expense Risk Charge

 

In Contract Years 1-9, we deduct a daily charge equal to an annual effective rate of 1.67% of your Account Value in the Variable Account Options to cover mortality and expense risk, certain administrative expenses and the cost of the Credit Plus feature in this contract.  A portion of the 1.67% pays us for assuming the mortality risk and the expense risk under the contract.  The mortality risk, as used here, refers to the risk we take that annuitants, as a class of persons, will live longer than estimated and we will be required to pay out more Annuity Benefits or greater Death Benefits than anticipated.  The

 

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expense risk is the risk that the actual expenses of administering and distributing the contract will exceed the reimbursement for administrative expenses.  A portion of the 1.67% is used to reimburse us for administrative expenses not covered by the annual administrative charge including the cost of distribution of the contracts.  We expect to make a profit from this fee.  The mortality and expense risk charge can’t be increased without your consent.

 

In Contract Year 10, this mortality and expense risk charge decreases to 1.15%.  In Contract Years 10 and beyond, we will deduct a daily charge equal to an annual effective rate of 1.15% of your Account Value in each of the Variable Account Options to cover mortality and expense risk, certain administrative expenses and the cost of the Credit Plus feature in this contract.

 

Annual Administrative Charge

 

We charge an annual administrative charge of $40, which is deducted on the last day of the Contract Year if your Account Value is less than $75,000 on that day.  This charge is taken pro rata from your Account Value in each Investment Option.  The part of the charge deducted from the Variable Account Options reduces the number of Units we credit to you.  The part of the charge deducted from the Fixed Accounts is withdrawn in dollars.  The annual administrative charge is pro-rated in the event of the Annuitant’s death, or if you surrender the contract or select an Annuity Benefit during a Contract Year or upon the calculation of a Death Benefit or Distribution on Death of owner.

 

Reduction of the Mortality and Expense Risk Charge or Annual Administrative Charge

 

We can reduce or eliminate the mortality and expense risk charge or the annual administrative charge for individuals or groups of individuals if we anticipate expense savings.  We may do this based on the size and type of the group or the amount of the contributions.  We won’t unlawfully discriminate against any person or group if we reduce or eliminate these charges.

 

Portfolio Charges

 

The Variable Account Options buy shares of the corresponding Portfolios at each Portfolio’s net asset value.  The price of the shares reflects investment management fees and other expenses that have already been deducted from the assets of the Portfolios.  The amount charged for investment management can’t be increased without shareholder approval.  Please refer to the Portfolio prospectuses for complete details on Portfolio expenses and related items.

 

Withdrawal Charge

 

If you withdraw your contributions, you may be charged a withdrawal charge of up to 9%.  The amount of the withdrawal charge is a percentage of each contribution and not of the Account Value.  As shown below, the charge varies, depending upon the “age” of the contributions included in the withdrawal - that is, the number of years that have passed since each contribution was made.

 

Contribution
Year

 

Charge as a percentage of
the contribution withdrawn(11)

 

1

 

9

%

2

 

9

%

3

 

8

%

4

 

7

%

5

 

6

%

6

 

5

%

7

 

4

%

8

 

3

%

9

 

2

%

thereafter

 

0

 

 


(11) In Pennsylvania, the withdrawal charge for each contribution year 1 through 9 is 9%, 8%, 7%, 6%, 5%, 4%, 3%, 2% and 1%.

 

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The maximum of 9% would apply if the entire amount of the withdrawal consisted of contributions made during your current Contract Year.  We don’t deduct a withdrawal charge when you withdraw contributions made more than seven years before your withdrawal.  The oldest contributions are treated as the first withdrawn and more recent contributions next.

 

Partial withdrawals up to the Free Withdrawal Amount of 10% are not subject to the withdrawal charge.  Details on the Free Withdrawal Amount are in Part 5, in the section titled “Withdrawals.”  Withdrawal Charges apply to the Withdrawal Charge amount itself since this amount is part of the Account Value withdrawn.

 

We won’t deduct a withdrawal charge if:

 

·       we calculate the Death Benefits on the death of the Annuitant; or

·      you use the withdrawal to buy an immediate Annuity Benefit from us with either (i) life contingencies, or (ii) a restricted prepayment option that provides for level payments over five or more years.

 

Reduction or Elimination of the Withdrawal Charge

 

We can reduce or eliminate the withdrawal charge for individuals or a group of individuals if we anticipate expense savings.  We may do this based on the size and type of the group, the amount of the contribution, or whether there is some relationship with us.  Examples of these relationships would include being an employee of Integrity or an affiliate, receiving distributions or making internal transfers from other contracts we issued, or transferring amounts held under qualified plans that we, or our affiliate, sponsored.  We won’t unlawfully discriminate against any person or group if we reduce or eliminate the withdrawal charge.

 

Hardship Waiver

 

We may waive the withdrawal charge on full or partial withdrawal requests of $1,000 or more under a hardship circumstance.  Hardship circumstances may include the owner’s (1) confinement to a nursing home, hospital or long term care facility, (2) diagnosis of terminal illness with any medical condition that would result in death or total disability, and (3) unemployment.  (The hardship waiver does not include unemployment on contracts issued in Indiana, Montana, New Jersey and Texas.  The hardship waiver does not include unemployment or terminal illness in Pennsylvania.)  We can require reasonable notice and documentation including, but not limited to, a physician’s certification and Determination Letter from a State Department of Labor.  The waiver of the withdrawal charge applies to the owner, not to the Annuitant.  If there are joint owners, the waivers apply to both the owner and the joint owner. The hardship waiver is not available on contracts issued in South Dakota.

 

Commission Allowance and Additional Payments to Distributors

 

We generally pay a commission to the sales representative equal to a maximum of 6.00% of contributions, plus up to 0.50% trail commission paid on Account Value starting in the second Contract Year.  Commissions may vary due to differences between states, sales channels, sales firms and special sales initiatives.

 

A broker-dealer or financial institution that distributes our variable annuity contracts may receive additional compensation from us for training, marketing or other services provided.  These services may include special access to sales staff, and advantageous placement of our products.  We do not make an independent assessment of the cost of providing such services.

 

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Integrity has agreements with the following broker-dealer firms under which we pay varying amounts on contributions paid, but no more than 0.25%, for enhanced access to their registered representatives.  The broker-dealer firms are American Portfolios Financial, Cadaret, Grant & Co., Inc., Cadaret Grant Agency, Central Jersey Financial, Investacorp, Inc., Linsco Private Ledger, Securities America Inc., Summit Equities, Stifel, Nicolaus and Company, and Sterne, Agee & Leach.

 

Depending on the arrangements in place at any particular time, a broker-dealer, and the registered representatives associated with it, may have a financial incentive to recommend a particular variable annuity contract.  This could be considered a conflict of interest.  You can find more about additional compensation in the Statement of Additional Information.

 

Optional Benefit Charges

 

You may purchase one of the Riders offered with this contract, which provide optional benefits for an additional cost.  The additional cost of each Rider, along with complete details about the benefits, is provided in Part 6.

 

Transfer Charge

 

You have twelve free transfers during a Contract Year.  Then we charge $20 for each additional transfer during that Contract Year.  Transfers under our Dollar Cost Averaging, Customized Asset Rebalancing, or Systematic Transfer Programs described in Part 9 do not count towards the twelve free transfers and we do not charge for transfers made under these programs

 

Tax Reserve

 

We can make a charge in the future for taxes or for reserves set aside for taxes, which will reduce the investment performance of the Variable Account Options.

 

State Premium Tax

 

We won’t deduct state premium taxes from your contributions before investing them in the Investment Options, unless required by your state law.  If you elect an Annuity Benefit, we’ll deduct any applicable state premium taxes from the amount available for the Annuity Benefit.  State premium taxes currently range from 0 to 3.5%.

 

Part 5 - Terms Of Your Variable Annuity

 

Your Contributions

 

·

Minimum initial contribution(12)

 

$

    20,000

·

Minimum additional contribution

 

$

         100

 

Maximum total contribution

 

$

1,000,000 if the Annuitant is age 75 or younger

·

 

 

$

   500,000 if the Annuitant is age 76 or older

 

Contributions may also be limited by various state or federal laws or prohibited by us for all owners under the contract.  If your contract is an individual retirement account (IRA), we will measure your contributions against the maximum limits for annual contributions set by federal law.  Contributions will be accepted at any time up to ten years before your Maximum Retirement Date.

 

We may refuse additional contributions if (1) we previously discontinued accepting additional contributions into an Investment Option and provided you with advance notice; (2) the additional contribution did not meet our minimum additional contribution amount for the annuity contract or for a specific Investment Option; or (3) for reason allowed by law.

 


(12) The minimum initial contribution is $5,000 In Pennsylvania and $3,000 in Texas.

 

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Your contributions are invested in the Investment Options you select.  Each contribution is credited as of the date we have received both the contribution and instructions for allocation to one or more Investment Options in good order at our Administrative Office.  Wire transfers are deemed received on the day of transmittal if credited to our account by 3 p.m. Eastern Time, otherwise they are deemed received on the next Business Day.  Contributions by check sent through the mail are deemed received when they are delivered in good order to our Administrative Office.

 

You can change your choice of Investment Options at any time by writing to the Administrative Office.  The request should indicate your contract number and the specific change, and you should sign the request.  When the Administrative Office receives it, the change will be effective for any contribution that accompanies it and for all future contributions.  We can also accept changes by telephone.  See “Transfers” in Part 5

 

Credit Plus Feature and Recapture

 

We will credit your Account Value with an amount equal to 5% of each contribution we receive from you in the first Contract Year.  This means that if you contribute $50,000 in the first Contract Year, we will add $2,500 to your Account Value.  We allocate the 5% Credit Plus to your Investment Options in the same percentages as you allocate your contributions.

 

There will be no separate charge for this feature, however to recoup the cost of providing this feature, PINNACLEplus has a higher mortality and expense risk charge and a higher withdrawal charge than a similar annuity without the Credit Plus feature.  These charges could be more than the amount of the credit added to your Account Value under the Credit Plus feature.  We expect to make a profit from the charges associated with the Credit Plus feature.

 

If you expect to withdraw funds from the contract in excess of the Free Withdrawal Amount or terminate the contract while withdrawal charges apply, it may not be to your advantage to purchase PINNACLEplus.

 

Contributions to the contract after the first Contract Year do not receive a Credit Plus credit.  However, these contributions will have the same mortality and expense risk charge and withdrawal charge as the contributions that receive a Credit Plus credit.  Therefore, if you intend to make subsequent contributions after the first Contract Year into this annuity you may wish to consider another annuity.

 

Recapture of Credit Plus

 

We may take back (recapture) any amount we add to your Account Value under the Credit Plus feature.  We will recapture a credit for twelve months after the credit is added to your Account Value, if any of the following occur during that twelve months:

 

·      You withdrawal an amount in excess of the Free Withdrawal Amount.  The Credit Plus credit will be recaptured in the same proportion as the withdrawal bears to the Account Value (for example, if 50% of Account Value is withdrawn, 50% of the Credit Plus credit will be recaptured).

·      A Death Benefit is calculated.  However, so long as the Annuitant is age 80 or younger on the Contract Date, the Death Benefit will never be less than contributions minus withdrawals (and associated charges).

·      A Distribution on Death is paid to the owner’s beneficiary.

·      You exercise the right to revoke the contract during the free look period.  In this case, we will incur any investment gain or loss attributable to the Credit Plus amount.

·      You elect an Annuity Benefit during the first five Contract Years.  Your credit will be recaptured according to the following schedule:

 

Contract Year

 

Percentage of Credit Plus Recaptured

 

1

 

100

%

2

 

90

%

3

 

80

%

4

 

70

%

5

 

60

%

 

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The total amount of all recaptures will never be greater than the Credit Plus amount originally credited to your contract.

 

Units in Our Separate Account

 

Your investment in the Variable Account Options is used to purchase Units.  On any given day, the value you have in a Variable Account Option is the number of Units credited to you in that Variable Account Option multiplied by the Unit Value.  The Units of each Variable Account Option have different Unit Values.

 

Units are purchased when you make new contributions or transfer amounts to a Variable Account Option.  Units are redeemed (sold) when you make withdrawals or transfer amounts out of a Variable Account Option into a different Investment Option.  We also redeem Units to pay the Death Benefit when the Annuitant dies, to make a Distribution on Death of owner, to pay the annual administrative charge and to pay for certain optional benefits.  The number of Units purchased or redeemed in any Variable Account Option is calculated by dividing the dollar amount of the transaction by the Variable Account Option’s Unit Value, calculated as of the next close of business of the New York Stock Exchange.

 

The Unit Values of the Variable Account Options fluctuate with the investment performance of the corresponding Portfolios, which reflects the investment income and realized and unrealized capital gains and losses of the Portfolios, as well as the Portfolio’s expenses.

 

How We Determine Unit Value

 

We determine Unit Values for each Variable Account Option after the close of business of the New York Stock Exchange, which is normally 4 p.m. Eastern Time on each Business Day.  The Unit Value of each Variable Account Option for any Business Day is equal to the Unit Value for the previous Business Day, multiplied by the net investment factor for that Variable Account Option on the current Business Day.  We determine a net investment factor for each Variable Account Option as follows:

 

·      First, we take the value of the Portfolio shares which belong to the corresponding Variable Account Option at the close of business that day.  For this purpose, we use the share value reported to us by the Portfolios.

·      Next, we add any dividends or capital gains distributions by the Portfolio on that day.

·      Then we charge or credit for any taxes or amounts set aside as a reserve for taxes.

·      Then we divide this amount by the value of the Portfolio shares which belong to the corresponding Variable Account Option at the close of business on the last day that a Unit Value was determined.

·      Finally, we subtract the mortality and expense risk charge for each calendar day since the last day that a Unit Value was determined (for example, a Monday calculation will include charges for Saturday and Sunday).  The daily charge is an amount equal to an annual effective rate of 1.67% during Contract Years 1-9 and 1.15% in Contract Year 10 and after.

 

Generally, this means that we adjust Unit Values to reflect the investment experience of the Portfolios and for the mortality and expense risk charge.

 

Transfers

 

You may transfer all or any part of your Account Value among the Variable Account Options and the QRO, subject to our transfer restrictions:

 

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·    The amount transferred must be at least $100 or, if less, the entire amount in the Investment   Option.

·    Transfers into the STO are not permitted.

·    Only two “round trips” are permitted through the QRO during any 12-month period.  A “round trip” is a transfer into or out of the QRO followed by a transfer out of or back into the QRO within 30 days.  We reserve the right to restrict further transfers into the QRO Account if you exceed this limit.

 

You may also reallocate all of your Account Value invested in the Variable Account Options at one time and this will count as one transfer.

 

After your twelve (12) free transfers during a Contract Year we charge $20 for each additional transfer during that Contract Year.  See Part 4, “Transfer Charge.”

 

You may request a transfer by writing to our Administrative Office at the address in the Glossary.  Mail sent to any other address may not be in good order.  Each request for a transfer must specify:

 

·     the contract number

·     the amounts to be transferred, and

·     the Investment Options to and from which the amounts are to be transferred.

 

If one portion of a transfer request involving multiple Investment Options violates our policy or is not in good order, the entire transfer request will not be processed.

 

Transfers may also be arranged through our telephone transfer service using your personal identifiers.  We’ll honor telephone transfer instructions from any person who provides correct identifying information. We aren’t responsible for fraudulent telephone transfers we believe to be genuine according to these procedures.  Accordingly, you bear the risk of loss if unauthorized persons make transfers on your behalf.

 

Telephone transfers may be requested from 9:00 a.m. - 5:00 p.m., Eastern Time, on any day we’re open for business.  If we receive your transfer request before 4:00 p.m. Eastern Time on a Business Day, you will receive the Unit Values for the Variable Account Options as of the close of business on the day you call.  Transfer requests for Variable Account Options received by us at or after 4:00 p.m. Eastern Time (or the close of the New York Stock Exchange, if earlier) on a Business Day or on a day other than a Business Day, will be processed using Unit Values as of the close of business on the next Business Day after the day you call.  All transfers will be confirmed in writing.

 

A transfer request doesn’t change the allocation of current or future contributions among the Investment Options.

 

Excessive Trading

 

We reserve the right to limit the number of transfers in any Contract Year or to refuse any transfer request for an owner or certain owners if: (a) we believe in our sole discretion that excessive trading or a specific transfer request or group of transfer requests may have a detrimental effect on Unit Values or the share prices of the Portfolios; or (b) we are informed by one or more of the Portfolios that the purchase or redemption of shares is to be restricted because of excessive trading, or that a specific transfer or group of transfers is expected to have a detrimental effect on share prices of affected Portfolios.

 

We reserve the right to modify these restrictions or to adopt new restrictions at any time and in our sole discretion.

 

We will notify you or your designated representative if your requested transfer is not made.  Current SEC rules preclude us from processing your request at a later date if it is not made when initially requested.  Accordingly, you will need to submit a new transfer request in order to make a transfer that was not made because of these limitations.

 

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Specific Notice Regarding the Use of this Annuity for Market Timing or Frequent Trading

 

This contract is not designed to serve as a vehicle for frequent trading in response to short-term fluctuations in the stock market.  Any individual or legal entity that intends to engage in stale price arbitrage, utilize market timing practices or make frequent transfers to take advantage of inefficiencies in mutual fund pricing or for any other reason should not purchase this contract.  These abusive or disruptive transfers can have an adverse impact on management of a Portfolio, increase Portfolio expenses and affect Portfolio performance.

 

The following policies for transfers between Investment Options are designed to protect contract owners from frequent trading activity.  However, we may not be able to detect all frequent trading, and we may not be able to prevent transfers by those we do detect.  As detecting frequent trading and preventing its recurrence is, in many circumstances, a reactive response to improper trading, we cannot guarantee, despite our policies and procedures, that we will detect all frequent trading in our contracts, prevent all frequent trading and prevent all harm caused by frequent trading.

 

1.             Prohibited Transfers.  Under normal market conditions, we will refuse to honor, unless made by first class U.S. mail:

 

·    a transfer request into an International or High Yield Variable Account Option (as defined by us) if, within the preceding five Business Days, there was a transfer out of the same Variable Account Option;

·    a transfer request out of an International or High Yield Variable Account Option if, within the preceding five Business Days, there was a purchase or transfer into the same Variable Account Option.

 

2.             Allowable Transfers Accompanying A Prohibited Transfer.  We cannot honor an otherwise allowable transfer request if it is made at the same time or accompanies a request for a Prohibited Transfer.

 

3.             Notification.  We will notify you if your requested transfer is not made.

 

4.             Revocation of Same-Day Transfer Privileges.  Contract owners (or agents acting on their behalf) who engage in market timing, as determined by us in our sole discretion, will have their same-day transfer privileges revoked immediately.

 

·        If your same-day transfer privileges are revoked, you will be required to submit all future transfer requests by U.S. mail or overnight delivery service.  Transfer requests made by telephone or the Internet or sent by fax, same-day mail or courier service will not be accepted.

·        In addition, if you wish to cancel a transfer request, your cancellation request must also be in writing and received by U.S. mail or overnight delivery service.  The cancellation request will be processed as of the day it is received.

 

5.             20 Investment Option Transfers Permitted.  You may submit 20 Investment Option transfers each Contract Year for each contract by U.S. mail, internet, telephone request, or fax.

 

·    All requests for transfers among your Investment Options in excess of 20 per Contract Year must be submitted by regular U.S. mail or overnight delivery.  Transfer requests made by telephone or the Internet or sent by fax, same day mail or courier service will not be accepted, and Internet trading privileges will be suspended.  If you want to cancel a written Investment Option transfer, you must also cancel it in writing by U.S mail or overnight delivery service.  We will process the cancellation request as of the day we receive it.

·    Upon reaching your next Contract Anniversary, you will again be provided with 20 Investment Option transfers.  Investment Option transfers are non-cumulative and may not be carried over from year to year.

 

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·    Transfers made under our Dollar Cost Averaging Program, Systematic Transfer Option Program, Customized Asset Rebalancing Program, or other related programs we may offer are not counted toward the 20 Investment Option transfer limitation.  If we determine in our sole discretion that you are manipulating these or similar programs to circumvent our transfer policies, however, we may take any action that we deem appropriate to stop this activity.  This could include (but is not limited to) revoking your same-day transfer privileges or your ability to utilize these programs.

 

Conformity with these policies does not necessarily mean that trading will not be deemed to constitute market timing.  If it is determined, in our sole discretion, that a contract owner is attempting to engage in improper trading, we reserve the right to revoke their same-day transfer privileges.  We will also take into consideration any information and data provided to us by the Portfolios’ investment advisors regarding improper trading.  If we are notified by a Portfolio’s investment advisor that the frequency or size of trades by an individual or group of individuals is disruptive to the management of the Portfolio, and the investment advisor asks us to restrict further trading in that Portfolio by the individual or group, we will comply with that request promptly.  We will impose the Portfolio’s investment advisor’s restriction even if the transactions otherwise conform to our policies.  We do not grant waivers of these policies to particular investors or classes of investors.

 

We may modify these restrictions at any time in our sole discretion.

 

Withdrawals

 

You may make withdrawals as often as you wish.  Each withdrawal must be at least $100.  The withdrawal will be taken from your Investment Options, pro rata, in the same proportion their value bears to your total Account Value.  For example, if your Account Value is divided in equal 25% shares among four Investment Options, when you make a withdrawal, 25% of the Account Value will come from each of your four Investment Options.  You can tell us if you want your withdrawal handled differently.

 

For partial withdrawals, the total amount deducted from your Account Value will include the withdrawal amount requested and any withdrawal charge that applies, so that the net amount you receive will be the amount you requested, less any applicable tax withholding.  Part 4, “Withdrawal Charge.”  Most of the withdrawals you make before you are 59½ years old are subject to a 10% federal tax penalty.  If your contract is part of a tax-favored retirement plan, the plan may limit your withdrawals.  See Part 8.

 

Certain Death Benefits and optional benefits are reduced by withdrawals on a proportional basis.  See Part 5, Death Benefits Paid on Death of Annuitant” and Part 6.

 

Free Withdrawal Amount

 

You may take your Free Withdrawal Amount each Contract Year without a withdrawal charge or MVA.

 

The Free Withdrawal Amount is the greater of:

 

·      10% of your Account Value during a Contract Year; or

·      10% of your Account Value at your most recent Contract Anniversary.

 

During your first Contract Year, the Free Withdrawal Amount is 10% of your initial contribution received on the Contract Date.

 

If you don’t take the Free Withdrawal Amount in any one Contract Year, you can’t add it to the next year’s Free Withdrawal Amount.  If you completely surrender the contract, withdrawal charges on your contributions will not be reduced by your Free Withdrawal Amount.

 

Your financial professional or a third party may offer you asset allocation or investment advisory services for your contract.  Fees you pay for such investment advisory services are in addition to any contract charges.  If you want to pay for such services from your Account Value, you must complete a form authorizing us to pay the amount requested by the third party from your Account Value.  These payments are withdrawals from your Account Value.  We will withdraw the requested payment according to the third party’s instructions (including instructions about which Investment Options to withdraw the fee from) and

 

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send you a confirmation of the transaction.  We will not verify the accuracy of the amount being requested.

 

Assignments

 

We do not allow assignment of your contract unless required by law.

 

Death Benefit Paid on Death of Annuitant

 

Unlike some other variable annuities, our contract pays the Death Benefit upon the Annuitant’s death, rather than upon the owner’s death.  You name the Annuitant’s beneficiary (or beneficiaries).  We will pay a Death Benefit to the Annuitant’s surviving beneficiary if:

 

·   the Annuitant dies before the Retirement Date; and

·   there is no contingent Annuitant.

 

If an Annuitant’s beneficiary doesn’t survive the Annuitant, then the Death Benefit is generally paid to the Annuitant’s estate.

 

A Death Benefit won’t be paid after the Annuitant’s death if there is a contingent Annuitant.  In that case, the contingent Annuitant becomes the new Annuitant under the contract.  The Annuitant and any contingent Annuitants may not be changed once the contract has been issued.

 

Standard Death Benefit

 

The standard Death Benefit varies depending on the Annuitant’s age on the Contract Date.

 

·      For contracts where the Annuitant’s age on the Contract Date is up to and including age 73:

 

If the Annuitant dies in the first seven Contract Years, the Death Benefit is the greater of:

 

·  total contributions minus proportional adjustments for any withdrawals (and associated charges); or

·  your current Account Value on the Business Day we receive due proof of death and the beneficiary’s election in good order, less any Credit Plus recapture.

 

If the Annuitant dies more than seven years after the Contract Date, the Death Benefit is the greatest of:

 

·    your Account Value on the seventh Contract Anniversary plus subsequent contributions, minus proportional adjustments for any subsequent withdrawals (and associated charges);

·    total contributions minus proportional adjustments for any withdrawals (and associated charges); or

·    your current Account Value on the Business Day we receive due proof of death and the beneficiary’s election in good order.

 

·      For contracts where the Annuitant’s age on the Contract Date is between 74 and 80, the Death Benefit is the greater of:

 

·      total Contributions minus proportional adjustments for any withdrawals (and associated charges); or

·      your current Account Value on the Business Day we receive due proof of death and the beneficiary’s election in good order, less any Credit Plus recapture.

 

The Death Benefit can be paid in a lump sum or as an annuity.  You may select either option.  If you have not selected an option before the Annuitant dies, the Annuitant’s beneficiary may select either option at the Annuitant’s death.  However, a beneficiary that is not a natural person automatically receives a lump sum distribution.

 

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Effect of Withdrawals on the Death Benefit

 

If you take withdrawals from your contract, we will make a proportional adjustment to your Death Benefit.  This means that your Death Benefit will be reduced by the same percentage as your withdrawal bears to your Account Value at the time of withdrawal.  For example:

 

·      If your Death Benefit is $100,000, and your current Account Value is $80,000,

·      and you take a withdrawal of $10,000,

·      we will reduce your Death Benefit by 12.5% because that is the same percentage that your   withdrawal bears to the Account Value at the time of the withdrawal ($10,000 /$80,000).

·      Therefore, your Death Benefit is reduced by $12,500.

 

Because the Account Value at the time of the withdrawal in this example is less than the Death Benefit, the Death Benefit is decreased by a larger dollar amount than the partial withdrawal amount.  All Death Benefits are reduced proportionally for withdrawals and any charges associated with the withdrawals.

 

Distribution on Death of Owner

 

When you, as owner, die before the Retirement Date, your entire interest in this contract is required to be distributed to the owner’s beneficiary within five years.  However, any interest that is payable to the owner’s beneficiary may be payable over the life of that beneficiary or over a period not extending beyond the life expectancy of that beneficiary, as long as distributions begin within one year after the owner’s death.  This distribution is required by Section 72(s) of the Code.

 

You name the owner’s beneficiary (or beneficiaries).  We will pay the owner’s surviving beneficiary the Distribution on Death.  If an owner’s beneficiary doesn’t survive the owner, then the Distribution on Death of the owner is generally paid to the owner’s estate.

 

If there are joint owners, the first death of one of the joint owners will be treated as the death of both owners, and a Distribution on Death to the owners’ beneficiary will be required.

 

If you, as owner, die on or after the Retirement Date and before the entire interest in the contract has been distributed, then the rest of the annuity must be distributed to the owner’s beneficiary at least as quickly as the method in effect when you died.

 

If your sole owner’s beneficiary is your spouse, the contract (along with its deferred tax status) may be continued in your spouse’s name as the owner.

 

You may change any beneficiary by sending the appropriate form in good order to the Administrative Office.  We reserve the right to limit the number of beneficiaries you can name at one time.  Please consult your financial professional and tax advisor in order to properly identify your beneficiaries so that the Death Benefit is paid to the intended beneficiary, and to structure your contract so that spousal continuation can occur, if that is your intention.

 

Spousal Continuation

 

Under the Code

 

If you (as owner) die, the Code allows your surviving spouse to continue the annuity contract, along with its tax-deferred status, so long as your spouse is your sole owner’s beneficiary.  This is called spousal continuation.

 

Under the Contract

 

This annuity contract also provides an enhanced type of spousal continuation (Spousal Continuation).  The Spousal Continuation under this contract is available only if you have structured your contract as follows:

 

·      you are the sole owner and Annuitant;

·      no contingent Annuitant is named; and

·      your spouse is the owner’s sole beneficiary and the Annuitant’s sole beneficiary.

 

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Under this enhanced Spousal Continuation, we will increase the continued contract’s Account Value to the same amount that would have been paid to your surviving spouse had he or she taken the Death Benefit as a lump sum distribution.  This increase will be added to the Fixed and Variable Account Options you have selected on a pro-rata basis.  For example, if the Account Value at death was $100,000, but we would have paid out a Death Benefit of $115,000, the surviving spouse’s contract will continue with a $115,000 Account Value.  The surviving spouse continues the contract with its tax deferred earnings and may exercise all rights and privileges under the contract, except that we will not accept additional contributions.  When the surviving spouse dies, the Death Benefit will be paid to the surviving spouse’s beneficiary.  Under this enhanced Spousal Continuation, we waive any withdrawal charges applicable to full or partial withdrawals made after the spousal continuation is elected.  We also reduce the mortality and expense risk charge to 1.15%.  If the surviving spouse is under 59½, the 10% federal tax penalty for early withdrawal may apply if withdrawals are taken.

 

Under either type of spousal continuation, certain Investment Options or administrative programs may not be available on the continued contract.  We reserve the right at any time to make changes to continued contracts that are permitted by law.

 

Death Claims

 

A death claim will be effective on the Business Day we receive due proof of death of either the owner or Annuitant.  This means we have received an original certified death certificate and company death claim paperwork that is in good order, including the beneficiary’s election.  During the period from the date of death until we receive all required paperwork in good order, the Account Value will remain invested in the Investment Options you chose, will continue to reflect the investment performance of any Variable Account Options during this period and will be subject to market fluctuations.  Fees and expenses will continue to apply.  If there are multiple beneficiaries, after one beneficiary submits death claim paperwork, the Death Benefit or Distribution on Death of owner will be calculated and the first beneficiary will receive payment according to his election.

 

Maximum Retirement Date and Annuity Benefit

 

Your Annuity Benefit is available anytime after your first Contract Anniversary up until the last Annuitant’s 100th birthday.  This is referred to as the Maximum Retirement Date..  You may elect your Annuity Benefit by writing to the Administrative Office any time before the Maximum Retirement Date.

 

Upon the Maximum Retirement Date, you may elect to receive a lump sum of your Surrender Value, or you may elect an Annuity Benefit.  The amount applied toward the purchase of an Annuity Benefit will be the Account Value, less any pro-rata annual administrative charge and Credit Plus recapture, except that the Surrender Value will be the amount applied if the Annuity Benefit does not have a life contingency and either (i) the term is less than five years, or (ii) the annuity can be changed to a lump sum payment without a withdrawal charge.

 

An Annuity Benefit can provide for fixed payments, which may be made monthly, quarterly, semi-annually or annually.  You can’t change or redeem the annuity once payments have begun.  For any annuity, the minimum initial payment must be at least $100 monthly.

 

We currently offer the following types of annuities, funded through our General Account:

 

·      Life and ten years certain annuity, which provides a fixed life income annuity with 10 years of payments guaranteed.

·      Period certain annuity, which provides for fixed payments for a fixed period.  The amount is determined by the period you select when you select the type of annuity you want.  If the Annuitant dies before the end of the period selected, the Annuitant’s beneficiary will receive the remaining periodic payments.

·      Period certain life annuity, which provides for fixed payments for at least the period selected and after that for the life of the Annuitant or the lives of the Annuitant and any joint Annuitant under a joint

 

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and survivor annuity.  If the Annuitant (or the Annuitant and the joint Annuitant under a joint and survivor annuity) dies before the period selected ends, the remaining payments will go to the Annuitant’s beneficiary.

·      Life income annuity, which provides fixed payments for the life of the Annuitant, or until the Annuitant and joint Annuitant both die under a joint and survivor annuity.

 

If you haven’t already selected a form of Annuity Benefit, we will contact you prior to your Maximum Retirement Date.  You can tell us at that time the type of annuity you want or confirm to us that you want the normal form of annuity, which is the life and ten years certain annuity.  However, if we do not receive your election on or before your Maximum Retirement Date, you will automatically receive the normal form of annuity.

 

Annuity Benefit Payments

 

Fixed Annuity Benefit payments won’t change and are based upon annuity rates provided in your contract.  The size of payments will depend on the form of annuity that was chosen and, in the case of a life income annuity, on the Annuitant’s age and gender (except under most tax-favored retirement programs, and under certain state laws, where gender-neutral rates apply).  If our annuity rates then in effect would yield a larger payment, those rates will apply instead of the rates provided in your contract.

 

If the age or gender of an Annuitant has been misstated, any benefits will be those that would have been purchased at the correct age and gender.  Any overpayments or underpayments made by us will be charged or credited with interest at the rate required by your state.  If we have made overpayments because of incorrect information about age or gender, we’ll deduct the overpayment from the next payment or payments due.  We add underpayments to the next payment.

 

Timing of Payment

 

We normally apply your Adjusted Account Value to the purchase of an Annuity Benefit, or send you partial or total withdrawals, within seven days after receipt of the required form at our Administrative Office.  We can defer our action as to Account Value allocated to the Variable Account Options, however, for any period during which:

 

(1)   the New York Stock Exchange has been closed or trading on it is restricted;

 

(2)   an emergency exists as determined by the SEC so that disposal of securities isn’t reasonably practicable or it isn’t reasonably practicable for the Separate Account fairly to determine the value of its net assets; or

 

(3)   the SEC, by order, permits us to defer action in order to protect persons with interests in the Separate Account.

 

How You Make Requests and Give Instructions

 

When you write to our Administrative Office, use the address listed in the Glossary of this prospectus.  We can’t honor your requests unless they are in proper and complete form.  Whenever possible, use one of our printed forms, which may be obtained from our Administrative Office.

 

Part 6 - Optional Benefits

 

You may purchase one of the Riders offered with this contract, which provide optional benefits for an additional cost.  The Riders may only be elected at the time of application and will replace or supplement the standard contract benefits.  Charges for the optional benefit Riders are in addition to the standard contract charges.  Be sure you understand the charges.  Carefully consider whether you need the benefit and whether it is appropriate for your particular circumstances.  Also consider whether you can buy the benefit more cheaply as part of the variable annuity or with a separate contract.

 

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Highest Anniversary Death Benefit Rider

 

The Highest Anniversary Death Benefit (HADB) is an optional benefit Rider, which you may purchase for an additional fee.  This Rider provides an enhancement of the standard Death Benefit under the contract as follows:

 

For contracts where the Annuitant’s age on the Contract Date is up to and including age 75, the Death Benefit will be the greater of:

 

·      your highest Account Value on any Contract Anniversary up to and including Annuitant’s age 80, plus any contributions received after that Contract Anniversary, minus proportional adjustments for any withdrawals (including associated charges and any Credit Plus recapture) after that Contract Anniversary; or

·      the standard Death Benefit described in Part 5.

 

The HADB Rider is not available if the Annuitant is age 76 or older on the Contract Date.

 

The fee for the HADB Rider is an annual effective rate of 0.20% assessed at the end of each calendar quarter for the life of the contract.  The fee is calculated by multiplying the value of your Variable Account Options as of the last day of each calendar quarter by the annual effective rate and dividing by 4.

 

Enhanced Earnings Benefit Rider

 

The EEB is an optional benefit Rider, which you may purchase for an additional fee.  The EEB Rider provides an enhancement of the standard Death Benefit under the contract, specifically a percentage of the gain in the contract is paid in addition to the standard Death Benefit.  If there is a gain in the contract when we calculate the Death Benefit, we will pay an amount equal to a portion of the gain as an additional Death Benefit.

 

Gain is calculated by taking your Account Value on the Death Benefit Date minus contributions adjusted for partial withdrawals.  If the resulting value is less than zero, then gain will be set equal to zero for purposes of this Death Benefit calculation.

 

The cost of the EEB and the percentage of gain paid depend on the Annuitant’s age on the Contract Date.  We will assess the cost of the EEB at the end of each calendar quarter by multiplying your Account Value by the annual effective rate as indicated in the chart below and dividing by 4.

 

Annuitant Age on the
Contract Date

 

Benefit Paid

 

Charge on Account Value at
Annual Effective Rate

 

59 or less

 

40% of Gain

 

0.20

%

60-69

 

40% of Gain

 

0.40

%

70-79

 

25% of Gain

 

0.50

%

80 or more

 

Not Available

 

Not Available

 

 

The maximum benefit is 150% of your contributions less adjustments for withdrawals.  Contributions received in the first seven Contract Years will be included for purposes of calculating the maximum benefit.  Contributions received after the seventh Contract Anniversary will not be included in calculating the maximum benefit until they have been in the contract for six months.  Any gain on a Credit Plus credit that is recaptured will not be included in the calculation of gain under the EEB.

 

If there is not gain or if a Death Benefit (which is paid on the death of the Annuitant) is not paid, the EEB will provide no benefit.  Contributions received from exchanged contracts shall be treated as a contribution for purposes of the EEB and determination of the percentage of gain paid.  Any gain in the exchanged contract will not be carried over to the new contract for purposes of calculating the EEB.  It will be carried over for purposes of income tax or exclusion allowance calculations.

 

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Please see Appendix B for hypothetical examples that illustrate how the EEB Rider works.

 

The EEB automatically terminates if you surrender the contract or elect an Annuity Benefit.

 

Based on our current interpretation of the tax law, the additional benefit provided by the EEB will be treated as earnings under the contract and taxed as income upon distribution.  You should consult your tax advisor and your investment professional to determine if the EEB is suitable for your needs.

 

A special note if you are purchasing this annuity for use as an IRA:  If you are purchasing this contract as an IRA and are electing the EEB there is no assurance that the contract will meet the qualification requirements for an IRA.  You should carefully consider selecting the EEB if this contract is an IRA.  Consult your tax or legal advisor if you are considering using the EEB with an IRA.  The contract owner bears the risk of any adverse tax consequences.

 

Part 7 - Voting Rights

 

How Portfolio Shares Are Voted

 

Integrity is the legal owner of the shares of the Portfolios held by the Separate Account and, as such, has the right to vote on certain matters.  Among other things, we may vote to elect a Portfolio’s Board of Directors, to ratify the selection of independent auditors for a Portfolio, and on any other matters described in a Portfolio’s current prospectus or requiring a vote by shareholders under the 1940 Act.

 

Whenever a shareholder vote is taken, we give you the opportunity to tell us how to vote the number of shares purchased as a result of contributions to your contract.  We’ll send you Portfolio proxy materials and a form for giving us voting instructions.

 

If we don’t receive instructions in time from all owners, we’ll vote shares in a Portfolio for which we have not received instructions in the same proportion as we vote shares for which we have received instructions.  As a result of this proportional voting, the vote of a small number of contract owners may determine the outcome of a proposal.  Under eligible deferred compensation plans and certain qualified plans, your voting instructions must be sent to us indirectly, through your employer, but we aren’t responsible for any failure by your employer to ask for your instructions or to tell us what your instructions are.  We’ll vote any Portfolio shares that we’re entitled to vote directly, because of amounts we have accumulated in our Separate Account, in the same proportion that other owners vote.  If the federal securities laws or regulations or interpretations of them change so that we’re permitted to vote shares of the Portfolios in our own right or to restrict owner voting, we may do so.

 

If shares of the Portfolios are sold to separate accounts of other insurance companies, the shares voted by those companies in accordance with instructions received from their contract holders will dilute the effect of voting instructions received by us from our owners.

 

How We Determine Your Voting Shares

 

You vote only on matters concerning the Portfolios which correspond to the Variable Account Options in which your contributions are invested on the record date set by the Portfolio’s Board of Directors.  We determine the number of Portfolio shares in each Variable Account Option under your contract by dividing the amount of your Account Value allocated to that Variable Account Option by the net asset value of one share of the corresponding Portfolio as of the record date set by a Portfolio’s Board for its shareholders’ meeting.  We count fractional shares.  The record date for this purpose can’t be more than 60 days before the shareholders’ meeting.  All Portfolio shares are entitled to one vote; fractional shares have fractional votes.

 

Separate Account Voting Rights

 

Under the 1940 Act, certain actions (such as some of those described under “Changes in How We Operate” in Part 2) may require contract owner approval.  In that case, you’ll be entitled to a number of

 

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votes based on the value you have in the Variable Account Options.  We’ll cast votes attributable to amounts we have in the Variable Account Options in the same proportions as votes cast by owners.

 

Part 8 - Tax Aspects of the Contract

 

Introduction

 

The effect of federal income taxes on your contract values or payments under your Annuity Benefits varies depending on many factors including:

 

·      our tax status

·      the tax status of the contract

·      the type of retirement plan, if any, for which the contract is purchased

·      the tax and employment status of the persons receiving payments

 

The following discussion of the federal income tax treatment of the contract isn’t designed to cover all situations and isn’t intended to be tax advice.  It is based upon our understanding of the present federal income tax laws as currently interpreted by the Internal Revenue Service (IRS) and various courts.  The IRS or the courts may change their views on the treatment of these contracts.  Future legislation may have a negative effect on annuity contracts.  Also, we have not attempted to consider any applicable state or other tax laws.  Because of the complexity of the tax laws and the fact that tax results will vary according to the particular circumstances, anyone considering buying a contract, selecting an Annuity Benefit under the contract, or receiving annuity payments under a contract should consult a qualified tax advisor.  Integrity does not guarantee the tax status, federal, state, or local, of any contract or any transaction involving the contracts.

 

Your Contract is an Annuity

 

·      You can purchase an annuity with after-tax dollars, in which case taxes on earnings under the contract are generally deferred until you make a withdrawal.

·      You may purchase an annuity with after-tax dollars to fund a Roth IRA, in which case earnings under the contract are generally fully excluded from taxable income at distribution.

·      You may also purchase an annuity with pre-tax dollars to fund a tax-favored retirement program, such as an IRA or contribute pre-tax dollars to an annuity used to fund a qualified retirement plan, such as a 401(k) plan.

 

This prospectus covers the basic tax rules that apply to an annuity purchased with after-tax dollars, which are not Roth IRAs (nonqualified annuity), and some of the special tax rules that apply to an annuity purchased to fund a tax-favored retirement program, such as IRAs, 401(k)s and Roth IRAs (qualified annuity).

 

Taxation of Annuities Generally

 

Section 72 of the Code governs the taxation of annuities.  In general, contributions you put into a non-qualified annuity (your “basis” or “investment in the contract”) will not be taxed when you receive those amounts back in a distribution.  Also, you are not generally taxed on the annuity’s earnings until some form of withdrawal or distribution is made under the contract.  However, under certain circumstances, the increase in value may be subject to current federal income tax.  For example, corporations, partnerships, and other non-natural persons can’t defer tax on the annuity’s income unless an exception applies.  In addition, if an owner transfers an annuity as a gift to someone other than a spouse (or former spouse), all increases in its value are taxed at the time of transfer.  The assignment or pledge of any portion of the value of a contract will be treated as a distribution of that portion of the value of the contract.

 

You can take withdrawals from the contract or you can elect an Annuity Benefit.  The tax implications are different for each type of distribution:

 

·   Withdrawals from a contract before Annuity Benefit payments begin are treated first as taxable income, but only to the extent of the increase of the Account Value.  The rest of the withdrawal,

 

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representing your basis in the annuity, isn’t taxable.  Generally, the investment or basis in the contract equals the contributions made by you or on your behalf, minus any amounts previously withdrawn that were not treated as taxable income.  Special rules may apply if the contract includes contributions made prior to August 14, 1982 that were rolled over to the contract in a tax-free exchange.

·   If you elect an Annuity Benefit, part of each payment will be the tax-free return of your investment in the contract, based on a ratio of your investment to your expected return under the contract (exclusion ratio).  The rest of each payment will be ordinary income.  That means that part of each annuity payment is tax-free and part of it is taxable.  When all of these tax-free portions add up to your investment in the contract, all remaining payments are taxed as ordinary income.  If the annuity payments end before the total investment is recovered, a deduction for the remaining basis will generally be allowed on the owner’s final federal income tax return.

 

We may be required to withhold federal income taxes on all distributions unless the eligible recipients elect not to have any amounts withheld and properly notify us of that election.

 

You may be subject to a tax penalty of 10% on the taxable portion of a distribution unless one of the following conditions apply:

 

·     you are 59½ or older

·     payment is a result of the owner’s death

·     payment is part of a series of substantially equal periodic payments paid at least annually for the life (or life expectancy) of the taxpayer or joint lives (or joint life expectancy) of the taxpayer and beneficiary

·     payment is a result of the taxpayer becoming disabled within the meaning of Code section 72(m)(7)

·     payment is from certain qualified plans (note, however, other penalties may apply)

·     payment is under a qualified funding asset as defined in Section 130(d) of the Code

·     payment is under certain types of qualified plans held by the employer until the employee separates from service

·     payment is under an immediate annuity as defined in Code Section 72(u)(4) (non-qualified contracts only)

·     payment is for the purchase of a first home (distribution up to $10,000) (IRA only)

·     payment is for certain higher education expenses (IRA only)

·     payment is for certain deductible medical expenses, or to cover health insurance premiums if you are unemployed (IRA only)

 

The IRS will treat all annuity contracts issued by us or our affiliates to one owner during any calendar year as a single contract in measuring the taxable income that results from surrenders and withdrawals under any one of the contracts.

 

Tax-Favored Retirement Programs

 

An owner can use this annuity with certain types of qualified retirement plans that receive favorable tax treatment under the Code.  Numerous tax rules apply to the participants in qualified retirement plans and to the contracts used in connection with those plans.  These tax rules vary according to the type of plan and the terms and conditions of the plan itself, regardless of the terms and conditions of the contract.  Special rules also apply to the time at which distributions must begin and the form in which the distributions must be paid.  Also, we do not offer loans through our annuity contracts even if the qualified plan does.

 

Inherited IRAs

 

This contract may be issued as an inherited IRA.  This occurs if, after the death of the owner of an IRA, the owner’s beneficiary directs that the IRA death proceeds be transferred to a new contract issued and titled as an inherited IRA.  The owner’s beneficiary of the original IRA contract will become the owner

 

PPI - 39



 

under the inherited IRA and may generally exercise all rights under the inherited IRA contract, including the right to name his or her own beneficiary in the event of death.

 

Special tax rules apply to an inherited IRA.  The tax law does not permit additional contributions to an inherited IRA contract.  Also, in order to avoid certain income tax penalties, a required minimum distribution (RMD) must be withdrawn each year from an inherited IRA.  The first RMD must be taken on or before December 31 of the calendar year following the year of the original IRA owner’s death.  The tax penalty equals 50% of the excess of the RMD over the amount actually withdrawn from the inherited IRA during the calendar year.

 

Annuities in Qualified Plans

 

IRAs and qualified retirement plans, such as 401(k) plans provide you with tax-deferred growth and other tax advantages.  For most investors, it will be advantageous to make maximum allowable contributions to IRAs and 401(k) plans before investing in a variable annuity.  In addition, if you are investing in a variable annuity through a qualified retirement plan (such as a 401(k) or IRA), you will get no additional tax advantage from the variable annuity.  Under these circumstances, consider buying a variable annuity only if it makes sense because of the annuity’s other features, such as the Death Benefit, Annuity Benefit or Optional Riders.

 

This contract offers an enhanced Death Benefit.  The IRS requires an actuarial present value of enhanced benefits to be added to the Account Value for purposes of calculating the fair market value of the annuity and determining the RMD.

 

Federal and State Income Tax Withholding

 

Certain states have indicated that pension and annuity withholding will apply to payments made to their residents.  Generally, an election out of federal withholding will also be considered an election out of state withholding.  For more information concerning a particular state, call our Administrative Office listed in the Glossary.

 

Impact of Taxes on the Company

 

We may charge the Separate Account for taxes.  We can also set up reserves for taxes.

 

Transfers Among Investment Options

 

There won’t be any current tax liability if you transfer any part of the Account Value among the Investment Options of your contract.

 

Part 9 – Additional Information

 

Systematic Withdrawal Program

 

We offer a program that allows you to pre-authorize periodic withdrawals from your contract prior to your Retirement Date.  You can choose to have withdrawals made monthly, quarterly, semi-annually or annually and can specify the day of the month (other than the 29th, 30th or 31st) on which the withdrawal is to be made.  If you do not select how often you want to receive withdrawals, we will make them on a monthly basis.  You may specify a dollar amount for each withdrawal, an annual percentage to be withdrawn, or elect the Free Withdrawal Amount to be used.  The minimum Systematic Withdrawal is $100.  If on any withdrawal date you don’t have enough Account Value to make all of the withdrawals you have specified, no withdrawal will be made and your enrollment in the program will be ended.  You may specify an account for direct deposit of your Systematic Withdrawals.  Withdrawals under this program are treated as ordinary withdrawals under the contract and are subject to income tax and a 10% tax penalty if you are under age 59½.  See Part 8.

 

To enroll in our Systematic Withdrawal Program, send the appropriate form to our Administrative Office.  You may terminate your participation in the program upon one day’s prior written notice, and we may

 

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terminate or change the Systematic Withdrawal Program at any time.

 

Income Plus Withdrawal Program

 

We offer an Income Plus Withdrawal Program that allows you to pre-authorize equal periodic withdrawals, based on your life expectancy, from your contract anytime before you reach age 59½.  You won’t have to pay a tax penalty for these withdrawals, but they will be subject to ordinary income tax.  See Part 8.  Once you begin receiving distributions, they shouldn’t be changed or stopped until the later of:

 

·        the date you reach age 59½; and

·        five years from the date of the first distribution.

 

If you change or stop the distribution or take an additional withdrawal, you may have to pay a 10% penalty tax that would have been due on all prior distributions made under the Income Plus Withdrawal Program before you reached the date described above, plus interest.

 

You can choose the Income Plus Withdrawal Program any time before you reach age 59½.  You may choose to have withdrawals made monthly, quarterly, semi-annually or annually and may specify the day of the month (other than the 29th, 30th or 31st) on which the withdrawal is made.  We’ll calculate the amount of the distribution subject to a $100 minimum.  If on any withdrawal date you don’t have enough Account Value to make all of the withdrawals you have specified, no withdrawal will be made and your enrollment in the program will end.  You must also specify an account for direct deposit of your withdrawals.

 

To enroll in our Income Plus Withdrawal Program, send the appropriate form to our Administrative Office.  You may end your participation in the program upon seven Business Days’ prior written notice, and we may terminate or change the Income Plus Withdrawal Program at any time.  This program isn’t available in connection with the Systematic Withdrawal Program, Dollar Cost Averaging, Systematic Transfer Option, or Customized Asset Rebalancing Program.  Withdrawals under this program are treated as ordinary withdrawals under the contract.

 

Choices Plus Required Minimum Distribution Program

 

We offer a Choices Plus Required Minimum Distribution Program that allows you to pre-authorize withdrawals from your contract after you attain age 70½.  The Code requires that you take minimum distributions from an IRA beginning on or before April 1st of the calendar year following the calendar year in which you turn 70½ years old.  These withdrawals are subject to ordinary income tax.  See Part 8.

 

You can choose the Choices Plus Required Minimum Distribution Program for your IRA at any time if you’re age 70½ or older.  You can elect this option by sending the election form to our Administrative Office.  You can choose to have withdrawals made monthly, quarterly, semiannually, or annually and can specify the day of the month (other than the 29th, 30th, or 31st) on which the withdrawal is made.  We’ll calculate the amount of the distribution using current IRS guidance.  We are not responsible for any tax or other liability you may incur if our good faith calculations are not correct.  You should consult with your tax advisor to ensure these calculations are appropriate to your situation.

 

Withdrawals of Account Value that are made as part of the Choices Plus program are not subject to withdrawal charges, but otherwise are treated as ordinary withdrawals under the contract, and are subject to Credit Plus recapture.

 

Dollar Cost Averaging Program

 

Dollar cost averaging refers to the practice of investing the same amount in the same investment at regular intervals (like once a month), regardless of market conditions.  Thus, you automatically buy more Units when the price is low and fewer when the price is high.  Over time, you may reduce the risk of buying Units when their cost is highest.  Dollar cost averaging does not assure a profit and does not protect against investment losses.

 

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We offer a Dollar Cost Averaging Program under which we transfer contributions that you have allocated to the Touchstone VST Money Market Fund or QRO to one or more other Investment Options on a monthly, quarterly, semi-annual or annual basis.  You must tell us how much you want transferred into each Investment Option.  The minimum transfer to each Investment Option is $100.  We won’t charge a transfer charge under our Dollar Cost Averaging Program, and these transfers won’t count towards your twelve free transfers.

 

To enroll in our Dollar Cost Averaging Program, send the appropriate form to our Administrative Office.  You may terminate your participation in the program upon one day’s prior written notice, and we may terminate or change the Dollar Cost Averaging Program at any time.  If you don’t have enough Account Value in the Touchstone VST Money Market Fund or QRO to transfer to each Investment Option specified, no transfer will be made and your enrollment in the program will end.

 

Systematic Transfer Program

 

We also offer a Systematic Transfer Program under which we transfer contributions from a STO to one or more other Investment Options on a monthly or quarterly basis.  We’ll transfer your STO contributions in approximately equal installments of at least $1,000 over either a six-month or one-year period, depending on the option you select.  If you don’t have enough Account Value in the STO to transfer to each Investment Option specified, a final transfer will be made on a pro rata basis and your enrollment in the program will be ended.  All interest accrued and any Account Value remaining in the STO at the end of the period during which transfers are scheduled to be made will be transferred at the end of that period on a pro rata basis to the Investment Options you chose for this program.  There is no charge for transfers under this program, and these transfers won’t count towards the twelve free transfers you may make in a Contract Year.

 

To enroll in our Systematic Transfer Program, send the appropriate form to our Administrative Office.  We can end the Systematic Transfer Program in whole or in part, or restrict contributions to the program.

 

Customized Asset Rebalancing Program

 

Asset rebalancing allows you to maintain a diversified investment mix that is appropriate for your goals and risk tolerance.  Because some of your investments may grow faster than others, your asset allocation may shift from your preferred mix.  Asset rebalancing periodically resets your investments to your original allocations, ensuring that your asset mix stays in line with your investment strategy.

 

We offer a Customized Asset Rebalancing Program that allows you to determine how often rebalancing occurs.  You can choose to rebalance monthly, quarterly, semi-annually or annually.  The value in the Variable Account Options will automatically be rebalanced by transfers among your Variable Account Options, and you will receive a confirmation notice after each rebalancing.  Transfers will occur only to and from those Variable Account Options where you have current contribution allocations.  Fixed Accounts are not included in the Customized Asset Rebalancing Program.  We won’t charge a transfer charge for transfers under our Customized Asset Rebalancing Program, and they won’t count towards your twelve free transfers.

 

To enroll in our Customized Asset Rebalancing Program, send the appropriate form to our Administrative Office.  Other allocation programs, such as Dollar Cost Averaging, as well as transfers and withdrawals that you make, may not work with the Customized Asset Rebalancing Program.  You should, therefore, monitor your use of other programs, transfers, and withdrawals while the Customized Asset Rebalancing Program is in effect.  You may terminate your participation in the program upon one day’s prior written notice, and we may end or change the Customized Asset Rebalancing Program at any time.  We recommend you consult with your financial professional when establishing your investment portfolio.

 

Systematic Contributions Program

 

We offer a program for systematic contributions that allows you to pre-authorize monthly, quarterly, or semi-annual withdrawals from your checking account to make your contributions to your annuity contract. 

 

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To enroll in this program, send the appropriate form to our Administrative Office.  You or we may end your participation in the program with 30 days’ prior written notice.  We may end your participation if your bank declines to make any payment.  The minimum amount for systematic contributions is $100 per month.

 

Legal Proceedings

 

Integrity is a party to litigation and arbitration proceedings in the ordinary course of its business.  None of these matters is expected to have a material adverse effect on Integrity.

 

Table of Contents of Statement of Additional Information

 

 

Page

General Information and History

1

Administration and Distribution of the Contracts

1

Performance Data and Illustrations

2

Distributions Under Tax Favored Retirement Programs

3

Financial Statements

4

 

If you would like to receive a copy of the Statement of Additional Information, please write:

 

Integrity Life Insurance Company

P.O. Box 5720

Cincinnati, Ohio 45201-5720

ATTN: Request for SAI of Separate Account I

 

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Appendix A

 

Financial Information for Separate Account I of Integrity (Pinnacle Plus)

 

For the Variable Account Options we currently offer, the table below shows the following data for Pinnacle Plus contracts with a mortality and expense risk charge of 1.67% in Contract Years 1-9: Unit Value at inception, the number of Units outstanding at December 31 of each year since inception, and the Unit Value at the beginning and end of each period since inception.

 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index Fund, Class B (857)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

15.73

 

$

13.65

 

$

13.35

 

$

11.56

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

15.13

 

$

15.73

 

$

13.65

 

$

13.35

 

$

11.56

 

 

 

Number of units outstanding at end of period

 

12,418

 

10,694

 

13,255

 

12,863

 

3,422

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Asset Manager, Service Class 2 (801)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

11.64

 

$

11.04

 

$

10.82

 

$

10.46

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

13.18

 

$

11.64

 

$

11.04

 

$

10.82

 

$

10.46

 

 

 

Number of units outstanding at end of period

 

17,753

 

9,509

 

12,426

 

16,017

 

2,129

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Balanced, Service Class 2 (803)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.25

 

$

11.17

 

$

10.77

 

$

10.41

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

13.10

 

$

12.25

 

$

11.17

 

$

10.77

 

$

10.41

 

 

 

Number of units outstanding at end of period

 

11,263

 

5,806

 

7,965

 

14,688

 

5,951

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Contrafund, Service Class 2 (804)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

16.04

 

$

14.64

 

$

12.76

 

$

11.27

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

18.50

 

$

16.04

 

$

14.64

 

$

12.76

 

$

11.27

 

 

 

Number of units outstanding at end of period

 

119,254

 

115,257

 

99,528

 

57,918

 

10,772

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Disciplined Small Cap, Service Class 2 (864)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

8.99

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

3,173

 

 

 

 

 

 

 

 

 

4-27-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Dynamic Capital Appreciation, Service Class 2 (861)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

14.13

 

$

12.62

 

$

10.64

 

 

 

$

10.00

 

Unit value at end of period

 

$

14.82

 

$

14.13

 

$

12.62

 

$

10.64

 

 

 

 

 

Number of units outstanding at end of period

 

7,579

 

6,643

 

8,483

 

 

 

 

 

 

 

PPI - 44



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income, Service Class 2 (805)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

15.21

 

$

12.90

 

$

12.43

 

$

11.36

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

15.15

 

$

15.21

 

$

12.90

 

$

12.43

 

$

11.36

 

 

 

Number of units outstanding at end of period

 

34,637

 

25,730

 

41,174

 

27,914

 

2,627

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Freedom 2010, Service Class 2 (1870)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

10.21

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

2,434

 

 

 

 

 

 

 

 

 

4-30-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Freedom 2015, Service Class 2 (1871)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

10.22

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

4,438

 

 

 

 

 

 

 

 

 

4-30-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Freedom 2020, Service Class 2 (1872)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

10.23

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

2,540

 

 

 

 

 

 

 

 

 

4-30-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Freedom 2025, Service Class 2 (1873)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

10.24

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

2,426

 

 

 

 

 

 

 

 

 

4-30-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Freedom 2030, Service Class 2 (1874)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

10.25

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

2,309

 

 

 

 

 

 

 

 

 

4-30-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Growth, Service Class 2 (808)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.15

 

$

11.59

 

$

11.17

 

$

11.02

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

15.13

 

$

12.15

 

$

11.59

 

$

11.17

 

$

11.02

 

 

 

Number of units outstanding at end of period

 

12,156

 

6.637

 

12,011

 

13,521

 

3,505

 

 

 

 

PPI - 45



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Growth & Income, Service Class 2 (806)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.86

 

$

11.59

 

$

10.97

 

$

10.58

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

14.15

 

$

12.86

 

$

11.59

 

$

10.97

 

$

10.58

 

 

 

Number of units outstanding at end of period

 

30,046

 

29,091

 

40,974

 

36,621

 

22,274

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Growth Opportunities, Service Class 2 (807)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.77

 

$

12.36

 

$

11.56

 

$

11.00

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

15.44

 

$

12.77

 

$

12.36

 

$

11.56

 

$

11.00

 

 

 

Number of units outstanding at end of period

 

15,324

 

3,073

 

2,246

 

2,281

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP High Income, Service Class 2 (809)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.62

 

$

11.56

 

$

11.49

 

$

10.68

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

12.73

 

$

12.62

 

$

11.56

 

$

11.49

 

$

10.68

 

 

 

Number of units outstanding at end of period

 

14,764

 

9,298

 

8,538

 

6,539

 

743

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Index 500, Service Class 2 (810)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

14.00

 

$

12.33

 

$

11.99

 

$

11.05

 

 

$

10.00

 

Unit value at end of period

 

$

14.48

 

$

14.00

 

$

12.33

 

$

11.99

 

$

11.05

 

 

 

Number of units outstanding at end of period

 

30,322

 

1,651

 

1,652

 

1,653

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Investment Grade Bond, Service Class 2 (811)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.52

 

$

10.28

 

$

10.26

 

$

10.01

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

10.77

 

$

10.52

 

$

10.28

 

$

10.26

 

$

10.01

 

 

 

Number of units outstanding at end of period

 

65,417

 

56,712

 

55,357

 

44,052

 

29,926

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Mid Cap, Service Class 2 (812)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

19.18

 

$

17.35

 

$

14.95

 

$

12.20

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

21.75

 

$

19.18

 

$

17.35

 

$

14.95

 

$

12.20

 

 

 

Number of units outstanding at end of period

 

69,217

 

64,355

 

46,816

 

35,644

 

6,606

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Overseas, Service Class 2 (813)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

18.50

 

$

15.97

 

$

13.68

 

$

12.27

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

21.29

 

$

18.50

 

$

15.97

 

$

13.68

 

$

12.27

 

 

 

Number of units outstanding at end of period

 

54,218

 

14,123

 

6,278

 

5,805

 

4,842

 

 

 

 

PPI - 46



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Value Strategies, Service Class 2 (1884)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Franklin Growth and Income Securities, Class 2 (849)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

14.43

 

$

12.57

 

$

12.34

 

$

11.35

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

13.66

 

$

14.43

 

$

12.57

 

$

12.34

 

$

11.35

 

 

 

Number of units outstanding at end of period

 

82,739

 

27,422

 

16,407

 

7,186

 

2,990

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Franklin Income Securities, Class 2 (850)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

14.55

 

$

12.51

 

$

12.52

 

$

11.19

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

14.84

 

$

14.55

 

$

12.51

 

$

12.52

 

$

11.19

 

 

 

Number of units outstanding at end of period

 

187,393

 

180,515

 

119,455

 

50,322

 

19,509

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Franklin Large Cap Growth Securities, Class 2 (851)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.52

 

$

11.48

 

$

11.55

 

$

10.89

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

13.08

 

$

12.52

 

$

11.48

 

$

11.55

 

$

10.89

 

 

 

Number of units outstanding at end of period

 

20,305

 

21,149

 

26,124

 

39,980

 

6,245

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Franklin Small Cap Value Securities, Class 2 (1875)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

8.86

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

1,341

 

 

 

 

 

 

 

 

 

4-30-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Mutual Share Securities, Class 2 (852)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

15.63

 

$

13.42

 

$

12.35

 

$

11.15

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

15.90

 

$

15.63

 

$

13.42

 

$

12.35

 

$

11.15

 

 

 

Number of units outstanding at end of period

 

126,078

 

111,538

 

77,693

 

34,497

 

5,385

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Templeton Foreign Securities, Class 2 (853)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

17.73

 

$

14.84

 

$

13.70

 

$

11.76

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

20.12

 

$

17.73

 

$

14.84

 

$

13.70

 

$

11.76

 

 

 

Number of units outstanding at end of period

 

22,318

 

20,057

 

12,309

 

12,968

 

3,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTVIPT Templeton Growth Securities, Class 2 (854)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

16.88

 

$

14.10

 

$

13.17

 

$

11.54

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

16.99

 

$

16.88

 

$

14.10

 

$

13.17

 

$

11.54

 

 

 

Number of units outstanding at end of period

 

58,123

 

65,640

 

37,599

 

5,522

 

 

 

 

 

PPI - 47



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO VIT All Asset Portfolio, Advisor Class (1876)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO VIT CommodityRealReturnTM Strategy Portfolio, Advisor Class (1877)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO VIT Low Duration Portfolio, Advisor Class (1878)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO VIT Real Return, Advisor Class (1879)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO VIT Total Return, Advisor Class (1880)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rydex VT Absolute Return Strategies Fund (1881)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rydex VT Hedged Equity Fund (1882)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rydex VT Sector Rotation Fund (1883)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

PPI - 48



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Baron Small Cap Growth (822)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

17.08

 

$

14.69

 

$

13.87

 

$

11.04

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

17.26

 

$

17.08

 

$

14.69

 

$

13.87

 

$

11.04

 

 

 

Number of units outstanding at end of period

 

29,517

 

28,438

 

26,607

 

17,949

 

1,859

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Core Bond (823)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.37

 

$

10.13

 

$

10.13

 

$

9.98

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

10.75

 

$

10.37

 

$

10.13

 

$

10.13

 

$

9.98

 

 

 

Number of units outstanding at end of period

 

68,861

 

36,947

 

26,549

 

21,654

 

3,408

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST High Yield (827)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

12.25

 

$

11.55

 

$

11.37

 

$

10.55

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

12.26

 

$

12.25

 

$

11.55

 

$

11.37

 

$

10.55

 

 

 

Number of units outstanding at end of period

 

29,184

 

27,335

 

26,178

 

27,139

 

16,459

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Large Cap Core Equity (formerly Enhanced Dividend 30) (825)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

13.67

 

$

10.98

 

$

11.52

 

$

11.14

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

14.15

 

$

13.67

 

$

10.98

 

$

11.52

 

$

11.14

 

 

 

Number of units outstanding at end of period

 

10,801

 

11,077

 

4,530

 

10,888

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Mid Cap Growth (824)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

16.51

 

$

14.45

 

$

12.75

 

$

11.57

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

18.57

 

$

16.51

 

$

14.45

 

$

12.75

 

$

11.57

 

 

 

Number of units outstanding at end of period

 

31,495

 

12,513

 

24,720

 

12,799

 

2,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Money Market, Service Class (829)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.30

 

$

10.01

 

$

9.89

 

$

9.95

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

10.62

 

$

10.30

 

$

10.01

 

$

9.89

 

$

9.95

 

 

 

Number of units outstanding at end of period

 

140,915

 

32,029

 

24,723

 

15,319

 

26,528

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Third Avenue Value (830)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

19.50

 

$

17.11

 

$

14.82

 

$

11.97

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

18.83

 

$

19.50

 

$

17.11

 

$

14.82

 

$

11.97

 

 

 

Number of units outstanding at end of period

 

95,425

 

82,986

 

79,956

 

51,320

 

6,420

 

 

 

 

PPI - 49



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Aggressive ETF, Service Class (1868)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

9.82

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

6,534

 

 

 

 

 

 

 

 

 

4-28-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Conservative ETF, Service Class (1866)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

10.07

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

2,373

 

 

 

 

 

 

 

 

 

4-28-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Enhanced ETF, Service Class (1869)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

9.63

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

34,200

 

 

 

 

 

 

 

 

 

4-28-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone VST Moderate ETF, Service Class (1867)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

10.00

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

$

9.91

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

9,726

 

 

 

 

 

 

 

 

 

4-28-07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen LIT Comstock, Class II (844)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

15.22

 

$

13.34

 

$

13.03

 

$

11.29

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

14.62

 

$

15.22

 

$

13.34

 

$

13.03

 

$

11.29

 

 

 

Number of units outstanding at end of period

 

21,158

 

21,687

 

21,312

 

10,553

 

3,667

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen LIT Capital Growth, Class II (845) (formerly LIT Strategic Growth)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

11.87

 

$

11.77

 

$

11.12

 

$

10.59

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

13.62

 

$

11.87

 

$

11.77

 

$

11.12

 

$

10.59

 

 

 

Number of units outstanding at end of period

 

2,037

 

1,403

 

764

 

579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt, Class II (846)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

14.23

 

$

13.06

 

$

11.84

 

$

10.94

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

14.88

 

$

14.23

 

$

13.06

 

$

11.84

 

$

10.94

 

 

 

Number of units outstanding at end of period

 

14,913

 

9,523

 

6858

 

5,069

 

710

 

 

 

 

PPI - 50



 

 

 

2007

 

2006

 

2005

 

2004

 

2003

 

Inception
Date and
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Equity, Class II (847)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

27.03

 

$

20.04

 

$

15.24

 

$

12.60

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

37.33

 

$

27.03

 

$

20.04

 

$

15.24

 

$

12.60

 

 

 

Number of units outstanding at end of period

 

19,402

 

12,046

 

5,645

 

4,182

 

5,338

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF U.S. Mid Cap Value, Class II (1885)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

 

 

 

 

 

$

10.00

 

Unit value at end of period

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of units outstanding at end of period

 

 

 

 

 

 

 

 

 

 

 

5-1-08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF U.S. Real Estate, Class II (848)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unit value at beginning of period

 

$

23.95

 

$

17.69

 

$

15.41

 

$

11.52

 

$

10.00

 

$

10.00

 

Unit value at end of period

 

$

19.48

 

$

23.95

 

$

17.69

 

$

15.41

 

$

11.52

 

 

 

Number of units outstanding at end of period

 

30,981

 

30,176

 

23,360

 

19,218

 

2,510

 

 

 

 

PPI - 51



 

Appendix B

 

Enhanced Earnings Benefit Calculation Examples

 

Example 1 - The following is a hypothetical example of how the EEB works:

 

Assumptions:

 

·      Annuitant was age 60 on the Contract Date (40% benefit)

·      Initial contribution = $100,000

·      No additional contributions

·      No withdrawals

·      Hypothetical Account Value at the time the Death Benefit is calculated = $125,000

 

Based on these assumptions stated above:

 

·      The gain in the contract is $25,000 ($125,000-$100,000 =$25,000)

·      Benefit paid would be $10,000 ($25,000 x 40%)

 

Example 2 - The following is an example of how the EEB will be calculated and paid in conjunction with the standard Death Benefit under this contract.

 

Assumptions:

 

·      Annuitant was age 60 on the Contract Date (40% benefit)

·      Initial contribution = $50,000

·      No additional contributions

·      No withdrawals

·      Hypothetical Account Value at the time the Death Benefit is calculated = $60,000

·      Highest anniversary Account Value = $70,000

 

Based on these assumptions:

 

·      the gain in the contract is $10,000 ($60,000 – $50,000);

·      the EEB is $4,000 (40% x $10,000); and thus

·      the total payment to the beneficiaries is $74,000 ($70,000 + $4,000)

 

PPI - 52



 

STATEMENT OF ADDITIONAL INFORMATION

 

May 1, 2008

 

Deferred Flexible Premium Variable Annuities

Issued By Integrity Life Insurance Company

Through Separate Account I of Integrity Life Insurance Company

 

This Statement of Additional Information (SAI) is not a prospectus.  It should be read in conjunction with the variable annuity prospectus dated May 1, 2008.

 

A copy of the prospectus to which this SAI relates is available at no charge by writing the Administrative Office at Integrity Life Insurance Company, P.O. Box 5720, Cincinnati, Ohio 45201-5720, or by calling 1-800-325-8583.

 

Table of Contents

 

 

Page

General Information and History

1

Administration and Distribution of the Contracts

1

Performance Data and Illustrations

2

Distributions Under Tax-Favored Retirement Programs

3

Financial Statements

4

 

General Information and History

 

Integrity Life Insurance Company (Integrity) is an Ohio life insurance company organized on May 3, 1966. Its principal executive offices are located at 400 Broadway, Cincinnati, Ohio 45202.  Integrity, the depositor of Separate Account I, is a wholly owned subsidiary of The Western and Southern Life Insurance Company (WSLIC), an Ohio life insurance company organized on February 23, 1888.  WSLIC is a wholly owned subsidiary of Western & Southern Financial Group, Inc., an Ohio corporation, which is wholly owned by Western & Southern Mutual Holding Company, an Ohio mutual insurance holding company.

 

Administration and Distribution of the Contracts

 

Administration

 

Integrity has responsibility for administration of Separate Account I (the Separate Account) and the variable annuity contracts issued through the Separate Account (Contracts).  Integrity has entered into Service Agreements with WSLIC and IFS Financial Services, Inc., which is an affiliated company, to provide certain services, including administrative services for the Separate Account and the Contracts.   Compensation for these services, which are paid by Integrity, is based on the charges and expenses incurred by the service provider, and will reflect actual costs to the extent reasonably possible.

 

Custodian

 

Integrity is the custodian of the assets of the Separate Account.  The shares are held in book-entry form. Integrity maintains a record of all purchases and redemptions of shares of the underlying portfolios.

 

Underwriter

 

Touchstone Securities, Inc. (Touchstone Securities), 303 Broadway, Suite 1100, Cincinnati, Ohio 45202, an indirect subsidiary of WSLIC and an affiliate of Integrity, is the principal underwriter of the Contracts.  Touchstone Securities is registered under the Securities Exchange Act of 1934 as a broker-dealer and is a member in good standing of the Financial Industry Regulatory Authority (FINRA).  The Contracts are offered through Touchstone Securities on a continuous basis.  The amount of distribution allowances paid to Touchstone Securities, the principal underwriter, was $29,110,947 in 2007, $28,701,189 in 2006, and $20,409,914 in 2005.  Touchstone Securities did not retain distribution allowances during these years.

 



 

Sales

 

The Contracts are sold by insurance agents licensed in the states where the Contracts may be lawfully sold.  The agents are also registered representatives of broker-dealers, which are registered under the Securities Exchange Act of 1934 and are members of FINRA.

 

We make payments to the broker-dealer firms that distribute our Contracts in the form of commissions and other incentives.  In addition to the commissions described in the prospectus, we offer up to a 1.00% annual trail commission paid quarterly to certain producers who qualify for a program called “Dynasty Trail.”  Currently, registered representatives who have at least $6,000,000.00 of business with us and maintain 90% of that business with us and meet both these standards at the end of each quarter will receive this additional commission. This program may be changed.

 

We may also make additional payments in the form of expense reimbursements or marketing allowances to the broker-dealers that distribute our Contracts in exchange for privileges, including additional or special access to broker-dealers’ sales staff, opportunities to provide and attend training and other conferences, and marketing enhancements of our Contracts.  The method for calculating any additional compensation may include consideration of the level of sales or assets attributable to the firm.  Not all broker-dealers receive additional compensation and the amount of compensation varies by firm.  These payments could be significant to a firm, and could be a conflict of interest.  We generally choose to compensate broker-dealers that have a strong capability to distribute the Contracts and that are willing to cooperate with our promotional efforts.

 

The following list includes the names of firms that received expense reimbursement or marketing allowance payments of more than $5,000 with respect to annuities sold for Integrity, and it’s wholly owned subsidiary National Integrity Life Insurance Company, during the last calendar year.

 

Affiliated Financial Services

 

American Portfolios Financial

 

Cadaret, Grant & Co., Inc.

Cadaret Grant Agency

 

Debany Financial

 

Destination Partners

Essential Group Services

 

Girard Securities

 

Income Protection Agency

Investacorp, Inc.

 

Linsco Private Ledger

 

First Montauk Securities, Inc.

Securities America, Inc.

 

Southwest Insurance Agency

 

Stifel, Nicolaus and Company

Vanderbilt Securities, LLC

 

 

 

 

 

Performance Data and Illustrations

 

We may provide performance information and illustrations using performance information.  Performance information may be based on historical returns of the Variable Account Options.  At any time in the future, performance will likely be higher or lower than in the past.  Historical performance does not predict future results.

 

Performance Data

 

In advertisements or in information furnished to you, we may provide the average annual total return and the cumulative total return of the units of the Variable Account Options. The money market option may also from time to time include the yield and effective yield of its units.  Performance information is computed separately for each Variable Account Option in accordance with the formulas described below.

 

Total return reflects all aspects of the return of a Variable Account Option, including the automatic reinvestment of all distributions and the deduction of all charges that apply on an annual basis.  Performance represents annualized percentage change in net assets of a Variable Account Option, based on a hypothetical $1,000 investment, the performance of the underlying portfolios and the charges that would have been made during the periods shown.  Premium taxes, if applicable, are not reflected.  Returns are not annualized for periods less than one year.

 

Average annual total returns are calculated by determining the growth or decline in value of a hypothetical investment in the Variable Account Option over certain periods, including 1, 3, 5, and 10 years and then calculating the annually compounded percentage rate that would have produced the same result if the rate of growth or decline in value had been constant over the period.

 

2



 

Investors should realize that a Variable Account Option’s performance is not constant over time, but changes from year to year, and that the average annual returns represent the averages of historical periods as opposed to the actual historical performance of a Variable Account Option during any portion of the period shown.  Average annual returns are calculated using this formula:

P (1+T)n = ERV, where P is a hypothetical initial payment of $1,000, T is the average annual total return, n is the number of years, and ERV is the redeemable value at the end of the period.

 

Standardized returns are average annual total returns calculated from the Variable Account Inception Date which represents the date the Variable Account Option was available in the Contract.  Standardized returns reflect a standard death benefit and the deduction of all fees and charges including portfolio level expenses, the annual mortality and expense risk charge, annual administration charge and withdrawal charges.

 

Non-standardized returns are calculated from the Fund Inception Date which represents the inception date of the underlying fund, rather than the date it was included in the Contract.  Performance which predates the inclusion in the Contract is hypothetical and has been adjusted to include the annual mortality and expense risk charge, and the annual administration charge.  Withdrawal charges are not reflected.

 

Cumulative total returns are unaveraged and reflect the simple percentage change in the value of a hypothetical investment in the Variable Account Option over a stated period of time.  In addition to the period since inception, cumulative total returns may be calculated on a year-to-date basis at the end of each calendar month in the current calendar year.  The last day of the period for year-to-date returns is the last day of the most recent calendar month at the time of publication.

 

Yields quoted in advertising reflect the change in value of a hypothetical investment in a Variable Account Option over a stated period of time, not taking into account capital gains or losses, or any withdrawal charges.  Yields are annualized and stated as a percentage.

 

Current yield and effective yield are calculated for the money market option.  Current yield is based on the change in the value of a hypothetical investment (exclusive of capital changes) over a particular 7-day period, less Contract charges that would have applied during the period (the base period), and stated as a percentage of the investment at the start of the base period (the base period return).  The base period return is then annualized by multiplying by 365/7, with the resulting yield figure carried to at least the nearest hundredth of one percent.

 

Effective yield assumes that all dividends received during an annual period have been reinvested.  This compounding effect causes effective yield to be higher than current yield.  Calculation of effective yield begins with the same base period return used in the calculation of current yield, which is then annualized to reflect weekly compounding pursuant to the following formula:

Effective Yield = [(Base Period Return + 1)365/7] – 1

 

Individualized Illustrations

 

Integrity may provide computer-generated illustrations using programs available through third party firms to provide registered representatives and existing or potential Contracts owners with individualized hypothetical illustrations.  The illustrations may include contract values and returns for some or all of the Variable Account Options.  Such illustrations may include graphs, bar charts and other types of formats.

 

Hypothetical values may be based on: (i) the results of a hypothetical contribution to a Contract invested in a single or multiple Variable Account Options using standardized and non-standardized average annual returns; or (ii) the results of a hypothetical contribution to a Contract using either static or variable assumed rates of return, as allow by law.

 

Distributions Under Tax-Favored Retirement Programs

 

Distributions from tax-favored plans are subject to certain restrictions.  Participants in qualified plans (other than IRAs), with the exception of five-percent owners, must begin receiving distributions by April 1 of the calendar year following the later of either (i) the year in which the participant reaches age 70 ½ or (ii) the calendar year in which the participant retires.  Participants in Traditional IRAs or 5% owners must begin receiving distributions by April 1 of the calendar year following the year in which the participant

 

3



 

reaches age 70 ½.  Distribution from certain TSA plans can be deferred until age 75.  Additional distribution rules apply after the participant’s death.  If you do not take mandatory distributions you may owe a 50% penalty tax on any difference between the required distribution amount and the amount distributed.  There are no mandatory distributions from Roth IRAs.

 

Distributions from qualified plans (other than traditional IRAs) to an employee, surviving spouse, or former spouse who is an alternate payee under a qualified domestic relations order (payee), in the form of a lump sum settlement, partial withdrawal or periodic annuity payments for a fixed period of fewer than 10 years, are subject to mandatory federal income tax withholding of 20% of the taxable amount of the distribution, unless (i) the payee directs the transfer of such amounts to another qualified plan or Traditional  IRA; or (ii) the payment is a minimum distribution required under the Internal Revenue Code. The taxable amount is the amount of the distribution less the amount allocable to after-tax contributions.  All other types of taxable distributions are subject to a 10% federal income tax withholding unless the payee elects not to have withholding apply.

 

We are not permitted to make distributions from a Contract unless a request has been made.  It is therefore your responsibility to comply with the minimum distribution rules.  You should consult your tax adviser regarding these rules and their proper application.

 

The above description of the minimum distribution requirements and the federal income tax consequences of distributions from tax-favored retirement plans which may be funded by the Contract is only a brief summary and is not intended as tax advice.  The rules governing the provisions of plans are extremely complex and often difficult to comprehend.  If you do not fully comply with all applicable rules, which are subject to change, you may suffer adverse tax consequences.  You should consult a qualified and competent tax adviser prior to adopting a plan or purchasing a Contract in connection with a tax-favored plan.

 

Financial Statements

 

The financial statements of Separate Account I as of December 31, 2007, and for the periods indicated in the financial statements, the statutory-basis financial statements of Integrity as of December 31, 2007 and 2006 and for each of the three years in the period ended December 31, 2007, and the statutory-basis financial statements of The Western and Southern Life Insurance Company (WSLIC) as of December 31, 2007 and 2006 and for each of the three years in the period ended December 31, 2007, included in this SAI have been audited by Ernst & Young LLP, 312 Walnut Street, Cincinnati, Ohio 45202, independent registered public accounting firm, as set forth in their reports included herein.  The financial statements audited by Ernst & Young LLP have been included herein in reliance on their reports given on the authority of such firm as experts in accounting and auditing.

 

You should distinguish the financial statements of Integrity from the financial statements of the Separate Account and consider the Integrity financial statements only as they relate to the ability of Integrity to meet its obligations under the Contracts.  You should consider the financial statements of WSLIC as bearing only on the ability of WSLIC to meet its obligations under the Guarantee to Integrity policy holders dated March 3, 2000.  You should not consider the Integrity or WSLIC financial statements as relating to the investment performance of the assets held in the Separate Account.

 

4



 

FINANCIAL STATEMENTS

 

Separate Account I of  Integrity Life Insurance Company

 

Year ended December 31, 2007 with Report of Independent Registered
Public Accounting Firm

 



 

Separate Account I

of

Integrity Life Insurance Company

 

Financial Statements

 

Year Ended December 31, 2007

 

Contents

 

Report of Independent Registered Public Accounting Firm

1

 

 

Audited Financial Statements

 

 

 

Statements of Assets and Liabilities

2

Statements of Operations for the Year ended December 31, 2007

8

Statements of Changes in Net Assets for the Year ended December 31, 2007

18

Statements of Changes in Net Assets for the Year ended December 31, 2006

25

Notes to Financial Statements

31

 



 

Report of Independent Registered Public Accounting Firm

 

The Contract Owners

Separate Account I of Integrity Life Insurance Company

and

The Board of Directors

Integrity Life Insurance Company

 

We have audited the accompanying statements of assets and liabilities of Separate Account I of Integrity Life Insurance Company (the Separate Account), comprised of the separate account divisions described in the statements of assets and liabilities, as of December 31, 2007, and the related statements of operations for the year then ended and changes in net assets for each of the two years in the period then ended, or for those individual divisions operating for portions of such periods as disclosed in the financial statements. These financial statements are the responsibility of the Separate Account’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Separate Account’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Separate Account’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures also included confirmation of investments owned as of December 31, 2007, by correspondence with the transfer agent. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of each of the respective divisions constituting Separate Account I of Integrity Life Insurance Company at December 31, 2007, and the results of their operations and the changes in their net assets for the periods described above, in conformity with U.S. generally accepted accounting principles.

 

 

/s/ Ernst & Young LLP

 

Cincinnati, Ohio

April 7, 2008

 

1



 

Separate Account I

of

Integrity Life Insurance Company

 

Statements of Assets and Liabilities

 

December 31, 2007

 

 

 

 

 

Payable to

 

 

 

 

 

 

 

 

 

 

 

(receivable from)

 

 

 

 

 

 

 

 

 

Investments

 

the general account

 

 

 

 

 

 

 

Division

 

at value

 

of Integrity

 

Net Assets

 

Unit Value

 

Units Outstanding

 

Affiliated:

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (AnnuiChoice™)

 

$

361,879

 

$

 

$

361,879

 

$

12.45

 

29,072

 

Touchstone Aggressive ETF (GrandMaster flex3™)

 

2,178,484

 

 

2,178,484

 

12.23

 

178,072

 

Touchstone Aggressive ETF (Grandmaster™)

 

196,020

 

 

196,020

 

12.31

 

15,922

 

Touchstone Aggressive ETF (IQ Annuity™)

 

3,966,203

 

(3

)

3,966,200

 

12.27

 

323,182

 

Touchstone Aggressive ETF (Pinnacle Plus™)

 

150,132

 

 

150,132

 

12.19

 

12,319

 

Touchstone Aggressive ETF (IQ Advisor Standard™)

 

19,960

 

 

19,960

 

13.28

 

1,503

 

Touchstone Balanced (AnnuiChoice™)

 

2,117,323

 

1

 

2,117,324

 

14.41

 

146,962

 

Touchstone Balanced (AnnuiChoice II™)

 

59,029

 

 

59,029

 

11.01

 

5,359

 

Touchstone Balanced (GrandMaster flex3™)

 

1,145,558

 

1

 

1,145,559

 

13.98

 

81,933

 

Touchstone Balanced (Grandmaster™)

 

415,905

 

 

415,905

 

12.96

 

32,103

 

Touchstone Balanced (IQ Annuity™)

 

1,202,227

 

(1

)

1,202,226

 

14.08

 

85,366

 

Touchstone Balanced (Pinnacle Plus™)

 

352,795

 

 

352,795

 

14.00

 

25,204

 

Touchstone Baron Small Cap (AnnuiChoice™)

 

2,251,623

 

 

2,251,623

 

18.25

 

123,406

 

Touchstone Baron Small Cap (AnnuiChoice II™)

 

112,577

 

 

112,577

 

11.47

 

9,814

 

Touchstone Baron Small Cap (GrandMaster flex3™)

 

1,376,196

 

(1

)

1,376,195

 

16.49

 

83,453

 

Touchstone Baron Small Cap (Grandmaster™)

 

330,126

 

 

330,126

 

14.81

 

22,294

 

Touchstone Baron Small Cap (IQ Annuity™)

 

3,208,093

 

 

3,208,093

 

17.79

 

180,354

 

Touchstone Baron Small Cap (Pinnacle Plus™)

 

509,490

 

 

509,490

 

17.26

 

29,517

 

Touchstone Baron Small Cap (IQ Advisor Enhanced™)

 

5,937

 

 

5,937

 

15.77

 

377

 

Touchstone Baron Small Cap (IQ Advisor Standard™)

 

216,025

 

 

216,025

 

15.89

 

13,591

 

Touchstone Conservative ETF (AnnuiChoice™)

 

894,454

 

 

894,454

 

11.65

 

76,747

 

Touchstone Conservative ETF (GrandMaster flex3™)

 

1,850,036

 

 

1,850,036

 

11.45

 

161,516

 

Touchstone Conservative ETF (Grandmaster™)

 

678,370

 

 

678,370

 

11.53

 

58,852

 

Touchstone Conservative ETF (IQ Annuity™)

 

1,572,943

 

 

1,572,943

 

11.49

 

136,892

 

Touchstone Conservative ETF (Pinnacle Plus™)

 

231,689

 

 

231,689

 

11.41

 

20,304

 

Touchstone Conservative ETF (IQ Advisor Standard™)

 

128,676

 

 

128,676

 

12.18

 

10,566

 

Touchstone Core Bond (AnnuiChoice™)

 

2,128,506

 

 

2,128,506

 

12.59

 

169,001

 

Touchstone Core Bond (AnnuiChoice II™)

 

55,937

 

1

 

55,938

 

10.59

 

5,283

 

Touchstone Core Bond (GrandMaster flex3™)

 

592,379

 

1

 

592,380

 

11.57

 

51,196

 

Touchstone Core Bond (Grandmaster™)

 

118,120

 

1

 

118,121

 

11.01

 

10,730

 

Touchstone Core Bond (IQ Annuity™)

 

978,392

 

 

978,392

 

12.05

 

81,174

 

Touchstone Core Bond (Pinnacle Plus™)

 

740,206

 

1

 

740,207

 

10.75

 

68,861

 

Touchstone Core Bond (IQ Advisor Standard™)

 

186,681

 

 

186,681

 

11.12

 

16,782

 

Touchstone Eagle Capital Appreciation (AnnuiChoice™)

 

1,229,560

 

(4

)

1,229,556

 

9.63

 

127,719

 

Touchstone Eagle Capital Appreciation (AnnuiChoice II™)

 

102,197

 

 

102,197

 

10.83

 

9,439

 

Touchstone Eagle Capital Appreciation (GrandMaster flex3™)

 

575,738

 

1

 

575,739

 

12.62

 

45,629

 

Touchstone Eagle Capital Appreciation (Grandmaster™)

 

76,406

 

1

 

76,407

 

12.92

 

5,912

 

Touchstone Eagle Capital Appreciation (IQ Annuity™)

 

714,700

 

 

714,700

 

9.42

 

75,853

 

Touchstone Eagle Capital Appreciation (Pinnacle Plus™)

 

153,332

 

 

153,332

 

14.02

 

10,933

 

Touchstone Mid Cap Growth (AnnuiChoice™)

 

4,179,396

 

 

4,179,396

 

18.01

 

232,105

 

Touchstone Mid Cap Growth (AnnuiChoice II™)

 

858,586

 

 

858,586

 

12.24

 

70,127

 

Touchstone Mid Cap Growth (GrandMaster flex3™)

 

2,760,144

 

2

 

2,760,146

 

17.87

 

154,442

 

Touchstone Mid Cap Growth (Grandmaster™)

 

381,053

 

 

381,053

 

15.81

 

24,103

 

Touchstone Mid Cap Growth (IQ Annuity™)

 

2,846,174

 

 

2,846,174

 

18.18

 

156,583

 

Touchstone Mid Cap Growth (Pinnacle Plus™)

 

584,961

 

 

584,961

 

18.57

 

31,495

 

Touchstone Mid Cap Growth (IQ Advisor Standard™)

 

113,687

 

 

113,687

 

16.35

 

6,954

 

Touchstone Large Cap Core Equity (AnnuiChoice™)

 

229,066

 

 

229,066

 

12.23

 

18,736

 

Touchstone Large Cap Core Equity (AnnuiChoice II™)

 

24,839

 

 

24,839

 

11.42

 

2,176

 

Touchstone Large Cap Core Equity (GrandMaster flex3™)

 

1,331,847

 

 

1,331,847

 

12.80

 

104,070

 

Touchstone Large Cap Core Equity (Grandmaster™)

 

5,540

 

 

5,540

 

13.14

 

422

 

Touchstone Large Cap Core Equity (IQ Annuity™)

 

599,752

 

(1

)

599,751

 

12.13

 

49,454

 

Touchstone Large Cap Core Equity (Pinnacle Plus™)

 

152,865

 

(1

)

152,864

 

14.15

 

10,801

 

Touchstone Large Cap Core Equity (IQ Advisor Standard™)

 

135,078

 

 

135,078

 

13.10

 

10,313

 

Touchstone Enhanced ETF (AnnuiChoice™)

 

1,127,105

 

1

 

1,127,106

 

12.97

 

86,902

 

Touchstone Enhanced ETF (GrandMaster flex3™)

 

9,898,441

 

 

9,898,441

 

12.75

 

776,540

 

Touchstone Enhanced ETF (Grandmaster™)

 

1,485,617

 

 

1,485,617

 

12.83

 

115,814

 

Touchstone Enhanced ETF (IQ Annuity™)

 

6,227,455

 

(3

)

6,227,452

 

12.79

 

487,010

 

Touchstone Enhanced ETF (Pinnacle Plus™)

 

252,070

 

 

252,070

 

12.70

 

19,850

 

Touchstone Enhanced ETF (IQ Advisor Enhanced™)

 

45,182

 

 

45,182

 

14.03

 

3,220

 

Touchstone Enhanced ETF (IQ Advisor Standard™)

 

308,454

 

 

308,454

 

14.13

 

21,832

 

Touchstone Growth & Income (AnnuiChoice™)

 

178,056

 

(1

)

178,055

 

13.17

 

13,519

 

Touchstone Growth & Income (GrandMaster flex3™)

 

89,583

 

1

 

89,584

 

13.02

 

6,879

 

Touchstone Growth & Income (Grandmaster™)

 

20,584

 

 

20,584

 

12.60

 

1,633

 

Touchstone Growth & Income (IQ Annuity™)

 

290,793

 

(1

)

290,792

 

13.21

 

22,018

 

 

See accompanying notes.

 

2



 

 

 

 

 

Payable to

 

 

 

 

 

 

 

 

 

 

 

(receivable from)

 

 

 

 

 

 

 

 

 

Investments

 

the general account

 

 

 

 

 

 

 

Division

 

at value

 

of Integrity

 

Net Assets

 

Unit Value

 

Units Outstanding

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

Touchstone Growth & Income (Pinnacle Plus™)

 

$

131,888

 

$

 

$

131,888

 

$

14.11

 

9,347

 

Touchstone High Yield (AnnuiChoice™)

 

593,034

 

(1

)

593,033

 

15.02

 

39,474

 

Touchstone High Yield (AnnuiChoice II™)

 

87,581

 

 

87,581

 

10.54

 

8,308

 

Touchstone High Yield (GrandMaster flex3™)

 

989,388

 

(1

)

989,387

 

14.00

 

70,655

 

Touchstone High Yield (Grandmaster™)

 

115,294

 

 

115,294

 

11.62

 

9,922

 

Touchstone High Yield (IQ Annuity™)

 

842,921

 

(1

)

842,920

 

14.44

 

58,369

 

Touchstone High Yield (Pinnacle Plus™)

 

357,779

 

 

357,779

 

12.26

 

29,184

 

Touchstone High Yield (IQ Advisor Standard™)

 

268,253

 

 

268,253

 

11.90

 

22,547

 

Touchstone Moderate ETF (AnnuiChoice™)

 

3,639,883

 

(1

)

3,639,882

 

12.08

 

301,330

 

Touchstone Moderate ETF (GrandMaster flex3™)

 

6,590,871

 

(1

)

6,590,870

 

11.87

 

555,172

 

Touchstone Moderate ETF (Grandmaster™)

 

653,172

 

(1

)

653,171

 

11.95

 

54,673

 

Touchstone Moderate ETF (IQ Annuity™)

 

3,001,353

 

(1

)

3,001,352

 

11.91

 

252,019

 

Touchstone Moderate ETF (Pinnacle Plus™)

 

266,639

 

 

266,639

 

11.83

 

22,545

 

Touchstone Moderate ETF (IQ Advisor Enhanced™)

 

51,523

 

 

51,523

 

12.69

 

4,060

 

Touchstone Moderate ETF (IQ Advisor Standard™)

 

123,273

 

1

 

123,274

 

12.78

 

9,646

 

Touchstone Money Market (AnnuiChoice™)

 

59,913

 

(2

)

59,911

 

11.26

 

5,320

 

Touchstone Money Market (Grandmaster™)

 

6,561,795

 

(3

)

6,561,792

 

10.90

 

602,270

 

Touchstone Money Market (IQ Annuity™)

 

581,484

 

 

581,484

 

10.90

 

53,330

 

Touchstone Money Market (IQ3™)

 

106,357

 

 

106,357

 

10.90

 

9,754

 

Touchstone Third Avenue Value (AnnuiChoice™)

 

8,972,425

 

 

8,972,425

 

19.86

 

451,855

 

Touchstone Third Avenue Value (AnnuiChoice II™)

 

578,407

 

 

578,407

 

10.63

 

54,419

 

Touchstone Third Avenue Value (GrandMaster flex3™)

 

5,295,921

 

(1

)

5,295,920

 

16.63

 

318,520

 

Touchstone Third Avenue Value (Grandmaster™)

 

2,545,633

 

1

 

2,545,634

 

15.60

 

163,190

 

Touchstone Third Avenue Value (IQ Annuity™)

 

6,551,228

 

(2

)

6,551,226

 

17.63

 

371,634

 

Touchstone Third Avenue Value (Pinnacle Plus™)

 

1,796,648

 

 

1,796,648

 

18.83

 

95,425

 

Touchstone Third Avenue Value (IQ Advisor Enhanced™)

 

5,596

 

(1

)

5,595

 

15.50

 

361

 

Touchstone Third Avenue Value (IQ Advisor Standard™)

 

497,850

 

1

 

497,851

 

15.63

 

31,856

 

Touchstone Value Plus (AnnuiChoice™)

 

839,752

 

(2

)

839,750

 

11.25

 

74,616

 

Touchstone Value Plus (AnnuiChoice II™)

 

41,951

 

 

41,951

 

10.52

 

3,986

 

Touchstone Value Plus (GrandMaster flex3™)

 

111,791

 

 

111,791

 

11.82

 

9,461

 

Touchstone Value Plus (Grandmaster™)

 

100,046

 

 

100,046

 

12.29

 

8,141

 

Touchstone Value Plus (IQ Annuity™)

 

430,532

 

2

 

430,534

 

10.93

 

39,393

 

Touchstone Value Plus (Pinnacle Plus™)

 

87,635

 

 

87,635

 

13.44

 

6,521

 

Non-Affiliated:

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (AnnuiChoice™)

 

513,236

 

1

 

513,237

 

17.98

 

28,537

 

JP Morgan Mid Cap Value (GrandMaster flex3™)

 

954,654

 

1

 

954,655

 

17.26

 

55,325

 

JP Morgan Mid Cap Value (Grandmaster™)

 

89,692

 

 

89,692

 

14.43

 

6,215

 

JP Morgan Mid Cap Value (IQ3™)

 

361,186

 

 

361,186

 

17.54

 

20,596

 

JP Morgan Mid Cap Value (Pinnacle Plus™)

 

386,199

 

 

386,199

 

16.54

 

23,346

 

Non-Affiliated Initial Class:

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (Grandmaster™)

 

23,768,049

 

 

23,768,049

 

58.03

 

409,593

 

Fidelity VIP Growth (Grandmaster™)

 

15,151,259

 

1

 

15,151,260

 

69.96

 

216,569

 

Fidelity VIP High Income (Grandmaster™)

 

4,022,285

 

 

4,022,285

 

18.09

 

222,357

 

Fidelity VIP II Asset Manager (Grandmaster™)

 

12,331,629

 

1

 

12,331,630

 

38.80

 

317,815

 

Fidelity VIP II Contrafund (Grandmaster™)

 

27,333,486

 

 

27,333,486

 

47.21

 

579,035

 

Fidelity VIP II Index 500 (Grandmaster™)

 

10,182,465

 

2

 

10,182,467

 

34.23

 

297,489

 

Fidelity VIP II Index 500 (IQ Annuity™)

 

867,541

 

 

867,541

 

11.34

 

76,498

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice ™)

 

877,626

 

(1

)

877,625

 

10.19

 

86,150

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice II™)

 

81,494

 

 

81,494

 

10.18

 

8,008

 

Fidelity VIP II Investment Grade Bond (Grandmaster™)

 

5,747,337

 

 

5,747,337

 

30.50

 

188,407

 

Fidelity VIP II Investment Grade Bond (Grandmaster flex3™)

 

1,319,749

 

(2

)

1,319,747

 

10.15

 

130,043

 

Fidelity VIP II Investment Grade Bond (IQ Annuity™)

 

2,328,806

 

 

2,328,806

 

14.47

 

160,988

 

Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)

 

275,266

 

 

275,266

 

10.14

 

27,146

 

Fidelity VIP III Balanced (Grandmaster™)

 

1,412,567

 

(2

)

1,412,565

 

16.73

 

84,437

 

Fidelity VIP III Growth & Income (Grandmaster™)

 

3,766,984

 

 

3,766,984

 

19.62

 

192,026

 

Fidelity VIP III Growth Opportunities (Grandmaster™)

 

1,408,045

 

(1

)

1,408,044

 

14.74

 

95,534

 

Fidelity VIP Overseas (AnnuiChoice ™)

 

390,372

 

 

390,372

 

10.62

 

36,767

 

Fidelity VIP Overseas (AnnuiChoice II™)

 

111,942

 

1

 

111,943

 

10.61

 

10,554

 

Fidelity VIP Overseas (Grandmaster™)

 

7,457,090

 

(1

)

7,457,089

 

37.94

 

196,569

 

Fidelity VIP Overseas (Grandmaster flex3™)

 

290,622

 

 

290,622

 

10.58

 

27,476

 

Fidelity VIP Overseas (IQ Annuity™)

 

377,631

 

1

 

377,632

 

10.58

 

35,678

 

Fidelity VIP Overseas (Pinnacle Plus™)

 

366,028

 

 

366,028

 

10.57

 

34,634

 

 

See accompanying notes.

 

3



 

 

 

 

 

Payable to

 

 

 

 

 

 

 

 

 

 

 

(receivable from)

 

 

 

 

 

 

 

 

 

Investments

 

the general account

 

 

 

 

 

 

 

Division

 

at value

 

of Integrity

 

Net Assets

 

Unit Value

 

Units Outstanding

 

Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (Annuichoice ™)

 

$

 365,012

 

$

 —

 

$

 365,012

 

$

 11.33

 

32,227

 

Touchstone Aggressive ETF (Annuichoice II ™)

 

165,330

 

 

165,330

 

11.11

 

14,888

 

Touchstone Aggressive ETF (Grandmaster flex3™)

 

134,075

 

 

134,075

 

9.82

 

13,648

 

Touchstone Aggressive ETF (IQ Advisor Standard ™)

 

203

 

 

203

 

9.89

 

21

 

Touchstone Aggressive ETF (Pinnacle Plus™)

 

64,132

 

 

64,132

 

9.82

 

6,534

 

Touchstone Conservative ETF (Annuichoice ™)

 

225,528

 

 

225,528

 

11.07

 

20,375

 

Touchstone Conservative ETF (Annuichoice II ™)

 

85,364

 

 

85,364

 

10.88

 

7,848

 

Touchstone Conservative ETF (GrandMaster flex3™)

 

77,310

 

 

77,310

 

10.08

 

7,673

 

Tocuhstone Conservative ETF (IQ Advisor Enhanced ™)

 

59,228

 

 

59,228

 

10.14

 

5,840

 

Touchstone Conservative ETF (Pinnacle Plus™)

 

23,888

 

 

23,888

 

10.07

 

2,373

 

Touchstone Enhanced ETF (Annuichoice ™)

 

371,631

 

 

371,631

 

11.34

 

32,757

 

Touchstone Enhanced ETF (Annuichoice II ™)

 

81,223

 

 

81,223

 

11.13

 

7,300

 

Touchstone Enhanced ETF (GrandMaster flex3™)

 

344,726

 

 

344,726

 

9.64

 

35,764

 

Touchstone Enhanced ETF (Pinnacle Plus™)

 

329,375

 

 

329,375

 

9.63

 

34,200

 

Touchstone GMAB Aggressive (AnnuiChoice II™)

 

102,727

 

 

102,727

 

11.02

 

9,326

 

Touchstone GMAB Conservative (AnnuiChoice™)

 

11,270

 

 

11,270

 

10.97

 

1,027

 

Touchstone GMAB Conservative (AnnuiChoice II™)

 

224,456

 

 

224,456

 

10.79

 

20,804

 

Touchstone GMAB Moderate ETF (AnnuiChoice ™)

 

37,467

 

 

37,467

 

11.07

 

3,385

 

Touchstone GMAB Moderate ETF (AnnuiChoice II™)

 

24,677

 

 

24,677

 

10.88

 

2,268

 

Touchstone Moderate ETF (AnnuiChoice ™)

 

702,321

 

(1

)

702,320

 

11.17

 

62,899

 

Touchstone Moderate ETF (AnnuiChoice II ™)

 

247,516

 

 

247,516

 

10.97

 

22,561

 

Touchstone Moderate ETF (GrandM aster flex3™)

 

3,769,905

 

 

3,769,905

 

9.92

 

379,909

 

Touchstone Moderate ETF (IQ Advisor Standard™)

 

16,019

 

 

16,019

 

9.99

 

1,604

 

Touchstone Moderate ETF (Pinnacle Plus™)

 

96,432

 

 

96,432

 

9.91

 

9,726

 

Touchstone Money Market (AnnuiChoice™)

 

4,002,352

 

(3

)

4,002,349

 

10.95

 

365,573

 

Touchstone Money Market (AnnuiChoice II™)

 

399,086

 

(1

)

399,085

 

10.50

 

38,005

 

Touchstone Money Market (GrandMaster flex3™)

 

3,164,240

 

(1

)

3,164,239

 

10.68

 

296,295

 

Touchstone Money Market (IQ Annuity™)

 

5,358,427

 

(2

)

5,358,425

 

10.73

 

499,493

 

Touchstone Money Market (Pinnacle Plus™)

 

1,496,646

 

(1

)

1,496,645

 

10.62

 

140,915

 

Touchstone Money Market (IQ Advisor Standard™)

 

1,242,468

 

(1

)

1,242,467

 

11.15

 

111,460

 

Non-Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (IQ Annuity™)

 

887,981

 

(1

)

887,980

 

13.82

 

64,263

 

Fidelity VIP Growth (IQ Annuity™)

 

710,989

 

 

710,989

 

11.36

 

62,570

 

Fidelity VIP High Income (IQ Annuity™)

 

275,712

 

(2

)

275,710

 

10.22

 

26,984

 

Fidelity VIP II Asset Manager (IQ Annuity™)

 

233,643

 

 

233,643

 

12.37

 

18,894

 

Fidelity VIP II Contrafund (IQ Annuity™)

 

2,253,035

 

(3

)

2,253,032

 

17.46

 

129,012

 

Fidelity VIP III Balanced (IQ Annuity™)

 

154,306

 

1

 

154,307

 

12.23

 

12,617

 

Fidelity VIP III Growth & Income (IQ Annuity™)

 

269,053

 

1

 

269,054

 

12.20

 

22,056

 

Fidelity VIP III Growth Opportunities (IQ Annuity™)

 

74,475

 

 

74,475

 

9.64

 

7,730

 

Fidelity VIP III Mid Cap (Grandmaster™)

 

3,747,964

 

 

3,747,964

 

36.33

 

103,168

 

Fidelity VIP III Mid Cap (IQ Annuity™)

 

1,689,603

 

 

1,689,603

 

37.89

 

44,590

 

Fidelity VIP Overseas (IQ Annuity™)

 

157,827

 

2

 

157,829

 

16.47

 

9,585

 

Non-Affiliated Service Class 2:

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Asset Manager (AnnuiChoice™)

 

428,850

 

2

 

428,852

 

12.81

 

33,482

 

Fidelity VIP Asset Manager (AnnuiChoice II™)

 

1,291

 

 

1,291

 

11.90

 

108

 

Fidelity VIP Asset Manager (GrandMaster flex3™)

 

297,189

 

(1

)

297,188

 

12.65

 

23,485

 

Fidelity VIP Asset Manager (IQ3™)

 

442,253

 

 

442,253

 

12.79

 

34,582

 

Fidelity VIP Asset Manager (Pinnacle Plus™)

 

233,930

 

(1

)

233,929

 

13.18

 

17,753

 

Fidelity VIP Balanced (AnnuiChoice™)

 

1,605,606

 

2

 

1,605,608

 

12.95

 

124,000

 

Fidelity VIP Balanced (AnnuiChoice II™)

 

52,475

 

 

52,475

 

11.37

 

4,616

 

Fidelity VIP Balanced (GrandMaster flex3™)

 

468,509

 

 

468,509

 

14.11

 

33,208

 

Fidelity VIP Balanced (Grandmaster™)

 

1,657,653

 

 

1,657,653

 

12.90

 

128,536

 

Fidelity VIP Balanced (IQ3™)

 

898,181

 

 

898,181

 

12.78

 

70,258

 

Fidelity VIP Balanced (Pinnacle Plus™)

 

147,493

 

 

147,493

 

13.10

 

11,263

 

Fidelity VIP Balanced (IQ Advisor Standard™)

 

173,077

 

 

173,077

 

12.97

 

13,341

 

Fidelity VIP Contrafund (AnnuiChoice™)

 

9,994,831

 

1

 

9,994,832

 

17.25

 

579,263

 

Fidelity VIP Contrafund (AnnuiChoice II™)

 

583,275

 

 

583,275

 

12.43

 

46,922

 

Fidelity VIP Contrafund (GrandMaster flex3™)

 

7,391,975

 

 

7,391,975

 

17.92

 

412,418

 

Fidelity VIP Contrafund (IQ3™)

 

6,960,464

 

1

 

6,960,465

 

17.85

 

389,917

 

Fidelity VIP Contrafund (Pinnacle Plus™)

 

2,205,908

 

1

 

2,205,909

 

18.50

 

119,254

 

Fidelity VIP Contrafund (IQ Advisor Standard™)

 

177,749

 

 

177,749

 

17.01

 

10,449

 

Fidelity VIP Disciplined Small Cap (AnnuiChoice™)

 

248,180

 

 

248,180

 

9.03

 

27,487

 

Fidelity VIP Disciplined Small Cap (AnnuiChoice II™)

 

4,080

 

 

4,080

 

9.02

 

452

 

Fidelity VIP Disciplined Small Cap (GrandMaster™)

 

101,720

 

 

101,720

 

9.01

 

11,293

 

 

See accompanying notes.

 

4



 

 

 

 

 

Payable to

 

 

 

 

 

 

 

 

 

 

 

(receivable from)

 

 

 

 

 

 

 

 

 

Investments

 

the general account

 

 

 

 

 

 

 

Division

 

at value

 

of Integrity

 

Net Assets

 

Unit Value

 

Units Outstanding

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Disciplined Small Cap (GrandMaster flex3™)

 

$

85,987

 

$

 

$

85,987

 

$

8.99

 

9,560

 

Fidelity VIP Disciplined Small Cap (IQ Annuity™)

 

243,909

 

 

243,909

 

9.00

 

27,098

 

Fidelity VIP Disciplined Small Cap (Pinnacle Plus™)

 

28,517

 

 

28,517

 

8.99

 

3,173

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)

 

129,486

 

 

129,486

 

15.68

 

8,258

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice II™)

 

7,188

 

 

7,188

 

11.52

 

624

 

Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)

 

125,225

 

1

 

125,226

 

14.89

 

8,410

 

Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)

 

149,191

 

 

149,191

 

15.00

 

9,945

 

Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)

 

3,441

 

 

3,441

 

14.22

 

242

 

Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)

 

112,349

 

 

112,349

 

14.82

 

7,579

 

Fidelity VIP Dynamic Capital Appreciation (IQ Advisor Standard™)

 

31,836

 

 

31,836

 

13.75

 

2,315

 

Fidelity VIP Equity-Income (AnnuiChoice™)

 

3,912,203

 

1

 

3,912,204

 

13.59

 

287,930

 

Fidelity VIP Equit-Income (AnnuiChoice II™)

 

167,358

 

 

167,358

 

11.00

 

15,218

 

Fidelity VIP Equity-Income (GrandMaster flex3™)

 

876,895

 

2

 

876,897

 

13.84

 

63,348

 

Fidelity VIP Equity-Income (IQ3™)

 

2,084,540

 

(2

)

2,084,538

 

13.21

 

157,855

 

Fidelity VIP Equity-Income (Pinnacle Plus™)

 

524,739

 

 

524,739

 

15.15

 

34,637

 

Fidelity Freedom 2010 (AnnuiChoice™)

 

67,207

 

 

67,207

 

10.26

 

6,551

 

Fidelity Freedom 2010 (AnnuiChoice II™)

 

40,591

 

 

40,591

 

10.25

 

3,961

 

Fidelity Freedom 2010 (GrandMaster™)

 

27,261

 

 

27,261

 

10.23

 

2,664

 

Fidelity Freedom 2010 (GrandmMaster flex3™)

 

40,236

 

 

40,236

 

10.22

 

3,937

 

Fidelity Freedom 2010 (IQ Annuity™)

 

79,183

 

 

79,183

 

10.23

 

7,742

 

Fidelity Freedom 2010 (Pinnacle Plus™)

 

24,852

 

 

24,852

 

10.21

 

2,434

 

Fidelity Freedom 2015 (AnnuiChoice II™)

 

84,897

 

 

84,897

 

10.26

 

8,274

 

Fidelity Freedom 2015 (IQ Annuity™)

 

73,733

 

 

73,733

 

10.24

 

7,201

 

Fidelity Freedom 2015 (Pinnacle Plus™)

 

45,373

 

 

45,373

 

10.22

 

4,438

 

Fidelity Freedom 2020 (AnnuiChoice™)

 

277,604

 

(1

)

277,603

 

10.28

 

26,998

 

Fidelity Freedom 2020 (AnnuiChoice II™)

 

24,781

 

 

24,781

 

10.27

 

2,413

 

Fidelity Freedom 2020 (Pinnacle Plus™)

 

25,992

 

 

25,992

 

10.23

 

2,540

 

Fidelity Freedom 2025 (AnnuiChoice II™)

 

69,455

 

 

69,455

 

10.27

 

6,760

 

Fidelity Freedom 2025 (Pinnacle Plus™)

 

24,836

 

 

24,836

 

10.24

 

2,426

 

Fidelity Freedom 2030 (IQ Annuity™)

 

1,019

 

 

1,019

 

10.26

 

99

 

Fidelity Freedom 2030 (Pinnacle Plus™)

 

23,661

 

 

23,661

 

10.25

 

2,309

 

Fidelity VIP Growth & Income (AnnuiChoice™)

 

1,311,736

 

 

1,311,736

 

12.57

 

104,346

 

Fidelity VIP Growth & Income (AnnuiChoice II™)

 

41,210

 

 

41,210

 

11.88

 

3,468

 

Fidelity VIP Growth & Income (GrandMaster flex3™)

 

358,778

 

(1

)

358,777

 

14.17

 

25,318

 

Fidelity VIP Growth & Income (IQ3™)

 

864,520

 

1

 

864,521

 

12.72

 

67,961

 

Fidelity VIP Growth & Income (Pinnacle Plus™)

 

425,034

 

 

425,034

 

14.15

 

30,046

 

Fidelity VIP Growth (AnnuiChoice™)

 

2,075,365

 

(3

)

2,075,362

 

10.12

 

204,980

 

Fidelity VIP Growth (AnnuiChoice II™)

 

5,981

 

(2

)

5,979

 

13.20

 

453

 

Fidelity VIP Growth (GrandMaster™)

 

884,094

 

 

884,094

 

11.71

 

75,497

 

Fidelity VIP Growth (GrandMaster flex3™)

 

958,164

 

2

 

958,166

 

13.41

 

71,473

 

Fidelity VIP Growth (IQ3™)

 

1,970,874

 

(3

)

1,970,871

 

10.55

 

186,799

 

Fidelity VIP Growth (Pinnacle Plus™)

 

183,908

 

 

183,908

 

15.13

 

12,156

 

Fidelity VIP Growth Opportunities (AnnuiChoice™)

 

418,354

 

1

 

418,355

 

13.30

 

31,448

 

Fidelity VIP Growth Opportunities (GrandMaster flex3™)

 

91,224

 

(1

)

91,223

 

14.57

 

6,260

 

Fidelity VIP Growth Opportunities (IQ3™)

 

955,461

 

 

955,461

 

12.51

 

76,362

 

Fidelity VIP Growth Opportunities (Pinnacle Plus™)

 

236,547

 

 

236,547

 

15.44

 

15,324

 

Fidelity VIP Growth Opportunities (IQ Advisor Standard™)

 

153,045

 

 

153,045

 

14.40

 

10,624

 

Fidelity VIP Growth (IQ Advisor Standard™)

 

144,018

 

1

 

144,019

 

13.73

 

10,491

 

Fidelity VIP High Income (AnnuiChoice™)

 

702,342

 

 

702,342

 

12.68

 

55,377

 

Fidelity VIP High Income (AnnuiChoice II™)

 

2,726

 

 

2,726

 

10.64

 

256

 

Fidelity VIP High Income (GrandMaster flex3™)

 

897,635

 

 

897,635

 

13.74

 

65,340

 

Fidelity VIP High Income (IQ3™)

 

651,481

 

 

651,481

 

13.77

 

47,310

 

Fidelity VIP High Income (Pinnacle Plus™)

 

187,885

 

 

187,885

 

12.73

 

14,764

 

Fidelity VIP High Income (IQ Advisor Standard™)

 

17,364

 

 

17,364

 

12.21

 

1,422

 

Fidelity VIP Index 500 (AnnuiChoice™)

 

2,443,196

 

 

2,443,196

 

11.01

 

221,890

 

Fidelity VIP Index 500 (IQ3™)

 

1,862,394

 

 

1,862,394

 

11.68

 

159,449

 

Fidelity VIP Index 500 (AnnuiChoice II™)

 

160,936

 

(1

)

160,935

 

9.86

 

16,320

 

Fidelity VIP Index 500 (Grandmaster™)

 

2,174,833

 

1

 

2,174,834

 

9.85

 

220,850

 

Fidelity VIP Index 500 (Grandmaster flex3™)

 

769,155

 

 

769,155

 

9.83

 

78,214

 

Fidelity VIP Index 500 (IQ Advisor Standard™)

 

259,084

 

(3

)

259,081

 

9.90

 

26,174

 

Fidelity VIP Index 500 (Pinnacle Plus™)

 

438,967

 

(1

)

438,966

 

14.48

 

30,322

 

Fidelity VIP Investment Grade Bond (AnnuiChoice™)

 

5,674,070

 

(3

)

5,674,067

 

13.30

 

426,757

 

Fidelity VIP Investment Grade Bond (AnnuiChoice II™)

 

417,964

 

 

417,964

 

10.45

 

40,001

 

Fidelity VIP Investment Grade Bond (GrandMaster™)

 

1,277,530

 

(1

)

1,277,529

 

10.14

 

125,960

 

 

See accompanying notes.

 

5



 

 

 

 

 

Payable to

 

 

 

 

 

 

 

 

 

 

 

(receivable from)

 

 

 

 

 

 

 

 

 

Investments

 

the general account

 

 

 

 

 

 

 

Division

 

at value

 

of Integrity

 

Net Assets

 

Unit Value

 

Units Outstanding

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Investment Grade Bond (GrandMaster flex3™)

 

$

1,940,104

 

$

1

 

$

1,940,105

 

$

10.87

 

178,487

 

Fidelity VIP Investment Grade Bond (IQ3™)

 

4,347,256

 

(1

)

4,347,255

 

12.65

 

343,757

 

Fidelity VIP Investment Grade Bond (Pinnacle Plus™)

 

704,492

 

 

704,492

 

10.77

 

65,417

 

Fidelity VIP Investment Grade Bond (IQ Advisor Standard™)

 

188,925

 

 

188,925

 

11.10

 

17,026

 

Fidelity VIP Mid Cap (AnnuiChoice™)

 

6,154,743

 

 

6,154,743

 

22.80

 

269,975

 

Fidelity VIP Mid Cap (AnnuiChoice II™)

 

333,942

 

 

333,942

 

11.96

 

27,918

 

Fidelity VIP Mid Cap (GrandMaster flex3™)

 

3,274,962

 

 

3,274,962

 

20.63

 

158,730

 

Fidelity VIP Mid Cap (Grandmaster™)

 

3,704,651

 

 

3,704,651

 

17.99

 

205,959

 

Fidelity VIP Mid Cap (IQ Annuity™)

 

3,308,665

 

(1

)

3,308,664

 

22.59

 

146,477

 

Fidelity VIP Mid Cap (Pinnacle Plus™)

 

1,505,383

 

 

1,505,383

 

21.75

 

69,217

 

Fidelity VIP Mid Cap (IQ Advisor Enhanced™)

 

13,846

 

 

13,846

 

18.34

 

755

 

Fidelity VIP Mid Cap (IQ Advisor Standard™)

 

65,446

 

(2

)

65,444

 

18.48

 

3,540

 

Fidelity VIP Overseas (AnnuiChoice™)

 

2,933,037

 

(2

)

2,933,035

 

15.33

 

191,381

 

Fidelity VIP Overseas (AnnuiChoice II™)

 

128,708

 

 

128,708

 

12.63

 

10,189

 

Fidelity VIP Overseas (GrandMaster™)

 

1,532,145

 

 

1,532,145

 

10.57

 

144,909

 

Fidelity VIP Overseas (GrandMaster flex3™)

 

1,310,819

 

 

1,310,819

 

17.27

 

75,899

 

Fidelity VIP Overseas (IQ3™)

 

2,655,542

 

 

2,655,542

 

15.55

 

170,784

 

Fidelity VIP Overseas (Pinnacle Plus™)

 

1,154,371

 

(1

)

1,154,370

 

21.29

 

54,218

 

Fidelity VIP Overseas (IQ Advisor Enhanced™)

 

21,901

 

 

21,901

 

17.46

 

1,255

 

Fidelity VIP Overseas (IQ Advisor Standard™)

 

533,246

 

 

533,246

 

17.60

 

30,305

 

Non-Affiliated Class 1:

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)

 

398,624

 

 

398,624

 

18.12

 

21,998

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II™)

 

23,678

 

 

23,678

 

11.13

 

2,128

 

Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)

 

230,148

 

 

230,148

 

17.52

 

13,135

 

Van Kampen UIF Emerging Markets Debt (IQ3™)

 

284,491

 

2

 

284,493

 

17.71

 

16,066

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice™)

 

1,369,466

 

1

 

1,369,467

 

21.86

 

62,652

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)

 

112,327

 

 

112,327

 

9.30

 

12,073

 

Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)

 

841,974

 

2

 

841,976

 

21.44

 

39,271

 

Van Kampen UIF U.S. Real Estate (IQ3™)

 

1,022,007

 

(2

)

1,022,005

 

20.98

 

48,722

 

Non-Affiliated Class 2:

 

 

 

 

 

 

 

 

 

 

 

Franklin Foreign Securities (IQ Annuity™)

 

2,148,491

 

 

2,148,491

 

21.68

 

99,098

 

Franklin Growth and Income Securities (AnnuiChoice™)

 

4,972,356

 

(1

)

4,972,355

 

14.57

 

341,238

 

Franklin Growth and Income Securities (AnnuiChoice II™)

 

83,099

 

 

83,099

 

10.33

 

8,047

 

Franklin Growth and Income Securities (GrandMaster flex3™)

 

1,821,925

 

(2

)

1,821,923

 

14.17

 

128,552

 

Franklin Growth and Income Securities (Grandmaster™)

 

1,560,786

 

 

1,560,786

 

14.32

 

109,019

 

Franklin Growth and Income Securities (IQ Annuity™)

 

4,148,005

 

(1

)

4,148,004

 

14.24

 

291,202

 

Franklin Growth and Income Securities (Pinnacle Plus™)

 

1,130,116

 

(1

)

1,130,115

 

13.66

 

82,739

 

Franklin Growth and Income Securities (IQ Advisor Standard™)

 

3,459

 

 

3,459

 

12.41

 

279

 

Franklin Income Securities (AnnuiChoice™)

 

7,124,838

 

2

 

7,124,840

 

17.22

 

413,731

 

Franklin Income Securities (AnnuiChoice II™)

 

643,392

 

(1

)

643,391

 

10.91

 

58,946

 

Franklin Income Securities (GrandMaster flex3™)

 

6,623,707

 

 

6,623,707

 

16.75

 

395,453

 

Franklin Income Securities (Grandmaster™)

 

6,146,055

 

 

6,146,055

 

16.92

 

363,248

 

Franklin Income Securities (IQ Annuity™)

 

7,898,672

 

 

7,898,672

 

16.83

 

469,199

 

Franklin Income Securities (Pinnacle Plus™)

 

2,781,627

 

 

2,781,627

 

14.84

 

187,393

 

Franklin Income Securities (IQ Advisor Enhanced™)

 

10,732

 

 

10,732

 

13.55

 

792

 

Franklin Income Securities (IQ Advisor Standard™)

 

4,015

 

 

4,015

 

13.66

 

294

 

Franklin Large Cap Growth Securities (AnnuiChoice™)

 

375,780

 

 

375,780

 

14.74

 

25,496

 

Franklin Large Cap Growth Securities (AnnuiChoice II™)

 

44,287

 

 

44,287

 

11.36

 

3,900

 

Franklin Large Cap Growth Securities (GrandMaster flex3™)

 

379,490

 

1

 

379,491

 

14.34

 

26,472

 

Franklin Large Cap Growth Securities (Grandmaster™)

 

63,956

 

 

63,956

 

14.48

 

4,417

 

Franklin Large Cap Growth Securities (IQ Annuity™)

 

661,833

 

 

661,833

 

14.41

 

45,936

 

Franklin Large Cap Growth Securities (Pinnacle Plus™)

 

265,571

 

 

265,571

 

13.08

 

20,305

 

Franklin Large Cap Growth Securities (IQ Advisor Standard™)

 

61,722

 

 

61,722

 

12.34

 

5,001

 

Franklin Mutual Shares Securities (AnnuiChoice™)

 

4,417,396

 

 

4,417,396

 

17.82

 

247,939

 

Franklin Mutual Shares Securities (AnnuiChoice II™)

 

323,920

 

 

323,920

 

11.05

 

29,320

 

Franklin Mutual Shares Securities (GrandMaster flex3™)

 

4,491,885

 

(2

)

4,491,883

 

17.33

 

259,214

 

Franklin Mutual Shares Securities (IQ Annuity™)

 

2,879,670

 

1

 

2,879,671

 

17.42

 

165,341

 

Franklin Mutual Shares Securities (Pinnacle Plus™)

 

2,004,668

 

 

2,004,668

 

15.90

 

126,078

 

Franklin Mutual Shares Securities (IQ Advisor Standard™)

 

431,509

 

1

 

431,510

 

14.77

 

29,224

 

Franklin Mutual Shares Securities(Grandmaster™)

 

5,347,905

 

(3

)

5,347,902

 

17.50

 

305,510

 

Franklin Small Cap Value Securities (Annuichoice™)

 

23,141

 

 

23,141

 

8.90

 

2,599

 

Franklin Small Cap Value Securities (Annuichoice II™)

 

31,469

 

 

31,469

 

8.89

 

3,538

 

Franklin Small Cap Value Securities (Grandmaster ™)

 

8,569

 

 

8,569

 

8.88

 

965

 

Franklin Small Cap Value Securities (Grandmaster flex3 ™)

 

4,786

 

 

4,786

 

8.87

 

540

 

 

See accompanying notes.

 

6



 

 

 

 

 

Payable to

 

 

 

 

 

 

 

 

 

 

 

(receivable from)

 

 

 

 

 

 

 

 

 

Investments

 

the general account

 

 

 

 

 

 

 

Division

 

at value

 

of Integrity

 

Net Assets

 

Unit Value

 

Units Outstanding

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

Franklin Small Cap Value Securities (IQ Annuuity ™)

 

$

624

 

$

 

$

624

 

$

8.88

 

70

 

Franklin Small Cap Value Securities (Pinnacle Plus™)

 

11,881

 

 

11,881

 

8.86

 

1,341

 

Templeton Foriegn Securities Fund (GrandMaster flex3™)

 

2,438,253

 

 

2,438,253

 

21.57

 

113,032

 

Templeton Foriegn Securities Fund (Grandmaster™)

 

743,438

 

 

743,438

 

21.79

 

34,118

 

Templeton Foriegn Securities Fund (Pinnacle Plus™)

 

449,139

 

 

449,139

 

20.12

 

22,318

 

Templeton Foreign Securities Fund (AnnuiChoice™)

 

2,503,251

 

1

 

2,503,252

 

22.18

 

112,869

 

Templeton Foreign Securities Fund (AnnuiChoice II™)

 

162,822

 

 

162,822

 

12.51

 

13,013

 

Templeton Foriegn Securities Fund (IQ Advisor Standard™)

 

103,897

 

(1

)

103,896

 

17.48

 

5,944

 

Templeton Growth Securities (AnnuiChoice™)

 

1,683,486

 

 

1,683,486

 

18.89

 

89,118

 

Templeton Growth Securities (AnnuiChoice II™)

 

227,895

 

 

227,895

 

11.15

 

20,441

 

Templeton Growth Securities (GrandMaster flex3™)

 

2,278,202

 

 

2,278,202

 

18.37

 

123,994

 

Templeton Growth Securities (Grandmaster™)

 

1,150,905

 

 

1,150,905

 

18.56

 

62,010

 

Templeton Growth Securities (IQ Annuity™)

 

1,933,514

 

 

1,933,514

 

18.47

 

104,704

 

Templeton Growth Securities (Pinnacle Plus™)

 

987,517

 

 

987,517

 

16.99

 

58,123

 

Van Kampen LIT Comstock (AnnuiChoice™)

 

871,777

 

 

871,777

 

16.37

 

53,258

 

Van Kampen LIT Comstock (AnnuiChoice II™)

 

53,949

 

 

53,949

 

10.44

 

5,167

 

Van Kampen LIT Comstock (GrandMaster flex3™)

 

653,721

 

 

653,721

 

15.92

 

41,060

 

Van Kampen LIT Comstock (Grandmaster™)

 

253,553

 

 

253,553

 

16.08

 

15,766

 

Van Kampen LIT Comstock (IQ Annuity™)

 

1,095,941

 

 

1,095,941

 

16.00

 

68,490

 

Van Kampen LIT Comstock (Pinnacle Plus™)

 

309,328

 

(1

)

309,327

 

14.62

 

21,158

 

Van Kampen LIT Strategic Growth (AnnuiChoice™)

 

129,812

 

 

129,812

 

15.82

 

8,206

 

Van Kampen LIT Strategic Growth (AnnuiChoice II™)

 

8,802

 

 

8,802

 

12.43

 

708

 

Van Kampen LIT Strategic Growth (GrandMaster flex3™)

 

95,944

 

 

95,944

 

15.39

 

6,236

 

Van Kampen LIT Strategic Growth (Grandmaster™)

 

10,579

 

 

10,579

 

15.54

 

681

 

Van Kampen LIT Strategic Growth (IQ Annuity™)

 

69,152

 

 

69,152

 

15.46

 

4,472

 

Van Kampen LIT Strategic Growth (Pinnacle Plus™)

 

27,738

 

1

 

27,739

 

13.62

 

2,037

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)

 

128,630

 

 

128,630

 

10.20

 

12,611

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II™)

 

50,187

 

 

50,187

 

10.19

 

4,926

 

Van Kampen UIF Emerging Markets Debt (Grandmaster™)

 

323,972

 

 

323,972

 

17.16

 

18,884

 

Van Kampen UIF Emerging Markets Debt (GrandMaste flex3™)

 

553,644

 

 

553,644

 

10.16

 

54,487

 

Van Kampen UIF Emerging Markets Debt (IQ Annuity™)

 

426,287

 

 

426,287

 

17.07

 

24,974

 

Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)

 

221,971

 

1

 

221,972

 

14.88

 

14,913

 

Van Kampen UIF Emerging Markets Debt (IQ Advisor Standard™)

 

19,849

 

 

19,849

 

13.81

 

1,437

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)

 

1,840,773

 

 

1,840,773

 

43.96

 

41,871

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)

 

41,373

 

 

41,373

 

16.65

 

2,486

 

Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)

 

1,354,685

 

1

 

1,354,686

 

42.76

 

31,680

 

Van Kampen UIF Emerging Markets Equity (Grandmaster™)

 

610,546

 

(1

)

610,545

 

43.19

 

14,135

 

Van Kampen UIF Emerging Markets Equity (IQ Annuity™)

 

2,862,503

 

 

2,862,503

 

42.98

 

66,605

 

Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)

 

724,353

 

 

724,353

 

37.33

 

19,402

 

Van Kampen UIF Emerging Markets Equity (IQ Advisor Standard™)

 

131,420

 

1

 

131,421

 

30.28

 

4,340

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™)

 

421,305

 

1

 

421,306

 

7.72

 

54,572

 

Van Kampen UIF U.S Real Estate (AnnuiChoice II™)

 

58,884

 

 

58,884

 

7.71

 

7,635

 

Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)

 

603,437

 

 

603,437

 

19.48

 

30,981

 

Van Kampen UIF U.S. Real Estate (Grandmaster™)

 

567,779

 

 

567,779

 

22.63

 

25,087

 

Van Kampen UIF U.S. Real Estate (Grandmaster flex3™)

 

493,555

 

1

 

493,556

 

7.69

 

64,175

 

Van Kampen UIF U.S. Real Estate (IQ Annuity™)

 

482,251

 

 

482,251

 

22.52

 

21,416

 

Van Kampen UIF U.S. Real Estate (IQ Advisor Standard™)

 

322,921

 

 

322,921

 

17.53

 

18,419

 

Non-Affiliated Class B:

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index (AnnuiChoice™)

 

769,628

 

2

 

769,630

 

14.98

 

51,390

 

DWS Small Cap Index (AnnuiChoice II™)

 

26,104

 

 

26,104

 

10.54

 

2,476

 

DWS Small Cap Index (GrandMaster flex3™)

 

174,438

 

 

174,438

 

14.40

 

12,112

 

DWS Small Cap Index (Grandmaster™)

 

144,161

 

 

144,161

 

13.25

 

10,883

 

DWS Small Cap Index (IQ3™)

 

534,015

 

 

534,015

 

14.48

 

36,889

 

DWS Small Cap Index (Pinnacle Plus™)

 

187,940

 

 

187,940

 

15.13

 

12,418

 

 

See accompanying notes.

 

7



 

Separate Account I
of

Integrity Life Insurance Company

 

Statements of Operations

 

For the Year Ended December 31, 2007

 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net assets 
resulting from 
operations

 

Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (AnnuiChoice ™)

 

$

 7,142

 

$

3,719

 

$

3,423

 

$

2,676

 

$

9,457

 

$

29,763

 

$

29,000

 

$

(763

)

$

11,370

 

$

14,793

 

Touchstone Aggressive ETF (GrandMaster flex3 ™)

 

42,978

 

36,053

 

6,925

 

84,278

 

56,891

 

221,209

 

159,112

 

(62,097

)

79,072

 

85,997

 

Touchstone Aggressive ETF (Grandmaster ™)

 

3,866

 

4,312

 

(446

)

39,345

 

5,119

 

46,906

 

21,615

 

(25,291

)

19,173

 

18,727

 

Touchstone Aggressive ETF (IQ Annuity ™)

 

78,245

 

58,744

 

19,501

 

48,422

 

103,568

 

382,862

 

347,310

 

(35,552

)

116,438

 

135,939

 

Touchstone Aggressive ETF (Pinnacle Plus ™)

 

2,964

 

2,458

 

506

 

474

 

3,923

 

11,283

 

10,848

 

(435

)

3,962

 

4,468

 

Touchstone Aggressive ETF (IQ Advisor Standard ™)

 

394

 

121

 

273

 

37

 

521

 

3,506

 

3,534

 

28

 

586

 

859

 

Touchstone Balanced (AnnuiChoice ™)

 

115,232

 

21,579

 

93,653

 

50,124

 

90,269

 

132,913

 

(8,455

)

(141,368

)

(975

)

92,678

 

Touchstone Balanced (AnnuiChoice II ™) (April 27)*

 

3,063

 

413

 

2,650

 

38

 

2,332

 

 

(4,076

)

(4,076

)

(1,706

)

944

 

Touchstone Balanced (GrandMaster flex3 ™)

 

62,305

 

21,011

 

41,294

 

37,418

 

48,824

 

6,823

 

(70,261

)

(77,084

)

9,158

 

50,452

 

Touchstone Balanced (Grandmaster ™)

 

22,729

 

6,577

 

16,152

 

3,201

 

17,862

 

(9,895

)

(26,005

)

(16,110

)

4,953

 

21,105

 

Touchstone Balanced (IQ Annuity ™)

 

65,399

 

19,374

 

46,025

 

63,075

 

51,258

 

23,952

 

(82,598

)

(106,550

)

7,783

 

53,808

 

Touchstone Balanced (Pinnacle Plus ™)

 

19,210

 

7,673

 

11,537

 

17,982

 

15,054

 

(7,562

)

(30,220

)

(22,658

)

10,378

 

21,915

 

Touchstone Baron Small Cap (AnnuiChoice ™)

 

 

25,007

 

(25,007

)

289,244

 

294,058

 

434,026

 

(78,469

)

(512,495

)

70,807

 

45,800

 

Touchstone Baron Small Cap (AnnuiChoice II ™)

 

 

466

 

(466

)

61

 

13,822

 

(180

)

(18,524

)

(18,344

)

(4,461

)

(4,927

)

Touchstone Baron Small Cap (GrandMaster flex3 ™)

 

 

20,334

 

(20,334

)

162,058

 

168,779

 

220,795

 

(76,182

)

(296,977

)

33,860

 

13,526

 

Touchstone Baron Small Cap (Grandmaster ™)

 

 

5,269

 

(5,269

)

20,622

 

46,853

 

33,029

 

(24,101

)

(57,130

)

10,345

 

5,076

 

Touchstone Baron Small Cap (IQ Annuity ™)

 

 

50,677

 

(50,677

)

200,109

 

418,156

 

692,825

 

173,403

 

(519,422

)

98,843

 

48,166

 

Touchstone Baron Small Cap (Pinnacle Plus ™)

 

 

9,393

 

(9,393

)

72,604

 

66,298

 

64,083

 

(63,302

)

(127,385

)

11,517

 

2,124

 

Touchstone Baron Small Cap (IQ Advisor Enhanced ™)

 

 

49

 

(49

)

15

 

771

 

1,518

 

894

 

(624

)

162

 

113

 

Touchstone Baron Small Cap (IQ Advisor Standard ™)

 

 

1,177

 

(1,177

)

2,012

 

28,048

 

19,535

 

(6,353

)

(25,888

)

4,172

 

2,995

 

Touchstone Conservative ETF (AnnuiChoice ™)

 

15,835

 

9,041

 

6,794

 

12,316

 

2,019

 

62,390

 

82,795

 

20,405

 

34,740

 

41,534

 

Touchstone Conservative ETF (GrandMaster flex3 ™)

 

32,748

 

32,299

 

449

 

75,691

 

4,176

 

75,856

 

83,967

 

8,111

 

87,978

 

88,427

 

Touchstone Conservative ETF (Grandmaster ™)

 

12,033

 

11,579

 

454

 

36,940

 

1,594

 

29,882

 

27,367

 

(2,515

)

36,019

 

36,473

 

Touchstone Conservative ETF (IQ Annuity ™)

 

27,914

 

18,854

 

9,060

 

79,891

 

3,639

 

50,603

 

35,700

 

(14,903

)

68,627

 

77,687

 

Touchstone Conservative ETF (Pinnacle Plus ™)

 

4,101

 

3,353

 

748

 

564

 

523

 

2,357

 

8,363

 

6,006

 

7,093

 

7,841

 

Touchstone Conservative ETF (IQ Advisor Standard ™)

 

2,278

 

764

 

1,514

 

103

 

290

 

12,561

 

16,919

 

4,358

 

4,751

 

6,265

 

Touchstone Core Bond (AnnuiChoice ™)

 

92,381

 

16,517

 

75,864

 

20,320

 

 

(15,413

)

(32,995

)

(17,582

)

2,738

 

78,602

 

Touchstone Core Bond (AnnuiChoice II ™)

 

2,425

 

264

 

2,161

 

70

 

 

(696

)

(1,673

)

(977

)

(907

)

1,254

 

Touchstone Core Bond (GrandMaster flex3 ™)

 

25,701

 

9,023

 

16,678

 

5,253

 

 

(3,268

)

(3,568

)

(300

)

4,953

 

21,631

 

Touchstone Core Bond (Grandmaster ™)

 

5,121

 

1,669

 

3,452

 

1,240

 

 

(742

)

(658

)

84

 

1,324

 

4,776

 

Touchstone Core Bond (IQ Annuity ™)

 

42,437

 

13,601

 

28,836

 

28,822

 

 

653

 

(10,637

)

(11,290

)

17,532

 

46,368

 

Touchstone Core Bond (Pinnacle Plus ™)

 

32,104

 

8,228

 

23,876

 

4,547

 

 

(3,236

)

(10,058

)

(6,822

)

(2,275

)

21,601

 

Touchstone Core Bond (IQ Advisor Standard ™) (August 16)*

 

8,093

 

201

 

7,892

 

1,445

 

 

 

(5,211

)

(5,211

)

(3,766

)

4,126

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

8



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Eagle Capital Appreciation (AnnuiChoice™)

 

$

 8,036

 

$

12,077

 

$

(4,041

)

$

142,253

 

$

 

$

203,456

 

$

38,633

 

$

(164,823

)

$

(22,570

)

$

(26,611

)

Touchstone Eagle Capital Appreciation (AnnuiChoice II™)

 

668

 

986

 

(318

)

2,301

 

 

699

 

(5,113

)

(5,812

)

(3,511

)

(3,829

)

Touchstone Eagle Capital Appreciation (GrandMaster flex3™)

 

3,869

 

9,719

 

(5,850

)

92,518

 

 

86,034

 

(27,281

)

(113,315

)

(20,797

)

(26,647

)

Touchstone Eagle Capital Appreciation (Grandmaster ™) (April 27)*

 

499

 

1,003

 

(504

)

(1,204

)

 

 

(3,591

)

(3,591

)

(4,795

)

(5,299

)

Touchstone Eagle Capital Appreciation (IQ Annuity™)

 

4,671

 

11,485

 

(6,814

)

50,765

 

 

61,327

 

(37,960

)

(99,287

)

(48,522

)

(55,336

)

Touchstone Eagle Capital Appreciation (Pinnacle Plus™)

 

1,002

 

2,153

 

(1,151

)

18,568

 

 

24,006

 

687

 

(23,319

)

(4,751

)

(5,902

)

Touchstone Mid Cap Growth (AnnuiChoice™)

 

139,523

 

37,938

 

101,585

 

80,357

 

548,638

 

11,135

 

(293,843

)

(304,978

)

324,017

 

425,602

 

Touchstone Mid Cap Growth (AnnuiChoice II™)

 

26,814

 

6,121

 

20,693

 

575

 

105,439

 

1,262

 

(83,522

)

(84,784

)

21,230

 

41,923

 

Touchstone Mid Cap Growth (GrandMaster flex3™)

 

93,820

 

27,682

 

66,138

 

183,263

 

368,921

 

(2,651

)

(414,173

)

(411,522

)

140,662

 

206,800

 

Touchstone Mid Cap Growth (Grandmaster ™)

 

13,259

 

3,994

 

9,265

 

7,312

 

52,138

 

1,965

 

(46,221

)

(48,186

)

11,264

 

20,529

 

Touchstone Mid Cap Growth (IQ Annuity™)

 

87,580

 

26,663

 

60,917

 

38,992

 

344,385

 

(10,300

)

(378,943

)

(368,643

)

14,734

 

75,651

 

Touchstone Mid Cap Growth (Pinnacle Plus™)

 

19,450

 

7,304

 

12,146

 

3,044

 

76,483

 

6,539

 

(49,608

)

(56,147

)

23,380

 

35,526

 

Touchstone Mid Cap Growth (IQ Advisor Standard ™)

 

3,780

 

498

 

3,282

 

545

 

14,864

 

1,723

 

(21,321

)

(23,044

)

(7,635

)

(4,353

)

Touchstone Large Cap Core Equity (AnnuiChoice™)

 

7,102

 

2,551

 

4,551

 

13,908

 

 

19,001

 

9,743

 

(9,258

)

4,650

 

9,201

 

Touchstone Large Cap Core Equity (AnnuiChoice II™)

 

677

 

287

 

390

 

1,518

 

 

295

 

(834

)

(1,129

)

389

 

779

 

Touchstone Large Cap Core Equity (GrandMaster flex3™)

 

41,487

 

15,910

 

25,577

 

127,098

 

 

76,047

 

(58,434

)

(134,481

)

(7,383

)

18,194

 

Touchstone Large Cap Core Equity (Grandmaster ™)

 

171

 

121

 

50

 

1,849

 

 

1,334

 

(41

)

(1,375

)

474

 

524

 

Touchstone Large Cap Core Equity (IQ Annuity™)

 

18,658

 

7,950

 

10,708

 

34,152

 

 

30,564

 

(38,283

)

(68,847

)

(34,695

)

(23,987

)

Touchstone Large Cap Core Equity (Pinnacle Plus™)

 

4,718

 

2,764

 

1,954

 

13,507

 

 

18,087

 

9,526

 

(8,561

)

4,946

 

6,900

 

Touchstone Large Cap Core Equity (IQ Advisor Standard ™)

 

4,175

 

561

 

3,614

 

664

 

 

270

 

(10,977

)

(11,247

)

(10,583

)

(6,969

)

Touchstone Enhanced ETF (AnnuiChoice ™)

 

23,140

 

11,619

 

11,521

 

6,561

 

9,178

 

132,081

 

138,460

 

6,379

 

22,118

 

33,639

 

Touchstone Enhanced ETF (GrandMaster flex3 ™)

 

205,564

 

189,383

 

16,181

 

793,807

 

82,854

 

1,272,969

 

798,553

 

(474,416

)

402,245

 

418,426

 

Touchstone Enhanced ETF (Grandmaster ™)

 

30,493

 

20,595

 

9,898

 

22,043

 

12,098

 

140,092

 

133,845

 

(6,247

)

27,894

 

37,792

 

Touchstone Enhanced ETF (IQ Annuity ™)

 

127,858

 

91,589

 

36,269

 

131,331

 

50,741

 

742,043

 

663,419

 

(78,624

)

103,448

 

139,717

 

Touchstone Enhanced ETF (Pinnacle Plus ™)

 

5,176

 

4,086

 

1,090

 

1,097

 

2,053

 

22,630

 

21,829

 

(801

)

2,349

 

3,439

 

Touchstone Enhanced ETF (IQ Advisor Enhanced ™)

 

927

 

371

 

556

 

1,212

 

368

 

11,223

 

10,506

 

(717

)

863

 

1,419

 

Touchstone Enhanced ETF (IQ Advisor Standard ™)

 

6,330

 

3,007

 

3,323

 

51,922

 

2,510

 

64,233

 

29,037

 

(35,196

)

19,236

 

22,559

 

Touchstone Growth & Income (AnnuiChoice™)

 

7,316

 

1,961

 

5,355

 

1,451

 

10,667

 

(4,620

)

(14,552

)

(9,932

)

2,186

 

7,541

 

Touchstone Growth & Income (GrandMaster flex3™)

 

3,681

 

1,735

 

1,946

 

1,581

 

5,368

 

(4,658

)

(11,004

)

(6,346

)

603

 

2,549

 

Touchstone Growth & Income (Grandmaster™)

 

845

 

221

 

624

 

335

 

1,232

 

52

 

(1,691

)

(1,743

)

(176

)

448

 

Touchstone Growth & Income (IQ Annuity ™)

 

11,986

 

4,849

 

7,137

 

7,443

 

17,521

 

2,846

 

(20,884

)

(23,730

)

1,234

 

8,371

 

Touchstone Growth & Income (Pinnacle Plus™)

 

5,420

 

2,444

 

2,976

 

10,001

 

7,909

 

3,623

 

(10,007

)

(13,630

)

4,280

 

7,256

 

Touchstone High Yield (AnnuiChoice™)

 

51,359

 

6,835

 

44,524

 

14,494

 

 

14,324

 

(37,570

)

(51,894

)

(37,400

)

7,124

 

Touchstone High Yield (AnnuiChoice II™) (April 27)*

 

7,577

 

310

 

7,267

 

(8

)

 

 

(7,871

)

(7,871

)

(7,879

)

(612

)

Touchstone High Yield (GrandMaster flex3™)

 

85,603

 

18,041

 

67,562

 

21,410

 

 

8,854

 

(75,723

)

(84,577

)

(63,167

)

4,395

 

Touchstone High Yield (Grandmaster ™)

 

9,974

 

3,010

 

6,964

 

(13,674

)

 

(17,499

)

(10,217

)

7,282

 

(6,392

)

572

 

Touchstone High Yield (IQ Annuity™)

 

73,301

 

13,010

 

60,291

 

26,237

 

 

3,021

 

(76,452

)

(79,473

)

(53,236

)

7,055

 

Touchstone High Yield (Pinnacle Plus™)

 

30,957

 

5,927

 

25,030

 

(140

)

 

6,120

 

(18,717

)

(24,837

)

(24,977

)

53

 

Touchstone High Yield (IQ Advisor Standard ™)

 

23,205

 

2,131

 

21,074

 

13,614

 

 

(6,603

)

(22,221

)

(15,618

)

(2,004

)

19,070

 

Touchstone Moderate ETF (AnnuiChoice ™)

 

53,412

 

37,508

 

15,904

 

40,272

 

17,835

 

360,644

 

440,125

 

79,481

 

137,588

 

153,492

 

 

See accompanying notes. 

 


* - 2007 inception date of division.

 

9



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Moderate ETF (GrandMaster flex3 ™)

 

$

97,065

 

$

106,935

 

$

(9,870

)

$

97,188

 

$

33,298

 

$

426,102

 

$

544,001

 

$

117,899

 

$

248,385

 

$

238,515

 

Touchstone Moderate ETF (Grandmaster ™)

 

9,577

 

9,041

 

536

 

32,769

 

3,185

 

51,278

 

39,402

 

(11,876

)

24,078

 

24,614

 

Touchstone Moderate ETF (IQ Annuity ™)

 

44,071

 

40,657

 

3,414

 

60,761

 

14,735

 

188,929

 

193,600

 

4,671

 

80,167

 

83,581

 

Touchstone Moderate ETF (Pinnacle Plus ™)

 

3,912

 

4,660

 

(748

)

5,301

 

1,306

 

24,841

 

27,706

 

2,865

 

9,472

 

8,724

 

Touchstone Moderate ETF (IQ Advisor Enhanced ™)

 

756

 

413

 

343

 

58

 

252

 

5,203

 

6,717

 

1,514

 

1,824

 

2,167

 

Touchstone Moderate ETF (IQ Advisor Standard ™)

 

1,808

 

739

 

1,069

 

153

 

603

 

17,415

 

21,016

 

3,601

 

4,357

 

5,426

 

Touchstone Money Market (AnnuiChoice ™)

 

3,209

 

642

 

2,567

 

 

 

8

 

8

 

 

 

2,567

 

Touchstone Money Market (Grandmaster ™)

 

362,679

 

97,981

 

264,698

 

 

 

 

 

 

 

264,698

 

Touchstone Money Market (IQ Annuity ™)

 

47,814

 

13,877

 

33,937

 

 

 

40

 

40

 

 

 

33,937

 

Touchstone Money Market (IQ3 ™)

 

5,453

 

1,590

 

3,863

 

 

 

 

 

 

 

3,863

 

Touchstone Third Avenue Value (AnnuiChoice ™)

 

70,242

 

96,913

 

(26,671

)

1,398,521

 

576,675

 

1,459,619

 

(859,576

)

(2,319,195

)

(343,999

)

(370,670

)

Touchstone Third Avenue Value (AnnuiChoice II ™)

 

4,533

 

4,290

 

243

 

3,181

 

36,353

 

(36

)

(75,978

)

(75,942

)

(36,408

)

(36,165

)

Touchstone Third Avenue Value (GrandMaster flex3 ™)

 

41,615

 

84,666

 

(43,051

)

480,269

 

344,000

 

266,028

 

(705,305

)

(971,333

)

(147,064

)

(190,115

)

Touchstone Third Avenue Value (Grandmaster ™)

 

19,971

 

35,934

 

(15,963

)

142,028

 

164,335

 

123,577

 

(326,082

)

(449,659

)

(143,296

)

(159,259

)

Touchstone Third Avenue Value (IQ Annuity ™)

 

51,414

 

109,000

 

(57,586

)

831,017

 

423,659

 

801,227

 

(584,378

)

(1,385,605

)

(130,929

)

(188,515

)

Touchstone Third Avenue Value (Pinnacle Plus ™)

 

14,085

 

32,515

 

(18,430

)

226,117

 

114,311

 

230,529

 

(188,923

)

(419,452

)

(79,024

)

(97,454

)

Touchstone Third Avenue Value (IQ Advisor Enhanced ™) (April 27)*

 

44

 

33

 

11

 

 

358

 

 

(921

)

(921

)

(563

)

(552

)

Touchstone Third Avenue Value (IQ Advisor Standard ™)

 

3,802

 

1,287

 

2,515

 

9,817

 

13,135

 

9,027

 

(24,278

)

(33,305

)

(10,353

)

(7,838

)

Touchstone Value Plus (AnnuiChoice ™)

 

12,622

 

10,807

 

1,815

 

165,598

 

 

343,784

 

133,451

 

(210,333

)

(44,735

)

(42,920

)

Touchstone Value Plus (AnnuiChoice II ™)

 

630

 

390

 

240

 

448

 

 

656

 

(3,454

)

(4,110

)

(3,662

)

(3,422

)

Touchstone Value Plus (GrandMaster flex3 ™)

 

1,679

 

1,960

 

(281

)

11,084

 

 

29,529

 

12,614

 

(16,915

)

(5,831

)

(6,112

)

Touchstone Value Plus (Grandmaster ™)

 

1,503

 

1,318

 

185

 

1,695

 

 

16,064

 

7,715

 

(8,349

)

(6,654

)

(6,469

)

Touchstone Value Plus (IQ Annuity ™)

 

6,467

 

21,590

 

(15,123

)

249,962

 

 

268,861

 

(12,341

)

(281,202

)

(31,240

)

(46,363

)

Touchstone Value Plus (Pinnacle Plus ™)

 

1,316

 

1,177

 

139

 

409

 

 

6,902

 

1,693

 

(5,209

)

(4,800

)

(4,661

)

Non-Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (AnnuiChoice ™)

 

14,593

 

6,028

 

8,565

 

32,485

 

18,221

 

94,568

 

47,583

 

(46,985

)

3,721

 

12,286

 

JP Morgan Mid Cap Value (GrandMaster flex3 ™)

 

27,270

 

17,899

 

9,371

 

78,516

 

34,051

 

171,069

 

69,998

 

(101,071

)

11,496

 

20,867

 

JP Morgan Mid Cap Value (Grandmaster ™)

 

3,126

 

1,724

 

1,402

 

23,040

 

3,903

 

26,553

 

5,328

 

(21,225

)

5,718

 

7,120

 

JP Morgan Mid Cap Value (IQ3 ™)

 

9,315

 

5,831

 

3,484

 

18,613

 

11,632

 

61,317

 

33,217

 

(28,100

)

2,145

 

5,629

 

JP Morgan Mid Cap Value (Pinnacle Plus ™)

 

9,443

 

6,861

 

2,582

 

11,762

 

11,791

 

63,498

 

41,353

 

(22,145

)

1,408

 

3,990

 

Non-Affiliated Initial Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (Grandmaster ™)

 

604,115

 

376,323

 

227,792

 

1,159,395

 

1,869,665

 

5,902,589

 

2,842,134

 

(3,060,455

)

(31,395

)

196,397

 

Fidelity VIP Growth (Grandmaster ™)

 

150,540

 

213,697

 

(63,157

)

586,981

 

 

2,040,844

 

5,000,796

 

2,959,952

 

3,546,933

 

3,483,776

 

Fidelity VIP High Income (Grandmaster ™)

 

345,871

 

58,180

 

287,691

 

84,813

 

 

(19,589

)

(312,065

)

(292,476

)

(207,663

)

80,028

 

Fidelity VIP II Asset Manager (Grandmaster ™)

 

766,632

 

177,911

 

588,721

 

373,741

 

365,578

 

1,515,607

 

1,903,504

 

387,897

 

1,127,216

 

1,715,937

 

Fidelity VIP II Contrafund (Grandmaster ™)

 

1,447,578

 

380,776

 

1,066,802

 

2,867,051

 

5,423,640

 

5,819,860

 

566,377

 

(5,253,483

)

3,037,208

 

4,104,010

 

Fidelity VIP II Index 500 (Grandmaster ™)

 

413,939

 

161,317

 

252,622

 

798,077

 

 

3,319,862

 

2,787,386

 

(532,476

)

265,601

 

518,223

 

Fidelity VIP II Index 500 (IQ Annuity ™)

 

34,117

 

14,103

 

20,014

 

41,660

 

 

324,131

 

302,002

 

(22,129

)

19,531

 

39,545

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

10



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Non-Affiliated Initial Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice ™) (April 27)*

 

$

692

 

$

6,549

 

$

(5,857

)

$

(719

)

$

 

$

 

$

21,338

 

$

21,338

 

$

20,619

 

$

14,762

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice II ™) (April 27)*

 

64

 

628

 

(564

)

2

 

 

 

1,980

 

1,980

 

1,982

 

1,418

 

Fidelity VIP II Investment Grade Bond (Grandmaster ™)

 

314,920

 

93,584

 

221,336

 

(273,206

)

 

(124,970

)

105,785

 

230,755

 

(42,451

)

178,885

 

Fidelity VIP II Investment Grade Bond (Grandmaster flex3 ™) (April 27)*

 

1,248

 

16,798

 

(15,550

)

620

 

 

 

32,057

 

32,057

 

32,677

 

17,127

 

Fidelity VIP II Investment Grade Bond (IQ Annuity ™)

 

55,881

 

31,738

 

24,143

 

(45,213

)

 

(28,121

)

44,810

 

72,931

 

27,718

 

51,861

 

Fidelity VIP II Investment Grade Bond (Pinnacle Plus ™) (April 27)*

 

232

 

3,333

 

(3,101

)

(6

)

 

 

6,686

 

6,686

 

6,680

 

3,579

 

Fidelity VIP III Balanced (Grandmaster ™)

 

112,562

 

24,097

 

88,465

 

144,361

 

27,257

 

216,294

 

105,480

 

(110,814

)

60,804

 

149,269

 

Fidelity VIP III Growth & Income (Grandmaster ™)

 

186,657

 

55,060

 

131,597

 

209,041

 

55,314

 

144,488

 

166,896

 

22,408

 

286,763

 

418,360

 

Fidelity VIP III Growth Opportunities (Grandmaster ™)

 

 

20,367

 

(20,367

)

261,414

 

 

231,592

 

279,427

 

47,835

 

309,249

 

288,882

 

Fidelity VIP Overseas (AnnuiChoice ™) (April 27)*

 

6,930

 

2,837

 

4,093

 

1,865

 

 

 

18,288

 

18,288

 

20,153

 

24,246

 

Fidelity VIP Overseas (AnnuiChoice II ™) (April 27)*

 

1,986

 

1,018

 

968

 

2,582

 

 

 

5,244

 

5,244

 

7,826

 

8,794

 

Fidelity VIP Overseas (Grandmaster ™)

 

272,946

 

114,166

 

158,780

 

1,905,845

 

614,270

 

3,905,318

 

2,490,550

 

(1,414,768

)

1,105,347

 

1,264,127

 

Fidelity VIP Overseas (Grandmaster flex3 ™) (April 27)*

 

5,160

 

4,767

 

393

 

4,289

 

 

 

13,615

 

13,615

 

17,904

 

18,297

 

Fidelity VIP Overseas (IQ Annuity ™) (April 27)*

 

6,698

 

3,782

 

2,916

 

1,138

 

 

 

17,724

 

17,724

 

18,862

 

21,778

 

Fidelity VIP Overseas (Pinnacle Plus ™) (April 27)*

 

6,495

 

4,501

 

1,994

 

(388

)

 

 

17,147

 

17,147

 

16,759

 

18,753

 

Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (Annuichoice ™)

 

7,158

 

3,224

 

3,934

 

5,338

 

9,589

 

12,080

 

1,679

 

(10,401

)

4,526

 

8,460

 

Touchstone Aggressive ETF (Annuichoice II ™)

 

3,244

 

1,766

 

1,478

 

11,842

 

4,336

 

140

 

(10,047

)

(10,187

)

5,991

 

7,469

 

Touchstone Aggressive ETF (Grandmaster flex3 ™) (April 27)*

 

2,629

 

901

 

1,728

 

(51

)

3,514

 

 

(7,267

)

(7,267

)

(3,804

)

(2,076

)

Touchstone Aggressive ETF (IQ Advisor Standard ™) (May 3)*

 

3

 

48

 

(45

)

(2,885

)

 

 

 

 

(2,885

)

(2,930

)

Touchstone Aggressive ETF (Pinnacle Plus ™) (April 27)*

 

1,257

 

425

 

832

 

1

 

1,682

 

 

(4,165

)

(4,165

)

(2,482

)

(1,650

)

Touchstone Conservative ETF (Annuichoice ™)

 

3,944

 

1,845

 

2,099

 

7,888

 

514

 

4,820

 

3,836

 

(984

)

7,418

 

9,517

 

Touchstone Conservative ETF (Annuichoice II ™)

 

1,462

 

478

 

984

 

388

 

122

 

(47

)

81

 

128

 

638

 

1,622

 

Touchstone Conservative ETF (GrandMaster flex3 ™) (April 27)*

 

1,350

 

560

 

790

 

376

 

175

 

 

12

 

12

 

563

 

1,353

 

Tocuhstone Conservative ETF (IQ Advisor Enhanced ™) (April 27)*

 

1,035

 

174

 

861

 

2,225

 

134

 

 

1,169

 

1,169

 

3,528

 

4,389

 

Touchstone Conservative ETF (Pinnacle Plus ™) (April 27)*

 

418

 

215

 

203

 

13

 

54

 

 

49

 

49

 

116

 

319

 

Touchstone Enhanced ETF (Annuichoice ™)

 

7,130

 

3,212

 

3,918

 

8,958

 

3,029

 

10,077

 

(7,433

)

(17,510

)

(5,523

)

(1,605

)

Touchstone Enhanced ETF (Annuichoice II ™)

 

2,693

 

1,070

 

1,623

 

(2,517

)

1,734

 

(1

)

(6,308

)

(6,307

)

(7,090

)

(5,467

)

Touchstone Enhanced ETF (GrandMaster flex3 ™) (April 27)*

 

6,614

 

2,283

 

4,331

 

275

 

2,815

 

 

(23,231

)

(23,231

)

(20,141

)

(15,810

)

Touchstone Enhanced ETF (Pinnacle Plus ™) (April 27)*

 

6,280

 

2,929

 

3,351

 

(194

)

2,652

 

 

(20,218

)

(20,218

)

(17,760

)

(14,409

)

Touchstone GMAB Aggressive (AnnuiChoice ™) (April 27)*

 

2,014

 

1,474

 

540

 

308

 

2,695

 

 

(2,205

)

(2,205

)

798

 

1,338

 

Touchstone GMAB Conservative (AnnuiChoice ™) (Dec 4)*

 

197

 

13

 

184

 

 

26

 

 

(280

)

(280

)

(254

)

(70

)

Touchstone GMAB Conservative (AnnuiChoice II ™) (April 27)*

 

3,922

 

1,163

 

2,759

 

201

 

509

 

 

(940

)

(940

)

(230

)

2,529

 

Touchstone GMAB Moderate ETF (AnnuiChoice ™)

 

517

 

606

 

(89

)

54

 

184

 

1,946

 

2,994

 

1,048

 

1,286

 

1,197

 

Touchstone GMAB Moderate ETF (AnnuiChoice II ™) (April 27)*

 

985

 

148

 

837

 

(1,783

)

351

 

 

(717

)

(717

)

(2,149

)

(1,312

)

Touchstone Moderate ETF (AnnuiChoice ™)

 

8,772

 

5,048

 

3,724

 

5,583

 

3,154

 

14,867

 

15,923

 

1,056

 

9,793

 

13,517

 

Touchstone Moderate ETF (AnnuiChoice II ™)

 

3,556

 

1,606

 

1,950

 

5,066

 

1,604

 

195

 

(7,786

)

(7,981

)

(1,311

)

639

 

Touchstone Moderate ETF (GrandM aster flex3 ™) (April 27)*

 

51,524

 

27,138

 

24,386

 

337

 

17,191

 

 

(52,446

)

(52,446

)

(34,918

)

(10,532

)

Touchstone Moderate ETF (IQ Advisor Standard ™) (April 27)*

 

192

 

5

 

187

 

 

 

 

(324

)

(324

)

(324

)

(137

)

Touchstone Moderate ETF (Pinnacle Plus ™) (April 27)*

 

1,324

 

751

 

573

 

394

 

459

 

 

(1,202

)

(1,202

)

(349

)

224

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

11



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Affiliated Service Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Money Market (AnnuiChoice ™)

 

$

262,903

 

$

55,606

 

$

207,297

 

$

 

$

 

$

 

$

 

$

 

$

 

$

207,297

 

Touchstone Money Market (AnnuiChoice II ™)

 

14,159

 

3,419

 

10,740

 

 

 

 

 

 

 

10,740

 

Touchstone Money Market (GrandMaster flex3 ™)

 

126,635

 

41,405

 

85,230

 

 

 

 

 

 

 

85,230

 

Touchstone Money Market (IQ Annuity ™)

 

312,847

 

95,631

 

217,216

 

 

 

20

 

20

 

 

 

217,216

 

Touchstone Money Market (Pinnacle Plus ™)

 

36,325

 

12,848

 

23,477

 

 

 

 

 

 

 

23,477

 

Touchstone Money Market (IQ Advisor Standard ™)

 

37,959

 

4,804

 

33,155

 

 

 

(3

)

(3

)

 

 

33,155

 

Non-Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (IQ Annuity ™)

 

21,504

 

16,256

 

5,248

 

62,102

 

69,585

 

56,403

 

(64,803

)

(121,206

)

10,481

 

15,729

 

Fidelity VIP Growth (IQ Annuity ™)

 

5,215

 

10,797

 

(5,582

)

56,068

 

 

190,219

 

308,782

 

118,563

 

174,631

 

169,049

 

Fidelity VIP High Income (IQ Annuity ™)

 

22,869

 

7,399

 

15,470

 

19,351

 

 

(3,987

)

(22,056

)

(18,069

)

1,282

 

16,752

 

Fidelity VIP II Asset Manager (IQ Annuity ™)

 

13,648

 

3,505

 

10,143

 

5,474

 

6,744

 

18,166

 

25,971

 

7,805

 

20,023

 

30,166

 

Fidelity VIP II Contrafund (IQ Annuity ™)

 

117,368

 

31,581

 

85,787

 

170,035

 

447,387

 

73,163

 

(331,440

)

(404,603

)

212,819

 

298,606

 

Fidelity VIP III Balanced (IQ Annuity ™)

 

8,820

 

2,318

 

6,502

 

2,416

 

2,077

 

18,895

 

19,042

 

147

 

4,640

 

11,142

 

Fidelity VIP III Growth & Income (IQ Annuity ™)

 

12,634

 

4,281

 

8,353

 

10,046

 

3,880

 

45,820

 

52,742

 

6,922

 

20,848

 

29,201

 

Fidelity VIP III Growth Opportunities (IQ Annuity ™)

 

 

1,412

 

(1,412

)

30,243

 

 

17,978

 

4,277

 

(13,701

)

16,542

 

15,130

 

Fidelity VIP III Mid Cap (Grandmaster ™)

 

55,402

 

76,681

 

(21,279

)

460,471

 

771,585

 

663,301

 

324,251

 

(339,050

)

893,006

 

871,727

 

Fidelity VIP III Mid Cap (IQ Annuity ™)

 

16,215

 

27,043

 

(10,828

)

220,356

 

189,668

 

359,638

 

207,592

 

(152,046

)

257,978

 

247,150

 

Fidelity VIP Overseas (IQ Annuity ™)

 

6,078

 

2,827

 

3,251

 

35,393

 

15,879

 

49,953

 

18,976

 

(30,977

)

20,295

 

23,546

 

Non-Affiliated Service Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Asset Manager (AnnuiChoice ™)

 

24,189

 

4,081

 

20,108

 

13,925

 

13,102

 

30,357

 

33,581

 

3,224

 

30,251

 

50,359

 

Fidelity VIP Asset Manager (AnnuiChoice II ™) (May 3)*

 

36

 

7

 

29

 

 

 

 

42

 

42

 

42

 

71

 

Fidelity VIP Asset Manager (GrandMaster flex3 ™)

 

16,691

 

4,872

 

11,819

 

10,831

 

8,383

 

15,526

 

25,621

 

10,095

 

29,309

 

41,128

 

Fidelity VIP Asset Manager (IQ3)

 

24,437

 

6,274

 

18,163

 

9,928

 

12,033

 

20,814

 

35,737

 

14,923

 

36,884

 

55,047

 

Fidelity VIP Asset Manager (Pinnacle Plus ™)

 

9,730

 

1,582

 

8,148

 

3,792

 

3,210

 

10,781

 

4,911

 

(5,870

)

1,132

 

9,280

 

Fidelity VIP Balanced (AnnuiChoice ™)

 

91,458

 

16,241

 

75,217

 

86,793

 

21,541

 

232,525

 

166,772

 

(65,753

)

42,581

 

117,798

 

Fidelity VIP Balanced (AnnuiChoice II ™)

 

748

 

186

 

562

 

6

 

10

 

5

 

(1,013

)

(1,018

)

(1,002

)

(440

)

Fidelity VIP Balanced (GrandMaster flex3 ™)

 

26,011

 

7,417

 

18,594

 

14,144

 

6,090

 

33,398

 

26,165

 

(7,233

)

13,001

 

31,595

 

Fidelity VIP Balanced (Grandmaster ™) (April 27)*

 

22,576

 

7,980

 

14,596

 

616

 

 

 

(4,301

)

(4,301

)

(3,685

)

10,911

 

Fidelity VIP Balanced (IQ3 ™)

 

43,742

 

12,333

 

31,409

 

15,337

 

9,774

 

65,039

 

60,078

 

(4,961

)

20,150

 

51,559

 

Fidelity VIP Balanced (Pinnacle Plus ™)

 

6,285

 

2,135

 

4,150

 

3,272

 

1,325

 

8,137

 

6,122

 

(2,015

)

2,582

 

6,732

 

Fidelity VIP Balanced (IQ Advisor Standard ™) (August 20)*

 

2,357

 

72

 

2,285

 

9

 

 

 

(1,408

)

(1,408

)

(1,399

)

886

 

Fidelity VIP Contrafund (AnnuiChoice ™)

 

515,940

 

87,054

 

428,886

 

805,707

 

1,989,148

 

625,841

 

(1,354,731

)

(1,980,572

)

814,283

 

1,243,169

 

Fidelity VIP Contrafund (AnnuiChoice II ™)

 

29,625

 

3,673

 

25,952

 

1,349

 

109,949

 

(4,012

)

(94,896

)

(90,884

)

20,414

 

46,366

 

Fidelity VIP Contrafund (GrandMaster flex3 ™)

 

402,609

 

113,244

 

289,365

 

634,393

 

1,574,571

 

46,002

 

(1,501,320

)

(1,547,322

)

661,642

 

951,007

 

Fidelity VIP Contrafund (IQ3 ™)

 

358,085

 

101,033

 

257,052

 

440,689

 

1,392,050

 

269,182

 

(840,559

)

(1,109,741

)

722,998

 

980,050

 

Fidelity VIP Contrafund (Pinnacle Plus ™)

 

113,767

 

34,473

 

79,294

 

162,801

 

437,955

 

169,052

 

(222,810

)

(391,862

)

208,894

 

288,188

 

Fidelity VIP Contrafund (IQ Advisor Standard ™)

 

9,168

 

1,133

 

8,035

 

9,471

 

35,587

 

18,412

 

(4,131

)

(22,543

)

22,515

 

30,550

 

Fidelity VIP Disciplined Small Cap (AnnuiChoice ™) (April 27)*

 

841

 

2,048

 

(1,207

)

81

 

1,105

 

 

(25,543

)

(25,543

)

(24,357

)

(25,564

)

Fidelity VIP Disciplined Small Cap (AnnuiChoice II ™) (April 27)*

 

14

 

34

 

(20

)

(2

)

18

 

 

(425

)

(425

)

(409

)

(429

)

 

See accompanying notes.

 


* - 2007 inception date of division.

 

12



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Disciplined Small Cap (GrandMaster ™) (April 27)*

 

$

345

 

$

1,403

 

$

(1,058

)

$

(7,057

)

$

453

 

$

 

$

(7,901

)

$

(7,901

)

$

(14,505

)

$

(15,563

)

Fidelity VIP Disciplined Small Cap (GrandMaster flex3 ™) (April 27)*

 

290

 

1,066

 

(776

)

(1,675

)

383

 

 

(8,232

)

(8,232

)

(9,524

)

(10,300

)

Fidelity VIP Disciplined Small Cap (IQ Annuity ™) (April 27)*

 

819

 

2,718

 

(1,899

)

169

 

1,079

 

 

(22,975

)

(22,975

)

(21,727

)

(23,626

)

Fidelity VIP Disciplined Small Cap (Pinnacle Plus ™) (April 27)*

 

96

 

348

 

(252

)

(12

)

127

 

 

(2,973

)

(2,973

)

(2,858

)

(3,110

)

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice ™)

 

7,076

 

1,819

 

5,257

 

11,451

 

7,979

 

5,651

 

(14,074

)

(19,725

)

(295

)

4,962

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice II ™)

 

349

 

39

 

310

 

2

 

390

 

(6

)

(700

)

(694

)

(302

)

8

 

Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3 ™)

 

6,590

 

1,465

 

5,125

 

2,595

 

7,411

 

2,515

 

(11,905

)

(14,420

)

(4,414

)

711

 

Fidelity VIP Dynamic Capital Appreciation (Grandmaster ™)

 

7,799

 

1,573

 

6,226

 

(483

)

8,775

 

(146

)

(16,341

)

(16,195

)

(7,903

)

(1,677

)

Fidelity VIP Dynamic Capital Appreciation (IQ Annuity ™)

 

390

 

145

 

245

 

(818

)

451

 

137

 

(301

)

(438

)

(805

)

(560

)

Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus ™)

 

5,961

 

1,826

 

4,135

 

813

 

6,712

 

3,707

 

(3,868

)

(7,575

)

(50

)

4,085

 

Fidelity VIP Dynamic Capital Appreciation (IQ Advisor Standard ™)

 

1,708

 

193

 

1,515

 

12

 

1,925

 

(51

)

(1,683

)

(1,632

)

305

 

1,820

 

Fidelity VIP Equity-Income (AnnuiChoice ™)

 

89,875

 

41,563

 

48,312

 

137,281

 

308,351

 

338,362

 

(150,165

)

(488,527

)

(42,895

)

5,417

 

Fidelity VIP Equit-Income (AnnuiChoice II ™)

 

3,685

 

787

 

2,898

 

(7

)

12,886

 

(13

)

(16,534

)

(16,521

)

(3,642

)

(744

)

Fidelity VIP Equity-Income (GrandMaster flex3 ™)

 

20,817

 

21,720

 

(903

)

148,946

 

70,279

 

119,851

 

(66,559

)

(186,410

)

32,815

 

31,912

 

Fidelity VIP Equity-Income (IQ3 ™)

 

49,348

 

42,821

 

6,527

 

233,880

 

166,891

 

181,238

 

(196,924

)

(378,162

)

22,609

 

29,136

 

Fidelity VIP Equity-Income (Pinnacle Plus ™)

 

11,881

 

7,897

 

3,984

 

3,974

 

40,940

 

23,382

 

(31,506

)

(54,888

)

(9,974

)

(5,990

)

Fidelity Freedom 2010 (AnnuiChoice ™) (April 27)*

 

2,152

 

86

 

2,066

 

(15

)

542

 

 

(2,285

)

(2,285

)

(1,758

)

308

 

Fidelity Freedom 2010 (AnnuiChoice II ™) (April 27)*

 

1,150

 

92

 

1,058

 

(2

)

290

 

 

(1,130

)

(1,130

)

(842

)

216

 

Fidelity Freedom 2010 (GrandMaster ™) (April 27)*

 

871

 

24

 

847

 

 

220

 

 

(1,297

)

(1,297

)

(1,077

)

(230

)

Fidelity Freedom 2010 (GrandmMaster flex3 ™) (April 27)*

 

1,287

 

186

 

1,101

 

(1,471

)

324

 

 

(1,549

)

(1,549

)

(2,696

)

(1,595

)

Fidelity Freedom 2010 (IQ Annuity ™) (April 27)*

 

2,533

 

228

 

2,305

 

6

 

638

 

 

(3,490

)

(3,490

)

(2,846

)

(541

)

Fidelity Freedom 2010 (Pinnacle Plus ™) (April 27)*

 

795

 

64

 

731

 

 

200

 

 

(851

)

(851

)

(651

)

80

 

Fidelity Freedom 2015 (AnnuiChoice II ™) (April 27)*

 

2,659

 

336

 

2,323

 

(11

)

753

 

 

(2,769

)

(2,769

)

(2,027

)

296

 

Fidelity Freedom 2015 (IQ Annuity ™) (April 27)*

 

2,442

 

118

 

2,324

 

2

 

691

 

 

(1,330

)

(1,330

)

(637

)

1,687

 

Fidelity Freedom 2015 (Pinnacle Plus ™) (April 27)*

 

1,504

 

127

 

1,377

 

3

 

425

 

 

(1,806

)

(1,806

)

(1,378

)

(1

)

Fidelity Freedom 2020 (AnnuiChoice ™) (April 27)*

 

8,667

 

817

 

7,850

 

1,492

 

2,543

 

 

(9,965

)

(9,965

)

(5,930

)

1,920

 

Fidelity Freedom 2020 (AnnuiChoice II ™) (April 27)*

 

773

 

36

 

737

 

1

 

227

 

 

(882

)

(882

)

(654

)

83

 

Fidelity Freedom 2020 (Pinnacle Plus ™) (April 27)*

 

810

 

66

 

744

 

 

238

 

 

(926

)

(926

)

(688

)

56

 

Fidelity Freedom 2025 (AnnuiChoice II ™) (April 27)*

 

2,234

 

337

 

1,897

 

8

 

578

 

 

(690

)

(690

)

(104

)

1,793

 

Fidelity Freedom 2025 (Pinnacle Plus ™) (April 27)*

 

799

 

64

 

735

 

 

207

 

 

(877

)

(877

)

(670

)

65

 

Fidelity Freedom 2030 (IQ Annuity ™) (April 27)*

 

36

 

9

 

27

 

 

11

 

 

(19

)

(19

)

(8

)

19

 

Fidelity Freedom 2030 (Pinnacle Plus ™) (April 27)*

 

824

 

61

 

763

 

 

261

 

 

(969

)

(969

)

(708

)

55

 

Fidelity VIP Growth & Income (AnnuiChoice ™)

 

48,121

 

11,761

 

36,360

 

34,090

 

15,311

 

159,728

 

186,666

 

26,938

 

76,339

 

112,699

 

Fidelity VIP Growth & Income (AnnuiChoice II ™) (April 27)*

 

254

 

164

 

90

 

15

 

 

 

803

 

803

 

818

 

908

 

Fidelity VIP Growth & Income (GrandMaster flex3 ™)

 

16,811

 

5,895

 

10,916

 

44,320

 

5,551

 

55,859

 

34,390

 

(21,469

)

28,402

 

39,318

 

Fidelity VIP Growth & Income (IQ3 ™)

 

39,654

 

13,512

 

26,142

 

66,758

 

13,064

 

100,613

 

83,728

 

(16,885

)

62,937

 

89,079

 

Fidelity VIP Growth & Income (Pinnacle Plus ™)

 

16,555

 

6,933

 

9,622

 

3,875

 

5,304

 

59,897

 

79,425

 

19,528

 

28,707

 

38,329

 

Fidelity VIP Growth (AnnuiChoice ™)

 

7,652

 

16,794

 

(9,142

)

168,617

 

 

177,182

 

385,799

 

208,617

 

377,234

 

368,092

 

Fidelity VIP Growth (AnnuiChoice II ™)

 

22

 

60

 

(38

)

12

 

 

15

 

1,206

 

1,191

 

1,203

 

1,165

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

13



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Growth (GrandMaster ™) (April 27)*

 

$

762

 

$

6,316

 

$

(5,554

)

$

75,573

 

$

 

$

 

$

43,546

 

$

43,546

 

$

119,119

 

$

113,565

 

Fidelity VIP Growth (GrandMaster flex3 ™)

 

3,279

 

10,132

 

(6,853

)

104,747

 

 

34,340

 

59,948

 

25,608

 

130,355

 

123,502

 

Fidelity VIP Growth (IQ3 ™)

 

5,076

 

17,648

 

(12,572

)

130,516

 

 

45,428

 

116,106

 

70,678

 

201,194

 

188,622

 

Fidelity VIP Growth (Pinnacle Plus ™)

 

481

 

1,825

 

(1,344

)

3,807

 

 

9,948

 

29,139

 

19,191

 

22,998

 

21,654

 

Fidelity VIP Growth Opportunities (AnnuiChoice ™)

 

 

1,613

 

(1,613

)

35,175

 

 

3,912

 

5,576

 

1,664

 

36,839

 

35,226

 

Fidelity VIP Growth Opportunities (GrandMaster flex3 ™)

 

 

1,017

 

(1,017

)

2,657

 

 

1,502

 

9,496

 

7,994

 

10,651

 

9,634

 

Fidelity VIP Growth Opportunities (IQ3 ™)

 

 

4,851

 

(4,851

)

21,572

 

 

6,183

 

(8,158

)

(14,341

)

7,231

 

2,380

 

Fidelity VIP Growth Opportunities (Pinnacle Plus ™)

 

 

1,928

 

(1,928

)

13,556

 

 

3,594

 

(898

)

(4,492

)

9,064

 

7,136

 

Fidelity VIP Growth Opportunities (IQ Advisor Standard ™) (July 11)*

 

 

257

 

(257

)

(1,066

)

 

 

(2,123

)

(2,123

)

(3,189

)

(3,446

)

Fidelity VIP Growth (IQ Advisor Standard ™) (July 11)*

 

91

 

233

 

(142

)

(551

)

 

 

(1,344

)

(1,344

)

(1,895

)

(2,037

)

Fidelity VIP High Income (AnnuiChoice ™)

 

58,003

 

10,485

 

47,518

 

32,699

 

 

(6,928

)

(53,964

)

(47,036

)

(14,337

)

33,181

 

Fidelity VIP High Income (AnnuiChoice II ™) (April 27)*

 

225

 

21

 

204

 

 

 

 

(227

)

(227

)

(227

)

(23

)

Fidelity VIP High Income (GrandMaster flex3 ™)

 

73,744

 

22,232

 

51,512

 

53,807

 

 

(15,730

)

(70,799

)

(55,069

)

(1,262

)

50,250

 

Fidelity VIP High Income (IQ3 ™)

 

53,563

 

15,658

 

37,905

 

37,306

 

 

(18,196

)

(51,586

)

(33,390

)

3,916

 

41,821

 

Fidelity VIP High Income (Pinnacle Plus ™)

 

15,430

 

2,217

 

13,213

 

(1,950

)

 

(5,529

)

(16,105

)

(10,576

)

(12,526

)

687

 

Fidelity VIP High Income (IQ Advisor Standard ™)

 

1,431

 

363

 

1,068

 

(1,722

)

 

(1,829

)

(1,441

)

388

 

(1,334

)

(266

)

Fidelity VIP Index 500 (AnnuiChoice ™)

 

63,003

 

22,647

 

40,356

 

155,660

 

 

311,366

 

160,233

 

(151,133

)

4,527

 

44,883

 

Fidelity VIP Index 500 (IQ3 ™)

 

45,121

 

24,505

 

20,616

 

257,743

 

 

198,429

 

(60,626

)

(259,055

)

(1,312

)

19,304

 

Fidelity VIP Index 500 (AnnuiChoice II ™) (April 27)*

 

2,777

 

908

 

1,869

 

208

 

 

 

(4,166

)

(4,166

)

(3,958

)

(2,089

)

Fidelity VIP Index 500 (Grandmaster ™) (April 27)*

 

37,521

 

20,018

 

17,503

 

1,726

 

 

 

(45,608

)

(45,608

)

(43,882

)

(26,379

)

Fidelity VIP Index 500 (Grandmaster flex3 ™) (April 27)*

 

13,310

 

8,839

 

4,471

 

4,401

 

 

 

(19,114

)

(19,114

)

(14,713

)

(10,242

)

Fidelity VIP Index 500 (IQ Advisor Standard ™) (April 27)*

 

4,469

 

685

 

3,784

 

7

 

 

 

(7,348

)

(7,348

)

(7,341

)

(3,557

)

Fidelity VIP Index 500 (Pinnacle Plus ™)

 

7,929

 

4,325

 

3,604

 

1,243

 

 

4,528

 

(5,667

)

(10,195

)

(8,952

)

(5,348

)

Fidelity VIP Investment Grade Bond (AnnuiChoice ™)

 

235,175

 

56,834

 

178,341

 

(66,655

)

 

(109,664

)

(56,383

)

53,281

 

(13,374

)

164,967

 

Fidelity VIP Investment Grade Bond (AnnuiChoice II ™) (April 27)*

 

1,897

 

1,961

 

(64

)

(596

)

 

 

7,506

 

7,506

 

6,910

 

6,846

 

Fidelity VIP Investment Grade Bond (GrandMaster ™) (April 27)*

 

1,014

 

8,591

 

(7,577

)

9,014

 

 

 

28,397

 

28,397

 

37,411

 

29,834

 

Fidelity VIP Investment Grade Bond (GrandMaster flex3 ™)

 

41,695

 

24,267

 

17,428

 

2,704

 

 

17,382

 

43,895

 

26,513

 

29,217

 

46,645

 

Fidelity VIP Investment Grade Bond (IQ3 ™)

 

177,050

 

63,923

 

113,127

 

(32,201

)

 

9,055

 

36,592

 

27,537

 

(4,664

)

108,463

 

Fidelity VIP Investment Grade Bond (Pinnacle Plus ™)

 

24,871

 

10,836

 

14,035

 

(5,924

)

 

(10,181

)

(2,515

)

7,666

 

1,742

 

15,777

 

Fidelity VIP Investment Grade Bond (IQ Advisor Standard ™)

 

3,515

 

566

 

2,949

 

(1,354

)

 

718

 

3,204

 

2,486

 

1,132

 

4,081

 

Fidelity VIP Mid Cap (AnnuiChoice ™)

 

40,487

 

65,905

 

(25,418

)

695,735

 

628,327

 

927,838

 

500,586

 

(427,252

)

896,810

 

871,392

 

Fidelity VIP Mid Cap (AnnuiChoice II ™)

 

1,074

 

2,476

 

(1,402

)

3,107

 

7,709

 

1,413

 

14,307

 

12,894

 

23,710

 

22,308

 

Fidelity VIP Mid Cap (GrandMaster flex3 ™)

 

26,110

 

61,733

 

(35,623

)

201,558

 

441,124

 

198,206

 

90,854

 

(107,352

)

535,330

 

499,707

 

Fidelity VIP Mid Cap (Grandmaster ™)

 

8,422

 

32,533

 

(24,111

)

24,658

 

2,595

 

2,912

 

170,979

 

168,067

 

195,320

 

171,209

 

Fidelity VIP Mid Cap (IQ Annuity ™)

 

23,118

 

54,649

 

(31,531

)

62,234

 

369,769

 

167,339

 

224,878

 

57,539

 

489,542

 

458,011

 

Fidelity VIP Mid Cap (Pinnacle Plus ™)

 

8,272

 

21,234

 

(12,962

)

79,325

 

115,420

 

115,239

 

76,274

 

(38,965

)

155,780

 

142,818

 

Fidelity VIP Mid Cap (IQ Advisor Enhanced ™)

 

80

 

107

 

(27

)

22

 

1,147

 

2,298

 

2,899

 

601

 

1,770

 

1,743

 

Fidelity VIP Mid Cap (IQ Advisor Standard ™)

 

452

 

466

 

(14

)

3,036

 

7,196

 

3,356

 

(1,800

)

(5,156

)

5,076

 

5,062

 

Fidelity VIP Overseas (AnnuiChoice ™)

 

61,140

 

19,441

 

41,699

 

108,349

 

77,438

 

128,430

 

118,764

 

(9,666

)

176,121

 

217,820

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

14



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Overseas (AnnuiChoice II ™)

 

$

2,303

 

$

878

 

$

1,425

 

$

2,049

 

$

1,850

 

$

1,218

 

$

4,796

 

$

3,578

 

$

7,477

 

$

8,902

 

Fidelity VIP Overseas (GrandMaster ™) (April 27)*

 

23,904

 

12,399

 

11,505

 

25,601

 

 

 

25,673

 

25,673

 

51,274

 

62,779

 

Fidelity VIP Overseas (GrandMaster flex3 ™)

 

31,698

 

19,551

 

12,147

 

166,317

 

56,189

 

90,466

 

(75

)

(90,541

)

131,965

 

144,112

 

Fidelity VIP Overseas (IQ3 ™)

 

52,825

 

27,136

 

25,689

 

79,426

 

56,982

 

61,428

 

46,857

 

(14,571

)

121,837

 

147,526

 

Fidelity VIP Overseas (Pinnacle Plus ™)

 

21,713

 

13,415

 

8,298

 

38,735

 

18,550

 

30,218

 

34,455

 

4,237

 

61,522

 

69,820

 

Fidelity VIP Overseas (IQ Advisor Enhanced ™)

 

604

 

167

 

437

 

57

 

1,317

 

6,081

 

7,308

 

1,227

 

2,601

 

3,038

 

Fidelity VIP Overseas (IQ Advisor Standard ™)

 

10,273

 

1,659

 

8,614

 

29,672

 

9,804

 

33,851

 

9,095

 

(24,756

)

14,720

 

23,334

 

Non-Affiliated Class 1:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice ™)

 

32,127

 

4,129

 

27,998

 

(4,658

)

10,447

 

4,549

 

(8,043

)

(12,592

)

(6,803

)

21,195

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II ™)

 

2,977

 

394

 

2,583

 

(234

)

968

 

665

 

(706

)

(1,371

)

(637

)

1,946

 

Van Kampen UIF Emerging Markets Debt (GrandMaster flex3 ™)

 

52,083

 

9,418

 

42,665

 

13,901

 

16,937

 

44,044

 

(4,783

)

(48,827

)

(17,989

)

24,676

 

Van Kampen UIF Emerging Markets Debt (IQ3 ™)

 

33,308

 

6,085

 

27,223

 

13,437

 

10,831

 

36,657

 

5,932

 

(30,725

)

(6,457

)

20,766

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™)

 

48,838

 

23,176

 

25,662

 

417,739

 

172,802

 

701,727

 

(259,076

)

(960,803

)

(370,262

)

(344,600

)

Van Kampen UIF U.S. Real Estate (AnnuiChoice II ™)

 

3,871

 

1,720

 

2,151

 

(7,032

)

13,696

 

3,212

 

(42,296

)

(45,508

)

(38,844

)

(36,693

)

Van Kampen UIF U.S. Real Estate (GrandMaster flex3 ™)

 

47,886

 

33,641

 

14,245

 

230,593

 

169,430

 

543,661

 

(178,349

)

(722,010

)

(321,987

)

(307,742

)

Van Kampen UIF U.S. Real Estate (IQ3 ™)

 

38,238

 

27,722

 

10,516

 

356,717

 

135,296

 

414,975

 

(379,219

)

(794,194

)

(302,181

)

(291,665

)

Non-Affiliated Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Foreign Securities (IQ Annuity ™)

 

37,322

 

25,470

 

11,852

 

139,161

 

72,429

 

276,486

 

272,457

 

(4,029

)

207,561

 

219,413

 

Franklin Growth and Income Securities (AnnuiChoice ™)

 

172,531

 

44,167

 

128,364

 

92,875

 

276,181

 

176,747

 

(810,058

)

(986,805

)

(617,749

)

(489,385

)

Franklin Growth and Income Securities (AnnuiChoice II ™)

 

3,050

 

902

 

2,148

 

(506

)

4,881

 

694

 

(14,292

)

(14,986

)

(10,611

)

(8,463

)

Franklin Growth and Income Securities (GrandMaster flex3 ™)

 

77,679

 

30,017

 

47,662

 

8,469

 

124,345

 

60,244

 

(330,317

)

(390,561

)

(257,747

)

(210,085

)

Franklin Growth and Income Securities (Grandmaster ™)

 

64,260

 

21,778

 

42,482

 

22,365

 

102,865

 

56,768

 

(281,251

)

(338,019

)

(212,789

)

(170,307

)

Franklin Growth and Income Securities (IQ Annuity ™)

 

141,705

 

52,047

 

89,658

 

(31,058

)

226,837

 

75,952

 

(633,600

)

(709,552

)

(513,773

)

(424,115

)

Franklin Growth and Income Securities (Pinnacle Plus ™)

 

41,078

 

18,190

 

22,888

 

417

 

65,755

 

29,767

 

(195,773

)

(225,540

)

(159,368

)

(136,480

)

Franklin Growth and Income Securities (IQ Advisor Standard ™) (June 1)*

 

109

 

13

 

96

 

(5

)

176

 

 

(774

)

(774

)

(603

)

(507

)

Franklin Income Securities (AnnuiChoice ™)

 

293,199

 

80,149

 

213,050

 

648,957

 

34,631

 

985,466

 

288,013

 

(697,453

)

(13,865

)

199,185

 

Franklin Income Securities (AnnuiChoice II ™)

 

8,529

 

4,236

 

4,293

 

5,130

 

1,007

 

2,990

 

(8,153

)

(11,143

)

(5,006

)

(713

)

Franklin Income Securities (GrandMaster flex3 ™)

 

246,337

 

106,074

 

140,263

 

224,404

 

29,095

 

639,784

 

376,617

 

(263,167

)

(9,668

)

130,595

 

Franklin Income Securities (Grandmaster ™)

 

246,838

 

91,807

 

155,031

 

179,814

 

29,155

 

520,856

 

332,241

 

(188,615

)

20,354

 

175,385

 

Franklin Income Securities (IQ Annuity ™)

 

272,267

 

114,913

 

157,354

 

469,711

 

32,158

 

506,737

 

(3,671

)

(510,408

)

(8,539

)

148,815

 

Franklin Income Securities (Pinnacle Plus ™)

 

122,582

 

50,321

 

72,261

 

144,414

 

14,478

 

260,398

 

63,359

 

(197,039

)

(38,147

)

34,114

 

Franklin Income Securities (IQ Advisor Enhanced ™)

 

385

 

87

 

298

 

14

 

46

 

1,428

 

1,375

 

(53

)

7

 

305

 

Franklin Income Securities (IQ Advisor Standard ™) (June 1)*

 

138

 

13

 

125

 

(3

)

16

 

 

(289

)

(289

)

(276

)

(151

)

Franklin Large Cap Growth Securities (AnnuiChoice ™)

 

2,605

 

3,786

 

(1,181

)

55,151

 

2,564

 

32,711

 

(5,207

)

(37,918

)

19,797

 

18,616

 

Franklin Large Cap Growth Securities (AnnuiChoice II ™)

 

51

 

101

 

(50

)

10

 

51

 

39

 

230

 

191

 

252

 

202

 

Franklin Large Cap Growth Securities (GrandMaster flex3 ™)

 

2,875

 

7,436

 

(4,561

)

54,031

 

2,831

 

33,482

 

(5,271

)

(38,753

)

18,109

 

13,548

 

Franklin Large Cap Growth Securities (Grandmaster ™)

 

400

 

953

 

(553

)

8,533

 

394

 

10,061

 

5,579

 

(4,482

)

4,445

 

3,892

 

Franklin Large Cap Growth Securities (IQ Annuity ™)

 

5,192

 

7,899

 

(2,707

)

26,378

 

5,112

 

23,614

 

(12,151

)

(35,765

)

(4,275

)

(6,982

)

Franklin Large Cap Growth Securities (Pinnacle Plus ™)

 

1,794

 

4,418

 

(2,624

)

10,330

 

1,767

 

33,111

 

33,222

 

111

 

12,208

 

9,584

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

15



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of 
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net 
assets resulting from 
operations

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Large Cap Growth Securities (IQ Advisor Standard ™) (April 27)*

 

$

228

 

$

215

 

$

13

 

$

(486

)

$

225

 

$

 

$

(2,835

)

$

(2,835

)

$

(3,096

)

$

(3,083

)

Franklin Mutual Shares Securities (AnnuiChoice ™)

 

83,940

 

41,588

 

42,352

 

733,384

 

116,364

 

729,198

 

(100,532

)

(829,730

)

20,018

 

62,370

 

Franklin Mutual Shares Securities (AnnuiChoice II ™)

 

2,995

 

2,064

 

931

 

589

 

4,152

 

607

 

(5,184

)

(5,791

)

(1,050

)

(119

)

Franklin Mutual Shares Securities (GrandMaster flex3 ™)

 

87,670

 

68,340

 

19,330

 

325,479

 

121,535

 

600,456

 

212,519

 

(387,937

)

59,077

 

78,407

 

Franklin Mutual Shares Securities (IQ Annuity ™)

 

74,077

 

45,834

 

28,243

 

346,258

 

102,692

 

321,838

 

(134,169

)

(456,007

)

(7,057

)

21,186

 

Franklin Mutual Shares Securities (Pinnacle Plus ™)

 

45,188

 

33,865

 

11,323

 

175,729

 

62,644

 

223,833

 

(1,053

)

(224,886

)

13,487

 

24,810

 

Franklin Mutual Shares Securities (IQ Advisor Standard ™)

 

3,636

 

1,053

 

2,583

 

7,611

 

5,041

 

9,638

 

(1,605

)

(11,243

)

1,409

 

3,992

 

Franklin Mutual Shares Securities(Grandmaster ™)

 

50,099

 

36,282

 

13,817

 

276,288

 

69,451

 

402,408

 

45,438

 

(356,970

)

(11,231

)

2,586

 

Franklin Small Cap Value Securities (Annuichoice ™) (April 27)*

 

 

58

 

(58

)

(3

)

 

 

(971

)

(971

)

(974

)

(1,032

)

Franklin Small Cap Value Securities (Annuichoice II ™) (April 27)*

 

 

69

 

(69

)

(15

)

 

 

(977

)

(977

)

(992

)

(1,061

)

Franklin Small Cap Value Securities (Grandmaster ™) (April 27)*

 

347

 

103

 

244

 

(2,926

)

1,295

 

 

(501

)

(501

)

(2,132

)

(1,888

)

Franklin Small Cap Value Securities (Grandmaster flex3 ™) (April 27)*

 

 

21

 

(21

)

(1

)

 

 

(375

)

(375

)

(376

)

(397

)

Franklin Small Cap Value Securities (IQ Annuuity ™) (April 27)*

 

 

495

 

(495

)

(33,746

)

 

 

(20

)

(20

)

(33,766

)

(34,261

)

Franklin Small Cap Value Securities (Pinnacle Plus ™) (April 27)*

 

 

38

 

(38

)

(2

)

 

 

(516

)

(516

)

(518

)

(556

)

Templeton Foriegn Securities Fund (GrandMaster flex3 ™)

 

36,778

 

27,589

 

9,189

 

235,609

 

71,374

 

313,488

 

218,015

 

(95,473

)

211,510

 

220,699

 

Templeton Foriegn Securities Fund (Grandmaster ™)

 

8,944

 

6,793

 

2,151

 

75,480

 

17,358

 

94,932

 

55,098

 

(39,834

)

53,004

 

55,155

 

Templeton Foriegn Securities Fund (Pinnacle Plus ™)

 

10,466

 

7,548

 

2,918

 

52,117

 

20,313

 

65,167

 

42,589

 

(22,578

)

49,852

 

52,770

 

Templeton Foreign Securities Fund (AnnuiChoice ™)

 

43,636

 

20,640

 

22,996

 

107,954

 

84,682

 

329,229

 

380,466

 

51,237

 

243,873

 

266,869

 

Templeton Foreign Securities Fund (AnnuiChoice II ™)

 

1,925

 

1,131

 

794

 

2,821

 

3,737

 

2,429

 

8,761

 

6,332

 

12,890

 

13,684

 

Templeton Foriegn Securities Fund (IQ Advisor Standard ™)

 

2,984

 

572

 

2,412

 

(1,802

)

5,792

 

4,977

 

6,711

 

1,734

 

5,724

 

8,136

 

Templeton Growth Securities (AnnuiChoice ™)

 

52,941

 

31,433

 

21,508

 

330,014

 

123,554

 

429,156

 

(16,312

)

(445,468

)

8,100

 

29,608

 

Templeton Growth Securities (AnnuiChoice II ™)

 

1,494

 

1,338

 

156

 

141

 

3,486

 

442

 

(1,628

)

(2,070

)

1,557

 

1,713

 

Templeton Growth Securities (GrandMaster flex3 ™)

 

40,950

 

39,721

 

1,229

 

308,762

 

95,572

 

403,450

 

25,843

 

(377,607

)

26,727

 

27,956

 

Templeton Growth Securities (Grandmaster ™)

 

77,786

 

60,237

 

17,549

 

158,482

 

181,539

 

281,660

 

9,293

 

(272,367

)

67,654

 

85,203

 

Templeton Growth Securities (IQ Annuity ™)

 

43,986

 

33,630

 

10,356

 

275,445

 

102,653

 

344,744

 

(55,644

)

(400,388

)

(22,290

)

(11,934

)

Templeton Growth Securities (Pinnacle Plus ™)

 

20,759

 

20,400

 

359

 

84,642

 

48,448

 

135,654

 

6,198

 

(129,456

)

3,634

 

3,993

 

Van Kampen LIT Comstock (AnnuiChoice ™)

 

18,882

 

10,766

 

8,116

 

54,844

 

23,228

 

131,002

 

20,620

 

(110,382

)

(32,310

)

(24,194

)

Van Kampen LIT Comstock (AnnuiChoice II ™)

 

613

 

519

 

94

 

15

 

756

 

145

 

(2,940

)

(3,085

)

(2,314

)

(2,220

)

Van Kampen LIT Comstock (GrandMaster flex3 ™)

 

18,221

 

15,099

 

3,122

 

86,592

 

22,403

 

142,025

 

9,631

 

(132,394

)

(23,399

)

(20,277

)

Van Kampen LIT Comstock (Grandmaster ™)

 

6,944

 

4,603

 

2,341

 

22,115

 

8,534

 

42,500

 

3,968

 

(38,532

)

(7,883

)

(5,542

)

Van Kampen LIT Comstock (IQ Annuity ™)

 

22,569

 

18,198

 

4,371

 

86,056

 

27,757

 

138,309

 

(12,613

)

(150,922

)

(37,109

)

(32,738

)

Van Kampen LIT Comstock (Pinnacle Plus ™)

 

5,730

 

5,590

 

140

 

13,690

 

7,047

 

40,511

 

6,991

 

(33,520

)

(12,783

)

(12,643

)

Van Kampen LIT Strategic Growth (AnnuiChoice ™)

 

 

710

 

(710

)

12,666

 

 

1,156

 

(257

)

(1,413

)

11,253

 

10,543

 

Van Kampen LIT Strategic Growth (AnnuiChoice II ™)

 

 

89

 

(89

)

12

 

 

3

 

1,166

 

1,163

 

1,175

 

1,086

 

Van Kampen LIT Strategic Growth (GrandMaster flex3 ™)

 

 

1,269

 

(1,269

)

1,718

 

 

(804

)

10,417

 

11,221

 

12,939

 

11,670

 

Van Kampen LIT Strategic Growth (Grandmaster ™)

 

 

202

 

(202

)

729

 

 

(129

)

1,508

 

1,637

 

2,366

 

2,164

 

Van Kampen LIT Strategic Growth (IQ Annuity ™)

 

 

620

 

(620

)

2,486

 

 

334

 

2,628

 

2,294

 

4,780

 

4,160

 

Van Kampen LIT Strategic Growth (Pinnacle Plus ™)

 

 

414

 

(414

)

862

 

 

1,288

 

(742

)

(2,030

)

(1,168

)

(1,582

)

Van Kampen UIF Emerging Markets Debt (AnnuiChoice ™) (April 27)*

 

1,622

 

388

 

1,234

 

(80

)

530

 

 

(328

)

(328

)

122

 

1,356

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

16



 

 

 

Investment

 

 

 

 

 

Realized and unrealized gain (loss) on investments

 

 

 

 

 

Income

 

Expenses

 

 

 

 

 

 

 

Net unrealized appreciation (depreciation) of investments

 

 

 

 

 

Division

 

Reinvested 
dividends

 

Mortality and 
expense risk and 
administrative
charges

 

Net investment
income (loss)

 

Realized gain (loss)
on sales of
investments

 

Realized gain 
distributions

 

Beginning of
period

 

End of period

 

Change in net unrealized
appreciation 
(depreciation) 
during the period

 

Net realized and
unrealized gain (loss)
on investments

 

Net increase
(decrease) in net
assets resulting from 
operations

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II ™) (April 27)*

 

$

60

 

$

33

 

$

27

 

$

(125

)

$

20

 

$

 

$

234

 

$

234

 

$

129

 

$

156

 

Van Kampen UIF Emerging Markets Debt (Grandmaster ™)

 

17,670

 

3,725

 

13,945

 

962

 

5,780

 

5,114

 

(2,236

)

(7,350

)

(608

)

13,337

 

Van Kampen UIF Emerging Markets Debt (GrandMaste flex3 ™) (April 27)*

 

12,508

 

2,890

 

9,618

 

(5,766

)

4,092

 

 

(1,324

)

(1,324

)

(2,998

)

6,620

 

Van Kampen UIF Emerging Markets Debt (IQ Annuity ™)

 

20,676

 

3,708

 

16,968

 

(708

)

6,763

 

(797

)

(11,080

)

(10,283

)

(4,228

)

12,740

 

Van Kampen UIF Emerging Markets Debt (Pinnacle Plus ™)

 

10,313

 

2,601

 

7,712

 

1,592

 

3,374

 

4,494

 

(1,127

)

(5,621

)

(655

)

7,057

 

Van Kampen UIF Emerging Markets Debt (IQ Advisor Standard ™) (January 3)*

 

1,668

 

75

 

1,593

 

(216

)

546

 

 

(1,165

)

(1,165

)

(835

)

758

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice ™)

 

10,066

 

12,591

 

(2,525

)

176,165

 

125,925

 

153,781

 

245,828

 

92,047

 

394,137

 

391,612

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice II ™)

 

204

 

291

 

(87

)

1,341

 

2,550

 

878

 

5,364

 

4,486

 

8,377

 

8,290

 

Van Kampen UIF Emerging Markets Equity (GrandMaster flex3 ™)

 

9,306

 

16,725

 

(7,419

)

93,543

 

116,411

 

145,298

 

276,030

 

130,732

 

340,686

 

333,267

 

Van Kampen UIF Emerging Markets Equity (Grandmaster ™)

 

4,104

 

6,111

 

(2,007

)

54,547

 

51,347

 

57,505

 

89,988

 

32,483

 

138,377

 

136,370

 

Van Kampen UIF Emerging Markets Equity (IQ Annuity ™)

 

10,192

 

21,441

 

(11,249

)

153,470

 

127,494

 

143,991

 

252,960

 

108,969

 

389,933

 

378,684

 

Van Kampen UIF Emerging Markets Equity (Pinnacle Plus ™)

 

4,411

 

8,616

 

(4,205

)

114,402

 

55,176

 

92,679

 

85,626

 

(7,053

)

162,525

 

158,320

 

Van Kampen UIF Emerging Markets Equity (IQ Advisor Standard ™)

 

206

 

301

 

(95

)

3,865

 

2,582

 

1,322

 

1,642

 

320

 

6,767

 

6,672

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™) (April 27)*

 

4,303

 

2,020

 

2,283

 

(19,812

)

16,581

 

 

(68,009

)

(68,009

)

(71,240

)

(68,957

)

Van Kampen UIF U.S Real Estate (AnnuiChoice II ™) (April 27)*

 

887

 

369

 

518

 

(2,047

)

3,418

 

 

(11,808

)

(11,808

)

(10,437

)

(9,919

)

Van Kampen UIF U. S. Real Estate (Pinnacle Plus ™)

 

15,470

 

12,798

 

2,672

 

102,608

 

59,606

 

175,654

 

(135,045

)

(310,699

)

(148,485

)

(145,813

)

Van Kampen UIF U.S. Real Estate (Grandmaster ™)

 

20,590

 

13,831

 

6,759

 

116,516

 

79,334

 

215,966

 

(163,136

)

(379,102

)

(183,252

)

(176,493

)

Van Kampen UIF U.S. Real Estate (Grandmaster flex3 ™) (April 27)*

 

5,772

 

4,005

 

1,767

 

(18,304

)

22,241

 

 

(114,216

)

(114,216

)

(110,279

)

(108,512

)

Van Kampen UIF U.S. Real Estate (IQ Annuity ™)

 

16,509

 

10,581

 

5,928

 

138,663

 

63,610

 

223,343

 

(132,627

)

(355,970

)

(153,697

)

(147,769

)

Van Kampen UIF U.S. Real Estate (IQ Advisor Standard ™)

 

3,131

 

962

 

2,169

 

7,995

 

12,062

 

24,582

 

(21,526

)

(46,108

)

(26,051

)

(23,882

)

Non-Affiliated Class B:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index (AnnuiChoice ™)

 

9,869

 

9,023

 

846

 

35,606

 

54,187

 

118,862

 

8,197

 

(110,665

)

(20,872

)

(20,026

)

DWS Small Cap Index (AnnuiChoice II ™)

 

117

 

124

 

(7

)

(1

)

641

 

73

 

(292

)

(365

)

275

 

268

 

DWS Small Cap Index (GrandMaster flex3 ™)

 

3,219

 

3,881

 

(662

)

38,487

 

17,678

 

60,143

 

1,229

 

(58,914

)

(2,749

)

(3,411

)

DWS Small Cap Index (Grandmaster ™)

 

1,619

 

2,057

 

(438

)

3,794

 

8,890

 

10,003

 

(8,357

)

(18,360

)

(5,676

)

(6,114

)

DWS Small Cap Index (IQ3 ™)

 

6,223

 

9,262

 

(3,039

)

52,233

 

34,169

 

63,662

 

(9,835

)

(73,497

)

12,905

 

9,866

 

DWS Small Cap Index (Pinnacle Plus ™)

 

1,838

 

3,098

 

(1,260

)

7,098

 

10,091

 

26,166

 

3,609

 

(22,557

)

(5,368

)

(6,628

)

 

See accompanying notes.

 


* - 2007 inception date of division.

 

17



 

Separate Account I

of

Integrity Life Insurance Company

 

Statements of Changes in Net Assets

 

For the Year Ended December 31, 2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (AnnuiChoice ™)

 

$

3,423

 

$

12,133

 

$

(763

)

$

14,793

 

$

 

$

(4,122

)

$

(6,532

)

$

(795

)

$

(11,449

)

$

3,344

 

$

358,535

 

$

361,879

 

 

(389

)

(514

)

(903

)

Touchstone Aggressive ETF (GrandMaster flex3 ™)

 

6,925

 

141,169

 

(62,097

)

85,997

 

309,701

 

(78,120

)

(113,203

)

(285

)

118,093

 

204,090

 

1,974,394

 

2,178,484

 

25,643

 

(6,319

)

(8,269

)

11,055

 

Touchstone Aggressive ETF (Grandmaster ™)

 

(446

)

44,464

 

(25,291

)

18,727

 

 

(13,052

)

(171,085

)

(18

)

(184,155

)

(165,428

)

361,448

 

196,020

 

 

(1,020

)

(13,503

)

(14,523

)

Touchstone Aggressive ETF (IQ Annuity ™)

 

19,501

 

151,990

 

(35,552

)

135,939

 

133,041

 

(181,188

)

(8,246

)

(626

)

(57,019

)

78,920

 

3,887,280

 

3,966,200

 

10,697

 

(14,892

)

(753

)

(4,948

)

Touchstone Aggressive ETF (Pinnacle Plus ™)

 

506

 

4,397

 

(435

)

4,468

 

26,832

 

 

12,842

 

(437

)

39,237

 

43,705

 

106,427

 

150,132

 

2,251

 

(36

)

1,078

 

3,293

 

Touchstone Aggressive ETF (IQ Advisor Standard ™)

 

273

 

558

 

28

 

859

 

 

 

(1

)

(30

)

(31

)

828

 

19,132

 

19,960

 

 

(2

)

 

(2

)

Touchstone Balanced (AnnuiChoice ™)

 

93,653

 

140,393

 

(141,368

)

92,678

 

11,891

 

(206,403

)

157,049

 

(14,485

)

(51,948

)

40,730

 

2,076,594

 

2,117,324

 

892

 

(15,471

)

11,040

 

(3,539

)

Touchstone Balanced (AnnuiChoice II ™) (April 27)*

 

2,650

 

2,370

 

(4,076

)

944

 

21,287

 

(132

)

36,934

 

(4

)

58,085

 

59,029

 

 

59,029

 

1,985

 

(12

)

3,386

 

5,359

 

Touchstone Balanced (GrandMaster flex3 ™)

 

41,294

 

86,242

 

(77,084

)

50,452

 

13,780

 

(206,768

)

(80,353

)

(1,121

)

(274,462

)

(224,010

)

1,369,569

 

1,145,559

 

1,017

 

(15,062

)

(5,732

)

(19,777

)

Touchstone Balanced (Grandmaster ™)

 

16,152

 

21,063

 

(16,110

)

21,105

 

1,500

 

(86,330

)

48,235

 

(70

)

(36,665

)

(15,560

)

431,465

 

415,905

 

118

 

(6,702

)

4,036

 

(2,548

)

Touchstone Balanced (IQ Annuity ™)

 

46,025

 

114,333

 

(106,550

)

53,808

 

78,474

 

(271,177

)

(17,188

)

(1,610

)

(211,501

)

(157,693

)

1,359,919

 

1,202,226

 

5,605

 

(19,334

)

(1,272

)

(15,001

)

Touchstone Balanced (Pinnacle Plus ™)

 

11,537

 

33,036

 

(22,658

)

21,915

 

11,891

 

(81,196

)

(122,543

)

(1,833

)

(193,681

)

(171,766

)

524,561

 

352,795

 

835

 

(6,118

)

(8,377

)

(13,660

)

Touchstone Baron Small Cap (AnnuiChoice ™)

 

(25,007

)

583,302

 

(512,495

)

45,800

 

3,829

 

(185,269

)

1,664

 

(12,622

)

(192,398

)

(146,598

)

2,398,221

 

2,251,623

 

255

 

(10,624

)

64

 

(10,305

)

Touchstone Baron Small Cap (AnnuiChoice II ™)

 

(466

)

13,883

 

(18,344

)

(4,927

)

88,817

 

(647

)

15,779

 

(42

)

103,907

 

98,980

 

13,597

 

112,577

 

7,296

 

(58

)

1,372

 

8,610

 

Touchstone Baron Small Cap (GrandMaster flex3 ™)

 

(20,334

)

330,837

 

(296,977

)

13,526

 

43,875

 

(265,392

)

109,400

 

(1,329

)

(113,446

)

(99,920

)

1,476,115

 

1,376,195

 

2,637

 

(15,796

)

6,062

 

(7,097

)

Touchstone Baron Small Cap (Grandmaster ™)

 

(5,269

)

67,475

 

(57,130

)

5,076

 

718

 

(105,804

)

43,588

 

(62

)

(61,560

)

(56,484

)

386,610

 

330,126

 

47

 

(7,029

)

2,811

 

(4,171

)

Touchstone Baron Small Cap (IQ Annuity ™)

 

(50,677

)

618,265

 

(519,422

)

48,166

 

118,053

 

(307,761

)

(76,321

)

(1,157

)

(267,186

)

(219,020

)

3,427,113

 

3,208,093

 

6,459

 

(17,016

)

(4,188

)

(14,745

)

Touchstone Baron Small Cap (Pinnacle Plus ™)

 

(9,393

)

138,902

 

(127,385

)

2,124

 

129,702

 

(21,601

)

(85,084

)

(1,485

)

21,532

 

23,656

 

485,834

 

509,490

 

7,328

 

(1,296

)

(4,953

)

1,079

 

Touchstone Baron Small Cap (IQ Advisor Enhanced ™)’’

 

(49

)

786

 

(624

)

113

 

 

 

(8

)

 

(8

)

105

 

5,832

 

5,937

 

 

 

 

 

Touchstone Baron Small Cap (IQ Advisor Standard ™)

 

(1,177

)

30,060

 

(25,888

)

2,995

 

45,477

 

(917

)

(6,408

)

 

38,152

 

41,147

 

174,878

 

216,025

 

2,811

 

(56

)

(402

)

2,353

 

Touchstone Conservative ETF (AnnuiChoice ™)

 

6,794

 

14,335

 

20,405

 

41,534

 

 

(6,343

)

(115,945

)

(1,099

)

(123,387

)

(81,853

)

976,307

 

894,454

 

 

(646

)

(10,309

)

(10,955

)

Touchstone Conservative ETF (GrandMaster flex3 ™)

 

449

 

79,867

 

8,111

 

88,427

 

42,000

 

(113,211

)

(247,104

)

(602

)

(318,917

)

(230,490

)

2,080,526

 

1,850,036

 

3,808

 

(10,141

)

(21,253

)

(27,586

)

Touchstone Conservative ETF (Grandmaster ™)

 

454

 

38,534

 

(2,515

)

36,473

 

 

(246,098

)

77,771

 

(40

)

(168,367

)

(131,894

)

810,264

 

678,370

 

 

(21,619

)

7,139

 

(14,480

)

Touchstone Conservative ETF (IQ Annuity ™)

 

9,060

 

83,530

 

(14,903

)

77,687

 

317,354

 

(170,602

)

412,958

 

(3,088

)

556,622

 

634,309

 

938,634

 

1,572,943

 

28,097

 

(15,301

)

38,964

 

51,760

 

Touchstone Conservative ETF (Pinnacle Plus ™)

 

748

 

1,087

 

6,006

 

7,841

 

 

(1,637

)

187,424

 

(7

)

185,780

 

193,621

 

38,068

 

231,689

 

 

(147

)

16,982

 

16,835

 

Touchstone Conservative ETF (IQ Advisor Standard ™)

 

1,514

 

393

 

4,358

 

6,265

 

 

 

6

 

 

6

 

6,271

 

122,405

 

128,676

 

 

 

 

 

Touchstone Core Bond (AnnuiChoice ™)

 

75,864

 

20,320

 

(17,582

)

78,602

 

3,120

 

(403,361

)

753,263

 

(11,391

)

341,631

 

420,233

 

1,708,273

 

2,128,506

 

395

 

(33,992

)

61,007

 

27,410

 

Touchstone Core Bond (AnnuiChoice II ™)

 

2,161

 

70

 

(977

)

1,254

 

3,058

 

(14,792

)

46,328

 

(44

)

34,550

 

35,804

 

20,134

 

55,938

 

296

 

(1,417

)

4,422

 

3,301

 

Touchstone Core Bond (GrandMaster flex3 ™)

 

16,678

 

5,253

 

(300

)

21,631

 

 

(106,316

)

93,735

 

(2,629

)

(15,210

)

6,421

 

585,959

 

592,380

 

27

 

(9,636

)

8,235

 

(1,374

)

Touchstone Core Bond (Grandmaster ™)

 

3,452

 

1,240

 

84

 

4,776

 

 

(30,704

)

55,859

 

(21

)

25,134

 

29,910

 

88,211

 

118,121

 

 

(2,879

)

5,274

 

2,395

 

Touchstone Core Bond (IQ Annuity ™)

 

28,836

 

28,822

 

(11,290

)

46,368

 

114,742

 

(142,207

)

285,922

 

(1,181

)

257,276

 

303,644

 

674,748

 

978,392

 

9,771

 

(12,223

)

25,453

 

23,001

 

Touchstone Core Bond (Pinnacle Plus ™)

 

23,876

 

4,547

 

(6,822

)

21,601

 

41,880

 

(33,159

)

328,141

 

(1,309

)

335,553

 

357,154

 

383,053

 

740,207

 

4,012

 

(3,276

)

31,178

 

31,914

 

Touchstone Core Bond (IQ Advisor Standard ™) (August 16)*

 

7,892

 

1,445

 

(5,211

)

4,126

 

147,379

 

(1,997

)

37,173

 

 

182,555

 

186,681

 

 

186,681

 

13,393

 

(182

)

3,571

 

16,782

 

Touchstone Eagle Capital Appreciation (AnnuiChoice ™)

 

(4,041

)

142,253

 

(164,823

)

(26,611

)

316

 

(162,709

)

621,572

 

(6,709

)

452,470

 

425,859

 

803,697

 

1,229,556

 

89

 

(17,121

)

61,398

 

44,366

 

Touchstone Eagle Capital Appreciation (AnnuiChoice II ™)

 

(318

)

2,301

 

(5,812

)

(3,829

)

54,834

 

(18,145

)

28,538

 

(156

)

65,071

 

61,242

 

40,955

 

102,197

 

4,766

 

(1,613

)

2,515

 

5,668

 

Touchstone Eagle Capital Appreciation (GrandMaster flex3 ™)

 

(5,850

)

92,518

 

(113,315

)

(26,647

)

 

(197,321

)

482,978

 

(2,900

)

282,757

 

256,110

 

319,629

 

575,739

 

 

(15,561

)

36,039

 

20,478

 

Touchstone Eagle Capital Appreciation (Grandmaster ™) (April 27)*

 

(504

)

(1,204

)

(3,591

)

(5,299

)

1,360

 

(8,894

)

89,270

 

(30

)

81,706

 

76,407

 

 

76,407

 

101

 

(647

)

6,458

 

5,912

 

Touchstone Eagle Capital Appreciation (IQ Annuity ™)

 

(6,814

)

50,765

 

(99,287

)

(55,336

)

1,201

 

(129,248

)

615,472

 

(779

)

486,646

 

431,310

 

283,390

 

714,700

 

121

 

(13,152

)

58,991

 

45,960

 

Touchstone Eagle Capital Appreciation (Pinnacle Plus ™)

 

(1,151

)

18,568

 

(23,319

)

(5,902

)

2,700

 

(62,470

)

120,482

 

(152

)

60,560

 

54,658

 

98,674

 

153,332

 

183

 

(4,394

)

8,167

 

3,956

 

Touchstone Mid Cap Growth (AnnuiChoice ™)

 

101,585

 

628,995

 

(304,978

)

425,602

 

99,310

 

(394,393

)

921,602

 

(18,471

)

608,048

 

1,033,650

 

3,145,746

 

4,179,396

 

5,614

 

(23,632

)

52,224

 

34,206

 

Touchstone Mid Cap Growth (AnnuiChoice II ™)

 

20,693

 

106,014

 

(84,784

)

41,923

 

680,733

 

 

50,937

 

(100

)

731,570

 

773,493

 

85,093

 

858,586

 

57,975

 

(8

)

4,299

 

62,266

 

Touchstone Mid Cap Growth (GrandMaster flex3 ™)

 

66,138

 

552,184

 

(411,522

)

206,800

 

29,527

 

(310,216

)

912,568

 

(3,379

)

628,500

 

835,300

 

1,924,846

 

2,760,146

 

1,812

 

(18,501

)

49,807

 

33,118

 

Touchstone Mid Cap Growth (Grandmaster ™)

 

9,265

 

59,450

 

(48,186

)

20,529

 

70

 

(11,271

)

272,318

 

(92

)

261,025

 

281,554

 

99,499

 

381,053

 

5

 

(736

)

17,730

 

16,999

 

Touchstone Mid Cap Growth (IQ Annuity ™)

 

60,917

 

383,377

 

(368,643

)

75,651

 

22,731

 

(597,909

)

2,504,772

 

(2,357

)

1,927,237

 

2,002,888

 

843,286

 

2,846,174

 

1,278

 

(33,748

)

136,739

 

104,269

 

Touchstone Mid Cap Growth (Pinnacle Plus ™)

 

12,146

 

79,527

 

(56,147

)

35,526

 

57,051

 

(11,508

)

297,720

 

(399

)

342,864

 

378,390

 

206,571

 

584,961

 

3,320

 

(649

)

16,311

 

18,982

 

Touchstone Mid Cap Growth (IQ Advisor Standard ™)

 

3,282

 

15,409

 

(23,044

)

(4,353

)

 

(2,307

)

59,076

 

 

56,769

 

52,416

 

61,271

 

113,687

 

 

(144

)

2,835

 

2,691

 

Touchstone Large Cap Core Equity (AnnuiChoice ™)

 

4,551

 

13,908

 

(9,258

)

9,201

 

 

(64,307

)

50,936

 

(1,880

)

(15,251

)

(6,050

)

235,116

 

229,066

 

17

 

(5,473

)

4,142

 

(1,314

)

Touchstone Large Cap Core Equity (AnnuiChoice II ™)

 

390

 

1,518

 

(1,129

)

779

 

20,378

 

(14,969

)

(2,003

)

(73

)

3,333

 

4,112

 

20,727

 

24,839

 

1,738

 

(1,280

)

(172

)

286

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

18



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Large Cap Core Equity (GrandMaster flex3 ™)

 

$

25,577

 

$

127,098

 

$

(134,481

)

$

18,194

 

$

116,280

 

$

(85,263

)

$

(166,825

)

$

(2,751

)

$

(138,559

)

$

(120,365

)

$

1,452,212

 

$

1,331,847

 

8,568

 

(6,881

)

(15,266

)

(13,579

)

Touchstone Large Cap Core Equity (Grandmaster ™)

 

50

 

1,849

 

(1,375

)

524

 

 

(641

)

(15,303

)

(10

)

(15,954

)

(15,430

)

20,970

 

5,540

 

 

(50

)

(1,186

)

(1,236

)

Touchstone Large Cap Core Equity (IQ Annuity ™)

 

10,708

 

34,152

 

(68,847

)

(23,987

)

8,715

 

(124,416

)

413,421

 

(888

)

296,832

 

272,845

 

326,906

 

599,751

 

715

 

(10,227

)

30,990

 

21,478

 

Touchstone Large Cap Core Equity (Pinnacle Plus ™)

 

1,954

 

13,507

 

(8,561

)

6,900

 

400

 

(14,878

)

9,159

 

(118

)

(5,437

)

1,463

 

151,401

 

152,864

 

28

 

(1,049

)

745

 

(276

)

Touchstone Large Cap Core Equity (IQ Advisor Standard ™)

 

3,614

 

664

 

(11,247

)

(6,969

)

47,005

 

(4,022

)

68,874

 

 

111,857

 

104,888

 

30,190

 

135,078

 

3,430

 

(298

)

4,768

 

7,900

 

Touchstone Enhanced ETF (AnnuiChoice ™)

 

11,521

 

15,739

 

6,379

 

33,639

 

 

(11,739

)

(7,997

)

(2,400

)

(22,136

)

11,503

 

1,115,603

 

1,127,106

 

 

(1,083

)

(596

)

(1,679

)

Touchstone Enhanced ETF (GrandMaster flex3 ™)

 

16,181

 

876,661

 

(474,416

)

418,426

 

51,322

 

(74,085

)

(4,511,896

)

(3,966

)

(4,538,625

)

(4,120,199

)

14,018,640

 

9,898,441

 

3,986

 

(5,961

)

(347,740

)

(349,715

)

Touchstone Enhanced ETF (Grandmaster ™)

 

9,898

 

34,141

 

(6,247

)

37,792

 

 

(21,114

)

17,088

 

(53

)

(4,079

)

33,713

 

1,451,904

 

1,485,617

 

 

(1,594

)

1,260

 

(334

)

Touchstone Enhanced ETF (IQ Annuity ™)

 

36,269

 

182,072

 

(78,624

)

139,717

 

669,132

 

(206,120

)

(153,292

)

(1,345

)

308,375

 

448,092

 

5,779,360

 

6,227,452

 

51,388

 

(16,135

)

(11,565

)

23,688

 

Touchstone Enhanced ETF (Pinnacle Plus ™)

 

1,090

 

3,150

 

(801

)

3,439

 

 

(1,027

)

67,340

 

(111

)

66,202

 

69,641

 

182,429

 

252,070

 

 

(88

)

5,244

 

5,156

 

Touchstone Enhanced ETF (IQ Advisor Enhanced ™)

 

556

 

1,580

 

(717

)

1,419

 

 

(4,632

)

5

 

 

(4,627

)

(3,208

)

48,390

 

45,182

 

 

(339

)

 

(339

)

Touchstone Enhanced ETF (IQ Advisor Standard ™)

 

3,323

 

54,432

 

(35,196

)

22,559

 

 

 

(318,012

)

 

(318,012

)

(295,453

)

603,907

 

308,454

 

 

 

(22,365

)

(22,365

)

Touchstone Growth & Income (AnnuiChoice ™)

 

5,355

 

12,118

 

(9,932

)

7,541

 

261

 

(12,485

)

(30,935

)

(959

)

(44,118

)

(36,577

)

214,632

 

178,055

 

21

 

(1,005

)

(2,262

)

(3,246

)

Touchstone Growth & Income (GrandMaster flex3 ™)

 

1,946

 

6,949

 

(6,346

)

2,549

 

67

 

(16,370

)

(36,365

)

(459

)

(53,127

)

(50,578

)

140,162

 

89,584

 

5

 

(1,299

)

(2,838

)

(4,132

)

Touchstone Growth & Income (Grandmaster ™)

 

624

 

1,567

 

(1,743

)

448

 

 

(3,954

)

13,630

 

(15

)

9,661

 

10,109

 

10,475

 

20,584

 

 

(299

)

1,080

 

781

 

Touchstone Growth & Income (IQ Annuity ™)

 

7,137

 

24,964

 

(23,730

)

8,371

 

339

 

(45,471

)

(34,098

)

(325

)

(79,555

)

(71,184

)

361,976

 

290,792

 

25

 

(3,442

)

(2,633

)

(6,050

)

Touchstone Growth & Income (Pinnacle Plus ™)

 

2,976

 

17,910

 

(13,630

)

7,256

 

101,906

 

(4,841

)

(88,585

)

(113

)

8,367

 

15,623

 

116,265

 

131,888

 

7,295

 

(351

)

(6,016

)

928

 

Touchstone High Yield (AnnuiChoice ™)

 

44,524

 

14,494

 

(51,894

)

7,124

 

6,685

 

(115,651

)

(133,267

)

(3,936

)

(246,169

)

(239,045

)

832,078

 

593,033

 

493

 

(7,971

)

(8,852

)

(16,330

)

Touchstone High Yield (AnnuiChoice II ™) (April 27)*

 

7,267

 

(8

)

(7,871

)

(612

)

30,773

 

(501

)

57,921

 

 

88,193

 

87,581

 

 

87,581

 

2,868

 

(48

)

5,488

 

8,308

 

Touchstone High Yield (GrandMaster flex3 ™)

 

67,562

 

21,410

 

(84,577

)

4,395

 

17,393

 

(234,016

)

(50,360

)

(1,365

)

(268,348

)

(263,953

)

1,253,340

 

989,387

 

1,262

 

(16,808

)

(3,477

)

(19,023

)

Touchstone High Yield (Grandmaster ™)

 

6,964

 

(13,674

)

7,282

 

572

 

 

(310,148

)

(167,621

)

(52

)

(477,821

)

(477,249

)

592,543

 

115,294

 

 

(26,711

)

(14,565

)

(41,276

)

Touchstone High Yield (IQ Annuity ™)

 

60,291

 

26,237

 

(79,473

)

7,055

 

42,822

 

(121,406

)

41,357

 

(866

)

(38,093

)

(31,038

)

873,958

 

842,920

 

2,929

 

(8,445

)

3,188

 

(2,328

)

Touchstone High Yield (Pinnacle Plus ™)

 

25,030

 

(140

)

(24,837

)

53

 

4,917

 

(8,863

)

27,047

 

(255

)

22,846

 

22,899

 

334,880

 

357,779

 

394

 

(736

)

2,191

 

1,849

 

Touchstone High Yield (IQ Advisor Standard ™)

 

21,074

 

13,614

 

(15,618

)

19,070

 

400,531

 

(419,300

)

(402,198

)

 

(420,967

)

(401,897

)

670,150

 

268,253

 

32,790

 

(34,362

)

(32,865

)

(34,437

)

Touchstone Moderate ETF (AnnuiChoice ™)

 

15,904

 

58,107

 

79,481

 

153,492

 

 

(162,885

)

(35,808

)

(5,424

)

(204,117

)

(50,625

)

3,690,507

 

3,639,882

 

 

(14,004

)

(2,959

)

(16,963

)

Touchstone Moderate ETF (GrandMaster flex3 ™)

 

(9,870

)

130,486

 

117,899

 

238,515

 

127,429

 

(241,753

)

374,842

 

(2,161

)

258,357

 

496,872

 

6,093,998

 

6,590,870

 

10,948

 

(20,727

)

33,158

 

23,379

 

Touchstone Moderate ETF (Grandmaster ™)

 

536

 

35,954

 

(11,876

)

24,614

 

3,015

 

(23,719

)

(111,633

)

(20

)

(132,357

)

(107,743

)

760,914

 

653,171

 

256

 

(1,976

)

(9,725

)

(11,445

)

Touchstone Moderate ETF (IQ Annuity ™)

 

3,414

 

75,496

 

4,671

 

83,581

 

505,409

 

(370,229

)

219,415

 

(4,287

)

350,308

 

433,889

 

2,567,463

 

3,001,352

 

42,149

 

(31,740

)

18,038

 

28,447

 

Touchstone Moderate ETF (Pinnacle Plus ™)

 

(748

)

6,607

 

2,865

 

8,724

 

9,081

 

(20,632

)

9,575

 

(403

)

(2,379

)

6,345

 

260,294

 

266,639

 

781

 

(1,816

)

807

 

(228

)

Touchstone Moderate ETF (IQ Advisor Enhanced ™)

 

343

 

310

 

1,514

 

2,167

 

 

 

(4

)

 

(4

)

2,163

 

49,360

 

51,523

 

 

 

 

 

Touchstone Moderate ETF (IQ Advisor Standard ™)

 

1,069

 

756

 

3,601

 

5,426

 

 

 

 

(30

)

(30

)

5,396

 

117,878

 

123,274

 

 

(2

)

 

(2

)

Touchstone Money Market (AnnuiChoice ™)

 

2,567

 

 

 

2,567

 

 

(13,716

)

3

 

(738

)

(14,451

)

(11,884

)

71,795

 

59,911

 

 

(1,318

)

1

 

(1,317

)

Touchstone Money Market (Grandmaster ™)

 

264,698

 

 

 

264,698

 

68,318

 

(2,849,619

)

3,118,183

 

(2,558

)

334,324

 

599,022

 

5,962,770

 

6,561,792

 

6,409

 

(265,798

)

293,903

 

34,514

 

Touchstone Money Market (IQ Annuity ™)

 

33,937

 

 

 

33,937

 

 

(687,391

)

782,767

 

(717

)

94,659

 

128,596

 

452,888

 

581,484

 

 

(64,035

)

74,320

 

10,285

 

Touchstone Money Market (IQ 3 ™)

 

3,863

 

 

 

3,863

 

 

(17,614

)

(15,629

)

(219

)

(33,462

)

(29,599

)

135,956

 

106,357

 

 

(1,686

)

(1,482

)

(3,168

)

Touchstone Third Avenue Value (AnnuiChoice ™)

 

(26,671

)

1,975,196

 

(2,319,195

)

(370,670

)

126,979

 

(1,208,660

)

2,176,063

 

(53,480

)

1,040,902

 

670,232

 

8,302,193

 

8,972,425

 

6,008

 

(58,929

)

98,285

 

45,364

 

Touchstone Third Avenue Value (AnnuiChoice II ™)

 

243

 

39,534

 

(75,942

)

(36,165

)

462,221

 

(46,370

)

158,449

 

(513

)

573,787

 

537,622

 

40,785

 

578,407

 

41,031

 

(4,153

)

13,816

 

50,694

 

Touchstone Third Avenue Value (GrandMaster flex3 ™)

 

(43,051

)

824,269

 

(971,333

)

(190,115

)

248,122

 

(1,184,577

)

797,093

 

(4,294

)

(143,656

)

(333,771

)

5,629,691

 

5,295,920

 

14,132

 

(67,366

)

44,400

 

(8,834

)

Touchstone Third Avenue Value (Grandmaster ™)

 

(15,963

)

306,363

 

(449,659

)

(159,259

)

5,148

 

(676,445

)

1,393,185

 

(507

)

721,381

 

562,122

 

1,983,512

 

2,545,634

 

306

 

(41,009

)

80,709

 

40,006

 

Touchstone Third Avenue Value (IQ Annuity ™)

 

(57,586

)

1,254,676

 

(1,385,605

)

(188,515

)

650,474

 

(1,413,944

)

(540,157

)

(6,708

)

(1,310,335

)

(1,498,850

)

8,050,076

 

6,551,226

 

34,576

 

(76,727

)

(28,164

)

(70,315

)

Touchstone Third Avenue Value (Pinnacle Plus ™)

 

(18,430

)

340,428

 

(419,452

)

(97,454

)

243,206

 

(143,536

)

178,581

 

(2,233

)

276,018

 

178,564

 

1,618,084

 

1,796,648

 

12,042

 

(7,241

)

7,638

 

12,439

 

Touchstone Third Avenue Value (IQ Advisor Enhanced ™) (April 27)*

 

11

 

358

 

(921

)

(552

)

 

 

6,147

 

 

6,147

 

5,595

 

 

5,595

 

 

 

361

 

361

 

Touchstone Third Avenue Value (IQ Advisor Standard ™)

 

2,515

 

22,952

 

(33,305

)

(7,838

)

389,712

 

(2,201

)

(44,462

)

 

343,049

 

335,211

 

162,640

 

497,851

 

24,460

 

(133

)

(2,630

)

21,697

 

Touchstone Value Plus (AnnuiChoice ™)

 

1,815

 

165,598

 

(210,333

)

(42,920

)

569

 

(171,067

)

(81,050

)

(7,413

)

(258,961

)

(301,881

)

1,141,631

 

839,750

 

110

 

(15,216

)

(6,614

)

(21,720

)

Touchstone Value Plus (AnnuiChoice II ™)

 

240

 

448

 

(4,110

)

(3,422

)

39,436

 

(14,802

)

(3

)

(45

)

24,586

 

21,164

 

20,787

 

41,951

 

3,468

 

(1,354

)

(1

)

2,113

 

Touchstone Value Plus (GrandMaster flex3 ™)

 

(281

)

11,084

 

(16,915

)

(6,112

)

459

 

(20,151

)

(22,755

)

(663

)

(43,110

)

(49,222

)

161,013

 

111,791

 

38

 

(1,631

)

(1,815

)

(3,408

)

Touchstone Value Plus (Grandmaster ™)

 

185

 

1,695

 

(8,349

)

(6,469

)

 

(3,045

)

30,542

 

(17

)

27,480

 

21,011

 

79,035

 

100,046

 

 

(216

)

2,271

 

2,055

 

Touchstone Value Plus (IQ Annuity ™)

 

(15,123

)

249,962

 

(281,202

)

(46,363

)

174,708

 

(460,310

)

(1,887,295

)

(2,702

)

(2,175,599

)

(2,221,962

)

2,652,496

 

430,534

 

14,628

 

(40,063

)

(164,605

)

(190,040

)

Touchstone Value Plus (Pinnacle Plus ™)

 

139

 

409

 

(5,209

)

(4,661

)

11,256

 

(203

)

31,726

 

(62

)

42,717

 

38,056

 

49,579

 

87,635

 

798

 

(19

)

2,262

 

3,041

 

Non-Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (AnnuiChoice ™)

 

8,565

 

50,706

 

(46,985

)

12,286

 

 

(115,923

)

(36,492

)

(4,304

)

(156,719

)

(144,433

)

657,670

 

513,237

 

 

(6,578

)

(1,974

)

(8,552

)

JP Morgan Mid Cap Value (GrandMaster flex3 ™)

 

9,371

 

112,567

 

(101,071

)

20,867

 

 

(304,476

)

(126,171

)

(1,408

)

(432,055

)

(411,188

)

1,365,843

 

954,655

 

 

(17,373

)

(7,136

)

(24,509

)

JP Morgan Mid Cap Value (Grandmaster ™)

 

1,402

 

26,943

 

(21,225

)

7,120

 

 

(53,719

)

(71,590

)

(20

)

(125,329

)

(118,209

)

207,901

 

89,692

 

 

(3,640

)

(4,705

)

(8,345

)

JP Morgan Mid Cap Value (IQ3 ™)

 

3,484

 

30,245

 

(28,100

)

5,629

 

 

(55,008

)

(35,970

)

(596

)

(91,574

)

(85,945

)

447,131

 

361,186

 

 

(3,114

)

(2,032

)

(5,146

)

JP Morgan Mid Cap Value (Pinnacle Plus ™)

 

2,582

 

23,553

 

(22,145

)

3,990

 

 

(29,843

)

(9,874

)

(329

)

(40,046

)

(36,056

)

422,255

 

386,199

 

 

(1,777

)

(590

)

(2,367

)

 

See accompanying notes.

 


* - 2007 inception date of division.

 

19



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Initial Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (Grandmaster ™)

 

$

227,792

 

$

3,029,060

 

$

(3,060,455

)

$

196,397

 

$

72,664

 

$

(4,473,584

)

$

(935,876

)

$

(10,071

)

$

(5,346,867

)

$

(5,150,470

)

$

28,918,519

 

$

23,768,049

 

1,208

 

(74,826

)

(15,904

)

(89,522

)

Fidelity VIP Growth (Grandmaster ™)

 

(63,157

)

586,981

 

2,959,952

 

3,483,776

 

23,015

 

(3,201,608

)

(1,951,575

)

(7,570

)

(5,137,738

)

(1,653,962

)

16,805,222

 

15,151,260

 

404

 

(52,653

)

(32,029

)

(84,278

)

Fidelity VIP High Income (Grandmaster ™)

 

287,691

 

84,813

 

(292,476

)

80,028

 

23,993

 

(1,360,247

)

505,465

 

(1,475

)

(832,264

)

(752,236

)

4,774,521

 

4,022,285

 

1,321

 

(75,447

)

28,867

 

(45,259

)

Fidelity VIP II Asset Manager (Grandmaster ™)

 

588,721

 

739,319

 

387,897

 

1,715,937

 

145,128

 

(2,359,683

)

(55,590

)

(6,243

)

(2,276,388

)

(560,451

)

12,892,081

 

12,331,630

 

3,933

 

(63,912

)

(775

)

(60,754

)

Fidelity VIP II Contrafund (Grandmaster ™)

 

1,066,802

 

8,290,691

 

(5,253,483

)

4,104,010

 

103,991

 

(4,973,045

)

(938,882

)

(10,730

)

(5,818,666

)

(1,714,656

)

29,048,142

 

27,333,486

 

2,394

 

(114,683

)

(22,478

)

(134,767

)

Fidelity VIP II Index 500 (Grandmaster ™)

 

252,622

 

798,077

 

(532,476

)

518,223

 

 

(2,175,962

)

(1,012,262

)

(4,905

)

(3,193,129

)

(2,674,906

)

12,857,373

 

10,182,467

 

 

(63,611

)

(29,599

)

(93,210

)

Fidelity VIP II Index 500 (IQ Annuity ™)

 

20,014

 

41,660

 

(22,129

)

39,545

 

 

(141,023

)

(38,087

)

(785

)

(179,895

)

(140,350

)

1,007,891

 

867,541

 

 

(12,538

)

(3,307

)

(15,845

)

Fidelity VIP II Investment Grade Bond (AnnuiChoice ™) (April 27)*

 

(5,857

)

(719

)

21,338

 

14,762

 

 

(37,895

)

903,476

 

(2,718

)

862,863

 

877,625

 

 

877,625

 

 

(4,093

)

90,243

 

86,150

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice II ™) (April 27)*

 

(564

)

2

 

1,980

 

1,418

 

 

 

80,076

 

 

80,076

 

81,494

 

 

81,494

 

 

 

8,008

 

8,008

 

Fidelity VIP II Investment Grade Bond (Grandmaster ™)

 

221,336

 

(273,206

)

230,755

 

178,885

 

13,878

 

(1,759,170

)

(791,279

)

(1,895

)

(2,538,466

)

(2,359,581

)

8,106,918

 

5,747,337

 

467

 

(58,997

)

(26,613

)

(85,143

)

Fidelity VIP II Investment Grade Bond (Grandmaster flex3 ™) (April 27)*

 

(15,550

)

620

 

32,057

 

17,127

 

 

(181,484

)

1,485,812

 

(1,708

)

1,302,620

 

1,319,747

 

 

1,319,747

 

 

(18,384

)

148,427

 

130,043

 

Fidelity VIP II Investment Grade Bond (IQ Annuity ™)

 

24,143

 

(45,213

)

72,931

 

51,861

 

29,400

 

(395,421

)

1,259,478

 

(874

)

892,583

 

944,444

 

1,384,362

 

2,328,806

 

2,090

 

(27,915

)

88,408

 

62,583

 

Fidelity VIP II Investment Grade Bond (Pinnacle Plus ™) (April 27)*

 

(3,101

)

(6

)

6,686

 

3,579

 

 

(16,744

)

288,739

 

(308

)

271,687

 

275,266

 

 

275,266

 

 

(1,714

)

28,860

 

27,146

 

Fidelity VIP III Balanced (Grandmaster ™)

 

88,465

 

171,618

 

(110,814

)

149,269

 

871

 

(434,222

)

(199,030

)

(626

)

(633,007

)

(483,738

)

1,896,303

 

1,412,565

 

54

 

(26,395

)

(11,152

)

(37,493

)

Fidelity VIP III Growth & Income (Grandmaster ™)

 

131,597

 

264,355

 

22,408

 

418,360

 

22,132

 

(786,800

)

(197,208

)

(1,557

)

(963,433

)

(545,073

)

4,312,057

 

3,766,984

 

1,160

 

(41,666

)

(10,589

)

(51,095

)

Fidelity VIP III Growth Opportunities (Grandmaster ™)

 

(20,367

)

261,414

 

47,835

 

288,882

 

4,461

 

(564,935

)

76,810

 

(964

)

(484,628

)

(195,746

)

1,603,790

 

1,408,044

 

340

 

(42,614

)

5,584

 

(36,690

)

Fidelity VIP Overseas (AnnuiChoice ™) (April 27)*

 

4,093

 

1,865

 

18,288

 

24,246

 

 

(39,315

)

407,015

 

(1,574

)

366,126

 

390,372

 

 

390,372

 

 

(3,981

)

40,748

 

36,767

 

Fidelity VIP Overseas (AnnuiChoice II ™) (April 27)*

 

968

 

2,582

 

5,244

 

8,794

 

 

(18,191

)

121,532

 

(192

)

103,149

 

111,943

 

 

111,943

 

 

(1,678

)

12,232

 

10,554

 

Fidelity VIP Overseas (Grandmaster ™)

 

158,780

 

2,520,115

 

(1,414,768

)

1,264,127

 

8,273

 

(1,967,239

)

(955,515

)

(3,406

)

(2,917,887

)

(1,653,760

)

9,110,849

 

7,457,089

 

247

 

(55,647

)

(25,950

)

(81,350

)

Fidelity VIP Overseas (Grandmaster flex3 ™) (April 27)*

 

393

 

4,289

 

13,615

 

18,297

 

 

(187,777

)

461,325

 

(1,223

)

272,325

 

290,622

 

 

290,622

 

 

(19,127

)

46,603

 

27,476

 

Fidelity VIP Overseas (IQ Annuity ™) (April 27)*

 

2,916

 

1,138

 

17,724

 

21,778

 

 

(27,650

)

383,647

 

(143

)

355,854

 

377,632

 

 

377,632

 

 

(2,707

)

38,385

 

35,678

 

Fidelity VIP Overseas (Pinnacle Plus ™) (April 27)*

 

1,994

 

(388

)

17,147

 

18,753

 

 

(17,299

)

365,237

 

(663

)

347,275

 

366,028

 

 

366,028

 

 

(1,777

)

36,411

 

34,634

 

Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (Annuichoice ™)

 

3,934

 

14,927

 

(10,401

)

8,460

 

60,550

 

(12,000

)

82,986

 

(239

)

131,297

 

139,757

 

225,255

 

365,012

 

5,415

 

(1,077

)

7,258

 

11,596

 

Touchstone Aggressive ETF (Annuichoice II ™)

 

1,478

 

16,178

 

(10,187

)

7,469

 

332,569

 

(165,584

)

(23,457

)

(280

)

143,248

 

150,717

 

14,613

 

165,330

 

29,972

 

(14,373

)

(2,074

)

13,525

 

Touchstone Aggressive ETF (Grandmaster flex3 ™) (April 27)*

 

1,728

 

3,463

 

(7,267

)

(2,076

)

4,568

 

 

131,583

 

 

136,151

 

134,075

 

 

134,075

 

475

 

 

13,173

 

13,648

 

Touchstone Aggressive ETF (IQ Advisor Standard ™) (May 3)*

 

(45

)

(2,885

)

 

(2,930

)

 

(666

)

3,799

 

 

3,133

 

203

 

 

203

 

 

(67

)

88

 

21

 

Touchstone Aggressive ETF (Pinnacle Plus ™) (April 27)*

 

832

 

1,683

 

(4,165

)

(1,650

)

13,440

 

 

52,347

 

(5

)

65,782

 

64,132

 

 

64,132

 

1,335

 

 

5,199

 

6,534

 

Touchstone Conservative ETF (Annuichoice ™)

 

2,099

 

8,402

 

(984

)

9,517

 

 

(12,344

)

77,768

 

(770

)

64,654

 

74,171

 

151,357

 

225,528

 

 

(1,201

)

7,299

 

6,098

 

Touchstone Conservative ETF (Annuichoice II ™)

 

984

 

510

 

128

 

1,622

 

77,188

 

(824

)

2,476

 

(85

)

78,755

 

80,377

 

4,987

 

85,364

 

7,232

 

(83

)

221

 

7,370

 

Touchstone Conservative ETF (GrandMaster flex3 ™) (April 27)*

 

790

 

551

 

12

 

1,353

 

33,612

 

(15,859

)

58,219

 

(15

)

75,957

 

77,310

 

 

77,310

 

3,405

 

(1,556

)

5,824

 

7,673

 

Tocuhstone Conservative ETF (IQ Advisor Enhanced ™) (April 27)*

 

861

 

2,359

 

1,169

 

4,389

 

 

(1,610

)

56,449

 

 

54,839

 

59,228

 

 

59,228

 

 

(159

)

5,999

 

5,840

 

Touchstone Conservative ETF (Pinnacle Plus ™) (April 27)*

 

203

 

67

 

49

 

319

 

10,500

 

(366

)

13,451

 

(16

)

23,569

 

23,888

 

 

23,888

 

1,059

 

(38

)

1,352

 

2,373

 

Touchstone Enhanced ETF (Annuichoice ™)

 

3,918

 

11,987

 

(17,510

)

(1,605

)

62,441

 

(15,009

)

151,966

 

(1,962

)

197,436

 

195,831

 

175,800

 

371,631

 

5,498

 

(1,421

)

12,766

 

16,843

 

Touchstone Enhanced ETF (Annuichoice II ™)

 

1,623

 

(783

)

(6,307

)

(5,467

)

95,040

 

(2,114

)

(7,704

)

(95

)

85,127

 

79,660

 

1,563

 

81,223

 

8,453

 

(194

)

(1,103

)

7,156

 

Touchstone Enhanced ETF (GrandMaster flex3 ™) (April 27)*

 

4,331

 

3,090

 

(23,231

)

(15,810

)

118,286

 

 

242,262

 

(12

)

360,536

 

344,726

 

 

344,726

 

11,783

 

(1

)

23,982

 

35,764

 

Touchstone Enhanced ETF (Pinnacle Plus ™) (April 27)*

 

3,351

 

2,458

 

(20,218

)

(14,409

)

255,962

 

(8,673

)

96,575

 

(80

)

343,784

 

329,375

 

 

329,375

 

25,277

 

(854

)

9,777

 

34,200

 

Touchstone GMAB Aggressive (AnnuiChoice ™) (April 27)*

 

540

 

3,003

 

(2,205

)

1,338

 

104,750

 

(3,216

)

(74

)

(71

)

101,389

 

102,727

 

 

102,727

 

9,619

 

(286

)

(7

)

9,326

 

Touchstone GMAB Conservative (AnnuiChoice ™) (Dec 4)*

 

184

 

26

 

(280

)

(70

)

11,347

 

 

(1

)

(6

)

11,340

 

11,270

 

 

11,270

 

1,028

 

(1

)

 

1,027

 

Touchstone GMAB Conservative (AnnuiChoice II ™) (April 27)*

 

2,759

 

710

 

(940

)

2,529

 

230,573

 

(8,415

)

(119

)

(112

)

221,927

 

224,456

 

 

224,456

 

21,599

 

(784

)

(11

)

20,804

 

Touchstone GMAB Moderate ETF (AnnuiChoice ™)

 

(89

)

238

 

1,048

 

1,197

 

 

 

(3

)

 

(3

)

1,194

 

36,273

 

37,467

 

 

 

 

 

Touchstone GMAB Moderate ETF (AnnuiChoice II ™) (April 27)*

 

837

 

(1,432

)

(717

)

(1,312

)

25,425

 

 

564

 

 

25,989

 

24,677

 

 

24,677

 

2,216

 

 

52

 

2,268

 

Touchstone Moderate ETF (AnnuiChoice ™)

 

3,724

 

8,737

 

1,056

 

13,517

 

270,079

 

(16,130

)

112,945

 

(637

)

366,257

 

379,774

 

322,546

 

702,320

 

24,281

 

(1,510

)

10,105

 

32,876

 

Touchstone Moderate ETF (AnnuiChoice II ™)

 

1,950

 

6,670

 

(7,981

)

639

 

251,611

 

(1,651

)

(16,239

)

(207

)

233,514

 

234,153

 

13,363

 

247,516

 

23,123

 

(166

)

(1,660

)

21,297

 

Touchstone Moderate ETF (GrandM aster flex3 ™) (April 27)*

 

24,386

 

17,528

 

(52,446

)

(10,532

)

175,998

 

(8,439

)

3,613,164

 

(286

)

3,780,437

 

3,769,905

 

 

3,769,905

 

17,534

 

(864

)

363,239

 

379,909

 

Touchstone Moderate ETF (IQ Advisor Standard ™) (April 27)*

 

187

 

 

(324

)

(137

)

15,955

 

 

201

 

 

16,156

 

16,019

 

 

16,019

 

1,583

 

 

21

 

1,604

 

Touchstone Moderate ETF (Pinnacle Plus ™) (April 27)*

 

573

 

853

 

(1,202

)

224

 

12,473

 

(1,486

)

85,250

 

(29

)

96,208

 

96,432

 

 

96,432

 

1,239

 

(152

)

8,639

 

9,726

 

Touchstone Money Market (AnnuiChoice ™)

 

207,297

 

 

 

207,297

 

61,156

 

(1,010,719

)

(809,475

)

(31,802

)

(1,790,840

)

(1,583,543

)

5,585,892

 

4,002,349

 

6,532

 

(98,221

)

(72,551

)

(164,240

)

Touchstone Money Market (AnnuiChoice II ™)

 

10,740

 

 

 

10,740

 

516,459

 

(47,376

)

(221,190

)

(252

)

247,641

 

258,381

 

140,704

 

399,085

 

50,051

 

(4,625

)

(21,314

)

24,112

 

Touchstone Money Market (GrandMaster flex3 ™)

 

85,230

 

 

 

85,230

 

833,201

 

(2,626,476

)

2,998,140

 

(3,600

)

1,201,265

 

1,286,495

 

1,877,744

 

3,164,239

 

79,287

 

(250,726

)

286,169

 

114,730

 

Touchstone Money Market (IQ Annuity ™)

 

217,216

 

 

 

217,216

 

1,999,873

 

(3,185,628

)

314,541

 

(17,999

)

(889,213

)

(671,997

)

6,030,422

 

5,358,425

 

190,551

 

(305,135

)

33,015

 

(81,569

)

Touchstone Money Market (Pinnacle Plus ™)

 

23,477

 

 

 

23,477

 

475,290

 

(83,520

)

753,134

 

(1,571

)

1,143,333

 

1,166,810

 

329,835

 

1,496,645

 

45,215

 

(8,104

)

71,775

 

108,886

 

Touchstone Money Market (IQ Advisor Standard ™)

 

33,155

 

 

 

33,155

 

1,286,435

 

(420,116

)

76,350

 

 

942,669

 

975,824

 

266,643

 

1,242,467

 

117,542

 

(37,903

)

6,881

 

86,520

 

Non-Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (IQ Annuity ™)

 

5,248

 

131,687

 

(121,206

)

15,729

 

23,126

 

(110,312

)

(268,708

)

(262

)

(356,156

)

(340,427

)

1,228,407

 

887,980

 

1,635

 

(7,791

)

(18,427

)

(24,583

)

Fidelity VIP Growth (IQ Annuity ™)

 

(5,582

)

56,068

 

118,563

 

169,049

 

 

(91,919

)

(97,847

)

(449

)

(190,215

)

(21,166

)

732,155

 

710,989

 

 

(9,244

)

(8,742

)

(17,986

)

 

See accompanying notes.

 


* - 2007 inception date of division.

 

20



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Service Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP High Income (IQ Annuity ™)

 

$

15,470

 

$

19,351

 

$

(18,069

)

$

16,752

 

$

 

$

(39,111

)

$

(352,104

)

$

(194

)

$

(391,409

)

$

(374,657

)

$

650,367

 

$

275,710

 

 

(3,803

)

(33,604

)

(37,407

)

Fidelity VIP II Asset Manager (IQ Annuity ™)

 

10,143

 

12,218

 

7,805

 

30,166

 

 

(44,399

)

13,883

 

(104

)

(30,620

)

(454

)

234,097

 

233,643

 

 

(3,847

)

1,221

 

(2,626

)

Fidelity VIP II Contrafund (IQ Annuity ™)

 

85,787

 

617,422

 

(404,603

)

298,606

 

47,126

 

(264,677

)

(150,169

)

(791

)

(368,511

)

(69,905

)

2,322,937

 

2,253,032

 

3,040

 

(16,507

)

(11,548

)

(25,015

)

Fidelity VIP III Balanced (IQ Annuity ™)

 

6,502

 

4,493

 

147

 

11,142

 

 

(13,849

)

(477

)

(120

)

(14,446

)

(3,304

)

157,611

 

154,307

 

 

(1,171

)

(41

)

(1,212

)

Fidelity VIP III Growth & Income (IQ Annuity ™)

 

8,353

 

13,926

 

6,922

 

29,201

 

 

(31,056

)

(12,735

)

(169

)

(43,960

)

(14,759

)

283,813

 

269,054

 

 

(2,572

)

(1,050

)

(3,622

)

Fidelity VIP III Growth Opportunities (IQ Annuity ™)

 

(1,412

)

30,243

 

(13,701

)

15,130

 

63

 

(83,255

)

38,307

 

(68

)

(44,953

)

(29,823

)

104,298

 

74,475

 

7

 

(9,335

)

3,933

 

(5,395

)

Fidelity VIP III Mid Cap (Grandmaster ™)

 

(21,279

)

1,232,056

 

(339,050

)

871,727

 

9,665

 

(1,230,986

)

(4,361,562

)

(1,598

)

(5,584,481

)

(4,712,754

)

8,460,718

 

3,747,964

 

292

 

(36,041

)

(126,396

)

(162,145

)

Fidelity VIP III Mid Cap (IQ Annuity ™)

 

(10,828

)

410,024

 

(152,046

)

247,150

 

59,007

 

(331,742

)

(424,126

)

(445

)

(697,306

)

(450,156

)

2,139,759

 

1,689,603

 

1,668

 

(9,390

)

(11,954

)

(19,676

)

Fidelity VIP Overseas (IQ Annuity ™)

 

3,251

 

51,272

 

(30,977

)

23,546

 

 

(36,219

)

(58,707

)

(116

)

(95,042

)

(71,496

)

229,325

 

157,829

 

 

(2,427

)

(4,074

)

(6,501

)

Non-Affiliated Service Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Asset Manager (AnnuiChoice ™)

 

20,108

 

27,027

 

3,224

 

50,359

 

 

(118,871

)

36,091

 

(1,941

)

(84,721

)

(34,362

)

463,214

 

428,852

 

 

(10,316

)

2,564

 

(7,752

)

Fidelity VIP Asset Manager (AnnuiChoice II ™) (May 3)*

 

29

 

 

42

 

71

 

 

 

1,220

 

 

1,220

 

1,291

 

 

1,291

 

 

 

108

 

108

 

Fidelity VIP Asset Manager (GrandMaster flex3 ™)

 

11,819

 

19,214

 

10,095

 

41,128

 

32,335

 

(56,311

)

(8,360

)

(162

)

(32,498

)

8,630

 

288,558

 

297,188

 

2,782

 

(4,462

)

(689

)

(2,369

)

Fidelity VIP Asset Manager (IQ3 ™)

 

18,163

 

21,961

 

14,923

 

55,047

 

38,429

 

(67,997

)

(39,920

)

(574

)

(70,062

)

(15,015

)

457,268

 

442,253

 

3,242

 

(5,725

)

(3,517

)

(6,000

)

Fidelity VIP Asset Manager (Pinnacle Plus ™)

 

8,148

 

7,002

 

(5,870

)

9,280

 

 

(52,488

)

166,800

 

(308

)

114,004

 

123,284

 

110,645

 

233,929

 

 

(4,462

)

12,706

 

8,244

 

Fidelity VIP Balanced (AnnuiChoice ™)

 

75,217

 

108,334

 

(65,753

)

117,798

 

6,956

 

(283,893

)

188,971

 

(14,399

)

(102,365

)

15,433

 

1,590,175

 

1,605,608

 

584

 

(23,219

)

14,460

 

(8,175

)

Fidelity VIP Balanced (AnnuiChoice II ™)

 

562

 

16

 

(1,018

)

(440

)

45,060

 

 

7,488

 

(3

)

52,545

 

52,105

 

370

 

52,475

 

3,923

 

 

658

 

4,581

 

Fidelity VIP Balanced (GrandMaster flex3 ™)

 

18,594

 

20,234

 

(7,233

)

31,595

 

4,638

 

(17,299

)

2,163

 

(246

)

(10,744

)

20,851

 

447,658

 

468,509

 

342

 

(1,251

)

157

 

(752

)

Fidelity VIP Balanced (Grandmaster ™) (April 27)*

 

14,596

 

616

 

(4,301

)

10,911

 

29,411

 

(55,254

)

1,672,619

 

(34

)

1,646,742

 

1,657,653

 

 

1,657,653

 

2,289

 

(4,296

)

130,543

 

128,536

 

Fidelity VIP Balanced (IQ3 ™)

 

31,409

 

25,111

 

(4,961

)

51,559

 

37,457

 

(117,696

)

188,674

 

(737

)

107,698

 

159,257

 

738,924

 

898,181

 

2,922

 

(9,403

)

14,814

 

8,333

 

Fidelity VIP Balanced (Pinnacle Plus ™)

 

4,150

 

4,597

 

(2,015

)

6,732

 

47,399

 

(7,508

)

29,903

 

(159

)

69,635

 

76,367

 

71,126

 

147,493

 

3,745

 

(590

)

2,302

 

5,457

 

Fidelity VIP Balanced (IQ Advisor Standard ™) (August 20)*

 

2,285

 

9

 

(1,408

)

886

 

172,354

 

(201

)

38

 

 

172,191

 

173,077

 

 

173,077

 

13,353

 

(15

)

3

 

13,341

 

Fidelity VIP Contrafund (AnnuiChoice ™)

 

428,886

 

2,794,855

 

(1,980,572

)

1,243,169

 

98,738

 

(936,874

)

976,191

 

(42,014

)

96,041

 

1,339,210

 

8,655,622

 

9,994,832

 

6,333

 

(62,093

)

52,487

 

(3,273

)

Fidelity VIP Contrafund (AnnuiChoice II ™)

 

25,952

 

111,298

 

(90,884

)

46,366

 

332,637

 

(18,586

)

140,020

 

(249

)

453,822

 

500,188

 

83,087

 

583,275

 

29,017

 

(1,635

)

11,790

 

39,172

 

Fidelity VIP Contrafund (GrandMaster flex3 ™)

 

289,365

 

2,208,964

 

(1,547,322

)

951,007

 

342,338

 

(1,948,381

)

(753,493

)

(9,655

)

(2,369,191

)

(1,418,184

)

8,810,159

 

7,391,975

 

21,365

 

(115,924

)

(60,640

)

(155,199

)

Fidelity VIP Contrafund (IQ3 ™)

 

257,052

 

1,832,739

 

(1,109,741

)

980,050

 

657,305

 

(1,149,441

)

(714,267

)

(6,323

)

(1,212,726

)

(232,676

)

7,193,141

 

6,960,465

 

39,889

 

(70,033

)

(45,727

)

(75,871

)

Fidelity VIP Contrafund (Pinnacle Plus ™)

 

79,294

 

600,756

 

(391,862

)

288,188

 

374,475

 

(212,622

)

(89,790

)

(2,839

)

69,224

 

357,412

 

1,848,497

 

2,205,909

 

22,491

 

(12,840

)

(5,654

)

3,997

 

Fidelity VIP Contrafund (IQ Advisor Standard ™)

 

8,035

 

45,058

 

(22,543

)

30,550

 

 

 

(29,752

)

 

(29,752

)

798

 

176,951

 

177,749

 

 

 

(1,679

)

(1,679

)

Fidelity VIP Disciplined Small Cap (AnnuiChoice ™) (April 27)*

 

(1,207

)

1,186

 

(25,543

)

(25,564

)

2,527

 

(17,871

)

290,016

 

(928

)

273,744

 

248,180

 

 

248,180

 

264

 

(1,861

)

29,084

 

27,487

 

Fidelity VIP Disciplined Small Cap (AnnuiChoice II ™) (April 27)*

 

(20

)

16

 

(425

)

(429

)

 

 

4,525

 

(16

)

4,509

 

4,080

 

 

4,080

 

 

(2

)

454

 

452

 

Fidelity VIP Disciplined Small Cap (GrandMaster ™) (April 27)*

 

(1,058

)

(6,604

)

(7,901

)

(15,563

)

 

(54,841

)

172,154

 

(30

)

117,283

 

101,720

 

 

101,720

 

 

(5,660

)

16,953

 

11,293

 

Fidelity VIP Disciplined Small Cap (GrandMaster flex3 ™) (April 27)*

 

(776

)

(1,292

)

(8,232

)

(10,300

)

4,944

 

(31,795

)

123,231

 

(93

)

96,287

 

85,987

 

 

85,987

 

488

 

(3,388

)

12,460

 

9,560

 

Fidelity VIP Disciplined Small Cap (IQ Annuity ™) (April 27)*

 

(1,899

)

1,248

 

(22,975

)

(23,626

)

1,003

 

(31,501

)

298,205

 

(172

)

267,535

 

243,909

 

 

243,909

 

105

 

(3,261

)

30,254

 

27,098

 

Fidelity VIP Disciplined Small Cap (Pinnacle Plus ™) (April 27)*

 

(252

)

115

 

(2,973

)

(3,110

)

 

 

31,647

 

(20

)

31,627

 

28,517

 

 

28,517

 

 

(2

)

3,175

 

3,173

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice ™)

 

5,257

 

19,430

 

(19,725

)

4,962

 

 

(11,610

)

(2,813

)

(1,031

)

(15,454

)

(10,492

)

139,978

 

129,486

 

 

(814

)

(360

)

(1,174

)

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice II ™)

 

310

 

392

 

(694

)

8

 

6,899

 

 

 

(3

)

6,896

 

6,904

 

284

 

7,188

 

598

 

 

 

598

 

Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3 ™)

 

5,125

 

10,006

 

(14,420

)

711

 

38,927

 

(21,591

)

46,630

 

(205

)

63,761

 

64,472

 

60,754

 

125,226

 

2,665

 

(1,399

)

2,857

 

4,123

 

Fidelity VIP Dynamic Capital Appreciation (Grandmaster ™)

 

6,226

 

8,292

 

(16,195

)

(1,677

)

 

(26,665

)

72,228

 

(19

)

45,544

 

43,867

 

105,324

 

149,191

 

 

(1,815

)

4,368

 

2,553

 

Fidelity VIP Dynamic Capital Appreciation (IQ Annuity ™)

 

245

 

(367

)

(438

)

(560

)

20,703

 

(1,710

)

(25,632

)

(12

)

(6,651

)

(7,211

)

10,652

 

3,441

 

1,475

 

(125

)

(1,896

)

(546

)

Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus ™)

 

4,135

 

7,525

 

(7,575

)

4,085

 

 

(5,117

)

19,815

 

(271

)

14,427

 

18,512

 

93,837

 

112,349

 

 

(354

)

1,290

 

936

 

Fidelity VIP Dynamic Capital Appreciation (IQ Advisor Standard ™)

 

1,515

 

1,937

 

(1,632

)

1,820

 

 

 

199

 

 

199

 

2,019

 

29,817

 

31,836

 

 

 

15

 

15

 

Fidelity VIP Equity-Income (AnnuiChoice ™)

 

48,312

 

445,632

 

(488,527

)

5,417

 

82,361

 

(266,534

)

243,419

 

(21,317

)

37,929

 

43,346

 

3,868,858

 

3,912,204

 

5,666

 

(20,546

)

17,344

 

2,464

 

Fidelity VIP Equit-Income (AnnuiChoice II ™)

 

2,898

 

12,879

 

(16,521

)

(744

)

57,135

 

(63

)

110,407

 

(3

)

167,476

 

166,732

 

626

 

167,358

 

5,272

 

(6

)

9,895

 

15,161

 

Fidelity VIP Equity-Income (GrandMaster flex3 ™)

 

(903

)

219,225

 

(186,410

)

31,912

 

66,114

 

(782,331

)

1,466

 

(3,814

)

(718,565

)

(686,653

)

1,563,550

 

876,897

 

4,690

 

(54,160

)

210

 

(49,260

)

Fidelity VIP Equity-Income (IQ3 ™)

 

6,527

 

400,771

 

(378,162

)

29,136

 

270,683

 

(544,209

)

(1,398,669

)

(3,432

)

(1,675,627

)

(1,646,491

)

3,731,029

 

2,084,538

 

19,566

 

(40,073

)

(103,603

)

(124,110

)

Fidelity VIP Equity-Income (Pinnacle Plus ™)

 

3,984

 

44,914

 

(54,888

)

(5,990

)

19,517

 

(26,770

)

147,102

 

(591

)

139,258

 

133,268

 

391,471

 

524,739

 

1,211

 

(1,737

)

9,433

 

8,907

 

Fidelity Freedom 2010 (AnnuiChoice ™) (April 27)*

 

2,066

 

527

 

(2,285

)

308

 

 

(878

)

67,873

 

(96

)

66,899

 

67,207

 

 

67,207

 

 

(96

)

6,647

 

6,551

 

Fidelity Freedom 2010 (AnnuiChoice II ™) (April 27)*

 

1,058

 

288

 

(1,130

)

216

 

36

 

(263

)

40,610

 

(8

)

40,375

 

40,591

 

 

40,591

 

4

 

(28

)

3,985

 

3,961

 

Fidelity Freedom 2010 (GrandMaster ™) (April 27)*

 

847

 

220

 

(1,297

)

(230

)

4,800

 

 

22,691

 

 

27,491

 

27,261

 

 

27,261

 

465

 

 

2,199

 

2,664

 

Fidelity Freedom 2010 (GrandmMaster flex3 ™) (April 27)*

 

1,101

 

(1,147

)

(1,549

)

(1,595

)

26,749

 

 

15,082

 

 

41,831

 

40,236

 

 

40,236

 

2,575

 

 

1,362

 

3,937

 

Fidelity Freedom 2010 (IQ Annuity ™) (April 27)*

 

2,305

 

644

 

(3,490

)

(541

)

32,520

 

(61

)

47,295

 

(30

)

79,724

 

79,183

 

 

79,183

 

3,175

 

(9

)

4,576

 

7,742

 

Fidelity Freedom 2010 (Pinnacle Plus ™) (April 27)*

 

731

 

200

 

(851

)

80

 

 

 

24,787

 

(15

)

24,772

 

24,852

 

 

24,852

 

 

(1

)

2,435

 

2,434

 

Fidelity Freedom 2015 (AnnuiChoice II ™) (April 27)*

 

2,323

 

742

 

(2,769

)

296

 

46,354

 

(263

)

38,568

 

(58

)

84,601

 

84,897

 

 

84,897

 

4,531

 

(32

)

3,775

 

8,274

 

Fidelity Freedom 2015 (IQ Annuity ™) (April 27)*

 

2,324

 

693

 

(1,330

)

1,687

 

 

 

72,046

 

 

72,046

 

73,733

 

 

73,733

 

 

 

7,201

 

7,201

 

Fidelity Freedom 2015 (Pinnacle Plus ™) (April 27)*

 

1,377

 

428

 

(1,806

)

(1

)

 

 

45,389

 

(15

)

45,374

 

45,373

 

 

45,373

 

 

(1

)

4,439

 

4,438

 

Fidelity Freedom 2020 (AnnuiChoice ™) (April 27)*

 

7,850

 

4,035

 

(9,965

)

1,920

 

 

(8,243

)

285,094

 

(1,168

)

275,683

 

277,603

 

 

277,603

 

 

(896

)

27,894

 

26,998

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

21



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity Freedom 2020 (AnnuiChoice II ™) (April 27)*

 

$

737

 

$

228

 

$

(882

)

$

83

 

$

18,355

 

$

 

$

6,364

 

$

(21

)

$

24,698

 

$

24,781

 

$

 

$

24,781

 

1,792

 

(2

)

623

 

2,413

 

Fidelity Freedom 2020 (Pinnacle Plus ™) (April 27)*

 

744

 

238

 

(926

)

56

 

 

 

25,951

 

(15

)

25,936

 

25,992

 

 

25,992

 

 

(1

)

2,541

 

2,540

 

Fidelity Freedom 2025 (AnnuiChoice II ™) (April 27)*

 

1,897

 

586

 

(690

)

1,793

 

67,662

 

 

 

 

67,662

 

69,455

 

 

69,455

 

6,760

 

 

 

6,760

 

Fidelity Freedom 2025 (Pinnacle Plus ™) (April 27)*

 

735

 

207

 

(877

)

65

 

 

 

24,786

 

(15

)

24,771

 

24,836

 

 

24,836

 

 

(1

)

2,427

 

2,426

 

Fidelity Freedom 2030 (IQ Annuity ™) (April 27)*

 

27

 

11

 

(19

)

19

 

1,000

 

 

 

 

1,000

 

1,019

 

 

1,019

 

99

 

 

 

99

 

Fidelity Freedom 2030 (Pinnacle Plus ™) (April 27)*

 

763

 

261

 

(969

)

55

 

 

 

23,621

 

(15

)

23,606

 

23,661

 

 

23,661

 

 

(1

)

2,310

 

2,309

 

Fidelity VIP Growth & Income (AnnuiChoice ™)

 

36,360

 

49,401

 

26,938

 

112,699

 

1,512

 

(95,029

)

189,171

 

(6,481

)

89,173

 

201,872

 

1,109,864

 

1,311,736

 

174

 

(8,228

)

14,636

 

6,582

 

Fidelity VIP Growth & Income (AnnuiChoice II ™) (April 27)*

 

90

 

15

 

803

 

908

 

25,735

 

(211

)

14,778

 

 

40,302

 

41,210

 

 

41,210

 

2,228

 

(18

)

1,258

 

3,468

 

Fidelity VIP Growth & Income (GrandMaster flex3 ™)

 

10,916

 

49,871

 

(21,469

)

39,318

 

23,389

 

(189,388

)

72,727

 

(781

)

(94,053

)

(54,735

)

413,512

 

358,777

 

1,720

 

(13,789

)

5,254

 

(6,815

)

Fidelity VIP Growth & Income (IQ3 ™)

 

26,142

 

79,822

 

(16,885

)

89,079

 

74,766

 

(162,587

)

6,777

 

(437

)

(81,481

)

7,598

 

856,923

 

864,521

 

6,311

 

(13,243

)

639

 

(6,293

)

Fidelity VIP Growth & Income (Pinnacle Plus ™)

 

9,622

 

9,179

 

19,528

 

38,329

 

17,794

 

(2,420

)

(2,678

)

(166

)

12,530

 

50,859

 

374,175

 

425,034

 

1,306

 

(188

)

(163

)

955

 

Fidelity VIP Growth (AnnuiChoice ™)

 

(9,142

)

168,617

 

208,617

 

368,092

 

6,885

 

(169,931

)

387,562

 

(11,607

)

212,909

 

581,001

 

1,494,361

 

2,075,362

 

973

 

(19,864

)

38,805

 

19,914

 

Fidelity VIP Growth (AnnuiChoice II ™)

 

(38

)

12

 

1,191

 

1,165

 

388

 

 

577

 

(32

)

933

 

2,098

 

3,881

 

5,979

 

36

 

(3

)

52

 

85

 

Fidelity VIP Growth (GrandMaster ™) (April 27)*

 

(5,554

)

75,573

 

43,546

 

113,565

 

66,219

 

(264,040

)

968,519

 

(169

)

770,529

 

884,094

 

 

884,094

 

6,236

 

(22,688

)

91,949

 

75,497

 

Fidelity VIP Growth (GrandMaster flex3 ™)

 

(6,853

)

104,747

 

25,608

 

123,502

 

25,898

 

(266,416

)

388,674

 

(1,784

)

146,372

 

269,874

 

688,292

 

958,166

 

2,250

 

(22,230

)

27,435

 

7,455

 

Fidelity VIP Growth (IQ3 ™)

 

(12,572

)

130,516

 

70,678

 

188,622

 

3,383

 

(234,365

)

1,053,946

 

(1,007

)

821,957

 

1,010,579

 

960,292

 

1,970,871

 

356

 

(23,895

)

96,736

 

73,197

 

Fidelity VIP Growth (Pinnacle Plus ™)

 

(1,344

)

3,807

 

19,191

 

21,654

 

3

 

(8,520

)

90,369

 

(228

)

81,624

 

103,278

 

80,630

 

183,908

 

 

(661

)

6,180

 

5,519

 

Fidelity VIP Growth Opportunities (AnnuiChoice ™)

 

(1,613

)

35,175

 

1,664

 

35,226

 

1,540

 

(91,807

)

387,990

 

(1,494

)

296,229

 

331,455

 

86,900

 

418,355

 

137

 

(7,485

)

30,848

 

23,500

 

Fidelity VIP Growth Opportunities (GrandMaster flex3 ™)

 

(1,017

)

2,657

 

7,994

 

9,634

 

12,971

 

(5,164

)

35,928

 

(38

)

43,697

 

53,331

 

37,892

 

91,223

 

926

 

(429

)

2,617

 

3,114

 

Fidelity VIP Growth Opportunities (IQ3 ™)

 

(4,851

)

21,572

 

(14,341

)

2,380

 

3,351

 

(86,574

)

934,408

 

(638

)

850,547

 

852,927

 

102,534

 

955,461

 

308

 

(7,397

)

73,526

 

66,437

 

Fidelity VIP Growth Opportunities (Pinnacle Plus ™)

 

(1,928

)

13,556

 

(4,492

)

7,136

 

23,415

 

(1,979

)

168,905

 

(183

)

190,158

 

197,294

 

39,253

 

236,547

 

1,642

 

(152

)

10,761

 

12,251

 

Fidelity VIP Growth Opportunities (IQ Advisor Standard ™) (July 11)*

 

(257

)

(1,066

)

(2,123

)

(3,446

)

 

(1,017

)

157,508

 

 

156,491

 

153,045

 

 

153,045

 

 

(70

)

10,694

 

10,624

 

Fidelity VIP Growth (IQ Advisor Standard ™) (July 11)*

 

(142

)

(551

)

(1,344

)

(2,037

)

 

(1,024

)

147,080

 

 

146,056

 

144,019

 

 

144,019

 

 

(74

)

10,565

 

10,491

 

Fidelity VIP High Income (AnnuiChoice ™)

 

47,518

 

32,699

 

(47,036

)

33,181

 

2,901

 

(166,782

)

(479,676

)

(4,808

)

(648,365

)

(615,184

)

1,317,526

 

702,342

 

295

 

(13,506

)

(36,865

)

(50,076

)

Fidelity VIP High Income (AnnuiChoice II ™) (April 27)*

 

204

 

 

(227

)

(23

)

2,750

 

 

(1

)

 

2,749

 

2,726

 

 

2,726

 

256

 

 

 

256

 

Fidelity VIP High Income (GrandMaster flex3 ™)

 

51,512

 

53,807

 

(55,069

)

50,250

 

59,777

 

(470,735

)

(724,525

)

(1,674

)

(1,137,157

)

(1,086,907

)

1,984,542

 

897,635

 

4,367

 

(34,292

)

(50,559

)

(80,484

)

Fidelity VIP High Income (IQ3 ™)

 

37,905

 

37,306

 

(33,390

)

41,821

 

109,219

 

(307,383

)

(740,596

)

(1,074

)

(939,834

)

(898,013

)

1,549,494

 

651,481

 

7,823

 

(22,280

)

(51,935

)

(66,392

)

Fidelity VIP High Income (Pinnacle Plus ™)

 

13,213

 

(1,950

)

(10,576

)

687

 

13,188

 

(27,829

)

84,640

 

(161

)

69,838

 

70,525

 

117,360

 

187,885

 

1,022

 

(2,178

)

6,622

 

5,466

 

Fidelity VIP High Income (IQ Advisor Standard ™)

 

1,068

 

(1,722

)

388

 

(266

)

18,502

 

(1,533

)

(55,631

)

 

(38,662

)

(38,928

)

56,292

 

17,364

 

1,495

 

(125

)

(4,647

)

(3,277

)

Fidelity VIP Index 500 (AnnuiChoice ™)

 

40,356

 

155,660

 

(151,133

)

44,883

 

 

(258,342

)

1,286,371

 

(13,080

)

1,014,949

 

1,059,832

 

1,383,364

 

2,443,196

 

 

(24,503

)

115,574

 

91,071

 

Fidelity VIP Index 500 (IQ3 ™)

 

20,616

 

257,743

 

(259,055

)

19,304

 

56,210

 

(387,953

)

1,231,577

 

(5,433

)

894,401

 

913,705

 

948,689

 

1,862,394

 

4,738

 

(33,619

)

104,144

 

75,263

 

Fidelity VIP Index 500 (AnnuiChoice II ™) (April 27)*

 

1,869

 

208

 

(4,166

)

(2,089

)

43,122

 

(1,776

)

121,774

 

(96

)

163,024

 

160,935

 

 

160,935

 

4,323

 

(186

)

12,183

 

16,320

 

Fidelity VIP Index 500 (Grandmaster ™) (April 27)*

 

17,503

 

1,726

 

(45,608

)

(26,379

)

5,719

 

(98,058

)

2,293,720

 

(168

)

2,201,213

 

2,174,834

 

 

2,174,834

 

566

 

(9,860

)

230,144

 

220,850

 

Fidelity VIP Index 500 (Grandmaster flex3 ™) (April 27)*

 

4,471

 

4,401

 

(19,114

)

(10,242

)

7,811

 

(323,008

)

1,096,110

 

(1,516

)

779,397

 

769,155

 

 

769,155

 

821

 

(32,194

)

109,587

 

78,214

 

Fidelity VIP Index 500 (IQ Advisor Standard ™) (April 27)*

 

3,784

 

7

 

(7,348

)

(3,557

)

98,179

 

(300

)

164,759

 

 

262,638

 

259,081

 

 

259,081

 

9,726

 

(30

)

16,478

 

26,174

 

Fidelity VIP Index 500 (Pinnacle Plus ™)

 

3,604

 

1,243

 

(10,195

)

(5,348

)

400

 

(3,856

)

424,872

 

(214

)

421,202

 

415,854

 

23,112

 

438,966

 

28

 

(276

)

28,919

 

28,671

 

Fidelity VIP Investment Grade Bond (AnnuiChoice ™)

 

178,341

 

(66,655

)

53,281

 

164,967

 

6,254

 

(619,305

)

413,318

 

(40,644

)

(240,377

)

(75,410

)

5,749,477

 

5,674,067

 

674

 

(50,899

)

31,414

 

(18,811

)

Fidelity VIP Investment Grade Bond (AnnuiChoice II ™) (April 27)*

 

(64

)

(596

)

7,506

 

6,846

 

302,483

 

(12,840

)

121,475

 

 

411,118

 

417,964

 

 

417,964

 

29,517

 

(1,259

)

11,743

 

40,001

 

Fidelity VIP Investment Grade Bond (GrandMaster ™) (April 27)*

 

(7,577

)

9,014

 

28,397

 

29,834

 

23,171

 

(148,652

)

1,373,250

 

(74

)

1,247,695

 

1,277,529

 

 

1,277,529

 

2,317

 

(14,884

)

138,527

 

125,960

 

Fidelity VIP Investment Grade Bond (GrandMaster flex3 ™)

 

17,428

 

2,704

 

26,513

 

46,645

 

146,534

 

(377,508

)

1,189,340

 

(1,360

)

957,006

 

1,003,651

 

936,454

 

1,940,105

 

13,814

 

(35,173

)

111,571

 

90,212

 

Fidelity VIP Investment Grade Bond (IQ3 ™)

 

113,127

 

(32,201

)

27,537

 

108,463

 

211,879

 

(566,082

)

245,646

 

(4,645

)

(113,202

)

(4,739

)

4,351,994

 

4,347,255

 

17,092

 

(46,065

)

19,761

 

(9,212

)

Fidelity VIP Investment Grade Bond (Pinnacle Plus ™)

 

14,035

 

(5,924

)

7,666

 

15,777

 

39,479

 

(86,461

)

139,550

 

(646

)

91,922

 

107,699

 

596,793

 

704,492

 

3,750

 

(8,209

)

13,164

 

8,705

 

Fidelity VIP Investment Grade Bond (IQ Advisor Standard ™)

 

2,949

 

(1,354

)

2,486

 

4,081

 

186,854

 

(1,716

)

(64,831

)

 

120,307

 

124,388

 

64,537

 

188,925

 

17,116

 

(158

)

(5,949

)

11,009

 

Fidelity VIP Mid Cap (AnnuiChoice ™)

 

(25,418

)

1,324,062

 

(427,252

)

871,392

 

26,634

 

(961,440

)

(474,156

)

(41,906

)

(1,450,868

)

(579,476

)

6,734,219

 

6,154,743

 

1,371

 

(45,370

)

(23,306

)

(67,305

)

Fidelity VIP Mid Cap (AnnuiChoice II ™)

 

(1,402

)

10,816

 

12,894

 

22,308

 

198,688

 

(48,778

)

90,134

 

(281

)

239,763

 

262,071

 

71,871

 

333,942

 

17,394

 

(4,147

)

7,821

 

21,068

 

Fidelity VIP Mid Cap (GrandMaster flex3 ™)

 

(35,623

)

642,682

 

(107,352

)

499,707

 

90,224

 

(1,098,884

)

(903,572

)

(7,849

)

(1,920,081

)

(1,420,374

)

4,695,336

 

3,274,962

 

4,947

 

(57,357

)

(47,252

)

(99,662

)

Fidelity VIP Mid Cap (Grandmaster ™)

 

(24,111

)

27,253

 

168,067

 

171,209

 

2,938

 

(393,594

)

3,898,649

 

(637

)

3,507,356

 

3,678,565

 

26,086

 

3,704,651

 

162

 

(21,942

)

226,089

 

204,309

 

Fidelity VIP Mid Cap (IQ Annuity ™)

 

(31,531

)

432,003

 

57,539

 

458,011

 

288,796

 

(872,336

)

(779,337

)

(5,506

)

(1,368,383

)

(910,372

)

4,219,036

 

3,308,664

 

13,560

 

(41,586

)

(37,787

)

(65,813

)

Fidelity VIP Mid Cap (Pinnacle Plus ™)

 

(12,962

)

194,745

 

(38,965

)

142,818

 

98,144

 

(166,862

)

199,350

 

(2,279

)

128,353

 

271,171

 

1,234,212

 

1,505,383

 

4,748

 

(8,268

)

8,382

 

4,862

 

Fidelity VIP Mid Cap (IQ Advisor Enhanced ™)

 

(27

)

1,169

 

601

 

1,743

 

 

 

2

 

 

2

 

1,745

 

12,101

 

13,846

 

 

 

 

 

Fidelity VIP Mid Cap (IQ Advisor Standard ™)

 

(14

)

10,232

 

(5,156

)

5,062

 

 

(721

)

(14,807

)

 

(15,528

)

(10,466

)

75,910

 

65,444

 

 

(40

)

(1,128

)

(1,168

)

Fidelity VIP Overseas (AnnuiChoice ™)

 

41,699

 

185,787

 

(9,666

)

217,820

 

5,375

 

(195,822

)

1,850,036

 

(11,295

)

1,648,294

 

1,866,114

 

1,066,921

 

2,933,035

 

455

 

(14,414

)

124,670

 

110,711

 

Fidelity VIP Overseas (AnnuiChoice II ™)

 

1,425

 

3,899

 

3,578

 

8,902

 

49,415

 

(15,527

)

63,527

 

(134

)

97,281

 

106,183

 

22,525

 

128,708

 

4,120

 

(1,195

)

5,201

 

8,126

 

Fidelity VIP Overseas (GrandMaster ™) (April 27)*

 

11,505

 

25,601

 

25,673

 

62,779

 

13,105

 

(181,513

)

1,637,996

 

(222

)

1,469,366

 

1,532,145

 

 

1,532,145

 

1,238

 

(17,543

)

161,214

 

144,909

 

Fidelity VIP Overseas (GrandMaster flex3 ™)

 

12,147

 

222,506

 

(90,541

)

144,112

 

79,398

 

(283,764

)

627,193

 

(4,239

)

418,588

 

562,700

 

748,119

 

1,310,819

 

5,055

 

(17,557

)

38,486

 

25,984

 

Fidelity VIP Overseas (IQ3 ™)

 

25,689

 

136,408

 

(14,571

)

147,526

 

139,054

 

(410,617

)

1,959,974

 

(1,879

)

1,686,532

 

1,834,058

 

821,484

 

2,655,542

 

9,559

 

(27,777

)

128,062

 

109,844

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

22



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Overseas (Pinnacle Plus ™)

 

$

8,298

 

$

57,285

 

$

4,237

 

$

69,820

 

$

35,707

 

$

(21,098

)

$

810,053

 

$

(1,383

)

$

823,279

 

$

893,099

 

$

261,271

 

$

1,154,370

 

1,787

 

(1,109

)

39,417

 

40,095

 

Fidelity VIP Overseas (IQ Advisor Enhanced ™)

 

437

 

1,374

 

1,227

 

3,038

 

 

 

(5

)

 

(5

)

3,033

 

18,868

 

21,901

 

 

 

 

 

Fidelity VIP Overseas (IQ Advisor Standard ™)

 

8,614

 

39,476

 

(24,756

)

23,334

 

176,354

 

(3,554

)

196,749

 

 

369,549

 

392,883

 

140,363

 

533,246

 

10,234

 

(207

)

10,997

 

21,024

 

Non-Affiliated Class 1:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice ™)

 

27,998

 

5,789

 

(12,592

)

21,195

 

259

 

(15,260

)

(25,140

)

(2,051

)

(42,192

)

(20,997

)

419,621

 

398,624

 

18

 

(981

)

(1,461

)

(2,424

)

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II ™)

 

2,583

 

734

 

(1,371

)

1,946

 

14,989

 

(14,878

)

(966

)

(46

)

(901

)

1,045

 

22,633

 

23,678

 

1,413

 

(1,339

)

(88

)

(14

)

Van Kampen UIF Emerging Markets Debt (GrandMaster flex3 ™)

 

42,665

 

30,838

 

(48,827

)

24,676

 

2,413

 

(110,617

)

(342,769

)

(229

)

(451,202

)

(426,526

)

656,674

 

230,148

 

145

 

(6,502

)

(19,813

)

(26,170

)

Van Kampen UIF Emerging Markets Debt (IQ3 ™)

 

27,223

 

24,268

 

(30,725

)

20,766

 

9,712

 

(41,877

)

(137,715

)

(1,298

)

(171,178

)

(150,412

)

434,905

 

284,493

 

579

 

(2,495

)

(7,802

)

(9,718

)

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™)

 

25,662

 

590,541

 

(960,803

)

(344,600

)

2,869

 

(446,339

)

(647,285

)

(13,187

)

(1,103,942

)

(1,448,542

)

2,818,009

 

1,369,467

 

132

 

(17,391

)

(25,928

)

(43,187

)

Van Kampen UIF U.S. Real Estate (AnnuiChoice II ™)

 

2,151

 

6,664

 

(45,508

)

(36,693

)

152,675

 

(17,036

)

(31,424

)

(232

)

103,983

 

67,290

 

45,037

 

112,327

 

12,816

 

(1,651

)

(3,060

)

8,105

 

Van Kampen UIF U.S. Real Estate (GrandMaster flex3 ™)

 

14,245

 

400,023

 

(722,010

)

(307,742

)

32,395

 

(851,674

)

(618,449

)

(2,312

)

(1,440,040

)

(1,747,782

)

2,589,758

 

841,976

 

1,180

 

(33,789

)

(26,730

)

(59,339

)

Van Kampen UIF U.S. Real Estate (IQ3 ™)

 

10,516

 

492,013

 

(794,194

)

(291,665

)

145,978

 

(365,122

)

(716,470

)

(3,007

)

(938,621

)

(1,230,286

)

2,252,291

 

1,022,005

 

5,425

 

(14,085

)

(30,364

)

(39,024

)

Non-Affiliated Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Foreign Securities (IQ Annuity ™)

 

11,852

 

211,590

 

(4,029

)

219,413

 

42,330

 

(333,042

)

526,568

 

(3,521

)

232,335

 

451,748

 

1,696,743

 

2,148,491

 

2,145

 

(16,668

)

24,579

 

10,056

 

Franklin Growth and Income Securities (AnnuiChoice ™)

 

128,364

 

369,056

 

(986,805

)

(489,385

)

32,198

 

(495,896

)

4,317,473

 

(28,075

)

3,825,700

 

3,336,315

 

1,636,040

 

4,972,355

 

2,116

 

(33,433

)

265,527

 

234,210

 

Franklin Growth and Income Securities (AnnuiChoice II ™)

 

2,148

 

4,375

 

(14,986

)

(8,463

)

4,809

 

(19,254

)

82,038

 

(183

)

67,410

 

58,947

 

24,152

 

83,099

 

449

 

(1,778

)

7,150

 

5,821

 

Franklin Growth and Income Securities (GrandMaster flex3 ™)

 

47,662

 

132,814

 

(390,561

)

(210,085

)

27,150

 

(894,701

)

2,204,613

 

(2,736

)

1,334,326

 

1,124,241

 

697,682

 

1,821,923

 

1,786

 

(58,298

)

138,400

 

81,888

 

Franklin Growth and Income Securities (Grandmaster ™)

 

42,482

 

125,230

 

(338,019

)

(170,307

)

3,479

 

(472,335

)

1,554,720

 

(316

)

1,085,548

 

915,241

 

645,545

 

1,560,786

 

223

 

(31,170

)

97,136

 

66,189

 

Franklin Growth and Income Securities (IQ Annuity ™)

 

89,658

 

195,779

 

(709,552

)

(424,115

)

35,960

 

(431,803

)

4,015,720

 

(4,128

)

3,615,749

 

3,191,634

 

956,370

 

4,148,004

 

2,309

 

(28,984

)

254,168

 

227,493

 

Franklin Growth and Income Securities (Pinnacle Plus ™)

 

22,888

 

66,172

 

(225,540

)

(136,480

)

126,194

 

(59,504

)

805,655

 

(1,362

)

870,983

 

734,503

 

395,612

 

1,130,115

 

8,289

 

(4,085

)

51,113

 

55,317

 

Franklin Growth and Income Securities (IQ Advisor Standard ™) (June 1)*

 

96

 

171

 

(774

)

(507

)

4,000

 

(34

)

 

 

3,966

 

3,459

 

 

3,459

 

281

 

(2

)

 

279

 

Franklin Income Securities (AnnuiChoice ™)

 

213,050

 

683,588

 

(697,453

)

199,185

 

58,690

 

(1,144,611

)

7,378

 

(47,991

)

(1,126,534

)

(927,349

)

8,052,189

 

7,124,840

 

3,580

 

(68,444

)

(1,679

)

(66,543

)

Franklin Income Securities (AnnuiChoice II ™)

 

4,293

 

6,137

 

(11,143

)

(713

)

588,932

 

(182,644

)

22,602

 

(650

)

428,240

 

427,527

 

215,864

 

643,391

 

53,302

 

(16,690

)

2,051

 

38,663

 

Franklin Income Securities (GrandMaster flex3 ™)

 

140,263

 

253,499

 

(263,167

)

130,595

 

579,221

 

(1,103,608

)

576,924

 

(3,681

)

48,856

 

179,451

 

6,444,256

 

6,623,707

 

34,222

 

(65,692

)

33,945

 

2,475

 

Franklin Income Securities (Grandmaster ™)

 

155,031

 

208,969

 

(188,615

)

175,385

 

68,997

 

(1,352,261

)

501,181

 

(1,787

)

(783,870

)

(608,485

)

6,754,540

 

6,146,055

 

4,015

 

(79,482

)

30,124

 

(45,343

)

Franklin Income Securities (IQ Annuity ™)

 

157,354

 

501,869

 

(510,408

)

148,815

 

1,554,553

 

(1,558,482

)

482,985

 

(7,981

)

471,075

 

619,890

 

7,278,782

 

7,898,672

 

90,975

 

(92,829

)

28,969

 

27,115

 

Franklin Income Securities (Pinnacle Plus ™)

 

72,261

 

158,892

 

(197,039

)

34,114

 

300,513

 

(172,929

)

(2,250

)

(4,390

)

120,944

 

155,058

 

2,626,569

 

2,781,627

 

20,147

 

(11,813

)

(1,456

)

6,878

 

Franklin Income Securities (IQ Advisor Enhanced ™)

 

298

 

60

 

(53

)

305

 

 

 

2

 

 

2

 

307

 

10,425

 

10,732

 

 

 

 

 

Franklin Income Securities (IQ Advisor Standard ™) (June 1)*

 

125

 

13

 

(289

)

(151

)

4,000

 

(34

)

200

 

 

4,166

 

4,015

 

 

4,015

 

282

 

(2

)

15

 

295

 

Franklin Large Cap Growth Securities (AnnuiChoice ™)

 

(1,181

)

57,715

 

(37,918

)

18,616

 

1,366

 

(19,898

)

24,268

 

(1,750

)

3,986

 

22,602

 

353,178

 

375,780

 

97

 

(1,469

)

1,668

 

296

 

Franklin Large Cap Growth Securities (AnnuiChoice II ™)

 

(50

)

61

 

191

 

202

 

4,000

 

 

37,526

 

(37

)

41,489

 

41,691

 

2,596

 

44,287

 

370

 

(3

)

3,293

 

3,660

 

Franklin Large Cap Growth Securities (GrandMaster flex3 ™)

 

(4,561

)

56,862

 

(38,753

)

13,548

 

20,371

 

(65,789

)

32,849

 

(403

)

(12,972

)

576

 

378,915

 

379,491

 

1,485

 

(4,592

)

1,937

 

(1,170

)

Franklin Large Cap Growth Securities (Grandmaster ™)

 

(553

)

8,927

 

(4,482

)

3,892

 

400

 

(11,637

)

(20,916

)

(38

)

(32,191

)

(28,299

)

92,255

 

63,956

 

28

 

(768

)

(1,519

)

(2,259

)

Franklin Large Cap Growth Securities (IQ Annuity ™)

 

(2,707

)

31,490

 

(35,765

)

(6,982

)

81,277

 

(80,444

)

439,258

 

(902

)

439,189

 

432,207

 

229,626

 

661,833

 

5,465

 

(5,482

)

29,269

 

29,252

 

Franklin Large Cap Growth Securities (Pinnacle Plus ™)

 

(2,624

)

12,097

 

111

 

9,584

 

5,796

 

(48,121

)

33,892

 

(409

)

(8,842

)

742

 

264,829

 

265,571

 

444

 

(3,763

)

2,475

 

(844

)

Franklin Large Cap Growth Securities (IQ Advisor Standard ™) (April 27)*

 

13

 

(261

)

(2,835

)

(3,083

)

 

(1,830

)

66,635

 

 

64,805

 

61,722

 

 

61,722

 

 

(144

)

5,145

 

5,001

 

Franklin Mutual Shares Securities (AnnuiChoice ™)

 

42,352

 

849,748

 

(829,730

)

62,370

 

14,835

 

(601,794

)

602,325

 

(27,643

)

(12,277

)

50,093

 

4,367,303

 

4,417,396

 

1,000

 

(34,287

)

30,118

 

(3,169

)

Franklin Mutual Shares Securities (AnnuiChoice II ™)

 

931

 

4,741

 

(5,791

)

(119

)

269,053

 

(45,262

)

59,812

 

(262

)

283,341

 

283,222

 

40,698

 

323,920

 

24,316

 

(4,046

)

5,282

 

25,552

 

Franklin Mutual Shares Securities (GrandMaster flex3 ™)

 

19,330

 

447,014

 

(387,937

)

78,407

 

480,472

 

(814,508

)

601,875

 

(1,873

)

265,966

 

344,373

 

4,147,510

 

4,491,883

 

27,321

 

(46,364

)

34,445

 

15,402

 

Franklin Mutual Shares Securities (IQ Annuity ™)

 

28,243

 

448,950

 

(456,007

)

21,186

 

495,063

 

(748,323

)

268,137

 

(2,648

)

12,229

 

33,415

 

2,846,256

 

2,879,671

 

27,464

 

(42,549

)

13,781

 

(1,304

)

Franklin Mutual Shares Securities (Pinnacle Plus ™)

 

11,323

 

238,373

 

(224,886

)

24,810

 

159,224

 

(62,293

)

144,944

 

(5,105

)

236,770

 

261,580

 

1,743,088

 

2,004,668

 

9,805

 

(4,072

)

8,807

 

14,540

 

Franklin Mutual Shares Securities (IQ Advisor Standard ™)

 

2,583

 

12,652

 

(11,243

)

3,992

 

344,707

 

(2,548

)

(44,387

)

 

297,772

 

301,764

 

129,746

 

431,510

 

23,330

 

(168

)

(2,976

)

20,186

 

Franklin Mutual Shares Securities(Grandmaster ™)

 

13,817

 

345,739

 

(356,970

)

2,586

 

32,455

 

(654,331

)

3,374,629

 

(479

)

2,752,274

 

2,754,860

 

2,593,042

 

5,347,902

 

1,790

 

(36,626

)

189,138

 

154,302

 

Franklin Small Cap Value Securities (Annuichoice ™) (April 27)*

 

(58

)

(3

)

(971

)

(1,032

)

 

 

24,207

 

(34

)

24,173

 

23,141

 

 

23,141

 

 

(4

)

2,603

 

2,599

 

Franklin Small Cap Value Securities (Annuichoice II ™) (April 27)*

 

(69

)

(15

)

(977

)

(1,061

)

 

(255

)

32,785

 

 

32,530

 

31,469

 

 

31,469

 

 

(28

)

3,566

 

3,538

 

Franklin Small Cap Value Securities (Grandmaster ™) (April 27)*

 

244

 

(1,631

)

(501

)

(1,888

)

9

 

(74

)

10,525

 

(3

)

10,457

 

8,569

 

 

8,569

 

1

 

(8

)

972

 

965

 

Franklin Small Cap Value Securities (Grandmaster flex3 ™) (April 27)*

 

(21

)

(1

)

(375

)

(397

)

5,183

 

 

 

 

5,183

 

4,786

 

 

4,786

 

540

 

 

 

540

 

Franklin Small Cap Value Securities (IQ Annuuity ™) (April 27)*

 

(495

)

(33,746

)

(20

)

(34,261

)

 

(311

)

35,196

 

 

34,885

 

624

 

 

624

 

 

(33

)

103

 

70

 

Franklin Small Cap Value Securities (Pinnacle Plus ™) (April 27)*

 

(38

)

(2

)

(516

)

(556

)

9,127

 

 

3,313

 

(3

)

12,437

 

11,881

 

 

11,881

 

983

 

 

358

 

1,341

 

Templeton Foriegn Securities Fund (GrandMaster flex3 ™)

 

9,189

 

306,983

 

(95,473

)

220,699

 

74,487

 

(245,782

)

704,448

 

(1,861

)

531,292

 

751,991

 

1,686,262

 

2,438,253

 

3,829

 

(12,459

)

32,813

 

24,183

 

Templeton Foriegn Securities Fund (Grandmaster ™)

 

2,151

 

92,838

 

(39,834

)

55,155

 

10,305

 

(78,984

)

197,531

 

(160

)

128,692

 

183,847

 

559,591

 

743,438

 

490

 

(3,945

)

8,325

 

4,870

 

Templeton Foriegn Securities Fund (Pinnacle Plus ™)

 

2,918

 

72,430

 

(22,578

)

52,770

 

106,375

 

(61,919

)

(2,810

)

(836

)

40,810

 

93,580

 

355,559

 

449,139

 

5,680

 

(3,447

)

28

 

2,261

 

Templeton Foreign Securities Fund (AnnuiChoice ™)

 

22,996

 

192,636

 

51,237

 

266,869

 

55,848

 

(86,363

)

469,285

 

(11,541

)

427,229

 

694,098

 

1,809,154

 

2,503,252

 

2,669

 

(4,632

)

21,596

 

19,633

 

Templeton Foreign Securities Fund (AnnuiChoice II ™)

 

794

 

6,558

 

6,332

 

13,684

 

87,385

 

(18,133

)

24,290

 

(154

)

93,388

 

107,072

 

55,750

 

162,822

 

7,358

 

(1,445

)

2,015

 

7,928

 

Templeton Foriegn Securities Fund (IQ Advisor Standard ™)

 

2,412

 

3,990

 

1,734

 

8,136

 

37,005

 

(2,584

)

(4,640

)

 

29,781

 

37,917

 

65,979

 

103,896

 

2,244

 

(154

)

(478

)

1,612

 

Templeton Growth Securities (AnnuiChoice ™)

 

21,508

 

453,568

 

(445,468

)

29,608

 

2,934

 

(637,664

)

(1,326,040

)

(21,103

)

(1,981,873

)

(1,952,265

)

3,635,751

 

1,683,486

 

265

 

(34,246

)

(71,904

)

(105,885

)

 

See accompanying notes.

 


* - 2007 inception date of division.

 

23



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Templeton Growth Securities (AnnuiChoice II ™)

 

$

156

 

$

3,627

 

$

(2,070

)

$

1,713

 

$

230,903

 

$

(24,655

)

$

(1

)

$

(222

)

$

206,025

 

$

207,738

 

$

20,157

 

$

227,895

 

20,818

 

(2,206

)

 

18,612

 

Templeton Growth Securities (GrandMaster flex3 ™)

 

1,229

 

404,334

 

(377,607

)

27,956

 

248,518

 

(529,052

)

(261,002

)

(1,628

)

(543,164

)

(515,208

)

2,793,410

 

2,278,202

 

13,480

 

(28,619

)

(14,047

)

(29,186

)

Templeton Growth Securities (Grandmaster ™)

 

17,549

 

340,021

 

(272,367

)

85,203

 

42,001

 

(693,649

)

(2,987,170

)

(1,216

)

(3,640,034

)

(3,554,831

)

4,705,736

 

1,150,905

 

2,219

 

(36,907

)

(159,274

)

(193,962

)

Templeton Growth Securities (IQ Annuity ™)

 

10,356

 

378,098

 

(400,388

)

(11,934

)

266,013

 

(382,589

)

(427,509

)

(2,016

)

(546,101

)

(558,035

)

2,491,549

 

1,933,514

 

14,105

 

(20,553

)

(24,926

)

(31,374

)

Templeton Growth Securities (Pinnacle Plus ™)

 

359

 

133,090

 

(129,456

)

3,993

 

104,053

 

(69,801

)

(156,857

)

(2,129

)

(124,734

)

(120,741

)

1,108,258

 

987,517

 

6,098

 

(4,144

)

(9,471

)

(7,517

)

Van Kampen LIT Comstock (AnnuiChoice ™)

 

8,116

 

78,072

 

(110,382

)

(24,194

)

5,907

 

(52,216

)

(205,783

)

(4,938

)

(257,030

)

(281,224

)

1,153,001

 

871,777

 

361

 

(3,331

)

(11,879

)

(14,849

)

Van Kampen LIT Comstock (AnnuiChoice II ™)

 

94

 

771

 

(3,085

)

(2,220

)

36,783

 

 

15,323

 

(58

)

52,048

 

49,828

 

4,121

 

53,949

 

3,434

 

(5

)

1,357

 

4,786

 

Van Kampen LIT Comstock (GrandMaster flex3 ™)

 

3,122

 

108,995

 

(132,394

)

(20,277

)

2,613

 

(347,680

)

(96,334

)

(420

)

(441,821

)

(462,098

)

1,115,819

 

653,721

 

164

 

(20,767

)

(5,724

)

(26,327

)

Van Kampen LIT Comstock (Grandmaster ™)

 

2,341

 

30,649

 

(38,532

)

(5,542

)

 

(148,109

)

(20,237

)

(53

)

(168,399

)

(173,941

)

427,494

 

253,553

 

 

(8,717

)

(1,127

)

(9,844

)

Van Kampen LIT Comstock (IQ Annuity ™)

 

4,371

 

113,813

 

(150,922

)

(32,738

)

16,269

 

(151,789

)

(193,347

)

(980

)

(329,847

)

(362,585

)

1,458,526

 

1,095,941

 

977

 

(9,042

)

(11,175

)

(19,240

)

Van Kampen LIT Comstock (Pinnacle Plus ™)

 

140

 

20,737

 

(33,520

)

(12,643

)

43,150

 

(38,072

)

(12,406

)

(862

)

(8,190

)

(20,833

)

330,160

 

309,327

 

2,869

 

(2,479

)

(919

)

(529

)

Van Kampen LIT Strategic Growth (AnnuiChoice ™)

 

(710

)

12,666

 

(1,413

)

10,543

 

300

 

(9,069

)

94,259

 

(469

)

85,021

 

95,564

 

34,248

 

129,812

 

20

 

(619

)

6,305

 

5,706

 

Van Kampen LIT Strategic Growth (AnnuiChoice II ™)

 

(89

)

12

 

1,163

 

1,086

 

 

 

1,002

 

(46

)

956

 

2,042

 

6,760

 

8,802

 

 

(4

)

85

 

81

 

Van Kampen LIT Strategic Growth (GrandMaster flex3 ™)

 

(1,269

)

1,718

 

11,221

 

11,670

 

 

 

(7,559

)

(4

)

(7,563

)

4,107

 

91,837

 

95,944

 

 

 

(618

)

(618

)

Van Kampen LIT Strategic Growth (Grandmaster ™)

 

(202

)

729

 

1,637

 

2,164

 

 

(4,728

)

(7,181

)

(5

)

(11,914

)

(9,750

)

20,329

 

10,579

 

 

(312

)

(512

)

(824

)

Van Kampen LIT Strategic Growth (IQ Annuity ™)

 

(620

)

2,486

 

2,294

 

4,160

 

63,555

 

(1,865

)

(1,097

)

(14

)

60,579

 

64,739

 

4,413

 

69,152

 

4,263

 

(124

)

5

 

4,144

 

Van Kampen LIT Strategic Growth (Pinnacle Plus ™)

 

(414

)

862

 

(2,030

)

(1,582

)

 

(748

)

13,444

 

(33

)

12,663

 

11,081

 

16,658

 

27,739

 

 

(64

)

698

 

634

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice ™) (April 27)*

 

1,234

 

450

 

(328

)

1,356

 

1,732

 

(7,796

)

133,461

 

(123

)

127,274

 

128,630

 

 

128,630

 

175

 

(787

)

13,223

 

12,611

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II ™) (April 27)*

 

27

 

(105

)

234

 

156

 

19,114

 

(3,629

)

34,546

 

 

50,031

 

50,187

 

 

50,187

 

1,896

 

(371

)

3,401

 

4,926

 

Van Kampen UIF Emerging Markets Debt (Grandmaster ™)

 

13,945

 

6,742

 

(7,350

)

13,337

 

718

 

(25,797

)

57,016

 

(27

)

31,910

 

45,247

 

278,725

 

323,972

 

42

 

(1,537

)

3,328

 

1,833

 

Van Kampen UIF Emerging Markets Debt (GrandMaste flex3 ™) (April 27)*

 

9,618

 

(1,674

)

(1,324

)

6,620

 

17,347

 

(1,988

)

531,716

 

(51

)

547,024

 

553,644

 

 

553,644

 

1,763

 

(201

)

52,926

 

54,488

 

Van Kampen UIF Emerging Markets Debt (IQ Annuity ™)

 

16,968

 

6,055

 

(10,283

)

12,740

 

8,892

 

(77,940

)

379,729

 

(712

)

309,969

 

322,709

 

103,578

 

426,287

 

535

 

(4,684

)

22,761

 

18,612

 

Van Kampen UIF Emerging Markets Debt (Pinnacle Plus ™)

 

7,712

 

4,966

 

(5,621

)

7,057

 

11,025

 

(3,658

)

72,260

 

(207

)

79,420

 

86,477

 

135,495

 

221,972

 

753

 

(265

)

4,902

 

5,390

 

Van Kampen UIF Emerging Markets Debt (IQ Advisor Standard ™) (January 3)*

 

1,593

 

330

 

(1,165

)

758

 

18,502

 

(904

)

1,493

 

 

19,091

 

19,849

 

 

19,849

 

1,389

 

(67

)

115

 

1,437

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice ™)

 

(2,525

)

302,090

 

92,047

 

391,612

 

6,515

 

(132,696

)

604,549

 

(10,892

)

467,476

 

859,088

 

981,685

 

1,840,773

 

192

 

(3,745

)

14,375

 

10,822

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice II ™)

 

(87

)

3,891

 

4,486

 

8,290

 

31,443

 

(5,577

)

1,783

 

(21

)

27,628

 

35,918

 

5,455

 

41,373

 

2,316

 

(389

)

104

 

2,031

 

Van Kampen UIF Emerging Markets Equity (GrandMaster flex3 ™)

 

(7,419

)

209,954

 

130,732

 

333,267

 

39,078

 

(198,947

)

242,889

 

(4,039

)

78,981

 

412,248

 

942,438

 

1,354,686

 

1,143

 

(5,607

)

5,669

 

1,205

 

Van Kampen UIF Emerging Markets Equity (Grandmaster ™)

 

(2,007

)

105,894

 

32,483

 

136,370

 

335

 

(46,815

)

117,902

 

(93

)

71,329

 

207,699

 

402,846

 

610,545

 

9

 

(1,218

)

2,422

 

1,213

 

Van Kampen UIF Emerging Markets Equity (IQ Annuity ™)

 

(11,249

)

280,964

 

108,969

 

378,684

 

179,246

 

(530,008

)

1,744,328

 

(3,597

)

1,389,969

 

1,768,653

 

1,093,850

 

2,862,503

 

5,189

 

(14,896

)

41,083

 

31,376

 

Van Kampen UIF Emerging Markets Equity (Pinnacle Plus ™)

 

(4,205

)

169,578

 

(7,053

)

158,320

 

91,067

 

(8,996

)

158,814

 

(490

)

240,395

 

398,715

 

325,638

 

724,353

 

3,273

 

(299

)

4,382

 

7,356

 

Van Kampen UIF Emerging Markets Equity (IQ Advisor Standard ™)

 

(95

)

6,447

 

320

 

6,672

 

 

(861

)

105,525

 

 

104,664

 

111,336

 

20,085

 

131,421

 

 

(28

)

3,442

 

3,414

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™) (April 27)*

 

2,283

 

(3,231

)

(68,009

)

(68,957

)

31,588

 

(9,911

)

469,273

 

(687

)

490,263

 

421,306

 

 

421,306

 

3,625

 

(1,205

)

52,152

 

54,572

 

Van Kampen UIF U.S Real Estate (AnnuiChoice II ™) (April 27)*

 

518

 

1,371

 

(11,808

)

(9,919

)

38,899

 

(1,398

)

31,335

 

(33

)

68,803

 

58,884

 

 

58,884

 

4,323

 

(175

)

3,487

 

7,635

 

Van Kampen UIF U. S. Real Estate (Pinnacle Plus ™)

 

2,672

 

162,214

 

(310,699

)

(145,813

)

223,443

 

(110,144

)

(85,663

)

(994

)

26,642

 

(119,171

)

722,608

 

603,437

 

8,878

 

(4,413

)

(3,660

)

805

 

Van Kampen UIF U.S. Real Estate (Grandmaster ™)

 

6,759

 

195,850

 

(379,102

)

(176,493

)

516

 

(197,252

)

(153,524

)

(330

)

(350,590

)

(527,083

)

1,094,862

 

567,779

 

20

 

(7,626

)

(6,784

)

(14,390

)

Van Kampen UIF U.S. Real Estate (Grandmaster flex3 ™) (April 27)*

 

1,767

 

3,937

 

(114,216

)

(108,512

)

36,771

 

(22,344

)

587,686

 

(45

)

602,068

 

493,556

 

 

493,556

 

4,195

 

(2,694

)

62,674

 

64,175

 

Van Kampen UIF U.S. Real Estate (IQ Annuity ™)

 

5,928

 

202,273

 

(355,970

)

(147,769

)

186,676

 

(142,770

)

(250,435

)

(413

)

(206,942

)

(354,711

)

836,962

 

482,251

 

6,724

 

(5,232

)

(10,376

)

(8,884

)

Van Kampen UIF U.S. Real Estate (IQ Advisor Standard ™)

 

2,169

 

20,057

 

(46,108

)

(23,882

)

258,530

 

(517

)

(86,743

)

 

171,270

 

147,388

 

175,533

 

322,921

 

14,380

 

(27

)

(4,167

)

10,186

 

Non-Affiliated Class B:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index (AnnuiChoice ™)

 

846

 

89,793

 

(110,665

)

(20,026

)

1,473

 

(24,546

)

(124,920

)

(5,155

)

(153,148

)

(173,174

)

942,804

 

769,630

 

111

 

(1,901

)

(7,795

)

(9,585

)

DWS Small Cap Index (AnnuiChoice II ™)

 

(7

)

640

 

(365

)

268

 

21,745

 

 

554

 

(28

)

22,271

 

22,539

 

3,565

 

26,104

 

2,099

 

(3

)

53

 

2,149

 

DWS Small Cap Index (GrandMaster flex3 ™)

 

(662

)

56,165

 

(58,914

)

(3,411

)

 

(132,910

)

(23,753

)

(599

)

(157,262

)

(160,673

)

335,111

 

174,438

 

10

 

(8,733

)

(1,576

)

(10,299

)

DWS Small Cap Index (Grandmaster ™)

 

(438

)

12,684

 

(18,360

)

(6,114

)

 

(6,499

)

56,195

 

(14

)

49,682

 

43,568

 

100,593

 

144,161

 

 

(482

)

4,036

 

3,554

 

DWS Small Cap Index (IQ3 ™)

 

(3,039

)

86,402

 

(73,497

)

9,866

 

65,118

 

(108,146

)

(76,944

)

(1,954

)

(121,926

)

(112,060

)

646,075

 

534,015

 

4,173

 

(7,328

)

(2,986

)

(6,141

)

DWS Small Cap Index (Pinnacle Plus ™)

 

(1,260

)

17,189

 

(22,557

)

(6,628

)

6,175

 

(19,712

)

40,051

 

(188

)

26,326

 

19,698

 

168,242

 

187,940

 

380

 

(1,230

)

2,574

 

1,724

 

 

See accompanying notes.

 


* - 2007 inception date of division.

 

24



 

 

Separate Account I

Of

Integrity Life Insurance Company

Statements of Charges in Net Assets

For the Year Ended December 31, 2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (AnnuiChoice™)

 

$

2,025

 

$

5,641

 

$

27,542

 

$

35,208

 

$

129,257

 

$

(4,006

)

$

23,162

 

$

(1,234

)

$

147,179

 

$

182,387

 

$

176,148

 

$

358,535

 

11,797

 

(471

)

2,098

 

13,424

 

Touchstone Aggressive ETF (GrandMaster flex3™)

 

(5,614

)

111,106

 

137,815

 

243,307

 

281,014

 

(117,555

)

(1,006,477

)

(441

)

(843,459

)

(600,152

)

2,574,546

 

1,974,394

 

26,159

 

(10,674

)

(91,877

)

(76,392

)

Touchstone Aggressive ETF (Grandmaster™)

 

72

 

8,857

 

33,043

 

41,972

 

 

(65,030

)

11,848

 

(49

)

(53,231

)

(11,259

)

372,707

 

361,448

 

 

(5,810

)

1,097

 

(4,713

)

Touchstone Aggressive ETF (IQ Annuity™)

 

(1,867

)

147,766

 

296,254

 

442,153

 

434,005

 

(436,804

)

(63,346

)

(2,628

)

(68,773

)

373,380

 

3,513,900

 

3,887,280

 

39,806

 

(39,456

)

(4,066

)

(3,716

)

Touchstone Aggressive ETF (Pinnacle Plus™)

 

(39

)

138

 

9,916

 

10,015

 

2,783

 

 

16,307

 

(324

)

18,766

 

28,781

 

77,646

 

106,427

 

260

 

(29

)

1,444

 

1,675

 

Touchstone Aggressive ETF (IQ Advisor Enhanced™)

 

28

 

4

 

460

 

492

 

 

 

(1

)

 

(1

)

491

 

3,898

 

4,389

 

 

 

 

 

Touchstone Aggressive ETF (IQ Advisor Standard™)

 

129

 

1,204

 

1,046

 

2,379

 

 

(8,092

)

 

(30

)

(8,122

)

(5,743

)

24,875

 

19,132

 

 

(703

)

 

(703

)

Touchstone Balanced (AnnuiChoice™)

 

15,603

 

279,120

 

(100,610

)

194,113

 

78,685

 

(271,797

)

15,949

 

(12,947

)

(190,110

)

4,003

 

2,072,591

 

2,076,594

 

6,124

 

(21,862

)

1,309

 

(14,429

)

Touchstone Balanced (GrandMaster flex3™)

 

4,797

 

162,142

 

(55,963

)

110,976

 

260,664

 

(522,251

)

394,809

 

(1,673

)

131,549

 

242,525

 

1,127,044

 

1,369,569

 

21,060

 

(42,049

)

31,307

 

10,318

 

Touchstone Balanced (Grandmaster™)

 

2,718

 

37,925

 

(8,228

)

32,415

 

 

(77,537

)

277,073

 

(56

)

199,480

 

231,895

 

199,570

 

431,465

 

 

(6,552

)

23,667

 

17,115

 

Touchstone Balanced (IQ Annuity™)

 

4,249

 

194,976

 

(76,936

)

122,289

 

143,269

 

(346,385

)

(44,395

)

(1,337

)

(248,848

)

(126,559

)

1,486,478

 

1,359,919

 

11,163

 

(27,321

)

(3,387

)

(19,545

)

Touchstone Balanced (Pinnacle Plus™)

 

2,209

 

48,978

 

(17,582

)

33,605

 

6,815

 

(5,039

)

246,745

 

(1,080

)

247,441

 

281,046

 

243,515

 

524,561

 

545

 

(478

)

19,121

 

19,188

 

Touchstone Baron Small Cap (AnnuiChoice™)

 

(22,936

)

442,048

 

(13,135

)

405,977

 

69,306

 

(402,324

)

(74,252

)

(11,721

)

(418,991

)

(13,014

)

2,411,235

 

2,398,221

 

4,332

 

(24,588

)

(3,440

)

(23,696

)

Touchstone Baron Small Cap (AnnuiChoice II™) (September 1)*

 

(17

)

378

 

(180

)

181

 

12,795

 

(7

)

628

 

 

13,416

 

13,597

 

 

13,597

 

1,149

 

(1

)

56

 

1,204

 

Touchstone Baron Small Cap (GrandMaster flex3™)

 

(20,807

)

128,186

 

100,679

 

208,058

 

92,982

 

(140,907

)

168,095

 

(1,548

)

118,622

 

326,680

 

1,149,435

 

1,476,115

 

6,278

 

(9,380

)

11,551

 

8,449

 

Touchstone Baron Small Cap (Grandmaster™)

 

(5,739

)

47,191

 

14,989

 

56,441

 

9,827

 

(94,054

)

(8,444

)

(58

)

(92,729

)

(36,288

)

422,898

 

386,610

 

739

 

(6,798

)

(1,252

)

(7,311

)

Touchstone Baron Small Cap (IQ Annuity™)

 

(52,224

)

380,598

 

220,551

 

548,925

 

136,771

 

(713,388

)

(61,528

)

(1,109

)

(639,254

)

(90,329

)

3,517,442

 

3,427,113

 

8,626

 

(43,086

)

(3,834

)

(38,294

)

Touchstone Baron Small Cap (Pinnacle Plus™)

 

(7,054

)

51,501

 

8,293

 

52,740

 

61,914

 

(13,054

)

(5,697

)

(925

)

42,238

 

94,978

 

390,856

 

485,834

 

3,928

 

(888

)

(1,209

)

1,831

 

Touchstone Baron Small Cap (IQ Advisor Enhanced™)’’

 

(43

)

176

 

727

 

860

 

 

 

1

 

 

1

 

861

 

4,971

 

5,832

 

 

 

 

 

Touchstone Baron Small Cap (IQ Advisor Standard™)

 

(752

)

14,652

 

9,033

 

22,933

 

29,651

 

(319

)

27,477

 

 

56,809

 

79,742

 

95,136

 

174,878

 

2,141

 

(22

)

1,932

 

4,051

 

Touchstone Conservative ETF (AnnuiChoice™)

 

(907

)

12,986

 

55,133

 

67,212

 

14,918

 

(98,847

)

266,769

 

(1,034

)

181,806

 

249,018

 

727,289

 

976,307

 

1,413

 

(9,020

)

25,358

 

17,751

 

Touchstone Conservative ETF (GrandMaster flex3™)

 

1,059

 

5,523

 

62,313

 

68,895

 

197,160

 

(31,940

)

1,274,984

 

(418

)

1,439,786

 

1,508,681

 

571,845

 

2,080,526

 

18,960

 

(3,059

)

117,859

 

133,760

 

Touchstone Conservative ETF (Grandmaster™)

 

537

 

13,415

 

25,471

 

39,423

 

 

(388,270

)

942,789

 

(10

)

554,509

 

593,932

 

216,332

 

810,264

 

 

(36,778

)

89,221

 

52,443

 

Touchstone Conservative ETF (IQ Annuity™)

 

(5,506

)

22,576

 

36,326

 

53,396

 

303,806

 

(248,726

)

9,240

 

(1,775

)

62,545

 

115,941

 

822,693

 

938,634

 

28,692

 

(23,529

)

440

 

5,603

 

Touchstone Conservative ETF (Pinnacle Plus™)

 

(197

)

66

 

2,127

 

1,996

 

 

(1,599

)

13,449

 

(7

)

11,843

 

13,839

 

24,229

 

38,068

 

 

(154

)

1,275

 

1,121

 

Touchstone Conservative ETF (IQ Advisor Standard™)

 

272

 

61

 

8,208

 

8,541

 

 

 

(1

)

 

(1

)

8,540

 

113,865

 

122,405

 

 

 

 

 

Touchstone Core Bond (AnnuiChoice™)

 

54,595

 

(4,816

)

1,932

 

51,711

 

15,523

 

(305,485

)

19,571

 

(13,200

)

(283,591

)

(231,880

)

1,940,153

 

1,708,273

 

1,607

 

(27,345

)

1,666

 

(24,072

)

Touchstone Core Bond (AnnuiChoice II™) (September 1)*

 

826

 

 

(696

)

130

 

20,000

 

 

4

 

 

20,004

 

20,134

 

 

20,134

 

1,982

 

 

 

1,982

 

Touchstone Core Bond (GrandMaster flex3™)

 

14,280

 

(1,300

)

658

 

13,638

 

39,281

 

(253,539

)

81,681

 

(3,118

)

(135,695

)

(122,057

)

708,016

 

585,959

 

4,090

 

(24,164

)

7,569

 

(12,505

)

Touchstone Core Bond (Grandmaster™)

 

2,664

 

(23

)

(604

)

2,037

 

 

(14,520

)

26,922

 

(13

)

12,389

 

14,426

 

73,785

 

88,211

 

 

(1,419

)

2,597

 

1,178

 

Touchstone Core Bond (IQ Annuity™)

 

15,471

 

15,761

 

(1,805

)

29,427

 

11,078

 

(299,950

)

(35,494

)

(957

)

(325,323

)

(295,896

)

970,644

 

674,748

 

1,018

 

(26,535

)

(2,128

)

(27,645

)

Touchstone Core Bond (Pinnacle Plus™)

 

10,379

 

3,301

 

(2,842

)

10,838

 

135,370

 

(14,449

)

(16,727

)

(981

)

103,213

 

114,051

 

269,002

 

383,053

 

13,349

 

(1,524

)

(1,427

)

10,398

 

Touchstone Eagle Capital Appreciation (AnnuiChoice™)

 

(1,117

)

39,004

 

71,918

 

109,805

 

172

 

(98,960

)

12,688

 

(4,056

)

(90,156

)

19,649

 

784,048

 

803,697

 

108

 

(11,769

)

994

 

(10,667

)

Touchstone Eagle Capital Appreciation (AnnuiChoice II™) (September 1)*

 

257

 

1

 

699

 

957

 

40,000

 

 

(2

)

 

39,998

 

40,955

 

 

40,955

 

3,771

 

 

 

3,771

 

Touchstone Eagle Capital Appreciation (GrandMaster flex3™)

 

(2,260

)

18,073

 

27,238

 

43,051

 

11,133

 

(28,443

)

(16,295

)

(1,525

)

(35,130

)

7,921

 

311,708

 

319,629

 

1,007

 

(2,555

)

(1,504

)

(3,052

)

Touchstone Eagle Capital Appreciation (IQ Annuity™)

 

(2,376

)

25,393

 

21,940

 

44,957

 

 

(50,576

)

(84,098

)

(135

)

(134,809

)

(89,852

)

373,242

 

283,390

 

 

(5,885

)

(9,538

)

(15,423

)

Touchstone Eagle Capital Appreciation (Pinnacle Plus™)

 

(1,039

)

6,701

 

9,495

 

15,157

 

 

(33,822

)

84

 

(140

)

(33,878

)

(18,721

)

117,395

 

98,674

 

 

(2,562

)

6

 

(2,556

)

Touchstone Mid Cap Growth (AnnuiChoice™)

 

(30,306

)

238,165

 

219,740

 

427,599

 

359,166

 

(223,117

)

(52,989

)

(12,867

)

70,193

 

497,792

 

2,647,954

 

3,145,746

 

24,427

 

(15,955

)

(2,177

)

6,295

 

Touchstone Mid Cap Growth (AnnuiChoice II™) (September 1)*

 

(255

)

4,382

 

1,262

 

5,389

 

79,200

 

 

504

 

 

79,704

 

85,093

 

 

85,093

 

7,812

 

 

49

 

7,861

 

Touchstone Mid Cap Growth (GrandMaster flex3™)

 

(21,575

)

37,042

 

206,452

 

221,919

 

241,985

 

(122,148

)

24,197

 

(2,931

)

141,103

 

363,022

 

1,561,824

 

1,924,846

 

16,586

 

(8,600

)

736

 

8,722

 

Touchstone Mid Cap Growth (Grandmaster™)

 

(1,459

)

(28,772

)

46,744

 

16,513

 

2,383

 

(11,827

)

(98,323

)

(51

)

(107,818

)

(91,305

)

190,804

 

99,499

 

188

 

(920

)

(7,778

)

(8,510

)

Touchstone Mid Cap Growth (IQ Annuity™)

 

(12,165

)

24,006

 

100,724

 

112,565

 

81,539

 

(146,712

)

(88,494

)

(740

)

(154,407

)

(41,842

)

885,128

 

843,286

 

5,322

 

(9,730

)

(6,149

)

(10,557

)

Touchstone Mid Cap Growth (Pinnacle Plus™)

 

(4,034

)

(14,643

)

62,702

 

44,025

 

4,084

 

(76,348

)

(121,480

)

(917

)

(194,661

)

(150,636

)

357,207

 

206,571

 

263

 

(5,087

)

(7,383

)

(12,207

)

Touchstone Mid Cap Growth (IQ Advisor Standard™)

 

(127

)

3,326

 

1,723

 

4,922

 

56,821

 

(79

)

(393

)

 

56,349

 

61,271

 

 

61,271

 

4,299

 

(6

)

(30

)

4,263

 

Touchstone Enhanced Dividend 30 (AnnuiChoice™)

 

2,487

 

46,560

 

19,465

 

68,512

 

14,078

 

(23,342

)

(18,648

)

(1,519

)

(29,431

)

39,081

 

196,035

 

235,116

 

1,336

 

(2,324

)

89

 

(899

)

Touchstone Enhanced Dividend 30 (AnnuiChoice II™) (September 1)*

 

426

 

1

 

295

 

722

 

20,000

 

 

5

 

 

20,005

 

20,727

 

 

20,727

 

1,890

 

 

 

1,890

 

Touchstone Enhanced Dividend 30 (GrandMaster flex3™)

 

19,290

 

71,750

 

77,247

 

168,287

 

 

(92,333

)

(109,782

)

(2,436

)

(204,551

)

(36,264

)

1,488,476

 

1,452,212

 

 

(8,900

)

(23,726

)

(32,626

)

Touchstone Enhanced Dividend 30 (Grandmaster™)

 

306

 

2,387

 

1,381

 

4,074

 

 

(2,101

)

(1,657

)

(9

)

(3,767

)

307

 

20,663

 

20,970

 

 

(186

)

(196

)

(382

)

Touchstone Enhanced Dividend 30 (IQ Annuity™)

 

4,141

 

14,242

 

30,478

 

48,861

 

2,603

 

(15,116

)

27,465

 

(174

)

14,778

 

63,639

 

263,267

 

326,906

 

251

 

(1,418

)

1,038

 

(129

)

Touchstone Enhanced Dividend 30 (Pinnacle Plus™)

 

1,903

 

1,976

 

17,321

 

21,200

 

6,733

 

(1,721

)

75,455

 

(11

)

80,456

 

101,656

 

49,745

 

151,401

 

580

 

(140

)

6,107

 

6,547

 

Touchstone Enhanced Dividend 30 (IQ Advisor Standard™)

 

649

 

187

 

270

 

1,106

 

29,028

 

 

56

 

 

29,084

 

30,190

 

 

30,190

 

2,413

 

 

 

2,413

 

Touchstone Enhanced ETF (AnnuiChoice™)

 

(2,144

)

6,726

 

123,227

 

127,809

 

237,625

 

(3,649

)

7,586

 

(1,817

)

239,745

 

367,554

 

748,049

 

1,115,603

 

20,563

 

(459

)

625

 

20,729

 

Touchstone Enhanced ETF (GrandMaster flex3™)

 

(92,247

)

530,696

 

1,000,376

 

1,438,825

 

7,284,433

 

(77,293

)

(511,880

)

(2,877

)

6,692,383

 

8,131,208

 

5,887,432

 

14,018,640

 

633,277

 

(6,524

)

(37,835

)

588,918

 

Touchstone Enhanced ETF (Grandmaster™)

 

(3,374

)

7,057

 

129,263

 

132,946

 

400

 

(28,082

)

883,793

 

(52

)

856,059

 

989,005

 

462,899

 

1,451,904

 

35

 

(2,352

)

76,312

 

73,995

 

 

See accompanying notes.

 


* - 2006 inception date of division.

 

25



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Enhanced ETF (IQ Annuity™)

 

$

(35,624

)

$

53,966

 

$

600,525

 

$

618,867

 

$

637,711

 

$

(258,066

)

$

793,338

 

$

(1,005

)

$

1,171,978

 

$

1,790,845

 

$

3,988,515

 

$

5,779,360

 

54,724

 

(22,199

)

67,181

 

99,706

 

Touchstone Enhanced ETF (Pinnacle Plus™)

 

(1,372

)

1,724

 

16,969

 

17,321

 

 

(1,470

)

38,756

 

(34

)

37,252

 

54,573

 

127,856

 

182,429

 

 

(131

)

3,140

 

3,009

 

Touchstone Enhanced ETF (IQ Advisor Enhanced™)

 

(35

)

68

 

6,085

 

6,118

 

 

 

(3

)

 

(3

)

6,115

 

42,275

 

48,390

 

 

 

 

 

Touchstone Enhanced ETF (IQ Advisor Standard™)

 

1,006

 

9,229

 

59,555

 

69,790

 

60,806

 

 

259,539

 

 

320,345

 

390,135

 

213,772

 

603,907

 

4,972

 

 

21,281

 

26,253

 

Touchstone Growth & Income (AnnuiChoice™)

 

3,038

 

15,310

 

1,324

 

19,672

 

5,458

 

(12,309

)

38,399

 

(1,011

)

30,537

 

50,209

 

164,423

 

214,632

 

431

 

(1,077

)

2,957

 

2,311

 

Touchstone Growth & Income (GrandMaster flex3™)

 

1,144

 

28,042

 

(12,835

)

16,351

 

20,058

 

(9,833

)

(213,376

)

(928

)

(204,079

)

(187,728

)

327,890

 

140,162

 

1,745

 

(944

)

(18,619

)

(17,818

)

Touchstone Growth & Income (Grandmaster™)

 

110

 

954

 

71

 

1,135

 

 

 

11

 

 

11

 

1,146

 

9,329

 

10,475

 

 

 

1

 

1

 

Touchstone Growth & Income (IQ Annuity™)

 

2,740

 

64,228

 

(23,020

)

43,948

 

1,691

 

(54,811

)

(105,529

)

(293

)

(158,942

)

(114,994

)

476,970

 

361,976

 

147

 

(4,536

)

(8,978

)

(13,367

)

Touchstone Growth & Income (Pinnacle Plus™)

 

777

 

14,636

 

(2,513

)

12,900

 

 

(4,568

)

(19,814

)

(105

)

(24,487

)

(11,587

)

127,852

 

116,265

 

 

(360

)

(1,570

)

(1,930

)

Touchstone High Yield (AnnuiChoice™)

 

51,692

 

6,478

 

(3,320

)

54,850

 

37,263

 

(53,414

)

(54,324

)

(4,257

)

(74,732

)

(19,882

)

851,960

 

832,078

 

2,601

 

(4,034

)

(3,799

)

(5,232

)

Touchstone High Yield (GrandMaster flex3™)

 

71,543

 

19,322

 

(16,441

)

74,424

 

42,347

 

(118,212

)

(101,375

)

(1,410

)

(178,650

)

(104,226

)

1,357,566

 

1,253,340

 

3,194

 

(8,948

)

(7,757

)

(13,511

)

Touchstone High Yield (Grandmaster™)

 

37,217

 

26,469

 

(31,250

)

32,436

 

695

 

(585,160

)

243,698

 

(20

)

(340,787

)

(308,351

)

900,894

 

592,543

 

64

 

(52,944

)

21,219

 

(31,661

)

Touchstone High Yield (IQ Annuity™)

 

49,281

 

25,442

 

(19,569

)

55,154

 

57,939

 

(286,783

)

(117,877

)

(909

)

(347,630

)

(292,476

)

1,166,434

 

873,958

 

4,201

 

(20,951

)

(8,698

)

(25,448

)

Touchstone High Yield (Pinnacle Plus™)

 

19,057

 

806

 

(1,083

)

18,780

 

3,430

 

(24,198

)

34,803

 

(194

)

13,841

 

32,621

 

302,259

 

334,880

 

295

 

(2,086

)

2,948

 

1,157

 

Touchstone High Yield (IQ Advisor Standard™)

 

46,347

 

(624

)

(6,603

)

39,120

 

 

(24,265

)

655,295

 

 

631,030

 

670,150

 

 

670,150

 

 

(2,089

)

59,073

 

56,984

 

Touchstone Moderate ETF (AnnuiChoice™)

 

2,931

 

15,904

 

297,488

 

316,323

 

855,532

 

(65,333

)

106,098

 

(4,394

)

891,903

 

1,208,226

 

2,482,281

 

3,690,507

 

79,400

 

(6,322

)

9,998

 

83,076

 

Touchstone Moderate ETF (GrandMaster flex3™)

 

4,459

 

27,283

 

343,431

 

375,173

 

775,814

 

(93,236

)

2,466,407

 

(1,038

)

3,147,947

 

3,523,120

 

2,570,878

 

6,093,998

 

71,984

 

(8,741

)

223,425

 

286,668

 

Touchstone Moderate ETF (Grandmaster™)

 

(987

)

25,560

 

34,259

 

58,832

 

5,962

 

(183,951

)

272,969

 

(74

)

94,906

 

153,738

 

607,176

 

760,914

 

555

 

(16,853

)

24,654

 

8,356

 

Touchstone Moderate ETF (IQ Annuity™)

 

(8,612

)

59,712

 

150,468

 

201,568

 

617,143

 

(534,772

)

312,293

 

(3,514

)

391,150

 

592,718

 

1,974,745

 

2,567,463

 

57,105

 

(50,131

)

28,524

 

35,498

 

Touchstone Moderate ETF (Pinnacle Plus™)

 

(1,517

)

1,692

 

20,740

 

20,915

 

1,796

 

(2,002

)

7,251

 

(342

)

6,703

 

27,618

 

232,676

 

260,294

 

170

 

(216

)

604

 

558

 

Touchstone Moderate ETF (IQ Advisor Enhanced™)

 

14

 

1,577

 

3,371

 

4,962

 

 

(18,750

)

2

 

 

(18,748

)

(13,786

)

63,146

 

49,360

 

 

(1,658

)

 

(1,658

)

Touchstone Moderate ETF (IQ Advisor Standard™)

 

479

 

381

 

10,138

 

10,998

 

4,397

 

(2,976

)

3

 

(30

)

1,394

 

12,392

 

105,486

 

117,878

 

392

 

(268

)

 

124

 

Touchstone Money Market (AnnuiChoice™)

 

4,046

 

 

 

4,046

 

 

(87,109

)

(7,732

)

(1,029

)

(95,870

)

(91,824

)

163,619

 

71,795

 

 

(8,339

)

(738

)

(9,077

)

Touchstone Money Market (Grandmaster™)

 

279,951

 

 

 

279,951

 

72,961

 

(5,122,047

)

4,267,162

 

(2,826

)

(784,750

)

(504,799

)

6,467,569

 

5,962,770

 

7,110

 

(497,036

)

420,161

 

(69,765

)

Touchstone Money Market (IQ Annuity™)

 

50,298

 

 

 

50,298

 

3,439

 

(2,172,554

)

1,733,476

 

(804

)

(436,443

)

(386,145

)

839,033

 

452,888

 

334

 

(209,962

)

170,200

 

(39,428

)

Touchstone Money Market (IQ3™)

 

6,511

 

 

 

6,511

 

 

(63,033

)

(8

)

(209

)

(63,250

)

(56,739

)

192,695

 

135,956

 

 

(6,019

)

 

(6,019

)

Touchstone Third Avenue Value (AnnuiChoice™)

 

8,329

 

1,222,737

 

(136,371

)

1,094,695

 

445,589

 

(1,132,057

)

126,006

 

(39,836

)

(600,298

)

494,397

 

7,807,796

 

8,302,193

 

24,165

 

(61,635

)

5,403

 

(32,067

)

Touchstone Third Avenue Value (AnnuiChoice II™) (September 1)*

 

233

 

1,115

 

(36

)

1,312

 

38,256

 

(15

)

1,232

 

 

39,473

 

40,785

 

 

40,785

 

3,613

 

(1

)

113

 

3,725

 

Touchstone Third Avenue Value (GrandMaster flex3™)

 

(13,222

)

908,561

 

(222,619

)

672,720

 

709,033

 

(626,668

)

(349,262

)

(3,643

)

(270,540

)

402,180

 

5,227,511

 

5,629,691

 

44,873

 

(40,349

)

(23,953

)

(19,429

)

Touchstone Third Avenue Value (Grandmaster™)

 

(6,367

)

157,774

 

89,083

 

240,490

 

9,381

 

(365,681

)

391,613

 

(414

)

34,899

 

275,389

 

1,708,123

 

1,983,512

 

625

 

(24,253

)

25,544

 

1,916

 

Touchstone Third Avenue Value (IQ Annuity™)

 

(39,608

)

1,623,199

 

(515,523

)

1,068,068

 

790,801

 

(2,249,369

)

(672,625

)

(6,992

)

(2,138,185

)

(1,070,117

)

9,120,193

 

8,050,076

 

46,445

 

(133,295

)

(43,001

)

(129,851

)

Touchstone Third Avenue Value (Pinnacle Plus™)

 

(7,779

)

189,163

 

12,836

 

194,220

 

242,567

 

(86,984

)

(97,778

)

(2,129

)

55,676

 

249,896

 

1,368,188

 

1,618,084

 

13,096

 

(4,884

)

(5,182

)

3,030

 

Touchstone Third Avenue Value (IQ Advisor Standard™)

 

813

 

22,929

 

(6,397

)

17,345

 

8,794

 

(40,679

)

65,958

 

 

34,073

 

51,418

 

111,222

 

162,640

 

611

 

(2,901

)

4,447

 

2,157

 

Touchstone Value Plus (AnnuiChoice™)

 

(1,898

)

105,033

 

97,018

 

200,153

 

2,373

 

(238,198

)

77,886

 

(6,208

)

(164,147

)

36,006

 

1,105,625

 

1,141,631

 

333

 

(21,939

)

7,357

 

(14,249

)

Touchstone Value Plus (AnnuiChoice II™) (September 1)*

 

126

 

1

 

656

 

783

 

20,000

 

 

4

 

 

20,004

 

20,787

 

 

20,787

 

1,873

 

 

 

1,873

 

Touchstone Value Plus (GrandMaster flex3™)

 

(1,281

)

11,311

 

16,987

 

27,017

 

8,843

 

(19,226

)

(33,790

)

(729

)

(44,902

)

(17,885

)

178,898

 

161,013

 

802

 

(1,742

)

(3,045

)

(3,985

)

Touchstone Value Plus (Grandmaster™)

 

(377

)

1,660

 

11,204

 

12,487

 

 

(11,831

)

3

 

(7

)

(11,835

)

652

 

78,383

 

79,035

 

 

(1,043

)

 

(1,043

)

Touchstone Value Plus (IQ Annuity™)

 

288

 

63,230

 

242,309

 

305,827

 

78,318

 

(181,771

)

1,516,433

 

(1,783

)

1,411,197

 

1,717,024

 

935,472

 

2,652,496

 

7,563

 

(17,652

)

144,048

 

133,959

 

Touchstone Value Plus (Pinnacle Plus™)

 

(74

)

202

 

4,549

 

4,677

 

 

(337

)

23,520

 

(27

)

23,156

 

27,833

 

21,746

 

49,579

 

 

(29

)

1,712

 

1,683

 

 

See accompanying notes.

 


* - 2006 inception date of division.

 

26



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (AnnuiChoice™)

 

$

6,981

 

$

69,183

 

$

28,739

 

$

104,903

 

$

27,376

 

$

(49,912

)

$

(175,733

)

$

(4,081

)

$

(202,350

)

$

(97,447

)

$

755,117

 

$

657,670

 

1,744

 

(3,260

)

(10,655

)

(12,171

)

JP Morgan Mid Cap Value (GrandMaster flex3™)

 

2,260

 

187,633

 

6,729

 

196,622

 

9,330

 

(77,528

)

16,985

 

(2,134

)

(53,347

)

143,275

 

1,222,568

 

1,365,843

 

619

 

(5,086

)

2,097

 

(2,370

)

JP Morgan Mid Cap Value (Grandmaster™)

 

2,239

 

21,928

 

11,090

 

35,257

 

10

 

(42,556

)

(76,544

)

(30

)

(119,120

)

(83,863

)

291,764

 

207,901

 

1

 

(3,166

)

(5,828

)

(8,993

)

JP Morgan Mid Cap Value (IQ3™)

 

3,508

 

58,614

 

20,374

 

82,496

 

6,445

 

(311,224

)

(65,057

)

(732

)

(370,568

)

(288,072

)

735,203

 

447,131

 

450

 

(19,585

)

(3,863

)

(22,998

)

JP Morgan Mid Cap Value (Pinnacle Plus™)

 

644

 

61,525

 

(1,079

)

61,090

 

500

 

(49,732

)

(143,326

)

(537

)

(193,095

)

(132,005

)

554,260

 

422,255

 

33

 

(3,349

)

(9,750

)

(13,066

)

Fidelity VIP Equity-Income (Grandmaster™)

 

1,030,968

 

4,652,300

 

(493,176

)

5,190,092

 

91,963

 

(5,482,641

)

(5,176,511

)

(12,213

)

(10,579,402

)

(5,389,310

)

34,307,829

 

28,918,519

 

1,787

 

(105,378

)

(99,426

)

(203,017

)

Fidelity VIP Growth (Grandmaster™)

 

(170,844

)

(1,360,117

)

2,453,216

 

922,255

 

101,816

 

(4,287,575

)

(1,421,653

)

(9,800

)

(5,617,212

)

(4,694,957

)

21,500,179

 

16,805,222

 

1,887

 

(79,350

)

(27,418

)

(104,881

)

Fidelity VIP High Income (Grandmaster™)

 

288,264

 

(58,053

)

256,812

 

487,023

 

27,337

 

(1,678,021

)

(1,455,319

)

(1,851

)

(3,107,854

)

(2,620,831

)

7,395,352

 

4,774,521

 

1,651

 

(100,330

)

(88,597

)

(187,276

)

Fidelity VIP II Asset Manager (Grandmaster™)

 

221,165

 

(243,550

)

808,955

 

786,570

 

69,084

 

(3,022,114

)

(794,380

)

(7,583

)

(3,754,993

)

(2,968,423

)

15,860,504

 

12,892,081

 

2,099

 

(92,382

)

(24,237

)

(114,520

)

Fidelity VIP II Contrafund (Grandmaster™)

 

(28,556

)

5,859,979

 

(3,125,341

)

2,706,082

 

107,733

 

(6,497,576

)

3,849,977

 

(12,952

)

(2,552,818

)

153,264

 

28,894,878

 

29,048,142

 

2,842

 

(168,553

)

96,955

 

(68,756

)

Fidelity VIP II Index 500 (Grandmaster™)

 

78,597

 

485,184

 

1,251,142

 

1,814,923

 

 

(3,587,603

)

(1,047,529

)

(6,627

)

(4,641,759

)

(2,826,836

)

15,684,209

 

12,857,373

 

 

(118,610

)

(34,834

)

(153,444

)

Fidelity VIP II Index 500 (IQ Annuity™)

 

4,152

 

36,342

 

94,045

 

134,539

 

 

(204,017

)

(27,085

)

(946

)

(232,048

)

(97,509

)

1,105,400

 

1,007,891

 

 

(20,475

)

(2,695

)

(23,170

)

Fidelity VIP II Investment Grade Bond (Grandmaster™)

 

256,810

 

(166,974

)

154,240

 

244,076

 

15,145

 

(1,947,870

)

(157,650

)

(2,660

)

(2,093,035

)

(1,848,959

)

9,955,877

 

8,106,918

 

526

 

(67,633

)

(5,176

)

(72,283

)

Fidelity VIP II Investment Grade Bond (IQ Annuity™)

 

42,615

 

(18,367

)

14,509

 

38,757

 

12,289

 

(123,341

)

(164,682

)

(308

)

(276,042

)

(237,285

)

1,621,647

 

1,384,362

 

894

 

(8,999

)

(12,037

)

(20,142

)

Fidelity VIP III Balanced (Grandmaster™)

 

17,035

 

218,085

 

(44,500

)

190,620

 

48,956

 

(558,112

)

(87,133

)

(869

)

(597,158

)

(406,538

)

2,302,841

 

1,896,303

 

3,389

 

(38,302

)

(6,337

)

(41,250

)

Fidelity VIP III Growth & Income (Grandmaster™)

 

3,332

 

1,132,977

 

(431,217

)

705,092

 

13,442

 

(1,639,897

)

(4,112,735

)

(2,571

)

(5,741,761

)

(5,036,669

)

9,348,726

 

4,312,057

 

818

 

(99,741

)

(246,486

)

(345,409

)

Fidelity VIP III Growth Opportunities (Grandmaster™)

 

(10,996

)

251,665

 

(178,527

)

62,142

 

5,275

 

(685,426

)

(226,174

)

(1,524

)

(907,849

)

(845,707

)

2,449,497

 

1,603,790

 

460

 

(58,987

)

(19,348

)

(77,875

)

Fidelity VIP Overseas (Grandmaster™)

 

24,242

 

1,403,492

 

(22,056

)

1,405,678

 

14,338

 

(2,024,725

)

(267,169

)

(4,235

)

(2,281,791

)

(876,113

)

9,986,962

 

9,110,849

 

481

 

(67,988

)

(9,458

)

(76,965

)

Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (Annuichoice ™) (July 31)*

 

2,432

 

253

 

12,080

 

14,765

 

195,679

 

(4,000

)

18,814

 

(3

)

210,490

 

225,255

 

 

225,255

 

19,233

 

(377

)

1,775

 

20,631

 

Touchstone Aggressive ETF (Annuichoice II ™) (September 1)*

 

162

 

1

 

140

 

303

 

14,309

 

 

1

 

 

14,310

 

14,613

 

 

14,613

 

1,363

 

 

 

1,363

 

Touchstone Conservative ETF (Annuichoice ™) (July 31)*

 

803

 

120

 

4,820

 

5,743

 

86,728

 

(2,968

)

61,854

 

 

145,614

 

151,357

 

 

151,357

 

8,573

 

(285

)

5,989

 

14,277

 

Touchstone Conservative ETF (Annuichoice II ™) (September 1)*

 

33

 

 

(47

)

(14

)

5,000

 

 

1

 

 

5,001

 

4,987

 

 

4,987

 

478

 

 

 

478

 

Touchstone Enhanced ETF (Annuichoice ™) (July 31)*

 

736

 

25

 

10,077

 

10,838

 

9,489

 

 

155,555

 

(82

)

164,962

 

175,800

 

 

175,800

 

907

 

(8

)

15,015

 

15,914

 

Touchstone Enhanced ETF (Annuichoice II ™) (September 1)*

 

4

 

 

(1

)

3

 

1,562

 

 

(2

)

 

1,560

 

1,563

 

 

1,563

 

144

 

 

 

144

 

Touchstone GMAB Moderate ETF (Annuichoice ™) (July 31)*

 

180

 

8

 

1,946

 

2,134

 

34,135

 

 

4

 

 

34,139

 

36,273

 

 

36,273

 

3,385

 

 

 

3,385

 

Touchstone Moderate ETF (Annuichoice ™) (July 31)*

 

2,179

 

138

 

14,867

 

17,184

 

217,512

 

(2,833

)

90,706

 

(23

)

305,362

 

322,546

 

 

322,546

 

21,534

 

(272

)

8,761

 

30,023

 

Touchstone Moderate ETF (Annuichoice II ™) (September 1)*

 

98

 

1

 

195

 

294

 

13,068

 

 

1

 

 

13,069

 

13,363

 

 

13,363

 

1,264

 

 

 

1,264

 

Touchstone Money Market (AnnuiChoice™)

 

160,657

 

 

 

160,657

 

89,765

 

(2,383,842

)

3,278,053

 

(25,307

)

958,669

 

1,119,326

 

4,466,566

 

5,585,892

 

11,820

 

(237,274

)

316,279

 

90,825

 

Touchstone Money Market (AnnuiChoice II™) (September 1)*

 

705

 

 

 

705

 

140,000

 

 

(1

)

 

139,999

 

140,704

 

 

140,704

 

13,893

 

 

 

13,893

 

Touchstone Money Market (GrandMaster flex3™)

 

95,891

 

 

 

95,891

 

608,240

 

(1,498,769

)

1,051,593

 

(7,452

)

153,612

 

249,503

 

1,628,241

 

1,877,744

 

60,852

 

(148,478

)

106,953

 

19,327

 

Touchstone Money Market (IQ Annuity™)

 

249,191

 

 

 

249,191

 

1,128,636

 

(6,914,063

)

1,731,610

 

(26,558

)

(4,080,375

)

(3,831,184

)

9,861,606

 

6,030,422

 

116,358

 

(689,014

)

173,554

 

(399,102

)

Touchstone Money Market (Pinnacle Plus™)

 

11,033

 

 

 

11,033

 

250,421

 

(3,560

)

(174,962

)

(465

)

71,434

 

82,467

 

247,368

 

329,835

 

24,794

 

(397

)

(17,091

)

7,306

 

Touchstone Money Market (IQ Advisor Standard™)

 

8,859

 

 

(3

)

8,856

 

1,034,127

 

(7,352

)

(830,256

)

 

196,519

 

205,375

 

61,268

 

266,643

 

99,125

 

(705

)

(79,442

)

18,978

 

Non-Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (IQ Annuity™)

 

34,769

 

293,512

 

(152,321

)

175,960

 

165

 

(111,201

)

(22,065

)

(349

)

(133,450

)

42,510

 

1,185,897

 

1,228,407

 

14

 

(8,984

)

(3,690

)

(12,660

)

Fidelity VIP Growth (IQ Annuity™)

 

(9,631

)

31,481

 

22,996

 

44,846

 

1,450

 

(93,235

)

(186,580

)

(616

)

(278,981

)

(234,135

)

966,290

 

732,155

 

162

 

(10,523

)

(20,917

)

(31,278

)

Fidelity VIP High Income (IQ Annuity™)

 

36,644

 

(50,050

)

87,910

 

74,504

 

1,000

 

(336,635

)

(467,378

)

(470

)

(803,483

)

(728,979

)

1,379,346

 

650,367

 

107

 

(35,720

)

(49,632

)

(85,245

)

Fidelity VIP II Asset Manager (IQ Annuity™)

 

4,747

 

9,748

 

(2,018

)

12,477

 

 

(36,192

)

(90,273

)

(166

)

(126,631

)

(114,154

)

348,251

 

234,097

 

 

(3,475

)

(8,839

)

(12,314

)

Fidelity VIP II Contrafund (IQ Annuity™)

 

(4,796

)

573,862

 

(331,436

)

237,630

 

20,259

 

(726,770

)

(147,749

)

(941

)

(855,201

)

(617,571

)

2,940,508

 

2,322,937

 

1,444

 

(50,884

)

(10,962

)

(60,402

)

Fidelity VIP III Balanced (IQ Annuity™)

 

1,618

 

20,508

 

(4,199

)

17,927

 

 

(73,818

)

(9,827

)

(146

)

(83,791

)

(65,864

)

223,475

 

157,611

 

 

(6,846

)

(899

)

(7,745

)

Fidelity VIP III Growth & Income (IQ Annuity™)

 

(1,546

)

52,247

 

(15,889

)

34,812

 

 

(100,348

)

(67,932

)

(237

)

(168,517

)

(133,705

)

417,518

 

283,813

 

 

(9,799

)

(6,596

)

(16,395

)

Fidelity VIP III Growth Opportunities (IQ Annuity™)

 

(902

)

23,310

 

(17,900

)

4,508

 

 

(51,607

)

(35,742

)

(85

)

(87,434

)

(82,926

)

187,224

 

104,298

 

 

(6,892

)

(4,434

)

(11,326

)

Fidelity VIP III Mid Cap (Grandmaster™)

 

(29,538

)

1,529,814

 

(997,860

)

502,416

 

6,051

 

(2,177,696

)

4,389,875

 

(2,435

)

2,215,795

 

2,718,211

 

5,742,507

 

8,460,718

 

198

 

(70,800

)

135,896

 

65,294

 

Fidelity VIP III Mid Cap (IQ Annuity™)

 

754

 

756,503

 

(497,395

)

259,862

 

11,501

 

(413,000

)

(367,439

)

(613

)

(769,551

)

(509,689

)

2,649,448

 

2,139,759

 

357

 

(12,643

)

(11,746

)

(24,032

)

Fidelity VIP Overseas (IQ Annuity™)

 

(60

)

38,628

 

(2,636

)

35,932

 

 

(59,669

)

(3,737

)

(98

)

(63,504

)

(27,572

)

256,897

 

229,325

 

 

(4,539

)

(322

)

(4,861

)

Non-Affiliated Service Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Asset Manager (AnnuiChoice™)

 

8,901

 

21,238

 

2,626

 

32,765

 

112,683

 

(173,167

)

(103,269

)

(2,234

)

(165,987

)

(133,222

)

596,436

 

463,214

 

10,527

 

(16,256

)

(9,352

)

(15,081

)

Fidelity VIP Asset Manager (GrandMaster flex3™)

 

(64

)

766

 

9,414

 

10,116

 

73,147

 

(7,461

)

87,886

 

(156

)

153,416

 

163,532

 

125,026

 

288,558

 

6,668

 

(726

)

8,096

 

14,038

 

Fidelity VIP Asset Manager (IQ3)

 

18,618

 

4,792

 

4,252

 

27,662

 

126,102

 

(124,766

)

(685,335

)

(1,106

)

(685,105

)

(657,443

)

1,114,711

 

457,268

 

11,586

 

(11,604

)

(63,857

)

(63,875

)

Fidelity VIP Asset Manager (Pinnacle Plus™)

 

1,354

 

2,357

 

2,873

 

6,584

 

 

(33,498

)

668

 

(349

)

(33,179

)

(26,595

)

137,240

 

110,645

 

 

(2,976

)

59

 

(2,917

)

Fidelity VIP Balanced (AnnuiChoice™)

 

12,405

 

68,669

 

69,083

 

150,157

 

17,670

 

(84,304

)

27,710

 

(11,912

)

(50,836

)

99,321

 

1,490,854

 

1,590,175

 

1,594

 

(8,522

)

2,311

 

(4,617

)

Fidelity VIP Balanced (AnnuiChoice II™) (September 1)*

 

 

 

5

 

5

 

366

 

 

(1

)

 

365

 

370

 

 

370

 

35

 

 

 

35

 

 

See accompanying notes.

 


* - 2006 inception date of division.

 

27



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Balanced (GrandMaster flex3™)

 

$

(207

)

$

30,544

 

$

11,029

 

$

41,366

 

$

123,440

 

$

(106,361

)

$

20,448

 

$

(263

)

$

37,264

 

$

78,630

 

$

369,028

 

$

447,658

 

9,907

 

(8,426

)

1,747

 

3,228

 

Fidelity VIP Balanced (IQ3™)

 

879

 

43,304

 

30,452

 

74,635

 

132,149

 

(120,142

)

387

 

(1,267

)

11,127

 

85,762

 

653,162

 

738,924

 

11,738

 

(10,512

)

549

 

1,775

 

Fidelity VIP Balanced (Pinnacle Plus™)

 

346

 

4,727

 

2,524

 

7,597

 

21,622

 

(46,997

)

(7

)

(82

)

(25,464

)

(17,867

)

88,993

 

71,126

 

1,880

 

(4,038

)

(1

)

(2,159

)

Fidelity VIP Contrafund (AnnuiChoice™)

 

4,968

 

1,213,269

 

(487,245

)

730,992

 

502,503

 

(947,484

)

1,597,893

 

(31,603

)

1,121,309

 

1,852,301

 

6,803,321

 

8,655,622

 

36,513

 

(69,785

)

110,675

 

77,403

 

Fidelity VIP Contrafund (AnnuiChoice II™) (September 1)*

 

361

 

5,798

 

(4,012

)

2,147

 

79,841

 

(7

)

1,106

 

 

80,940

 

83,087

 

 

83,087

 

7,645

 

(1

)

106

 

7,750

 

Fidelity VIP Contrafund (GrandMaster flex3™)

 

(24,679

)

1,619,752

 

(869,699

)

725,374

 

591,282

 

(810,336

)

114,262

 

(10,366

)

(115,158

)

610,216

 

8,199,943

 

8,810,159

 

40,899

 

(55,564

)

2,677

 

(11,988

)

Fidelity VIP Contrafund (IQ3)

 

(30,564

)

1,475,896

 

(778,799

)

666,533

 

1,167,084

 

(1,588,476

)

(1,318,915

)

(6,783

)

(1,747,090

)

(1,080,557

)

8,273,698

 

7,193,141

 

78,827

 

(108,486

)

(92,932

)

(122,591

)

Fidelity VIP Contrafund (Pinnacle Plus™)

 

(9,431

)

237,466

 

(78,803

)

149,232

 

261,923

 

(144,156

)

127,103

 

(2,322

)

242,548

 

391,780

 

1,456,717

 

1,848,497

 

16,990

 

(9,526

)

8,265

 

15,729

 

Fidelity VIP Contrafund (IQ Advisor Standard™)

 

724

 

17,384

 

(1,181

)

16,927

 

 

(645

)

7,976

 

 

7,331

 

24,258

 

152,693

 

176,951

 

 

(48

)

584

 

536

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)

 

(476

)

10,640

 

33

 

10,197

 

13,480

 

(15,158

)

106,988

 

(514

)

104,796

 

114,993

 

24,985

 

139,978

 

956

 

(1,138

)

7,717

 

7,535

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice II™) (September 1)*

 

 

8

 

(6

)

2

 

281

 

 

1

 

 

282

 

284

 

 

284

 

26

 

 

 

26

 

Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)

 

(511

)

4,598

 

360

 

4,447

 

 

(7,466

)

27,606

 

(16

)

20,124

 

24,571

 

36,183

 

60,754

 

 

(566

)

1,992

 

1,426

 

Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)

 

(842

)

8,725

 

(4,349

)

3,534

 

 

(4,841

)

76,516

 

(23

)

71,652

 

75,186

 

30,138

 

105,324

 

 

(367

)

5,384

 

5,017

 

Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)

 

(521

)

2,689

 

(359

)

1,809

 

24,905

 

(28,964

)

4,438

 

(20

)

359

 

2,168

 

8,484

 

10,652

 

1,930

 

(2,311

)

465

 

84

 

Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)

 

(1,543

)

25,834

 

(6,401

)

17,890

 

 

(2,329

)

(28,229

)

(560

)

(31,118

)

(13,228

)

107,065

 

93,837

 

 

(211

)

(1,629

)

(1,840

)

Fidelity VIP Dynamic Capital Appreciation (IQ Advisor Standard™)

 

45

 

794

 

(51

)

788

 

29,028

 

 

1

 

 

29,029

 

29,817

 

 

29,817

 

2,300

 

 

 

2,300

 

Fidelity VIP Equity-Income (AnnuiChoice™)

 

134,662

 

862,678

 

(320,263

)

677,077

 

225,676

 

(440,610

)

(847,473

)

(19,201

)

(1,081,608

)

(404,531

)

4,273,389

 

3,868,858

 

18,888

 

(38,358

)

(69,450

)

(88,920

)

Fidelity VIP Equit-Income (AnnuiChoice II™) (September 1)*

 

5

 

16

 

(13

)

8

 

 

(7

)

625

 

 

618

 

626

 

 

626

 

 

(1

)

58

 

57

 

Fidelity VIP Equity-Income (GrandMaster flex3™)

 

45,031

 

324,181

 

(96,982

)

272,230

 

86,857

 

(583,229

)

(73,395

)

(4,073

)

(573,840

)

(301,610

)

1,865,160

 

1,563,550

 

6,851

 

(46,533

)

(6,323

)

(46,005

)

Fidelity VIP Equity-Income (IQ3™)

 

80,198

 

446,067

 

(12,491

)

513,774

 

79,953

 

(610,675

)

1,405,908

 

(3,148

)

872,038

 

1,385,812

 

2,345,217

 

3,731,029

 

6,592

 

(50,510

)

116,398

 

72,480

 

Fidelity VIP Equity-Income (Pinnacle Plus™)

 

12,307

 

72,503

 

(14,538

)

70,272

 

35,635

 

(83,793

)

(161,269

)

(559

)

(209,986

)

(139,714

)

531,185

 

391,471

 

2,660

 

(6,201

)

(11,903

)

(15,444

)

Fidelity VIP Equity-Income (IQ Advisor Standard™)

 

3,287

 

10,404

 

3,008

 

16,699

 

 

(589

)

29,788

 

 

29,199

 

45,898

 

70,297

 

116,195

 

 

(50

)

2,423

 

2,373

 

Fidelity VIP Growth & Income (AnnuiChoice™)

 

80

 

221,557

 

(46,806

)

174,831

 

60,829

 

(212,994

)

(926,443

)

(6,728

)

(1,085,336

)

(910,505

)

2,020,369

 

1,109,864

 

5,847

 

(20,143

)

(86,785

)

(101,081

)

Fidelity VIP Growth & Income (GrandMaster flex3™)

 

(3,907

)

44,212

 

2,249

 

42,554

 

11,944

 

(141,852

)

(1,842

)

(843

)

(132,593

)

(90,039

)

503,551

 

413,512

 

1,010

 

(11,959

)

(396

)

(11,345

)

Fidelity VIP Growth & Income (IQ3™)

 

(7,408

)

104,922

 

(15,411

)

82,103

 

82,366

 

(227,177

)

(105,819

)

(682

)

(251,312

)

(169,209

)

1,026,132

 

856,923

 

7,712

 

(21,421

)

(10,934

)

(24,643

)

Fidelity VIP Growth & Income (Pinnacle Plus™)

 

(3,290

)

38,667

 

8,641

 

44,018

 

26,203

 

(51,778

)

(118,928

)

(225

)

(144,728

)

(100,710

)

474,885

 

374,175

 

2,182

 

(4,291

)

(9,774

)

(11,883

)

Fidelity VIP Growth (AnnuiChoice™)

 

(13,405

)

108,521

 

(10,054

)

85,062

 

56,020

 

(354,277

)

(233,272

)

(9,753

)

(541,282

)

(456,220

)

1,950,581

 

1,494,361

 

7,432

 

(47,112

)

(30,131

)

(69,811

)

Fidelity VIP Growth (AnnuiChoice II™) (September 1)*

 

(4

)

 

15

 

11

 

3,866

 

 

4

 

 

3,870

 

3,881

 

 

3,881

 

368

 

 

 

368

 

Fidelity VIP Growth (GrandMaster flex3™)

 

(9,554

)

57,785

 

(27,426

)

20,805

 

14,417

 

(177,987

)

200,228

 

(956

)

35,702

 

56,507

 

631,785

 

688,292

 

1,482

 

(17,249

)

18,128

 

2,361

 

Fidelity VIP Growth (IQ3™)

 

(11,952

)

112,676

 

(31,489

)

69,235

 

7,068

 

(216,839

)

(84,450

)

(662

)

(294,883

)

(225,648

)

1,185,940

 

960,292

 

1,184

 

(26,674

)

(8,264

)

(33,754

)

Fidelity VIP Growth (Pinnacle Plus™)

 

(1,563

)

4,866

 

1,043

 

4,346

 

1,000

 

(12,053

)

(51,694

)

(205

)

(62,952

)

(58,606

)

139,236

 

80,630

 

84

 

(1,040

)

(4,418

)

(5,374

)

Fidelity VIP Growth Opportunities (AnnuiChoice™)

 

(245

)

10,481

 

(7,752

)

2,484

 

15,573

 

(9,578

)

(3,564

)

(423

)

2,008

 

4,492

 

82,408

 

86,900

 

1,438

 

(969

)

(365

)

104

 

Fidelity VIP Growth Opportunities (GrandMaster flex3™)

 

(469

)

6,948

 

(5,086

)

1,393

 

4,920

 

(10,648

)

(14,715

)

(130

)

(20,573

)

(19,180

)

57,072

 

37,892

 

422

 

(946

)

(1,234

)

(1,758

)

Fidelity VIP Growth Opportunities (IQ3™)

 

3,006

 

21,660

 

(12,469

)

12,197

 

7,617

 

(128,828

)

47,373

 

(282

)

(74,120

)

(61,923

)

164,457

 

102,534

 

1,062

 

(13,419

)

5,790

 

(6,567

)

Fidelity VIP Growth Opportunities (Pinnacle Plus™)

 

(446

)

144

 

1,822

 

1,520

 

 

(1,868

)

11,879

 

(32

)

9,979

 

11,499

 

27,754

 

39,253

 

 

(159

)

986

 

827

 

Fidelity VIP High Income (AnnuiChoice™)

 

84,486

 

(2,270

)

44,873

 

127,089

 

115,255

 

(205,756

)

472,431

 

(5,181

)

376,749

 

503,838

 

813,688

 

1,317,526

 

10,079

 

(18,148

)

41,936

 

33,867

 

Fidelity VIP High Income (GrandMaster flex3™)

 

118,610

 

(41,896

)

99,380

 

176,094

 

8,939

 

(1,269,445

)

1,040,305

 

(759

)

(220,960

)

(44,866

)

2,029,408

 

1,984,542

 

688

 

(98,614

)

80,746

 

(17,180

)

Fidelity VIP High Income (IQ3™)

 

85,770

 

(132,781

)

242,435

 

195,424

 

14,136

 

(2,506,324

)

(498,199

)

(1,636

)

(2,992,023

)

(2,796,599

)

4,346,093

 

1,549,494

 

1,191

 

(196,666

)

(39,783

)

(235,258

)

Fidelity VIP High Income (Pinnacle Plus™)

 

6,872

 

(870

)

3,773

 

9,775

 

24

 

(3,751

)

12,720

 

(117

)

8,876

 

18,651

 

98,709

 

117,360

 

2

 

(321

)

1,079

 

760

 

Fidelity VIP High Income (IQ Advisor Standard™)

 

3,708

 

1,970

 

(1,829

)

3,849

 

 

(94

)

52,537

 

 

52,443

 

56,292

 

 

56,292

 

 

(8

)

4,707

 

4,699

 

Fidelity VIP Index 500 (AnnuiChoice™)

 

9,548

 

114,374

 

70,432

 

194,354

 

 

(144,254

)

(266,427

)

(8,018

)

(418,699

)

(224,345

)

1,607,709

 

1,383,364

 

 

(15,644

)

(27,293

)

(42,937

)

Fidelity VIP Index 500 (IQ3™)

 

1,535

 

37,844

 

81,486

 

120,865

 

 

(82,716

)

(110,566

)

(574

)

(193,856

)

(72,991

)

1,021,680

 

948,689

 

 

(8,067

)

(10,894

)

(18,961

)

Fidelity VIP Index 500 (Pinnacle Plus™)

 

(39

)

38

 

2,746

 

2,745

 

 

 

4

 

(9

)

(5

)

2,740

 

20,372

 

23,112

 

 

(1

)

 

(1

)

Fidelity VIP Investment Grade Bond (AnnuiChoice™)

 

190,085

 

(134,673

)

131,087

 

186,499

 

253,682

 

(748,557

)

(578,590

)

(37,536

)

(1,111,001

)

(924,502

)

6,673,979

 

5,749,477

 

20,793

 

(63,072

)

(45,395

)

(87,674

)

Fidelity VIP Investment Grade Bond (GrandMaster flex3™)

 

14,913

 

(9,328

)

19,118

 

24,703

 

138,297

 

(157,738

)

194,840

 

(1,282

)

174,117

 

198,820

 

737,634

 

936,454

 

13,391

 

(15,434

)

19,027

 

16,984

 

Fidelity VIP Investment Grade Bond (IQ3™)

 

115,406

 

(46,012

)

44,998

 

114,392

 

612,838

 

(903,308

)

(75,446

)

(5,196

)

(371,112

)

(256,720

)

4,608,714

 

4,351,994

 

51,090

 

(75,448

)

(6,300

)

(30,658

)

Fidelity VIP Investment Grade Bond (Pinnacle Plus™)

 

11,642

 

(603

)

2,868

 

13,907

 

21,898

 

(22,612

)

15,216

 

(477

)

14,025

 

27,932

 

568,861

 

596,793

 

2,134

 

(2,250

)

1,471

 

1,355

 

Fidelity VIP Investment Grade Bond (IQ Advisor Standard™)

 

1,505

 

(2,607

)

2,235

 

1,133

 

 

(488

)

17,109

 

 

16,621

 

17,754

 

46,783

 

64,537

 

 

(47

)

1,549

 

1,502

 

Fidelity VIP Mid Cap (AnnuiChoice™)

 

8,709

 

1,180,405

 

(576,208

)

612,906

 

301,650

 

(800,835

)

782,593

 

(34,359

)

249,049

 

861,955

 

5,872,264

 

6,734,219

 

15,971

 

(43,216

)

37,231

 

9,986

 

 

See accompanying notes.

 


* - 2006 inception date of division.

 

28



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Mid Cap (AnnuiChoice II™) (September 1)*

 

$

(112

)

$

7

 

$

1,413

 

$

1,308

 

$

69,348

 

$

(15

)

$

1,230

 

$

 

$

70,563

 

$

71,871

 

$

 

$

71,871

 

6,734

 

(1

)

117

 

6,850

 

Fidelity VIP Mid Cap (GrandMaster flex3™)

 

(5,152

)

1,086,367

 

(621,774

)

459,441

 

260,998

 

(418,024

)

46,953

 

(7,910

)

(117,983

)

341,458

 

4,353,878

 

4,695,336

 

15,276

 

(24,162

)

2,119

 

(6,767

)

Fidelity VIP Mid Cap (Grandmaster™)

 

(170

)

1,034

 

430

 

1,294

 

 

 

16,309

 

 

16,309

 

17,603

 

8,483

 

26,086

 

 

 

1,055

 

1,055

 

Fidelity VIP Mid Cap (IQ Annuity™)

 

(9,318

)

685,486

 

(244,613

)

431,555

 

642,168

 

(1,360,050

)

533,527

 

(5,064

)

(189,419

)

242,136

 

3,976,900

 

4,219,036

 

33,502

 

(71,043

)

28,156

 

(9,385

)

Fidelity VIP Mid Cap (Pinnacle Plus™)

 

(6,301

)

159,437

 

(51,831

)

101,305

 

210,597

 

(143,501

)

255,135

 

(1,616

)

320,615

 

421,920

 

812,292

 

1,234,212

 

11,544

 

(7,682

)

13,677

 

17,539

 

Fidelity VIP Mid Cap (IQ Advisor Enhanced™)

 

51

 

1,248

 

(51

)

1,248

 

 

 

1

 

 

1

 

1,249

 

10,852

 

12,101

 

 

 

 

 

Fidelity VIP Mid Cap (IQ Advisor Standard™)

 

(27

)

1,208

 

1,655

 

2,836

 

56,821

 

(21,764

)

24,957

 

 

60,014

 

62,850

 

13,060

 

75,910

 

3,721

 

(1,461

)

1,543

 

3,803

 

Fidelity VIP Overseas (AnnuiChoice™)

 

389

 

115,845

 

34,840

 

151,074

 

175,565

 

(242,180

)

370,680

 

(5,545

)

298,520

 

449,594

 

617,327

 

1,066,921

 

15,086

 

(21,023

)

32,183

 

26,246

 

Fidelity VIP Overseas (AnnuiChoice II™) (September 1)*

 

(35

)

1

 

1,218

 

1,184

 

21,344

 

 

(3

)

 

21,341

 

22,525

 

 

22,525

 

2,063

 

 

 

2,063

 

Fidelity VIP Overseas (GrandMaster flex3™)

 

(444

)

53,138

 

41,718

 

94,412

 

44,804

 

(109,004

)

321,805

 

(2,541

)

255,064

 

349,476

 

398,643

 

748,119

 

3,474

 

(7,950

)

23,550

 

19,074

 

Fidelity VIP Overseas (IQ3™)

 

(742

)

116,171

 

(26,850

)

88,579

 

192,960

 

(366,906

)

(69,822

)

(1,289

)

(245,057

)

(156,478

)

977,962

 

821,484

 

15,460

 

(29,726

)

(9,001

)

(23,267

)

Fidelity VIP Overseas (Pinnacle Plus™)

 

(555

)

38,022

 

(2,252

)

35,215

 

1,000

 

(4,938

)

130,013

 

(302

)

125,773

 

160,988

 

100,283

 

261,271

 

60

 

(303

)

8,088

 

7,845

 

Fidelity VIP Overseas (IQ Advisor Enhanced™)

 

84

 

36

 

2,599

 

2,719

 

 

 

 

 

 

2,719

 

16,149

 

18,868

 

 

 

 

 

Fidelity VIP Overseas (IQ Advisor Standard™)

 

904

 

4,464

 

15,359

 

20,727

 

8,794

 

(521

)

(12,682

)

 

(4,409

)

16,318

 

124,045

 

140,363

 

639

 

(39

)

(921

)

(321

)

Non-Affiliated Class 1:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)

 

21,198

 

(7,430

)

(4,108

)

9,660

 

20,248

 

(39,422

)

148,753

 

(2,307

)

127,272

 

136,932

 

282,689

 

419,621

 

1,292

 

(2,551

)

7,632

 

6,373

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II™) (September 1)*

 

(40

)

2

 

665

 

627

 

22,011

 

 

(5

)

 

22,006

 

22,633

 

 

22,633

 

2,142

 

 

 

2,142

 

Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)

 

25,748

 

(66,949

)

34,249

 

(6,952

)

35,047

 

(340,981

)

629,938

 

(475

)

323,529

 

316,577

 

340,097

 

656,674

 

2,288

 

(21,862

)

36,671

 

17,097

 

Van Kampen UIF Emerging Markets Debt (IQ3™)

 

25,985

 

(24,415

)

14,770

 

16,340

 

92,184

 

(100,753

)

(290,786

)

(1,615

)

(300,970

)

(284,630

)

719,535

 

434,905

 

5,930

 

(6,570

)

(20,162

)

(20,802

)

Van Kampen UIF U.S. Real Estate (AnnuiChoice™)

 

5,281

 

483,315

 

304,239

 

792,835

 

62,489

 

(261,678

)

(198,237

)

(13,298

)

(410,724

)

382,111

 

2,435,898

 

2,818,009

 

2,934

 

(12,411

)

(9,721

)

(19,198

)

Non-Affiliated Class 1 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice II™) (September 1)*

 

(81

)

5

 

3,212

 

3,136

 

41,883

 

 

18

 

 

41,901

 

45,037

 

 

45,037

 

3,966

 

 

2

 

3,968

 

Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)

 

(672

)

465,841

 

231,240

 

696,409

 

107,183

 

(520,740

)

235,841

 

(1,537

)

(179,253

)

517,156

 

2,072,602

 

2,589,758

 

4,969

 

(22,945

)

9,324

 

(8,652

)

Van Kampen UIF U.S. Real Estate (IQ3™)

 

(2,795

)

199,590

 

336,048

 

532,843

 

347,625

 

(466,241

)

338,883

 

(2,046

)

218,221

 

751,064

 

1,501,227

 

2,252,291

 

16,092

 

(22,051

)

14,134

 

8,175

 

Non-Affiliated Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Foreign Securities (IQ Annuity™)

 

(4,594

)

187,724

 

120,084

 

303,214

 

221,243

 

(391,152

)

(405,802

)

(2,551

)

(578,262

)

(275,048

)

1,971,791

 

1,696,743

 

13,054

 

(22,515

)

(25,348

)

(34,809

)

Franklin Growth and Income Securities (AnnuiChoice™)

 

29,557

 

142,107

 

80,301

 

251,965

 

10,253

 

(227,006

)

(261,500

)

(11,059

)

(489,312

)

(237,347

)

1,873,387

 

1,636,040

 

804

 

(16,157

)

(19,283

)

(34,636

)

Franklin Growth and Income Securities (AnnuiChoice II™) (September 1)*

 

(38

)

1

 

694

 

657

 

23,500

 

 

(5

)

 

23,495

 

24,152

 

 

24,152

 

2,226

 

 

 

2,226

 

Franklin Growth and Income Securities (GrandMaster flex3™)

 

6,282

 

31,465

 

37,784

 

75,531

 

110,353

 

(56,781

)

124,675

 

(1,019

)

177,228

 

252,759

 

444,923

 

697,682

 

7,979

 

(4,384

)

8,861

 

12,456

 

Franklin Growth and Income Securities (Grandmaster™)

 

8,524

 

35,076

 

40,682

 

84,282

 

 

(86,675

)

70,085

 

(136

)

(16,726

)

67,556

 

577,989

 

645,545

 

 

(6,374

)

5,033

 

(1,341

)

Franklin Growth and Income Securities (IQ Annuity™)

 

15,649

 

109,262

 

21,101

 

146,012

 

68,739

 

(198,791

)

(656,398

)

(1,151

)

(787,601

)

(641,589

)

1,597,959

 

956,370

 

4,844

 

(14,589

)

(49,035

)

(58,780

)

Franklin Growth and Income Securities (Pinnacle Plus™)

 

3,708

 

17,156

 

25,601

 

46,465

 

131,498

 

(4,086

)

16,009

 

(436

)

142,985

 

189,450

 

206,162

 

395,612

 

10,226

 

(339

)

1,128

 

11,015

 

Franklin Income Securities (AnnuiChoice™)

 

193,236

 

314,097

 

589,663

 

1,096,996

 

354,431

 

(622,500

)

1,562,849

 

(36,876

)

1,257,904

 

2,354,900

 

5,697,289

 

8,052,189

 

23,708

 

(43,479

)

102,249

 

82,478

 

Franklin Income Securities (AnnuiChoice II™) (September 1)*

 

(209

)

7

 

2,990

 

2,788

 

213,066

 

 

10

 

 

213,076

 

215,864

 

 

215,864

 

20,282

 

 

1

 

20,283

 

Franklin Income Securities (GrandMaster flex3™)

 

120,937

 

88,266

 

609,532

 

818,735

 

701,968

 

(486,495

)

863,120

 

(3,630

)

1,074,963

 

1,893,698

 

4,550,558

 

6,444,256

 

46,826

 

(33,178

)

56,282

 

69,930

 

Franklin Income Securities (Grandmaster™)

 

189,869

 

252,729

 

419,571

 

862,169

 

11,671

 

(1,429,105

)

4,422,602

 

(1,574

)

3,003,594

 

3,865,763

 

2,888,777

 

6,754,540

 

785

 

(92,083

)

296,048

 

204,750

 

Franklin Income Securities (IQ Annuity™)

 

72,169

 

76,578

 

517,967

 

666,714

 

2,791,689

 

(1,166,025

)

1,370,528

 

(4,078

)

2,992,114

 

3,658,828

 

3,619,954

 

7,278,782

 

175,720

 

(78,004

)

88,159

 

185,875

 

Franklin Income Securities (Pinnacle Plus™)

 

37,047

 

29,051

 

223,036

 

289,134

 

562,445

 

(143,542

)

425,884

 

(2,212

)

842,575

 

1,131,709

 

1,494,860

 

2,626,569

 

40,921

 

(11,010

)

31,149

 

61,060

 

Franklin Income Securities (IQ Advisor Enhanced™)

 

283

 

35

 

1,221

 

1,539

 

 

 

(2

)

 

(2

)

1,537

 

8,888

 

10,425

 

 

 

 

 

Franklin Large Cap Growth Securities (AnnuiChoice™)

 

(751

)

6,485

 

23,468

 

29,202

 

442

 

(4,652

)

93,008

 

(899

)

87,899

 

117,101

 

236,077

 

353,178

 

35

 

(422

)

7,093

 

6,706

 

Franklin Large Cap Growth Securities (AnnuiChoice II™) (September 1)*

 

(2

)

 

39

 

37

 

2,563

 

 

(4

)

 

2,559

 

2,596

 

 

2,596

 

240

 

 

 

240

 

Franklin Large Cap Growth Securities (GrandMaster flex3™)

 

(3,286

)

7,864

 

28,206

 

32,784

 

9,222

 

(68,605

)

(136,027

)

(706

)

(196,116

)

(163,332

)

542,247

 

378,915

 

755

 

(5,456

)

(10,847

)

(15,548

)

Franklin Large Cap Growth Securities (Grandmaster™)

 

(609

)

5,095

 

4,301

 

8,787

 

800

 

(24,444

)

(29,933

)

(40

)

(53,617

)

(44,830

)

137,085

 

92,255

 

63

 

(1,944

)

(2,296

)

(4,177

)

Franklin Large Cap Growth Securities (IQ Annuity™)

 

(2,268

)

15,494

 

15,975

 

29,201

 

20,975

 

(170,221

)

(17,974

)

(986

)

(168,206

)

(139,005

)

368,631

 

229,626

 

1,822

 

(13,003

)

(1,408

)

(12,589

)

Franklin Large Cap Growth Securities (Pinnacle Plus™)

 

(2,458

)

7,819

 

17,330

 

22,691

 

27,856

 

(86,157

)

869

 

(404

)

(57,836

)

(35,145

)

299,974

 

264,829

 

2,387

 

(7,372

)

10

 

(4,975

)

Franklin Mutual Shares Securities (AnnuiChoice™)

 

40,121

 

313,925

 

265,009

 

619,055

 

295,985

 

(505,235

)

65,633

 

(24,023

)

(167,640

)

451,415

 

3,915,888

 

4,367,303

 

18,472

 

(33,516

)

2,271

 

(12,773

)

Franklin Mutual Shares Securities (AnnuiChoice II™) (September 1)*

 

(31

)

4

 

607

 

580

 

35,905

 

(45

)

4,258

 

 

40,118

 

40,698

 

 

40,698

 

3,371

 

(4

)

401

 

3,768

 

Franklin Mutual Shares Securities (GrandMaster flex3™)

 

17,057

 

199,037

 

301,996

 

518,090

 

576,539

 

(106,077

)

374,563

 

(1,547

)

843,478

 

1,361,568

 

2,785,942

 

4,147,510

 

37,219

 

(6,814

)

22,527

 

52,932

 

Franklin Mutual Shares Securities (IQ Annuity™)

 

12,625

 

276,090

 

86,029

 

374,744

 

560,995

 

(866,633

)

514,163

 

(1,477

)

207,048

 

581,792

 

2,264,464

 

2,846,256

 

35,476

 

(55,080

)

31,566

 

11,962

 

Franklin Mutual Shares Securities (Pinnacle Plus™)

 

7,636

 

79,841

 

120,102

 

207,579

 

223,555

 

(102,375

)

373,857

 

(2,531

)

492,506

 

700,085

 

1,043,003

 

1,743,088

 

15,518

 

(7,345

)

25,672

 

33,845

 

Franklin Mutual Shares Securities (IQ Advisor Standard™)

 

(70

)

928

 

9,027

 

9,885

 

60,596

 

(8,680

)

59,771

 

 

111,687

 

121,572

 

8,174

 

129,746

 

4,498

 

(674

)

4,544

 

8,368

 

Franklin Mutual Shares Securities(Grandmaster™)

 

14,405

 

289,611

 

56,872

 

360,888

 

4,168

 

(535,751

)

561,997

 

(469

)

29,945

 

390,833

 

2,202,209

 

2,593,042

 

270

 

(34,448

)

35,410

 

1,232

 

 

See accompanying notes.

 


* - 2006 inception date of division.

 

29



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inccrease (deccrease) in net assets from operations:

 

Increase (decrease) in net assets from contract related transactions

 

 

 

 

 

 

 

Unit Transactions

 

Division

 

Net investment
income (loss)

 

Realized gain (loss)

 

Change in net
unrealized appreciation
(depreciation)
during the
period

 

Net increase
(decrease) in net assets resulting from operations

 

Contributions from contract holders

 

Contract terminations
and benefits

 

Net transfers among
investment
options

 

Contract
maintenance
charges

 

Net increase
(decrease) in net assets from contract
related
transactions

 

Increase
(decrease) in
net assets

 

Net assets,
beginning of
period

 

Net assets,
end of period

 

Units
purchased

 

Units
redeemed

 

Units
transferred

 

Increase
(decrease) in
units

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Templeton Foriegn Securities Fund (GrandMaster flex3™)

 

$

(5,021

)

$

168,777

 

$

104,086

 

$

267,842

 

$

207,543

 

$

(156,776

)

$

(209,694

)

$

(1,336

)

$

(160,263

)

$

107,579

 

$

1,578,683

 

$

1,686,262

 

12,080

 

(9,375

)

(13,315

)

(10,610

)

Templeton Foriegn Securities Fund (Grandmaster™)

 

(311

)

90,388

 

20,233

 

110,310

 

35

 

(243,272

)

(2,158

)

(163

)

(245,558

)

(135,248

)

694,839

 

559,591

 

2

 

(13,828

)

(438

)

(14,264

)

Templeton Foriegn Securities Fund (Pinnacle Plus™)

 

(1,674

)

34,423

 

27,910

 

60,659

 

93,961

 

(92,886

)

(21,830

)

(657

)

(21,412

)

39,247

 

316,312

 

355,559

 

6,015

 

(5,769

)

(1,498

)

(1,252

)

Templeton Foreign Securities Fund (AnnuiChoice™)

 

2,364

 

213,551

 

123,257

 

339,172

 

123,750

 

(77,882

)

(249,469

)

(8,488

)

(212,089

)

127,083

 

1,682,071

 

1,809,154

 

7,214

 

(4,928

)

(13,278

)

(10,992

)

Templeton Foreign Securities Fund (AnnuiChoice II™) (September 1)*

 

(84

)

4

 

2,429

 

2,349

 

53,404

 

 

(3

)

 

53,401

 

55,750

 

 

55,750

 

5,085

 

 

 

5,085

 

Templeton Foriegn Securities Fund (IQ Advisor Standard™)

 

533

 

11,795

 

(1,360

)

10,968

 

31,567

 

(9,254

)

(34,006

)

 

(11,693

)

(725

)

66,704

 

65,979

 

2,300

 

(682

)

(2,573

)

(955

)

Templeton Growth Securities (AnnuiChoice™)

 

11,007

 

248,922

 

261,784

 

521,713

 

57,464

 

(154,567

)

1,238,771

 

(16,364

)

1,125,304

 

1,647,017

 

1,988,734

 

3,635,751

 

3,636

 

(10,348

)

73,082

 

66,370

 

Templeton Growth Securities (AnnuiChoice II™) (September 1)*

 

(21

)

1

 

442

 

422

 

19,734

 

 

1

 

 

19,735

 

20,157

 

 

20,157

 

1,829

 

 

 

1,829

 

Templeton Growth Securities (GrandMaster flex3™)

 

(6,064

)

250,172

 

150,116

 

394,224

 

524,021

 

(74,648

)

(75,654

)

(2,629

)

371,090

 

765,314

 

2,028,096

 

2,793,410

 

31,885

 

(4,688

)

(7,392

)

19,805

 

Templeton Growth Securities (Grandmaster™)

 

16,687

 

347,134

 

170,792

 

534,613

 

28,337

 

(973,699

)

4,065,209

 

(962

)

3,118,885

 

3,653,498

 

1,052,238

 

4,705,736

 

1,789

 

(58,262

)

243,663

 

187,190

 

Templeton Growth Securities (IQ Annuity™)

 

(3,991

)

177,757

 

173,153

 

346,919

 

349,309

 

(369,922

)

504,764

 

(1,021

)

483,130

 

830,049

 

1,661,500

 

2,491,549

 

21,061

 

(22,562

)

28,642

 

27,141

 

Templeton Growth Securities (Pinnacle Plus™)

 

(2,270

)

47,203

 

105,606

 

150,539

 

354,053

 

(29,198

)

103,883

 

(997

)

427,741

 

578,280

 

529,978

 

1,108,258

 

23,429

 

(1,921

)

6,533

 

28,041

 

Van Kampen LIT Comstock (AnnuiChoice™)

 

17,529

 

72,433

 

60,922

 

150,884

 

29,283

 

(44,606

)

(34,013

)

(4,676

)

(54,012

)

96,872

 

1,056,129

 

1,153,001

 

1,901

 

(3,091

)

(2,376

)

(3,566

)

Van Kampen LIT Comstock (AnnuiChoice II™) (September 1)*

 

(4

)

 

145

 

141

 

3,976

 

 

4

 

 

3,980

 

4,121

 

 

4,121

 

381

 

 

 

381

 

Van Kampen LIT Comstock (GrandMaster flex3™)

 

10,612

 

89,524

 

38,612

 

138,748

 

49,169

 

(93,797

)

103,729

 

(524

)

58,577

 

197,325

 

918,494

 

1,115,819

 

3,323

 

(6,281

)

6,969

 

4,011

 

Van Kampen LIT Comstock (Grandmaster™)

 

8,532

 

36,444

 

23,356

 

68,332

 

566

 

(170,812

)

(109,506

)

(97

)

(279,849

)

(211,517

)

639,011

 

427,494

 

36

 

(11,163

)

(7,089

)

(18,216

)

Van Kampen LIT Comstock (IQ Annuity™)

 

14,688

 

87,508

 

87,456

 

189,652

 

280,649

 

(300,122

)

37,941

 

(1,236

)

17,232

 

206,884

 

1,251,642

 

1,458,526

 

18,637

 

(19,592

)

2,582

 

1,627

 

Van Kampen LIT Comstock (Pinnacle Plus™)

 

2,602

 

18,366

 

19,663

 

40,631

 

4,696

 

(12,148

)

13,274

 

(615

)

5,207

 

45,838

 

284,322

 

330,160

 

345

 

(894

)

924

 

375

 

Van Kampen LIT Strategic Growth (AnnuiChoice™)

 

(522

)

6,341

 

(5,551

)

268

 

12,830

 

(13,986

)

(21,550

)

(280

)

(22,986

)

(22,718

)

56,966

 

34,248

 

941

 

(1,100

)

(1,566

)

(1,725

)

Van Kampen LIT Strategic Growth (AnnuiChoice II™) (September 1)*

 

(4

)

 

3

 

(1

)

6,763

 

 

(2

)

 

6,761

 

6,760

 

 

6,760

 

627

 

 

 

627

 

Van Kampen LIT Strategic Growth (GrandMaster flex3™)

 

(1,385

)

9,061

 

(5,687

)

1,989

 

75

 

 

9,788

 

(19

)

9,844

 

11,833

 

80,004

 

91,837

 

5

 

(1

)

817

 

821

 

Van Kampen LIT Startegic Growth (Grandmaster™)

 

(668

)

4,825

 

(3,913

)

244

 

 

(32,184

)

3,082

 

(16

)

(29,118

)

(28,874

)

49,203

 

20,329

 

 

(2,391

)

208

 

(2,183

)

Van Kampen LIT Startegic Growth (IQ Annuity™)

 

(1,673

)

6,814

 

(610

)

4,531

 

4,298

 

(48,527

)

33,450

 

(179

)

(10,958

)

(6,427

)

10,840

 

4,413

 

330

 

(3,610

)

2,793

 

(487

)

Van Kampen LIT Strategic Growth (Pinnacle Plus™)

 

(184

)

299

 

220

 

335

 

 

(1,755

)

9,099

 

(10

)

7,334

 

7,669

 

8,989

 

16,658

 

 

(146

)

785

 

639

 

Van Kampen UIF Emerging Markets Debt (Grandmaster™)

 

17,522

 

9,251

 

(6,120

)

20,653

 

 

(88,887

)

16,451

 

(34

)

(72,470

)

(51,817

)

330,542

 

278,725

 

 

(5,916

)

863

 

(5,053

)

Van Kampen UIF Emerging Markets Debt (IQ Annuity™)

 

11,887

 

4,546

 

(8,295

)

8,138

 

1,000

 

(89,481

)

(43,984

)

(20

)

(132,485

)

(124,347

)

227,925

 

103,578

 

65

 

(5,767

)

(3,224

)

(8,926

)

Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)

 

10,012

 

955

 

(295

)

10,672

 

2,261

 

(2,239

)

35,367

 

(120

)

35,269

 

45,941

 

89,554

 

135,495

 

177

 

(179

)

2,667

 

2,665

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)

 

(3,159

)

330,831

 

(15,834

)

311,838

 

84,994

 

(140,965

)

(184,719

)

(9,127

)

(249,817

)

62,021

 

919,664

 

981,685

 

3,446

 

(5,671

)

(6,227

)

(8,452

)

Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™) (September 1)*

 

(14

)

1

 

878

 

865

 

4,594

 

 

(4

)

 

4,590

 

5,455

 

 

5,455

 

455

 

 

 

455

 

Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)

 

(7,121

)

220,925

 

36,637

 

250,441

 

75,411

 

(154,384

)

(172,484

)

(2,824

)

(254,281

)

(3,840

)

946,278

 

942,438

 

3,020

 

(5,801

)

(8,068

)

(10,849

)

Van Kampen UIF Emerging Markets Equity (Grandmaster™)

 

(1,981

)

41,524

 

28,377

 

67,920

 

2,975

 

(50,436

)

134,977

 

(61

)

87,455

 

155,375

 

247,471

 

402,846

 

111

 

(2,093

)

4,162

 

2,180

 

Van Kampen UIF Emerging Markets Equity (IQ Annuity™)

 

(7,353

)

105,728

 

38,701

 

137,076

 

265,519

 

(1,051,900

)

697,679

 

(11,290

)

(99,992

)

37,084

 

1,056,766

 

1,093,850

 

10,851

 

(40,836

)

19,204

 

(10,781

)

Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)

 

(1,856

)

14,239

 

48,885

 

61,268

 

29,819

 

(2,955

)

124,533

 

(160

)

151,237

 

212,505

 

113,133

 

325,638

 

1,350

 

(145

)

5,196

 

6,401

 

Van Kampen UIF Emerging Markets Equity (IQ Advisor Standard™)

 

(11

)

1

 

1,322

 

1,312

 

 

 

18,773

 

 

18,773

 

20,085

 

 

20,085

 

 

 

926

 

 

Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)

 

(2,366

)

60,001

 

103,447

 

161,082

 

137,247

 

(40,235

)

52,081

 

(770

)

148,323

 

309,405

 

413,203

 

722,608

 

6,156

 

(2,003

)

2,663

 

926

 

Van Kampen UIF U.S. Real Estate (IQ Annuity™)

 

(1,471

)

125,292

 

93,754

 

217,575

 

22,515

 

(102,696

)

89,972

 

(245

)

9,546

 

227,121

 

609,841

 

836,962

 

1,014

 

(4,327

)

3,658

 

(5,348

)

Van Kampen UIF U.S. Real Estate (IQ Advisor Standard™)

 

128

 

11,344

 

18,938

 

30,410

 

104,790

 

(711

)

(2,549

)

 

101,530

 

131,940

 

43,593

 

175,533

 

5,521

 

(40

)

(46

)

345

 

Non-Affiliated Class B :

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index (AnnuiChoice™)

 

(3,755

)

53,686

 

72,834

 

122,765

 

140,489

 

(27,384

)

(3,266

)

(3,466

)

106,373

 

229,138

 

713,666

 

942,804

 

9,893

 

(2,186

)

(283

)

7,424

 

DWS Small Cap Index (AnnuiChoice II™) (September 1)*

 

(4

)

 

73

 

69

 

3,500

 

 

(4

)

 

3,496

 

3,565

 

 

3,565

 

327

 

 

 

327

 

DWS Small Cap Index (GrandMaster flex3™)

 

(3,203

)

24,183

 

24,633

 

45,613

 

13,219

 

(33,874

)

1,923

 

(808

)

(19,540

)

26,073

 

309,038

 

335,111

 

964

 

(2,466

)

67

 

(1,435

)

DWS Small Cap Index (Grandmaster™)

 

(674

)

10,504

 

7,763

 

17,593

 

 

(42,614

)

27,556

 

(2

)

(15,060

)

2,533

 

98,060

 

100,593

 

 

(3,254

)

2,323

 

(931

)

DWS Small Cap Index (IQ3™)

 

(6,159

)

31,662

 

64,614

 

90,117

 

78,247

 

(181,341

)

(20,533

)

(1,379

)

(125,006

)

(34,889

)

680,964

 

646,075

 

5,624

 

(12,931

)

(2,045

)

(9,352

)

DWS Small Cap Index (Pinnacle Plus™)

 

(1,747

)

18,445

 

7,752

 

24,450

 

3,239

 

(16,140

)

(24,026

)

(236

)

(37,163

)

(12,713

)

180,955

 

168,242

 

223

 

(1,090

)

(1,694

)

(2,561

)

DWS Small Cap Index (IQ Advisor Standard™)

 

(39

)

5

 

1,851

 

1,817

 

 

(44

)

24,624

 

 

24,580

 

26,397

 

 

26,397

 

 

(3

)

1,978

 

1,975

 

 

See accompanying notes.

 


* - 2006 inception date of division.

 

30



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements

 

December 31, 2007

 

1. Organization and Significant Accounting Policies

 

Organization and Nature of Operations

 

Integrity Life Insurance Company (“Integrity”), a wholly owned subsidiary of The Western and Southern Life Insurance Company (“W&S”), established Separate Account I (the “Separate Account”) on May 19, 1986, for the purpose of issuing flexible premium variable annuity contracts (“Contracts”). The Separate Account is a unit investment trust registered with the Securities and Exchange Commission under the Investment Company Act of 1940, as amended. The operations of the Separate Account are part of Integrity.

 

Contract holders may allocate or transfer their account values to one or more of the Separate Account’s investment divisions, or for certain contract holders, to one or more fixed guaranteed rate options of Integrity’s Separate Account Guaranteed Principal Option (“GPO”).  Options in the Separate Account GPO include fixed guaranteed rate options over various maturity periods that are subject to a market value adjustment (“MVA”) and a Systematic Transfer Option (“STO”), which accumulates interest at a fixed rate without an MVA.  All STO contributions must be transferred to other investment divisions or to a guaranteed rate option within either six months or one year of the contribution.  In addition, certain contract holders may also allocate or transfer their account values to options held in Integrity’s general account.  Such options include a guaranteed interest division or quarterly rate option.

 

The Separate Account investment divisions are invested in shares of corresponding investment portfolios (“Funds”): the Variable Insurance Products Fund, Variable Insurance Products Fund II and Variable Insurance Products Fund III (collectively the “Fidelity VIP Funds”); Franklin Templeton Variable Insurance Products Trust (“Franklin Templeton Funds”), J.P. Morgan Series Trust II Portfolios (“JPMorgan Funds”); DWS Scudder  Investments VIT Funds (“DWS Funds”); Touchstone Variable Series Trust (“Touchstone Funds”); Van Kampen Universal Institutional Funds Portfolios (“Van Kampen UIF Funds”) and the Van Kampen Life Investment Trust Portfolios (“Van Kampen LIT Funds”).  The Fidelity VIP Funds are “series” type mutual funds managed by Fidelity Management and Research Company. The investment advisers of the Franklin Templeton Funds are various affiliates of Franklin Resources, Inc., doing business as Franklin Templeton Investments,

 

31



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

1. Organization and Significant Accounting Policies (continued)

 

including Franklin Advisers, Inc., Franklin Mutual Advisers, LLC, Templeton Investment Counsel, LLC, and Templeton Global Advisors Limited.  The MFS Funds are managed by Massachusetts Financial Services Company.  J.P. Morgan Investment Management, Inc. is the investment adviser to the JPMorgan Funds.  The investment adviser of the Putnam VT Funds is Putnam Investment Management, LLC.  The investment adviser for the DWS Funds is Deutsche Asset Management, Inc. The Touchstone Funds are managed by Touchstone Advisors, Inc.  The Van Kampen UIF Funds are managed by Morgan Stanley Investment Management, Inc. Van Kampen Asset Management manages the Van Kampen LIT Portfolios.

 

The contract holder’s account value in a Separate Account division, also referred to as subaccount, will vary depending on the performance of the corresponding portfolio, also referred to as underlying fund.  The Separate Account currently has 424 investment divisions available.  The investment objective of each division and its corresponding portfolio are the same.  Refer to each portfolio’s prospectus for a description of investment objectives.

 

The assets of the Separate Account are owned by Integrity. The portion of the Separate Account’s assets supporting the contracts may not be used to satisfy liabilities arising out of any other business of Integrity.

 

Basis of Presentation

 

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles for separate accounts formed as unit investment trusts.

 

Investments

 

Investments in shares of the Funds are valued at the net asset values of the respective portfolios, which approximate fair value. The difference between cost and fair value is reflected as unrealized appreciation and depreciation of investments.

 

Share transactions are recorded on the trade date. Realized gains and losses on sales of the Funds’ shares are determined based on the identified cost basis.

 

Capital gain distributions are included in the realized gain distributions line on the Statement of Operations.  Dividends are included in the reinvested dividends line on the Statement of Operations. Dividends and capital gain distributions are recorded on the ex-

 

32



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

1. Organization and Significant Accounting Policies (continued)

 

date.  Dividends and capital gain distributions from the Funds’ portfolios are reinvested in the respective portfolios and are reflected in the unit values of the divisions of the Separate Account.

 

Unit Value

 

Unit values for the Separate Account divisions are computed at the end of each business day. The unit value is equal to the unit value for the preceding business day multiplied by a net investment factor. This net investment factor is determined based on the value of the underlying mutual fund portfolios of the Separate Account, reinvested dividends and capital gains, and the daily asset charge for the mortality and expense risk and administrative charges.

 

Taxes

 

Operations of the Separate Account are included in the income tax return of Integrity, which is taxed as a life insurance company under the Internal Revenue Code (“IRC”). The Separate Account is not taxed as a regulated investment company under Subchapter L of the IRC.  Under the provisions of the policies, Integrity has the  right to charge the Separate Account for federal income tax attributable to the Separate Account. No charge is currently being made against the Separate Account for such tax since, under current tax law, Integrity pays no tax on investment income and capital gains reflected in variable life insurance policy reserves. However, Integrity retains the right to charge for any federal income tax incurred, which is attributable to the Separate Account if the law is changed. Charges for state and local taxes, if any, attributable to the Separate Account may also be made.

 

Use of Estimates

 

The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

33



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

1. Organization and Significant Accounting Policies (continued)

 

Recent Accounting Pronouncements

 

In September 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Statement No. 157 “Fair Value Measurements” (“Statement 157”).  Statement 157 establishes a framework for measuring values in U.S. generally accepted accounting principles, clarifies the definition of fair value within that framework and expands disclosures about the use of fair value measurements.  Statement 157 is intended to increase consistency and compatibility among fair value estimates used in financial reporting.  Statement 157 is effective for fiscal years beginning after November 15, 2007.  Management does not expect the adoption of Statement 157 to have a material impact on the amounts reported in the financial statements.

 

34



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

2.  Investments

 

The aggregate cost of portfolio shares purchased and proceeds from portfolio shares sold during the period ended December 31, 2007 (refer to the Statement of Changes in Net Assets for the applicable period ended December 31, 2007) and the cost of shares held at December 31, 2007 for each division were as follows:

 

Division

 

Purchases

 

Sales

 

Cost

 

Affiliated:

 

 

 

 

 

 

 

Touchstone Aggressive ETF (AnnuiChoice ™)

 

$

16,598

 

$

15,162

 

$

332,879

 

Touchstone Aggressive ETF (GrandMaster flex3 ™)

 

657,018

 

475,103

 

2,019,372

 

Touchstone Aggressive ETF (Grandmaster ™)

 

8,986

 

188,470

 

174,405

 

Touchstone Aggressive ETF (IQ Annuity ™)

 

361,139

 

295,084

 

3,618,893

 

Touchstone Aggressive ETF (Pinnacle Plus ™)

 

46,489

 

2,820

 

139,284

 

Touchstone Aggressive ETF (IQ Advisor Standard ™)

 

915

 

151

 

16,426

 

Touchstone Balanced (AnnuiChoice ™)

 

388,988

 

257,013

 

2,125,778

 

Touchstone Balanced (AnnuiChoice II ™)

 

63,832

 

765

 

63,105

 

Touchstone Balanced (GrandMaster flex3 ™)

 

184,568

 

368,909

 

1,215,819

 

Touchstone Balanced (Grandmaster ™)

 

188,584

 

191,241

 

441,910

 

Touchstone Balanced (IQ Annuity ™)

 

437,707

 

551,926

 

1,284,825

 

Touchstone Balanced (Pinnacle Plus ™)

 

124,790

 

291,882

 

383,015

 

Touchstone Baron Small Cap (AnnuiChoice ™)

 

982,792

 

906,142

 

2,330,092

 

Touchstone Baron Small Cap (AnnuiChoice II ™)

 

119,094

 

1,828

 

131,101

 

Touchstone Baron Small Cap (GrandMaster flex3 ™)

 

711,383

 

676,377

 

1,452,378

 

Touchstone Baron Small Cap (Grandmaster ™)

 

101,778

 

121,753

 

354,227

 

Touchstone Baron Small Cap (IQ Annuity ™)

 

692,092

 

591,803

 

3,034,690

 

Touchstone Baron Small Cap (Pinnacle Plus ™)

 

390,346

 

311,910

 

572,792

 

Touchstone Baron Small Cap (IQ Advisor Enhanced ™)

 

770

 

49

 

5,043

 

Touchstone Baron Small Cap (IQ Advisor Standard ™)

 

73,387

 

8,370

 

222,378

 

Touchstone Conservative ETF (AnnuiChoice ™)

 

17,854

 

132,433

 

811,659

 

Touchstone Conservative ETF (GrandMaster flex3 ™)

 

324,074

 

638,368

 

1,766,069

 

Touchstone Conservative ETF (Grandmaster ™)

 

213,176

 

379,497

 

651,003

 

Touchstone Conservative ETF (IQ Annuity ™)

 

1,234,782

 

665,465

 

1,537,243

 

Touchstone Conservative ETF (Pinnacle Plus ™)

 

192,195

 

5,140

 

223,326

 

Touchstone Conservative ETF (IQ Advisor Standard ™)

 

2,569

 

764

 

111,757

 

Touchstone Core Bond (AnnuiChoice ™)

 

1,890,899

 

1,473,395

 

2,161,501

 

Touchstone Core Bond (AnnuiChoice II ™)

 

52,379

 

15,665

 

57,610

 

Touchstone Core Bond (GrandMaster flex3 ™)

 

314,240

 

312,767

 

595,947

 

Touchstone Core Bond (Grandmaster ™)

 

173,270

 

144,682

 

118,778

 

Touchstone Core Bond (IQ Annuity ™)

 

1,550,944

 

1,264,827

 

989,029

 

Touchstone Core Bond (Pinnacle Plus ™)

 

749,716

 

390,289

 

750,264

 

Touchstone Core Bond (IQ Advisor Standard ™)

 

292,241

 

101,794

 

191,892

 

Touchstone Eagle Capital Appreciation (AnnuiChoice ™)

 

872,772

 

424,342

 

1,190,927

 

Touchstone Eagle Capital Appreciation (AnnuiChoice II ™)

 

99,337

 

34,585

 

107,310

 

Touchstone Eagle Capital Appreciation (GrandMaster flex3 ™)

 

718,219

 

441,307

 

603,019

 

Touchstone Eagle Capital Appreciation (Grandmaster ™)

 

153,310

 

72,108

 

79,997

 

Touchstone Eagle Capital Appreciation (IQ Annuity ™)

 

1,228,075

 

748,246

 

752,660

 

Touchstone Eagle Capital Appreciation (Pinnacle Plus ™)

 

130,855

 

71,444

 

152,645

 

Touchstone Mid Cap Growth (AnnuiChoice ™)

 

2,647,702

 

1,389,431

 

4,473,239

 

Touchstone Mid Cap Growth (AnnuiChoice II ™)

 

863,206

 

5,503

 

942,108

 

 

35



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Affiliated (continued):

 

 

 

 

 

 

 

Touchstone Mid Cap Growth (GrandMaster flex3 ™)

 

$

3,124,089

 

$

2,060,528

 

$

3,174,317

 

Touchstone Mid Cap Growth (Grandmaster ™)

 

420,799

 

98,376

 

427,274

 

Touchstone Mid Cap Growth (IQ Annuity ™)

 

3,804,117

 

1,471,571

 

3,225,117

 

Touchstone Mid Cap Growth (Pinnacle Plus ™)

 

493,376

 

61,875

 

634,569

 

Touchstone Mid Cap Growth (IQ Advisor Standard ™)

 

214,543

 

139,633

 

135,008

 

Touchstone Large Cap Core Equity (AnnuiChoice ™)

 

95,796

 

106,493

 

219,323

 

Touchstone Large Cap Core Equity (AnnuiChoice II ™)

 

21,053

 

17,325

 

25,673

 

Touchstone Large Cap Core Equity (GrandMaster flex3 ™)

 

2,091,190

 

2,204,175

 

1,390,281

 

Touchstone Large Cap Core Equity (Grandmaster ™)

 

9,927

 

25,826

 

5,581

 

Touchstone Large Cap Core Equity (IQ Annuity ™)

 

1,082,771

 

775,232

 

638,035

 

Touchstone Large Cap Core Equity (Pinnacle Plus ™)

 

51,173

 

54,654

 

143,339

 

Touchstone Large Cap Core Equity (IQ Advisor Standard ™)

 

170,130

 

54,656

 

146,055

 

Touchstone Enhanced ETF (AnnuiChoice ™)

 

32,318

 

33,760

 

988,645

 

Touchstone Enhanced ETF (GrandMaster flex3 ™)

 

347,727

 

4,787,314

 

9,099,888

 

Touchstone Enhanced ETF (Grandmaster ™)

 

142,988

 

125,075

 

1,351,772

 

Touchstone Enhanced ETF (IQ Annuity ™)

 

1,024,578

 

629,186

 

5,564,036

 

Touchstone Enhanced ETF (Pinnacle Plus ™)

 

74,219

 

4,873

 

230,241

 

Touchstone Enhanced ETF (IQ Advisor Enhanced ™)

 

1,295

 

5,003

 

34,676

 

Touchstone Enhanced ETF (IQ Advisor Standard ™)

 

8,840

 

321,020

 

279,417

 

Touchstone Growth & Income (AnnuiChoice ™)

 

18,492

 

46,589

 

192,608

 

Touchstone Growth & Income (GrandMaster flex3 ™)

 

39,172

 

84,982

 

100,587

 

Touchstone Growth & Income (Grandmaster ™)

 

18,678

 

7,164

 

22,275

 

Touchstone Growth & Income (IQ Annuity ™)

 

47,701

 

102,594

 

311,677

 

Touchstone Growth & Income (Pinnacle Plus ™)

 

116,205

 

96,950

 

141,895

 

Touchstone High Yield (AnnuiChoice ™)

 

119,971

 

321,612

 

630,604

 

Touchstone High Yield (AnnuiChoice II ™)

 

96,684

 

1,224

 

95,452

 

Touchstone High Yield (GrandMaster flex3 ™)

 

380,764

 

581,549

 

1,065,111

 

Touchstone High Yield (Grandmaster ™)

 

188,627

 

659,488

 

125,511

 

Touchstone High Yield (IQ Annuity ™)

 

839,054

 

816,855

 

919,373

 

Touchstone High Yield (Pinnacle Plus ™)

 

61,901

 

14,021

 

376,496

 

Touchstone High Yield (IQ Advisor Standard ™)

 

2,298,934

 

2,698,822

 

290,474

 

Touchstone Moderate ETF (AnnuiChoice ™)

 

71,935

 

242,316

 

3,199,758

 

Touchstone Moderate ETF (GrandMaster flex3 ™)

 

849,116

 

567,329

 

6,046,870

 

Touchstone Moderate ETF (Grandmaster ™)

 

111,665

 

240,304

 

613,770

 

Touchstone Moderate ETF (IQ Annuity ™)

 

798,738

 

430,277

 

2,807,753

 

Touchstone Moderate ETF (Pinnacle Plus ™)

 

34,402

 

36,221

 

238,933

 

Touchstone Moderate ETF (IQ Advisor Enhanced ™)

 

1,009

 

413

 

44,806

 

Touchstone Moderate ETF (IQ Advisor Standard ™)

 

2,411

 

769

 

102,257

 

Touchstone Money Market (AnnuiChoice ™)

 

3,209

 

15,096

 

59,905

 

Touchstone Money Market (Grandmaster ™)

 

8,464,972

 

7,865,968

 

6,561,795

 

Touchstone Money Market (IQ Annuity ™)

 

3,068,357

 

2,939,770

 

581,444

 

Touchstone Money Market (IQ3 ™)

 

5,453

 

35,053

 

106,357

 

Touchstone Third Avenue Value (AnnuiChoice ™)

 

6,097,456

 

4,506,543

 

9,832,001

 

Touchstone Third Avenue Value (AnnuiChoice II ™)

 

695,755

 

85,376

 

654,385

 

Touchstone Third Avenue Value (GrandMaster flex3 ™)

 

5,071,534

 

4,914,247

 

6,001,226

 

Touchstone Third Avenue Value (Grandmaster ™)

 

2,050,541

 

1,180,781

 

2,871,715

 

Touchstone Third Avenue Value (IQ Annuity ™)

 

3,236,442

 

4,180,707

 

7,135,606

 

Touchstone Third Avenue Value (Pinnacle Plus ™)

 

1,331,675

 

959,778

 

1,985,571

 

 

36



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Affiliated (continued):

 

 

 

 

 

 

 

Touchstone Third Avenue Value (IQ Advisor Enhanced ™)

 

$

6,550

 

$

33

 

$

6,517

 

Touchstone Third Avenue Value (IQ Advisor Standard ™)

 

422,367

 

63,667

 

522,128

 

Touchstone Value Plus (AnnuiChoice ™)

 

148,448

 

405,600

 

706,301

 

Touchstone Value Plus (AnnuiChoice II ™)

 

40,065

 

15,234

 

45,405

 

Touchstone Value Plus (GrandMaster flex3 ™)

 

3,708

 

47,094

 

99,177

 

Touchstone Value Plus (Grandmaster ™)

 

34,053

 

6,391

 

92,331

 

Touchstone Value Plus (IQ Annuity ™)

 

195,047

 

2,385,772

 

442,873

 

Touchstone Value Plus (Pinnacle Plus ™)

 

44,085

 

1,228

 

85,942

 

Non-Affiliated:

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (AnnuiChoice ™)

 

42,991

 

172,929

 

465,653

 

JP Morgan Mid Cap Value (GrandMaster flex3 ™)

 

61,354

 

449,985

 

884,656

 

JP Morgan Mid Cap Value (Grandmaster ™)

 

7,029

 

127,057

 

84,364

 

JP Morgan Mid Cap Value (IQ3 ™)

 

20,948

 

97,405

 

327,969

 

JP Morgan Mid Cap Value (Pinnacle Plus ™)

 

21,235

 

46,911

 

344,846

 

Non-Affiliated Initial Class:

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (Grandmaster ™)

 

2,852,865

 

6,102,255

 

20,925,915

 

Fidelity VIP Growth (Grandmaster ™)

 

373,834

 

5,574,759

 

10,150,463

 

Fidelity VIP High Income (Grandmaster ™)

 

3,111,910

 

3,656,481

 

4,334,350

 

Fidelity VIP II Asset Manager (Grandmaster ™)

 

1,561,863

 

2,883,955

 

10,428,125

 

Fidelity VIP II Contrafund (Grandmaster ™)

 

7,296,775

 

6,624,986

 

26,767,109

 

Fidelity VIP II Index 500 (Grandmaster ™)

 

415,802

 

3,356,325

 

7,395,079

 

Fidelity VIP II Index 500 (IQ Annuity ™)

 

34,117

 

193,994

 

565,539

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice ™)

 

1,104,373

 

247,366

 

856,288

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice II ™)

 

80,140

 

628

 

79,514

 

Fidelity VIP II Investment Grade Bond (Grandmaster ™)

 

1,679,356

 

3,996,502

 

5,641,552

 

Fidelity VIP II Investment Grade Bond (Grandmaster flex3 ™)

 

1,869,281

 

582,209

 

1,287,692

 

Fidelity VIP II Investment Grade Bond (IQ Annuity ™)

 

1,678,828

 

762,107

 

2,283,996

 

Fidelity VIP II Investment Grade Bond (Pinnacle Plus ™)

 

311,357

 

42,771

 

268,580

 

Fidelity VIP III Balanced (Grandmaster ™)

 

379,387

 

896,674

 

1,307,087

 

Fidelity VIP III Growth & Income (Grandmaster ™)

 

312,749

 

1,089,274

 

3,600,088

 

Fidelity VIP III Growth Opportunities (Grandmaster ™)

 

239,075

 

744,066

 

1,128,618

 

Fidelity VIP Overseas (AnnuiChoice ™)

 

486,157

 

115,938

 

372,084

 

Fidelity VIP Overseas (AnnuiChoice II ™)

 

145,278

 

41,162

 

106,698

 

Fidelity VIP Overseas (Grandmaster ™)

 

1,380,721

 

3,525,546

 

4,966,540

 

Fidelity VIP Overseas (Grandmaster flex3 ™)

 

666,682

 

393,964

 

277,007

 

Fidelity VIP Overseas (IQ Annuity ™)

 

394,281

 

35,512

 

359,907

 

Fidelity VIP Overseas (Pinnacle Plus ™)

 

453,757

 

104,488

 

348,881

 

Affiliated Service Class:

 

 

 

 

 

 

 

Touchstone Aggressive ETF (Annuichoice ™)

 

194,856

 

50,034

 

363,333

 

Touchstone Aggressive ETF (Annuichoice II ™)

 

440,118

 

291,055

 

175,377

 

Touchstone Aggressive ETF (Grandmaster flex3 ™)

 

175,929

 

34,536

 

141,342

 

Touchstone Aggressive ETF (IQ Advisor Standard ™)

 

45,694

 

42,606

 

203

 

Touchstone Aggressive ETF (Pinnacle Plus ™)

 

68,681

 

385

 

68,297

 

Touchstone Conservative ETF (Annuichoice ™)

 

486,796

 

419,532

 

221,692

 

Touchstone Conservative ETF (Annuichoice II ™)

 

91,565

 

11,703

 

85,283

 

Touchstone Conservative ETF (GrandMaster flex3 ™)

 

93,523

 

16,601

 

77,298

 

Tocuhstone Conservative ETF (IQ Advisor Enhanced ™)

 

103,841

 

48,007

 

58,059

 

Touchstone Conservative ETF (Pinnacle Plus ™)

 

24,764

 

938

 

23,839

 

 

37



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Affiliated Service Class (continued):

 

 

 

 

 

 

 

Touchstone Enhanced ETF (Annuichoice ™)

 

$

314,996

 

$

110,610

 

$

379,064

 

Touchstone Enhanced ETF (Annuichoice II ™)

 

237,629

 

149,147

 

87,531

 

Touchstone Enhanced ETF (GrandMaster flex3 ™)

 

418,746

 

51,064

 

367,957

 

Touchstone Enhanced ETF (Pinnacle Plus ™)

 

366,744

 

16,957

 

349,593

 

Touchstone GMAB Aggressive (AnnuiChoice II ™)

 

109,451

 

4,827

 

104,932

 

Touchstone GMAB Conservative (AnnuiChoice ™)

 

11,569

 

19

 

11,550

 

Touchstone GMAB Conservative (AnnuiChoice II ™)

 

235,003

 

9,808

 

225,396

 

Touchstone GMAB Moderate ETF (AnnuiChoice ™)

 

701

 

606

 

34,473

 

Touchstone GMAB Moderate ETF (AnnuiChoice II ™)

 

74,008

 

46,831

 

25,394

 

Touchstone Moderate ETF (AnnuiChoice ™)

 

432,486

 

59,351

 

686,398

 

Touchstone Moderate ETF (AnnuiChoice II ™)

 

431,857

 

194,788

 

255,302

 

Touchstone Moderate ETF (GrandMaster flex3 ™)

 

3,851,252

 

29,238

 

3,822,351

 

Touchstone Moderate ETF (IQ Advisor Standard ™)

 

16,347

 

4

 

16,343

 

Touchstone Moderate ETF (Pinnacle Plus ™)

 

131,478

 

34,238

 

97,634

 

Touchstone Money Market (AnnuiChoice ™)

 

16,519,798

 

18,103,355

 

4,002,352

 

Touchstone Money Market (AnnuiChoice II ™)

 

995,765

 

737,383

 

399,086

 

Touchstone Money Market (GrandMaster flex3 ™)

 

5,851,187

 

4,564,702

 

3,164,240

 

Touchstone Money Market (IQ Annuity ™)

 

17,798,468

 

18,470,483

 

5,358,407

 

Touchstone Money Market (Pinnacle Plus ™)

 

3,666,177

 

2,499,372

 

1,496,646

 

Touchstone Money Market (IQ Advisor Standard ™)

 

5,081,753

 

4,105,929

 

1,242,471

 

Non-Affiliated Service Class:

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (IQ Annuity ™)

 

118,045

 

399,370

 

952,784

 

Fidelity VIP Growth (IQ Annuity ™)

 

5,273

 

201,069

 

402,207

 

Fidelity VIP High Income (IQ Annuity ™)

 

416,354

 

792,290

 

297,768

 

Fidelity VIP II Asset Manager (IQ Annuity ™)

 

40,825

 

54,553

 

207,672

 

Fidelity VIP II Contrafund (IQ Annuity ™)

 

1,266,635

 

1,101,973

 

2,584,475

 

Fidelity VIP III Balanced (IQ Annuity ™)

 

10,897

 

16,769

 

135,264

 

Fidelity VIP III Growth & Income (IQ Annuity ™)

 

16,569

 

48,296

 

216,311

 

Fidelity VIP III Growth Opportunities (IQ Annuity ™)

 

61,245

 

107,606

 

70,198

 

Fidelity VIP III Mid Cap (Grandmaster ™)

 

843,558

 

5,677,726

 

3,423,713

 

Fidelity VIP III Mid Cap (IQ Annuity ™)

 

255,578

 

774,057

 

1,482,011

 

Fidelity VIP Overseas (IQ Annuity ™)

 

61,849

 

137,760

 

138,851

 

Non-Affiliated Service Class 2:

 

 

 

 

 

 

 

Fidelity VIP Asset Manager (AnnuiChoice ™)

 

138,707

 

190,221

 

395,269

 

Fidelity VIP Asset Manager (AnnuiChoice II ™)

 

1,255

 

6

 

1,249

 

Fidelity VIP Asset Manager (GrandMaster flex3 ™)

 

60,585

 

72,882

 

271,568

 

Fidelity VIP Asset Manager (IQ3 ™)

 

128,311

 

168,182

 

406,516

 

Fidelity VIP Asset Manager (Pinnacle Plus ™)

 

181,007

 

55,643

 

229,019

 

Fidelity VIP Balanced (AnnuiChoice ™)

 

366,426

 

372,029

 

1,438,834

 

Fidelity VIP Balanced (AnnuiChoice II ™)

 

53,274

 

157

 

53,488

 

Fidelity VIP Balanced (GrandMaster flex3 ™)

 

129,888

 

115,942

 

442,344

 

Fidelity VIP Balanced (Grandmaster ™)

 

1,741,904

 

80,566

 

1,661,954

 

Fidelity VIP Balanced (IQ3 ™)

 

288,176

 

139,292

 

838,103

 

Fidelity VIP Balanced (Pinnacle Plus ™)

 

96,537

 

21,433

 

141,371

 

Fidelity VIP Balanced (IQ Advisor Standard ™)

 

174,744

 

268

 

174,485

 

Fidelity VIP Contrafund (AnnuiChoice ™)

 

5,774,926

 

3,260,859

 

11,349,562

 

Fidelity VIP Contrafund (AnnuiChoice II ™)

 

618,825

 

29,107

 

678,171

 

Fidelity VIP Contrafund (GrandMaster flex3 ™)

 

7,428,654

 

7,933,902

 

8,893,295

 

 

38



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

Fidelity VIP Contrafund (IQ3 ™)

 

$

3,093,267

 

$

2,656,900

 

$

7,801,023

 

Fidelity VIP Contrafund (Pinnacle Plus ™)

 

1,185,647

 

599,168

 

2,428,718

 

Fidelity VIP Contrafund (IQ Advisor Standard ™)

 

44,947

 

31,072

 

181,880

 

Fidelity VIP Disciplined Small Cap (AnnuiChoice ™)

 

507,152

 

233,510

 

273,723

 

Fidelity VIP Disciplined Small Cap (AnnuiChoice II ™)

 

4,557

 

50

 

4,505

 

Fidelity VIP Disciplined Small Cap (GrandMaster ™)

 

391,438

 

274,760

 

109,621

 

Fidelity VIP Disciplined Small Cap (GrandMaster flex3 ™)

 

129,090

 

33,196

 

94,219

 

Fidelity VIP Disciplined Small Cap (IQ Annuity ™)

 

431,850

 

165,135

 

266,884

 

Fidelity VIP Disciplined Small Cap (Pinnacle Plus ™)

 

31,871

 

369

 

31,490

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice ™)

 

456,141

 

458,358

 

143,560

 

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice II ™)

 

7,639

 

42

 

7,888

 

Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3 ™)

 

101,285

 

24,988

 

137,130

 

Fidelity VIP Dynamic Capital Appreciation (Grandmaster ™)

 

101,727

 

41,179

 

165,532

 

Fidelity VIP Dynamic Capital Appreciation (IQ Annuity ™)

 

51,751

 

57,702

 

3,742

 

Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus ™)

 

32,427

 

7,155

 

116,217

 

Fidelity VIP Dynamic Capital Appreciation (IQ Advisor Standard ™)

 

3,832

 

192

 

33,519

 

Fidelity VIP Equity-Income (AnnuiChoice ™)

 

1,065,530

 

670,933

 

4,062,368

 

Fidelity VIP Equit-Income (AnnuiChoice II ™)

 

184,842

 

1,581

 

183,892

 

Fidelity VIP Equity-Income (GrandMaster flex3 ™)

 

330,979

 

980,167

 

943,454

 

Fidelity VIP Equity-Income (IQ3 ™)

 

691,645

 

2,193,858

 

2,281,464

 

Fidelity VIP Equity-Income (Pinnacle Plus ™)

 

215,578

 

31,397

 

556,245

 

Fidelity Freedom 2010 (AnnuiChoice ™)

 

70,430

 

923

 

69,492

 

Fidelity Freedom 2010 (AnnuiChoice II ™)

 

42,074

 

351

 

41,721

 

Fidelity Freedom 2010 (GrandMaster ™)

 

28,582

 

24

 

28,558

 

Fidelity Freedom 2010 (GrandmMaster flex3 ™)

 

94,372

 

51,116

 

41,785

 

Fidelity Freedom 2010 (IQ Annuity ™)

 

82,935

 

268

 

82,673

 

Fidelity Freedom 2010 (Pinnacle Plus ™)

 

25,776

 

73

 

25,703

 

Fidelity Freedom 2015 (AnnuiChoice II ™)

 

90,336

 

2,659

 

87,666

 

Fidelity Freedom 2015 (IQ Annuity ™)

 

75,179

 

118

 

75,063

 

Fidelity Freedom 2015 (Pinnacle Plus ™)

 

47,303

 

127

 

47,179

 

Fidelity Freedom 2020 (AnnuiChoice ™)

 

333,240

 

47,163

 

287,569

 

Fidelity Freedom 2020 (AnnuiChoice II ™)

 

25,715

 

53

 

25,663

 

Fidelity Freedom 2020 (Pinnacle Plus ™)

 

26,993

 

75

 

26,918

 

Fidelity Freedom 2025 (AnnuiChoice II ™)

 

70,474

 

337

 

70,145

 

Fidelity Freedom 2025 (Pinnacle Plus ™)

 

25,786

 

73

 

25,713

 

Fidelity Freedom 2030 (IQ Annuity ™)

 

1,047

 

9

 

1,038

 

Fidelity Freedom 2030 (Pinnacle Plus ™)

 

24,704

 

74

 

24,630

 

Fidelity VIP Growth & Income (AnnuiChoice ™)

 

300,122

 

159,277

 

1,125,070

 

Fidelity VIP Growth & Income (AnnuiChoice II ™)

 

40,701

 

309

 

40,407

 

Fidelity VIP Growth & Income (GrandMaster flex3 ™)

 

154,190

 

231,780

 

324,388

 

Fidelity VIP Growth & Income (IQ3 ™)

 

312,242

 

354,521

 

780,792

 

Fidelity VIP Growth & Income (Pinnacle Plus ™)

 

50,028

 

22,576

 

345,609

 

Fidelity VIP Growth (AnnuiChoice ™)

 

896,323

 

692,554

 

1,689,566

 

Fidelity VIP Growth (AnnuiChoice II ™)

 

992

 

91

 

4,775

 

Fidelity VIP Growth (GrandMaster ™)

 

1,361,276

 

596,301

 

840,548

 

Fidelity VIP Growth (GrandMaster flex3 ™)

 

885,317

 

745,802

 

898,216

 

Fidelity VIP Growth (IQ3 ™)

 

1,594,476

 

785,089

 

1,854,768

 

Fidelity VIP Growth (Pinnacle Plus ™)

 

100,520

 

20,242

 

154,769

 

 

39



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

Fidelity VIP Growth Opportunities (AnnuiChoice ™)

 

$

776,137

 

$

481,520

 

$

412,778

 

Fidelity VIP Growth Opportunities (GrandMaster flex3 ™)

 

73,197

 

30,514

 

81,728

 

Fidelity VIP Growth Opportunities (IQ3 ™)

 

963,926

 

118,233

 

963,619

 

Fidelity VIP Growth Opportunities (Pinnacle Plus ™)

 

296,713

 

108,484

 

237,445

 

Fidelity VIP Growth Opportunities (IQ Advisor Standard ™)

 

189,400

 

33,166

 

155,168

 

Fidelity VIP Growth (IQ Advisor Standard ™)

 

180,683

 

34,770

 

145,362

 

Fidelity VIP High Income (AnnuiChoice ™)

 

594,699

 

1,195,552

 

756,306

 

Fidelity VIP High Income (AnnuiChoice II ™)

 

2,974

 

21

 

2,953

 

Fidelity VIP High Income (GrandMaster flex3 ™)

 

2,272,056

 

3,357,701

 

968,434

 

Fidelity VIP High Income (IQ3 ™)

 

1,575,604

 

2,477,524

 

703,067

 

Fidelity VIP High Income (Pinnacle Plus ™)

 

125,224

 

42,177

 

203,990

 

Fidelity VIP High Income (IQ Advisor Standard ™)

 

49,115

 

86,707

 

18,805

 

Fidelity VIP Index 500 (AnnuiChoice ™)

 

1,580,181

 

524,875

 

2,282,963

 

Fidelity VIP Index 500 (IQ3 ™)

 

2,581,164

 

1,666,139

 

1,923,020

 

Fidelity VIP Index 500 (AnnuiChoice II ™)

 

177,088

 

12,194

 

165,102

 

Fidelity VIP Index 500 (Grandmaster ™)

 

2,510,049

 

291,334

 

2,220,441

 

Fidelity VIP Index 500 (Grandmaster flex3 ™)

 

1,118,101

 

334,233

 

788,269

 

Fidelity VIP Index 500 (IQ Advisor Standard ™)

 

267,404

 

979

 

266,432

 

Fidelity VIP Index 500 (Pinnacle Plus ™)

 

430,178

 

5,371

 

444,634

 

Fidelity VIP Investment Grade Bond (AnnuiChoice ™)

 

937,220

 

999,263

 

5,730,453

 

Fidelity VIP Investment Grade Bond (AnnuiChoice II ™)

 

428,370

 

17,316

 

410,458

 

Fidelity VIP Investment Grade Bond (GrandMaster ™)

 

1,911,284

 

671,165

 

1,249,133

 

Fidelity VIP Investment Grade Bond (GrandMaster flex3 ™)

 

2,042,213

 

1,067,782

 

1,896,209

 

Fidelity VIP Investment Grade Bond (IQ3 ™)

 

1,019,378

 

1,019,443

 

4,310,664

 

Fidelity VIP Investment Grade Bond (Pinnacle Plus ™)

 

210,074

 

104,112

 

707,007

 

Fidelity VIP Investment Grade Bond (IQ Advisor Standard ™)

 

219,217

 

95,957

 

185,721

 

Fidelity VIP Mid Cap (AnnuiChoice ™)

 

1,788,036

 

2,635,996

 

5,654,157

 

Fidelity VIP Mid Cap (AnnuiChoice II ™)

 

283,101

 

37,041

 

319,635

 

Fidelity VIP Mid Cap (GrandMaster flex3 ™)

 

2,232,599

 

3,747,181

 

3,184,108

 

Fidelity VIP Mid Cap (Grandmaster ™)

 

4,147,753

 

661,919

 

3,533,672

 

Fidelity VIP Mid Cap (IQ Annuity ™)

 

1,696,848

 

2,726,991

 

3,083,787

 

Fidelity VIP Mid Cap (Pinnacle Plus ™)

 

638,519

 

407,703

 

1,429,109

 

Fidelity VIP Mid Cap (IQ Advisor Enhanced ™)

 

1,229

 

106

 

10,947

 

Fidelity VIP Mid Cap (IQ Advisor Standard ™)

 

86,299

 

94,640

 

67,246

 

Fidelity VIP Overseas (AnnuiChoice ™)

 

2,443,788

 

676,353

 

2,814,273

 

Fidelity VIP Overseas (AnnuiChoice II ™)

 

114,418

 

13,865

 

123,912

 

Fidelity VIP Overseas (GrandMaster ™)

 

2,006,355

 

525,484

 

1,506,472

 

Fidelity VIP Overseas (GrandMaster flex3 ™)

 

2,556,732

 

2,069,803

 

1,310,894

 

Fidelity VIP Overseas (IQ3 ™)

 

3,240,408

 

1,471,205

 

2,608,685

 

Fidelity VIP Overseas (Pinnacle Plus ™)

 

1,102,338

 

252,202

 

1,119,916

 

Fidelity VIP Overseas (IQ Advisor Enhanced ™)

 

1,922

 

167

 

14,593

 

Fidelity VIP Overseas (IQ Advisor Standard ™)

 

499,820

 

111,853

 

524,151

 

 

40



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Non-Affiliated Class 1:

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice ™)

 

$

84,885

 

$

88,627

 

$

406,667

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II ™)

 

18,911

 

16,266

 

24,384

 

Van Kampen UIF Emerging Markets Debt (GrandMaster flex3 ™)

 

150,898

 

542,504

 

234,931

 

Van Kampen UIF Emerging Markets Debt (IQ3 ™)

 

74,789

 

207,917

 

278,559

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™)

 

550,260

 

1,455,727

 

1,628,542

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice II ™)

 

 

173,009

 

 

53,182

 

 

154,623

 

Van Kampen UIF U.S. Real Estate (GrandMaster flex3 ™)

 

367,157

 

1,623,534

 

1,020,323

 

Van Kampen UIF U.S. Real Estate (IQ3 ™)

 

1,290,253

 

2,083,052

 

1,401,226

 

Non-Affiliated Class 2

 

 

 

 

 

 

 

Franklin Foreign Securities (IQ Annuity ™)

 

923,828

 

607,221

 

1,876,034

 

Franklin Growth and Income Securities (AnnuiChoice ™)

 

5,272,624

 

1,042,372

 

5,782,414

 

Franklin Growth and Income Securities (AnnuiChoice II ™)

 

97,133

 

22,699

 

97,391

 

Franklin Growth and Income Securities (GrandMaster flex3 ™)

 

2,721,996

 

1,215,656

 

2,152,242

 

Franklin Growth and Income Securities (Grandmaster ™)

 

1,941,395

 

710,497

 

1,842,037

 

Franklin Growth and Income Securities (IQ Annuity ™)

 

6,097,452

 

2,165,210

 

4,781,605

 

Franklin Growth and Income Securities (Pinnacle Plus ™)

 

1,311,555

 

351,924

 

1,325,889

 

Franklin Growth and Income Securities (IQ Advisor Standard ™)

 

4,285

 

47

 

4,233

 

Franklin Income Securities (AnnuiChoice ™)

 

3,109,583

 

3,988,431

 

6,836,825

 

Franklin Income Securities (AnnuiChoice II ™)

 

554,802

 

121,257

 

651,545

 

Franklin Income Securities (GrandMaster flex3 ™)

 

2,009,734

 

1,791,519

 

6,247,090

 

Franklin Income Securities (Grandmaster ™)

 

1,069,924

 

1,669,613

 

5,813,814

 

Franklin Income Securities (IQ Annuity ™)

 

4,160,189

 

3,499,606

 

7,902,343

 

Franklin Income Securities (Pinnacle Plus ™)

 

1,322,203

 

1,114,517

 

2,718,268

 

Franklin Income Securities (IQ Advisor Enhanced ™)

 

431

 

87

 

9,357

 

Franklin Income Securities (IQ Advisor Standard ™)

 

4,354

 

47

 

4,304

 

Franklin Large Cap Growth Securities (AnnuiChoice ™)

 

650,756

 

645,386

 

380,987

 

Franklin Large Cap Growth Securities (AnnuiChoice II ™)

 

41,621

 

134

 

44,057

 

Franklin Large Cap Growth Securities (GrandMaster flex3 ™)

 

2,469,335

 

2,484,039

 

384,761

 

Franklin Large Cap Growth Securities (Grandmaster ™)

 

22,381

 

54,735

 

58,377

 

Franklin Large Cap Growth Securities (IQ Annuity ™)

 

1,168,755

 

727,165

 

673,984

 

Franklin Large Cap Growth Securities (Pinnacle Plus ™)

 

48,586

 

58,290

 

232,349

 

Franklin Large Cap Growth Securities (IQ Advisor Standard ™)

 

75,425

 

10,382

 

64,557

 

Franklin Mutual Shares Securities (AnnuiChoice ™)

 

4,257,942

 

4,111,512

 

4,517,928

 

Franklin Mutual Shares Securities (AnnuiChoice II ™)

 

311,685

 

23,258

 

329,104

 

Franklin Mutual Shares Securities (GrandMaster flex3 ™)

 

1,744,594

 

1,337,753

 

4,279,366

 

Franklin Mutual Shares Securities (IQ Annuity ™)

 

2,367,235

 

2,224,064

 

3,013,839

 

Franklin Mutual Shares Securities (Pinnacle Plus ™)

 

1,217,909

 

907,173

 

2,005,721

 

Franklin Mutual Shares Securities (IQ Advisor Standard ™)

 

523,201

 

217,804

 

433,114

 

Franklin Mutual Shares Securities(Grandmaster ™)

 

4,072,189

 

1,236,640

 

5,302,467

 

Franklin Small Cap Value Securities (Annuichoice ™)

 

24,207

 

92

 

24,112

 

Franklin Small Cap Value Securities (Annuichoice II ™)

 

32,782

 

321

 

32,446

 

Franklin Small Cap Value Securities (Grandmaster ™)

 

31,128

 

19,132

 

9,070

 

Franklin Small Cap Value Securities (Grandmaster flex3 ™)

 

5,183

 

21

 

5,161

 

Franklin Small Cap Value Securities (IQ Annuuity ™)

 

652,324

 

617,934

 

644

 

Franklin Small Cap Value Securities (Pinnacle Plus ™)

 

12,438

 

39

 

12,397

 

Templeton Foriegn Securities Fund (GrandMaster flex3 ™)

 

1,476,055

 

864,203

 

2,220,238

 

Templeton Foriegn Securities Fund (Grandmaster ™)

 

458,128

 

309,921

 

688,340

 

Templeton Foriegn Securities Fund (Pinnacle Plus ™)

 

261,833

 

197,798

 

406,550

 

Templeton Foreign Securities Fund (AnnuiChoice ™)

 

945,211

 

410,314

 

2,122,785

 

Templeton Foreign Securities Fund (AnnuiChoice II ™)

 

119,678

 

21,762

 

154,061

 

Templeton Foriegn Securities Fund (IQ Advisor Standard ™)

 

255,522

 

217,538

 

97,186

 

Templeton Growth Securities (AnnuiChoice ™)

 

2,520,369

 

4,357,181

 

1,699,798

 

Templeton Growth Securities (AnnuiChoice II ™)

 

224,892

 

15,224

 

229,523

 

 

41



 

Separate Account I

of

Integrity Life Insurance Company

 

notes to Financial Statements (continued)

 

2.  Investments (continued)

 

Division

 

Purchases

 

Sales

 

Cost

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

Templeton Growth Securities (GrandMaster flex3 ™)

 

$

1,066,727

 

$

1,513,089

 

$

2,252,359

 

Templeton Growth Securities (Grandmaster ™)

 

740,212

 

4,181,167

 

1,141,612

 

Templeton Growth Securities (IQ Annuity ™)

 

3,277,745

 

3,710,833

 

1,989,158

 

Templeton Growth Securities (Pinnacle Plus ™)

 

632,663

 

708,595

 

981,319

 

Van Kampen LIT Comstock (AnnuiChoice ™)

 

178,400

 

404,090

 

851,157

 

Van Kampen LIT Comstock (AnnuiChoice II ™)

 

53,986

 

1,084

 

56,889

 

Van Kampen LIT Comstock (GrandMaster flex3 ™)

 

153,734

 

570,025

 

644,090

 

Van Kampen LIT Comstock (Grandmaster ™)

 

35,536

 

193,064

 

249,585

 

Van Kampen LIT Comstock (IQ Annuity ™)

 

412,673

 

710,419

 

1,108,554

 

Van Kampen LIT Comstock (Pinnacle Plus ™)

 

79,933

 

80,938

 

302,337

 

Van Kampen LIT Strategic Growth (AnnuiChoice ™)

 

435,911

 

351,599

 

130,069

 

Van Kampen LIT Strategic Growth (AnnuiChoice II ™)

 

995

 

130

 

7,636

 

Van Kampen LIT Strategic Growth (GrandMaster flex3 ™)

 

28,023

 

36,853

 

85,527

 

Van Kampen LIT Strategic Growth (Grandmaster ™)

 

 

12,119

 

9,071

 

Van Kampen LIT Strategic Growth (IQ Annuity ™)

 

243,425

 

183,467

 

66,524

 

Van Kampen LIT Strategic Growth (Pinnacle Plus ™)

 

59,541

 

47,297

 

28,480

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice ™)

 

136,241

 

7,203

 

128,958

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II ™)

 

53,777

 

3,699

 

49,953

 

Van Kampen UIF Emerging Markets Debt (Grandmaster ™)

 

135,250

 

83,618

 

326,208

 

Van Kampen UIF Emerging Markets Debt (GrandMaste flex3 ™)

 

604,951

 

44,217

 

554,968

 

Van Kampen UIF Emerging Markets Debt (IQ Annuity ™)

 

450,255

 

116,558

 

437,367

 

Van Kampen UIF Emerging Markets Debt (Pinnacle Plus ™)

 

130,109

 

39,605

 

223,098

 

Van Kampen UIF Emerging Markets Debt (IQ Advisor Standard ™)

 

23,716

 

2,486

 

21,014

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice ™)

 

1,281,159

 

690,279

 

1,594,945

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice II ™)

 

36,808

 

6,721

 

36,009

 

Van Kampen UIF Emerging Markets Equity (GrandMaster flex3 ™)

 

641,595

 

453,626

 

1,078,655

 

Van Kampen UIF Emerging Markets Equity (Grandmaster ™)

 

362,342

 

241,661

 

520,558

 

Van Kampen UIF Emerging Markets Equity (IQ Annuity ™)

 

2,214,963

 

708,761

 

2,609,543

 

Van Kampen UIF Emerging Markets Equity (Pinnacle Plus ™)

 

636,057

 

344,681

 

638,727

 

Van Kampen UIF Emerging Markets Equity (IQ Advisor Standard ™)

 

149,305

 

42,166

 

129,778

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™)

 

611,166

 

102,040

 

489,314

 

Van Kampen UIF U.S Real Estate (AnnuiChoice II ™)

 

84,542

 

11,803

 

70,692

 

Van Kampen UIF U. S. Real Estate (Pinnacle Plus ™)

 

383,188

 

294,261

 

738,482

 

Van Kampen UIF U.S. Real Estate (Grandmaster ™)

 

459,622

 

724,130

 

730,915

 

Van Kampen UIF U.S. Real Estate (Grandmaster flex3 ™)

 

705,436

 

79,361

 

607,771

 

Van Kampen UIF U.S. Real Estate (IQ Annuity ™)

 

709,127

 

846,533

 

614,878

 

Van Kampen UIF U.S. Real Estate (IQ Advisor Standard ™)

 

277,761

 

92,256

 

344,447

 

Non-Affiliated Class B

 

 

 

 

 

 

 

DWS Small Cap Index (AnnuiChoice ™)

 

118,405

 

216,517

 

761,431

 

DWS Small Cap Index (AnnuiChoice II ™)

 

23,049

 

149

 

26,396

 

DWS Small Cap Index (GrandMaster flex3 ™)

 

57,291

 

197,531

 

173,209

 

DWS Small Cap Index (Grandmaster ™)

 

93,651

 

35,515

 

152,518

 

DWS Small Cap Index (IQ3 ™)

 

917,933

 

1,008,723

 

543,850

 

DWS Small Cap Index (Pinnacle Plus ™)

 

64,631

 

29,474

 

184,331

 

 

42


 


 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

3.  Expenses

 

Integrity assumes mortality and expense risks and incurs certain administrative expenses related to the operations of the Separate Account and deducts a charge from the assets of the Separate Account at an annual rate.  Eight contracts are currently offered by the Separate Account: GrandMaster flex3, IQ the SmartAnnuity (“IQ Annuity”), IQ3 the Smart Annuity (“IQ3”), IQ Advisor (Standard or Enhanced), AnnuiChoice, AnnuiChoice II, Pinnacle Plus and ETF easyAnnuity.  GrandMaster flex3, AnnuiChoice, AnnuiChoice II and Pinnacle Plus have a deferred sales load charge.  IQ Annuity, IQ3, IQ Advisor ( Standard or Enhanced) and ETF easyAnnuity have no sales load charges on their contracts. GrandMaster flex3 charges an annual rate of 1.40% and 0.15% of net assets, IQ Annuity and IQ3 charge an annual rate of 1.30% and 0.15% of net assets. AnnuiChoice charges an annual rate of 0.85% and 0.15% of net assets, AnnuiChoice II charges an annual rate of 1.00% and 0.15%, Pinnacle Plus charges an annual rate of 1.52% during the first nine contract years and 1.00% thereafter and 0.15% of net assets, respectively, for mortality and expense risks and administrative expenses.  IQ Advisor Standard, an integrated low-cost annuity sold by fee-based financial planners, charges an annual rate of 0.60% of net assets for mortality and expense risks and administrative expenses.  The same contract is available with an optional death benefit referred to as IQ Advisor Enhanced and charges an annual rate of 0.80% of net assets to cover these expenses.  ETF EasyAnnuity charges an annual rate of 0.60% of net assets for mortality and expense risks and administrative expenses. Guaranteed Minimum Accumulation Benefit (“GMAB”) funds in AnnuiChoice and AnnuiChoice II charge an additional 0.60% of net assets for expenses associated with the GMAB rider. These charges are deducted on a daily basis. For IQ Annuity, IQ3, ETF easyAnnuity and Annuichoice, an annual administrative charge of $30 per contract is assessed if the participant’s account value is less than $50,000, or less than $75,000 for AnnuiChoice, at the end of any participation year prior to the participant’s retirement date (as defined by the participant’s contract). Pinnacle Plus has an annual administrative charge of $40 per contract, which is assessed if the account value is less than $75,000 at the end of any participation year. For GrandMaster flex3, an annual administrative charge of $50 per contract is assessed if the account value is less than $75,000 at the end of any participation year. IQ Advisor (Standard or Enhanced) does not have an annual administrative charge.

 

Integrity also deducts an amount quarterly to cover the cost of any additional benefits provided under the policy by rider. The charges for riders are deducted on a quarterly anniversary day.

 

43



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights

 

A summary of net assets, unit values and units outstanding for variable annuity contracts, investment income and expense ratios, excluding expenses of the underlying funds and total returns are presented for the periods ended December 31, 2007, 2006, 2005, 2004, and 2003 (refer to the Statements of Changes in Net Assets for the applicable periods ended December 31, 2007 and 2006).

 

Investment income ratio amounts represent the dividends, excluding distributions of capital gains, received by the subaccount from the underlying mutual fund net of management fees assessed by the fund manager, divided by the average net assets.  These ratios exclude those expenses, such as mortality and expense risk and administrative charges, that result in direct reductions in the unit values.  The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying fund in which the subaccounts invest.

 

Expense ratio amounts represent the annualized contract expenses of the separate account, consisting primarily of mortality and expense risk and administrative charges, for each period indicated.  The ratios include only those expenses that result in a direct reduction to unit values.  Charges made directly to contract owner accounts through the redemption of units and expenses of the underlying fund are excluded.

 

Total return amounts represent the total return for the periods indicated, including changes in the value of the underlying fund, which includes expenses assessed through the reduction of unit values.  The ratio does not include any expenses assessed through the redemption of units.  Investment options with a date notation indicate the effective date of that investment option in the variable account.  The total return is calculated for the period indicated or from the effective date through the end of the reporting period.

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

29

 

$

12.45

 

$

362

 

1.93

%

1.00

%

4.08

%

 

 

2006

 

30

 

11.96

 

359

 

1.69

%

1.00

%

12.39

%

 

 

2005

 

17

 

10.64

 

176

 

0.00

%

1.00

%

3.59

%

 

 

2004

 

10.27

 

2

 

7.53

%

1.00

%

2.70

%

Touchstone Aggressive ETF (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

178

 

12.23

 

2,178

 

1.86

%

1.55

%

3.50

%

 

 

2006

 

167

 

11.82

 

1,974

 

1.30

%

1.55

%

11.77

%

 

 

2005

 

243

 

10.58

 

2,575

 

0.00

%

1.55

%

3.01

%

 

 

2004

 

2

 

10.27

 

17

 

8.37

%

1.55

%

2.70

%

Touchstone Aggressive ETF (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

16

 

12.31

 

196

 

1.23

%

1.35

%

3.72

%

 

 

2006

 

30

 

11.87

 

361

 

1.38

%

1.35

%

11.99

%

 

 

2005

 

35

 

10.60

 

373

 

0.00

%

1.35

%

3.22

%

 

 

2004

 

11

 

10.27

 

114

 

11.40

%

1.35

%

2.70

%

Touchstone Aggressive ETF (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

323

 

12.27

 

3,966

 

1.95

%

1.45

%

3.56

%

 

 

2006

 

328

 

11.85

 

3,887

 

1.41

%

1.45

%

11.88

%

 

 

2005

 

332

 

10.59

 

3,514

 

0.00

%

1.45

%

3.12

%

 

 

2004

 

*

10.27

 

5

 

9.21

%

1.45

%

2.70

%

Touchstone Aggressive ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

12

 

12.19

 

150

 

2.03

%

1.67

%

3.37

%

 

 

2006

 

9

 

11.79

 

106

 

1.64

%

1.67

%

11.63

%

 

 

2005

 

7

 

10.56

 

78

 

0.00

%

1.67

%

2.89

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

44



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

$

13.28

 

$

20

 

1.97

0.60

4.51

 

 

2006

 

2

 

12.71

 

19

 

1.18

%

0.60

%

12.84

%

 

 

2005

 

2

 

11.27

 

25

 

0.00

%

0.60

%

4.00

%

 

 

2004

 

2

 

10.83

 

16

 

1.76

%

0.60

%

8.30

%

Touchstone Balanced (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

147

 

14.41

 

2,117

 

5.38

%

1.00

%

4.40

%

 

 

2006

 

151

 

13.80

 

2,077

 

1.74

%

1.00

%

9.80

%

 

 

2005

 

165

 

12.57

 

2,073

 

1.44

%

1.00

%

5.55

%

 

 

2004

 

183

 

11.91

 

2,179

 

0.83

%

1.00

%

8.57

%

 

 

2003

 

169

 

10.97

 

1,848

 

0.74

%

1.00

%

20.42

%

Touchstone Balanced (AnnuiChoice II™ )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

11.01

 

59

 

8.41

%

1.55

%

10.15

%

Touchstone Balanced (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

82

 

13.98

 

1,146

 

4.65

%

1.55

%

3.80

%

 

 

2006

 

102

 

13.47

 

1,370

 

1.94

%

1.55

%

9.19

%

 

 

2005

 

91

 

12.33

 

1,127

 

1.46

%

1.55

%

4.97

%

 

 

2004

 

86

 

11.75

 

1,012

 

1.24

%

1.55

%

7.90

%

 

 

2003

 

27

 

10.89

 

295

 

1.06

%

1.55

%

19.80

%

Touchstone Balanced (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

32

 

12.96

 

416

 

4.71

%

1.35

%

4.06

%

 

 

2006

 

35

 

12.45

 

431

 

2.10

%

1.35

%

9.41

%

 

 

2005

 

18

 

11.38

 

200

 

2.01

%

1.35

%

5.18

%

 

 

2004

 

5

 

10.82

 

55

 

3.54

%

1.35

%

8.20

%

Touchstone Balanced (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

85

 

14.08

 

1,202

 

4.95

%

1.45

%

3.94

%

 

 

2006

 

100

 

13.55

 

1,360

 

1.77

%

1.45

%

9.30

%

 

 

2005

 

120

 

12.40

 

1,486

 

1.32

%

1.45

%

5.07

%

 

 

2004

 

138

 

11.80

 

1,627

 

1.11

%

1.45

%

8.06

%

 

 

2003

 

78

 

10.92

 

851

 

0.64

%

1.45

%

19.87

%

Touchstone Balanced (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

25

 

14.00

 

353

 

4.24

%

1.67

%

3.69

%

 

 

2006

 

39

 

13.50

 

525

 

2.20

%

1.67

%

9.06

%

 

 

2005

 

20

 

12.38

 

244

 

1.36

%

1.67

%

4.84

%

 

 

2004

 

20

 

11.80

 

232

 

1.03

%

1.67

%

7.76

%

 

 

2003

 

2

 

10.95

 

18

 

0.00

%

1.67

%

9.50

%

Touchstone Baron Small Cap (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

123

 

18.25

 

2,252

 

0.00

%

1.00

%

1.70

%

 

 

2006

 

134

 

17.94

 

2,398

 

0.00

%

1.00

%

17.09

%

 

 

2005

 

157

 

15.32

 

2,411

 

0.00

%

1.00

%

6.62

%

 

 

2004

 

172

 

14.37

 

2,467

 

0.00

%

1.00

%

26.61

%

 

 

2003

 

174

 

11.35

 

1,974

 

0.00

%

1.00

%

32.13

%

Touchstone Baron Small Cap (AnnuiChoice II™ )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

11.47

 

113

 

0.00

%

1.15

%

1.60

%

 

 

2006

 

1

 

11.29

 

14

 

0.00

%

1.15

%

0.00

%

Touchstone Baron Small Cap (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

83

 

16.49

 

1,376

 

0.00

%

1.55

%

1.17

%

 

 

2006

 

91

 

16.30

 

1,476

 

0.00

%

1.55

%

16.44

%

 

 

2005

 

82

 

14.00

 

1,149

 

0.00

%

1.55

%

6.03

%

 

 

2004

 

78

 

13.20

 

1,026

 

0.00

%

1.55

%

25.83

%

 

 

2003

 

64

 

10.49

 

670

 

0.00

%

1.55

%

31.29

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

45



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Baron Small Cap (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

22

 

$

14.81

 

$

330

 

0.00

%

1.35

%

1.35

%

 

 

2006

 

26

 

14.61

 

387

 

0.00

%

1.35

%

16.67

%

 

 

2005

 

34

 

12.52

 

423

 

0.00

%

1.35

%

6.24

%

 

 

2004

 

11

 

11.79

 

128

 

0.00

%

1.35

%

17.90

%

Touchstone Baron Small Cap (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

180

 

17.79

 

3,208

 

0.00

%

1.45

%

1.24

%

 

 

2006

 

195

 

17.57

 

3,427

 

0.00

%

1.45

%

16.56

%

 

 

2005

 

233

 

15.07

 

3,517

 

0.00

%

1.45

%

6.13

%

 

 

2004

 

183

 

14.20

 

2,593

 

0.00

%

1.45

%

26.00

%

 

 

2003

 

167

 

11.27

 

1,882

 

0.00

%

1.45

%

31.51

%

Touchstone Baron Small Cap (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

30

 

17.26

 

509

 

0.00

%

1.67

%

1.06

%

 

 

2006

 

28

 

17.08

 

486

 

0.00

%

1.67

%

16.30

%

 

 

2005

 

27

 

14.69

 

391

 

0.00

%

1.67

%

5.90

%

 

 

2004

 

18

 

13.87

 

249

 

0.00

%

1.67

%

25.63

%

 

 

2003

 

2

 

11.04

 

21

 

0.00

%

1.67

%

10.40

%

Touchstone Baron Small Cap (IQ Advisor Enhanced™)’’

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

15.77

 

6

 

0.00

%

0.80

%

1.93

%

 

 

2006

 

*

15.47

 

6

 

0.00

%

0.80

%

17.32

%

 

 

2005

 

*

13.19

 

5

 

0.00

%

0.80

%

6.83

%

 

 

2004

 

*

12.34

 

5

 

0.00

%

0.80

%

23.40

%

Touchstone Baron Small Cap (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

14

 

15.89

 

216

 

0.00

%

1.00

%

2.15

%

 

 

2006

 

11

 

15.56

 

175

 

0.00

%

0.60

%

17.56

%

 

 

2005

 

7

 

13.24

 

95

 

0.00

%

0.60

%

7.04

%

 

 

2004

 

5

 

12.37

 

62

 

0.00

%

0.60

%

23.70

%

Touchstone Conservative ETF (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

77

 

11.65

 

894

 

1.77

%

1.00

%

4.71

%

 

 

2006

 

88

 

11.13

 

976

 

0.91

%

1.00

%

7.07

%

 

 

2005

 

70

 

10.40

 

727

 

0.00

%

1.00

%

2.30

%

 

 

2004

 

10

 

10.16

 

101

 

19.75

%

1.00

%

1.60

%

Touchstone Conservative ETF (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

162

 

11.45

 

1,850

 

1.59

%

1.55

%

4.13

%

 

 

2006

 

189

 

11.00

 

2,081

 

1.65

%

1.55

%

6.48

%

 

 

2005

 

55

 

10.33

 

572

 

0.00

%

1.55

%

1.73

%

 

 

2004

 

6

 

10.16

 

62

 

74.95

%

1.55

%

1.60

%

Touchstone Conservative ETF (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

59

 

11.53

 

678

 

1.42

%

1.35

%

4.31

%

 

 

2006

 

73

 

11.05

 

810

 

1.47

%

1.35

%

6.69

%

 

 

2005

 

21

 

10.36

 

216

 

0.00

%

1.35

%

1.93

%

Touchstone Conservative ETF (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

137

 

11.49

 

1,573

 

2.15

%

1.45

%

4.17

%

 

 

2006

 

85

 

11.03

 

939

 

0.84

%

1.45

%

6.58

%

 

 

2005

 

80

 

10.34

 

823

 

0.00

%

1.45

%

1.83

%

Touchstone Conservative ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

20

 

11.41

 

232

 

2.04

%

1.67

%

4.02

%

 

 

2006

 

3

 

10.97

 

38

 

1.02

%

1.67

%

6.35

%

 

 

2005

 

2

 

10.32

 

24

 

0.00

%

1.67

%

1.61

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

46



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Conservative ETF (IQ Advisor Standard™)

 

2007

 

11

 

$

12.18

 

$

129

 

1.80

%

0.60

%

5.16

%

 

 

2006

 

11

 

11.58

 

122

 

0.83

%

0.60

%

7.50

%

 

 

2005

 

11

 

10.78

 

114

 

0.00

%

0.60

%

2.71

%

Touchstone Core Bond (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

169

 

12.59

 

2,129

 

5.62

%

1.00

%

4.43

%

 

 

2006

 

142

 

12.06

 

1,708

 

3.99

%

1.00

%

3.02

%

 

 

2005

 

166

 

11.71

 

1,940

 

0.00

%

1.00

%

0.67

%

 

 

2004

 

184

 

11.63

 

2,136

 

3.68

%

1.00

%

2.20

%

 

 

2003

 

224

 

11.38

 

2,549

 

3.30

%

1.00

%

2.52

%

Touchstone Core Bond (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

10.59

 

56

 

10.48

%

1.15

%

4.22

%

 

 

2006

 

2

 

10.16

 

20

 

28.27

%

1.15

%

0.00

%

Touchstone Core Bond (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

51

 

11.57

 

592

 

4.46

%

1.55

%

3.77

%

 

 

2006

 

53

 

11.15

 

586

 

3.64

%

1.55

%

2.45

%

 

 

2005

 

65

 

10.88

 

708

 

0.00

%

1.55

%

0.11

%

 

 

2004

 

77

 

10.87

 

842

 

3.95

%

1.55

%

1.68

%

 

 

2003

 

83

 

10.69

 

892

 

5.37

%

1.55

%

1.91

%

Touchstone Core Bond (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

11.01

 

118

 

4.16

%

1.35

%

4.05

%

 

 

2006

 

8

 

10.58

 

88

 

4.63

%

1.35

%

2.65

%

 

 

2005

 

7

 

10.31

 

74

 

0.00

%

1.35

%

0.31

%

 

 

2004

 

2

 

10.28

 

18

 

70.57

%

1.35

%

2.80

%

Touchstone Core Bond (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

81

 

12.05

 

978

 

4.55

%

1.45

%

3.91

%

 

 

2006

 

58

 

11.60

 

675

 

3.08

%

1.45

%

2.55

%

 

 

2005

 

86

 

11.31

 

971

 

0.00

%

1.45

%

0.21

%

 

 

2004

 

80

 

11.29

 

905

 

3.27

%

1.45

%

1.80

%

 

 

2003

 

103

 

11.09

 

1,137

 

2.13

%

1.45

%

2.02

%

Touchstone Core Bond (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

69

 

10.75

 

740

 

6.53

%

1.67

%

3.66

%

 

 

2006

 

37

 

10.37

 

383

 

4.60

%

1.67

%

2.32

%

 

 

2005

 

27

 

10.13

 

269

 

0.00

%

1.67

%

(0.01

)%

 

 

2004

 

22

 

10.13

 

219

 

5.10

%

1.67

%

1.50

%

 

 

2003

 

3

 

9.98

 

34

 

0.00

%

1.67

%

(0.20

)%

Touchstone Core Bond (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

17

 

11.12

 

187

 

22.81

%

1.00

%

11.24

%

Touchstone Eagle Capital Appreciation (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

128

 

9.63

 

1,230

 

0.67

%

1.00

%

(0.13

)%

 

 

2006

 

83

 

9.64

 

804

 

0.85

%

1.00

%

15.62

%

 

 

2005

 

94

 

8.34

 

784

 

0.09

%

1.00

%

(0.91

)%

 

 

2004

 

103

 

8.42

 

871

 

0.72

%

1.00

%

13.78

%

 

 

2003

 

203

 

7.40

 

1,504

 

0.15

%

1.00

%

30.97

%

Touchstone Eagle Capital Appreciation (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

9

 

10.83

 

102

 

0.78

%

1.15

%

(0.30

)%

 

 

2006

 

4

 

10.86

 

41

 

5.33

%

1.15

%

0.00

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

47



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Eagle Capital Appreciation (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

46

 

$

12.62

 

$

576

 

0.62

%

1.55

%

(0.73

)%

 

 

2006

 

25

 

12.71

 

320

 

0.82

%

1.55

%

14.98

%

 

 

2005

 

28

 

11.05

 

312

 

0.07

%

1.55

%

(1.46

)%

 

 

2004

 

45

 

11.22

 

506

 

0.95

%

1.55

%

13.22

%

 

 

2003

 

48

 

9.91

 

476

 

0.18

%

1.55

%

30.22

%

Touchstone Eagle Capital Appreciation (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

6

 

12.92

 

76

 

0.67

%

1.45

%

29.23

%

Touchstone Eagle Capital Appreciation (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

76

 

9.42

 

715

 

0.59

%

1.45

%

(0.61

)%

 

 

2006

 

30

 

9.48

 

283

 

0.71

%

1.45

%

15.10

%

 

 

2005

 

45

 

8.24

 

373

 

0.08

%

1.45

%

(1.36

)%

 

 

2004

 

51

 

8.35

 

423

 

0.59

%

1.45

%

13.30

%

 

 

2003

 

77

 

7.37

 

569

 

0.17

%

1.45

%

30.21

%

Touchstone Eagle Capital Appreciation (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

14.02

 

153

 

0.78

%

1.67

%

(0.82

)%

 

 

2006

 

7

 

14.14

 

99

 

0.72

%

1.67

%

14.84

%

 

 

2005

 

10

 

12.31

 

117

 

0.07

%

1.67

%

(1.58

)%

 

 

2004

 

14

 

12.51

 

170

 

1.13

%

1.67

%

13.01

%

 

 

2003

 

2

 

11.07

 

24

 

0.00

%

1.67

%

10.70

%

Touchstone Emerging Growth (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

232

 

18.01

 

4,179

 

3.69

%

1.00

%

13.25

%

 

 

2006

 

198

 

15.90

 

3,146

 

0.00

%

1.00

%

15.02

%

 

 

2005

 

192

 

13.82

 

2,648

 

4.67

%

1.00

%

14.15

%

 

 

2004

 

238

 

12.11

 

2,881

 

1.99

%

1.00

%

11.00

%

 

 

2003

 

226

 

10.91

 

2,465

 

0.00

%

1.00

%

45.66

%

Touchstone Emerging Growth (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

70

 

12.24

 

859

 

4.99

%

1.15

%

13.16

%

 

 

2006

 

8

 

10.82

 

85

 

0.00

%

1.15

%

0.00

%

Touchstone Emerging Growth (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

154

 

17.87

 

2,760

 

5.28

%

1.55

%

12.61

%

 

 

2006

 

121

 

15.87

 

1,925

 

0.00

%

1.55

%

14.38

%

 

 

2005

 

113

 

13.87

 

1,562

 

4.65

%

1.55

%

13.51

%

 

 

2004

 

179

 

12.22

 

2,189

 

2.48

%

1.55

%

10.29

%

 

 

2003

 

133

 

11.08

 

1,472

 

0.00

%

1.55

%

45.03

%

Touchstone Emerging Growth (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

24

 

15.81

 

381

 

4.47

%

1.35

%

12.84

%

 

 

2006

 

7

 

14.01

 

100

 

0.00

%

1.35

%

14.61

%

 

 

2005

 

16

 

12.22

 

191

 

15.22

%

1.35

%

13.74

%

 

 

2004

 

3

 

10.74

 

33

 

5.29

%

1.35

%

7.40

%

Touchstone Emerging Growth (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

157

 

18.18

 

2,846

 

4.74

%

1.45

%

12.76

%

 

 

2006

 

52

 

16.12

 

843

 

0.00

%

1.45

%

14.50

%

 

 

2005

 

63

 

14.08

 

885

 

5.27

%

1.45

%

13.63

%

 

 

2004

 

73

 

12.39

 

899

 

1.82

%

1.45

%

10.43

%

 

 

2003

 

53

 

11.22

 

593

 

0.00

%

1.45

%

45.15

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

48



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Emerging Growth (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

31

 

$

18.57

 

$

585

 

4.44

%

1.67

%

12.50

%

 

 

2006

 

13

 

16.51

 

207

 

0.00

%

1.67

%

14.24

%

 

 

2005

 

25

 

14.45

 

357

 

7.39

%

1.67

%

13.38

%

 

 

2004

 

13

 

12.75

 

163

 

2.60

%

1.67

%

10.20

%

 

 

2003

 

2

 

11.57

 

25

 

0.00

%

1.67

%

15.70

%

Touchstone Emerging Growth (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

16.35

 

114

 

4.54

%

0.60

%

13.76

%

 

 

2006

 

4

 

14.37

 

61

 

0.00

%

0.60

%

15.48

%

Touchstone Large Cap Core Equity (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

19

 

12.23

 

229

 

2.80

%

1.00

%

4.23

%

 

 

2006

 

20

 

11.73

 

235

 

1.91

%

1.00

%

25.31

%

 

 

2005

 

21

 

9.36

 

196

 

0.00

%

1.00

%

(4.02

)%

 

 

2004

 

31

 

9.75

 

301

 

3.05

%

1.00

%

4.17

%

 

 

2003

 

17

 

9.36

 

157

 

1.35

%

1.00

%

30.54

%

Touchstone Large Cap Core Equity (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

11.42

 

25

 

2.73

%

1.15

%

4.07

%

 

 

2006

 

2

 

10.97

 

21

 

15.02

%

1.15

%

0.00

%

Touchstone Large Cap Core Equity (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

104

 

12.80

 

1,332

 

4.09

%

1.55

%

3.71

%

 

 

2006

 

118

 

12.34

 

1,452

 

3.88

%

1.55

%

24.62

%

 

 

2005

 

150

 

9.91

 

1,488

 

0.00

%

1.55

%

(4.55

)%

 

 

2004

 

134

 

10.38

 

1,393

 

3.86

%

1.55

%

3.59

%

 

 

2003

 

72

 

10.02

 

720

 

2.28

%

1.55

%

29.79

%

Touchstone Large Cap Core Equity (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

13.14

 

6

 

1.97

%

1.35

%

3.87

%

 

 

2006

 

2

 

12.65

 

21

 

3.97

%

1.35

%

24.87

%

 

 

2005

 

2

 

10.13

 

21

 

0.00

%

1.35

%

(4.36

)%

 

 

2004

 

3

 

10.59

 

30

 

4.36

%

1.35

%

5.90

%

Touchstone Large Cap Core Equity (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

49

 

12.13

 

600

 

3.41

%

1.45

%

3.74

%

 

 

2006

 

28

 

11.69

 

327

 

3.39

%

1.45

%

24.75

%

 

 

2005

 

28

 

9.37

 

263

 

0.00

%

1.45

%

(4.46

)%

 

 

2004

 

23

 

9.80

 

224

 

2.65

%

1.45

%

3.59

%

 

 

2003

 

22

 

9.46

 

212

 

3.41

%

1.45

%

29.95

%

Touchstone Large Cap Core Equity (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

14.15

 

153

 

2.88

%

1.67

%

3.54

%

 

 

2006

 

11

 

13.67

 

151

 

3.85

%

1.67

%

24.47

%

 

 

2005

 

5

 

10.98

 

50

 

0.00

%

1.67

%

(4.67

)%

 

 

2004

 

11

 

11.52

 

125

 

3.41

%

1.67

%

3.41

%

Touchstone Large Cap Core Equity (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

13.10

 

135

 

4.42

%

0.60

%

4.70

%

 

 

2006

 

4

 

14.37

 

61

 

0.00

%

0.60

%

15.48

%

Touchstone Enhanced ETF (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

87

 

12.97

 

1,127

 

2.00

%

1.00

%

3.02

%

 

 

2006

 

20

 

11.73

 

235

 

1.91

%

1.00

%

25.31

%

 

 

2005

 

68

 

11.02

 

748

 

0.00

%

1.00

%

4.96

%

 

 

2004

 

*

10.50

 

3

 

6.47

%

1.00

%

5.00

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

49



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Enhanced ETF (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

777

 

$

12.75

 

$

9,898

 

1.71

%

1.55

%

2.38

%

 

 

2006

 

1,126

 

12.45

 

14,019

 

0.79

%

1.55

%

13.60

%

 

 

2005

 

537

 

10.96

 

5,888

 

0.00

%

1.55

%

4.38

%

Touchstone Enhanced ETF (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

116

 

12.83

 

1,486

 

2.02

%

1.35

%

2.62

%

 

 

2006

 

116

 

12.50

 

1,452

 

1.00

%

1.35

%

13.83

%

 

 

2005

 

42

 

10.98

 

463

 

0.00

%

1.35

%

4.59

%

 

 

2004

 

2

 

10.50

 

23

 

3.56

%

1.35

%

5.00

%

Touchstone Enhanced ETF (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

487

 

12.79

 

6,227

 

2.04

%

1.45

%

2.54

%

 

 

2006

 

463

 

12.47

 

5,779

 

0.75

%

1.45

%

13.72

%

 

 

2005

 

364

 

10.97

 

3,989

 

0.00

%

1.45

%

4.49

%

 

 

2004

 

*

10.50

 

1

 

51.06

%

1.45

%

5.00

%

Touchstone Enhanced ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

20

 

12.70

 

252

 

2.13

%

1.67

%

2.24

%

 

 

2006

 

15

 

12.42

 

182

 

0.78

%

1.67

%

13.47

%

 

 

2005

 

12

 

10.94

 

128

 

0.00

%

1.67

%

4.25

%

Touchstone Enhanced ETF (IQ Advisor Enhanced™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

14.03

 

45

 

2.01

%

0.80

%

3.17

%

 

 

2006

 

4

 

13.60

 

48

 

0.72

%

0.80

%

14.47

%

 

 

2005

 

4

 

11.88

 

42

 

0.00

%

0.80

%

5.17

%

 

 

2004

 

3

 

11.29

 

36

 

2.01

%

0.80

%

12.90

%

Touchstone Enhanced ETF (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

22

 

14.13

 

308

 

1.28

%

0.60

%

3.43

%

 

 

2006

 

44

 

13.66

 

604

 

0.78

%

0.60

%

14.70

%

 

 

2005

 

18

 

11.91

 

214

 

0.00

%

0.60

%

5.38

%

 

 

2004

 

24

 

11.30

 

268

 

6.89

%

0.60

%

13.00

%

Touchstone Growth & Income (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

14

 

13.17

 

178

 

3.77

%

1.00

%

2.90

%

 

 

2006

 

17

 

12.80

 

215

 

2.83

%

1.00

%

12.54

%

 

 

2005

 

14

 

11.38

 

164

 

0.02

%

1.00

%

0.84

%

 

 

2004

 

27

 

11.28

 

307

 

1.19

%

1.00

%

8.99

%

 

 

2003

 

60

 

10.35

 

620

 

6.60

%

1.00

%

31.51

%

Touchstone Growth & Income (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

13.02

 

90

 

3.34

%

1.55

%

2.30

%

 

 

2006

 

11

 

12.73

 

140

 

2.44

%

1.55

%

11.92

%

 

 

2005

 

29

 

11.37

 

328

 

0.04

%

1.55

%

0.28

%

 

 

2004

 

28

 

11.34

 

313

 

2.15

%

1.55

%

8.41

%

 

 

2003

 

18

 

10.46

 

183

 

6.10

%

1.55

%

30.75

%

Touchstone Growth & Income (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

12.60

 

21

 

5.17

%

1.35

%

2.55

%

 

 

2006

 

1

 

12.29

 

10

 

2.48

%

1.35

%

12.15

%

 

 

2005

 

1

 

10.96

 

9

 

0.01

%

1.35

%

0.49

%

 

 

2004

 

7

 

10.91

 

76

 

40.09

%

1.35

%

9.10

%

Touchstone Growth & Income (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

22

 

13.21

 

291

 

3.63

%

1.45

%

2.38

%

 

 

2006

 

28

 

12.90

 

362

 

2.17

%

1.45

%

12.03

%

 

 

2005

 

41

 

11.51

 

477

 

0.03

%

1.45

%

0.38

%

 

 

2004

 

38

 

11.47

 

436

 

1.90

%

1.45

%

8.51

%

 

 

2003

 

37

 

10.57

 

391

 

5.38

%

1.45

%

30.98

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

50



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Growth & Income (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

9

 

$

14.11

 

$

132

 

3.74

%

1.67

%

2.18

%

 

 

2006

 

8

 

13.81

 

116

 

2.37

%

1.67

%

11.78

%

 

 

2005

 

10

 

12.35

 

128

 

0.03

%

1.67

%

0.16

%

 

 

2004

 

11

 

12.33

 

131

 

2.08

%

1.67

%

8.25

%

 

 

2003

 

5

 

11.39

 

60

 

0.00

%

1.67

%

13.90

%

Touchstone High Yield (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

39

 

15.02

 

593

 

7.60

%

1.00

%

0.76

%

 

 

2006

 

56

 

14.91

 

832

 

7.25

%

1.00

%

6.82

%

 

 

2005

 

61

 

13.96

 

852

 

0.00

%

1.00

%

2.24

%

 

 

2004

 

62

 

13.65

 

852

 

6.64

%

1.00

%

8.42

%

 

 

2003

 

74

 

12.59

 

933

 

4.01

%

1.00

%

22.71

%

Touchstone High Yield (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.54

 

88

 

27.28

%

1.35

%

5.42

%

Touchstone High Yield (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

71

 

14.00

 

989

 

7.45

%

1.55

%

0.16

%

 

 

2006

 

90

 

13.98

 

1,253

 

7.49

%

1.55

%

6.23

%

 

 

2005

 

103

 

13.16

 

1,358

 

0.00

%

1.55

%

1.67

%

 

 

2004

 

116

 

12.94

 

1,498

 

6.86

%

1.55

%

7.83

%

 

 

2003

 

167

 

12.00

 

2,005

 

10.16

%

1.55

%

22.08

%

Touchstone High Yield (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

11.62

 

115

 

4.64

%

1.35

%

0.43

%

 

 

2006

 

51

 

11.57

 

593

 

9.43

%

1.35

%

6.45

%

 

 

2005

 

83

 

10.87

 

901

 

0.00

%

1.35

%

1.88

%

 

 

2004

 

91

 

10.67

 

971

 

38.77

%

1.35

%

6.70

%

Touchstone High Yield (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

58

 

14.44

 

843

 

8.25

%

1.45

%

0.29

%

 

 

2006

 

61

 

14.40

 

874

 

6.79

%

1.45

%

6.34

%

 

 

2005

 

86

 

13.54

 

1,166

 

0.00

%

1.45

%

1.78

%

 

 

2004

 

130

 

13.30

 

1,727

 

6.14

%

1.45

%

7.95

%

 

 

2003

 

133

 

12.32

 

1,634

 

3.86

%

1.45

%

22.22

%

Touchstone High Yield (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

29

 

12.26

 

358

 

8.81

%

1.67

%

0.08

%

 

 

2006

 

27

 

12.25

 

335

 

7.97

%

1.67

%

6.10

%

 

 

2005

 

26

 

11.55

 

302

 

0.00

%

1.67

%

1.55

%

 

 

2004

 

27

 

11.37

 

309

 

8.47

%

1.67

%

7.77

%

 

 

2003

 

16

 

10.55

 

174

 

0.00

%

1.67

%

5.50

%

Touchstone High Yield (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

23

 

11.90

 

268

 

6.66

%

0.60

%

1.17

%

 

 

2006

 

57

 

11.76

 

670

 

14.52

%

0.60

%

7.25

%

Touchstone Moderate ETF (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

301

 

12.08

 

3,640

 

1.43

%

1.00

%

4.22

%

 

 

2006

 

318

 

11.59

 

3,691

 

1.09

%

1.00

%

9.87

%

 

 

2005

 

235

 

10.55

 

2,482

 

0.00

%

1.00

%

2.89

%

 

 

2004

 

22

 

10.26

 

230

 

4.95

%

1.00

%

2.60

%

Touchstone Moderate ETF (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

555

 

11.87

 

6,591

 

1.42

%

1.55

%

3.59

%

 

 

2006

 

532

 

11.46

 

6,094

 

1.68

%

1.55

%

9.26

%

 

 

2005

 

245

 

10.49

 

2,571

 

0.00

%

1.55

%

2.32

%

 

 

2004

 

38

 

10.25

 

385

 

9.54

%

1.55

%

2.50

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

51



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Moderate ETF (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

55

 

$

11.95

 

$

653

 

1.45

%

1.35

%

3.80

%

 

 

2006

 

66

 

11.51

 

761

 

1.20

%

1.35

%

9.48

%

 

 

2005

 

58

 

10.51

 

607

 

0.00

%

1.35

%

2.53

%

 

 

2004

 

5

 

10.25

 

49

 

11.30

%

1.35

%

2.50

%

Touchstone Moderate ETF (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

252

 

11.91

 

3,001

 

1.58

%

1.45

%

3.74

%

 

 

2006

 

224

 

11.48

 

2,567

 

1.08

%

1.45

%

9.37

%

 

 

2005

 

188

 

10.50

 

1,975

 

0.00

%

1.45

%

2.43

%

 

 

2004

 

8

 

10.25

 

82

 

6.55

%

1.45

%

2.50

%

Touchstone Moderate ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

23

 

11.83

 

267

 

1.42

%

1.67

%

3.47

%

 

 

2006

 

23

 

11.43

 

260

 

1.05

%

1.67

%

9.13

%

 

 

2005

 

22

 

10.47

 

233

 

0.00

%

1.67

%

2.20

%

Touchstone Moderate ETF (IQ Advisor Enhanced™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

12.69

 

52

 

1.47

%

0.80

%

4.37

%

 

 

2006

 

4

 

12.16

 

49

 

0.83

%

0.80

%

10.09

%

 

 

2005

 

6

 

11.04

 

63

 

0.00

%

0.80

%

3.10

%

 

 

2004

 

1

 

10.71

 

13

 

3.54

%

0.80

%

7.10

%

Touchstone Moderate ETF (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

12.78

 

123

 

1.47

%

0.60

%

4.59

%

 

 

2006

 

10

 

12.22

 

118

 

1.04

%

0.60

%

10.31

%

 

 

2005

 

10

 

11.08

 

105

 

0.00

%

0.60

%

3.31

%

 

 

2004

 

7

 

10.72

 

77

 

2.33

%

0.60

%

7.20

%

Touchstone Money Market (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

11.26

 

60

 

5.05

%

1.00

%

4.08

%

 

 

2006

 

7

 

10.82

 

72

 

4.79

%

1.00

%

3.89

%

 

 

2005

 

16

 

10.41

 

164

 

3.12

%

1.00

%

2.13

%

 

 

2004

 

16

 

10.19

 

167

 

1.33

%

1.00

%

0.30

%

 

 

2003

 

18

 

10.16

 

182

 

1.03

%

1.00

%

0.00

%

Touchstone Money Market (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

602

 

10.90

 

6,562

 

5.03

%

1.35

%

3.76

%

 

 

2006

 

568

 

10.50

 

5,963

 

4.83

%

1.35

%

3.52

%

 

 

2005

 

638

 

10.14

 

6,468

 

3.06

%

1.35

%

1.77

%

 

 

2004

 

792

 

9.97

 

7,897

 

1.30

%

1.35

%

0.00

%

 

 

2003

 

1,227

 

9.97

 

12,230

 

0.00

%

1.35

%

(0.30

)%

Touchstone Money Market (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

53

 

10.90

 

581

 

5.03

%

1.45

%

3.65

%

 

 

2006

 

43

 

10.52

 

453

 

4.89

%

1.45

%

3.42

%

 

 

2005

 

82

 

10.17

 

839

 

3.18

%

1.45

%

1.67

%

 

 

2004

 

103

 

10.01

 

1,035

 

1.24

%

1.45

%

(0.10

)%

 

 

2003

 

379

 

10.02

 

3,795

 

0.00

%

1.45

%

0.20

%

Touchstone Money Market (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

10.90

 

106

 

5.04

%

1.45

%

3.65

%

 

 

2006

 

13

 

10.52

 

136

 

4.83

%

1.45

%

3.42

%

 

 

2005

 

19

 

10.17

 

193

 

3.08

%

1.45

%

1.67

%

 

 

2004

 

24

 

10.01

 

241

 

1.33

%

1.45

%

(0.10

)%

 

 

2003

 

33

 

10.02

 

334

 

0.98

%

1.45

%

(0.40

)%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

52



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Third Avenue Value (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

452

 

$

19.86

 

$

8,972

 

0.73

%

1.00

%

(2.76

)%

 

 

2006

 

406

 

20.42

 

8,302

 

1.11

%

1.00

%

14.72

%

 

 

2005

 

439

 

17.80

 

7,808

 

0.85

%

1.00

%

16.24

%

 

 

2004

 

461

 

15.32

 

7,057

 

0.26

%

1.00

%

24.65

%

 

 

2003

 

456

 

12.29

 

5,603

 

0.32

%

1.00

%

38.87

%

Touchstone Third Avenue Value (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

54

 

10.63

 

578

 

1.20

%

1.15

%

(2.93

)%

 

 

2006

 

4

 

10.95

 

41

 

5.52

%

1.15

%

0.00

%

Touchstone Third Avenue Value (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

319

 

16.63

 

5,296

 

0.77

%

1.55

%

(3.33

)%

 

 

2006

 

327

 

17.20

 

5,630

 

1.26

%

1.55

%

14.09

%

 

 

2005

 

347

 

15.07

 

5,228

 

1.10

%

1.55

%

15.60

%

 

 

2004

 

266

 

13.04

 

3,470

 

0.36

%

1.55

%

23.95

%

 

 

2003

 

153

 

10.52

 

1,609

 

0.23

%

1.55

%

38.06

%

Touchstone Third Avenue Value (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

163

 

15.60

 

2,546

 

0.75

%

1.35

%

(3.11

)%

 

 

2006

 

123

 

16.10

 

1,984

 

1.03

%

1.35

%

14.32

%

 

 

2005

 

121

 

14.09

 

1,708

 

1.48

%

1.35

%

15.83

%

 

 

2004

 

23

 

12.16

 

276

 

1.00

%

1.35

%

21.60

%

Touchstone Third Avenue Value (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

372

 

17.63

 

6,551

 

0.69

%

1.45

%

(3.20

)%

 

 

2006

 

442

 

18.21

 

8,050

 

0.98

%

1.45

%

14.20

%

 

 

2005

 

572

 

15.95

 

9,120

 

0.91

%

1.45

%

15.71

%

 

 

2004

 

518

 

13.78

 

7,139

 

0.26

%

1.45

%

24.03

%

 

 

2003

 

543

 

11.11

 

6,033

 

0.32

%

1.45

%

38.18

%

Touchstone Third Avenue Value (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

95

 

18.83

 

1,797

 

0.73

%

1.67

%

(3.45

)%

 

 

2006

 

83

 

19.50

 

1,618

 

1.14

%

1.67

%

13.95

%

 

 

2005

 

80

 

17.11

 

1,368

 

1.01

%

1.67

%

15.46

%

 

 

2004

 

51

 

14.82

 

761

 

0.37

%

1.67

%

23.81

%

 

 

2003

 

6

 

11.97

 

77

 

0.00

%

1.67

%

19.70

%

Touchstone Third Avenue Value (IQ Advisor Enhanced™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

15.50

 

6

 

1.07

%

0.80

%

55.04

%

Touchstone Third Avenue Value (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

32

 

15.63

 

498

 

1.75

%

0.60

%

(2.39

)%

 

 

2006

 

10

 

16.01

 

163

 

1.20

%

0.60

%

15.18

%

 

 

2005

 

8

 

13.90

 

111

 

0.94

%

0.60

%

16.71

%

 

 

2004

 

5

 

11.91

 

61

 

1.57

%

0.60

%

19.10

%

Touchstone Value Plus (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

75

 

11.25

 

840

 

1.18

%

1.00

%

(5.03

)%

 

 

2006

 

96

 

11.85

 

1,142

 

0.84

%

1.00

%

18.53

%

 

 

2005

 

111

 

10.00

 

1,106

 

0.00

%

1.00

%

1.15

%

 

 

2004

 

127

 

9.88

 

1,250

 

0.70

%

1.00

%

9.41

%

 

 

2003

 

169

 

9.03

 

1,523

 

0.97

%

1.00

%

28.45

%

Touchstone Value Plus (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

10.52

 

42

 

1.86

%

1.15

%

(5.19

)%

 

 

2006

 

2

 

11.10

 

21

 

5.19

%

1.15

%

0.00

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

53



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Value Plus (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

9

 

$

11.82

 

$

112

 

1.35

%

1.55

%

(5.55

)%

 

 

2006

 

13

 

12.51

 

161

 

0.77

%

1.55

%

17.87

%

 

 

2005

 

17

 

10.61

 

179

 

0.00

%

1.55

%

0.59

%

 

 

2004

 

27

 

10.55

 

286

 

0.60

%

1.55

%

8.76

%

 

 

2003

 

43

 

9.70

 

421

 

1.07

%

1.55

%

27.80

%

Touchstone Value Plus (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

12.29

 

100

 

1.55

%

1.35

%

(5.40

)%

 

 

2006

 

6

 

12.99

 

79

 

0.84

%

1.35

%

18.11

%

 

 

2005

 

7

 

10.99

 

78

 

0.00

%

1.35

%

0.79

%

 

 

2004

 

9

 

10.91

 

93

 

1.78

%

1.35

%

9.10

%

Touchstone Value Plus (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

39

 

10.93

 

431

 

0.45

%

1.45

%

(5.46

)%

 

 

2006

 

229

 

11.56

 

2,652

 

1.47

%

1.45

%

17.99

%

 

 

2005

 

95

 

9.80

 

935

 

0.00

%

1.45

%

0.69

%

 

 

2004

 

84

 

9.73

 

820

 

0.75

%

1.45

%

8.96

%

 

 

2003

 

92

 

8.93

 

825

 

0.81

%

1.45

%

27.75

%

Touchstone Value Plus (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

13.44

 

88

 

1.87

%

1.67

%

(5.70

)%

 

 

2006

 

3

 

14.25

 

50

 

1.39

%

1.67

%

17.73

%

 

 

2005

 

2

 

12.10

 

22

 

0.00

%

1.67

%

0.47

%

 

 

2004

 

2

 

12.05

 

22

 

1.45

%

1.67

%

8.75

%

 

 

2003

 

*

11.08

 

3

 

0.00

%

1.67

%

10.80

%

Non-Affiliated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

29

 

17.98

 

513

 

2.44

%

1.00

%

1.44

%

 

 

2006

 

37

 

17.73

 

658

 

1.93

%

1.00

%

15.68

%

 

 

2005

 

49

 

15.33

 

755

 

0.85

%

1.00

%

8.12

%

 

 

2004

 

38

 

14.18

 

545

 

0.90

%

1.00

%

19.86

%

 

 

2003

 

29

 

11.83

 

341

 

0.33

%

1.00

%

28.31

%

JP Morgan Mid Cap Value (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

55

 

17.26

 

955

 

2.40

%

1.55

%

0.85

%

 

 

2006

 

80

 

17.11

 

1,366

 

1.72

%

1.55

%

15.04

%

 

 

2005

 

82

 

14.87

 

1,223

 

0.81

%

1.55

%

7.53

%

 

 

2004

 

53

 

13.83

 

729

 

0.67

%

1.55

%

19.12

%

 

 

2003

 

43

 

11.61

 

494

 

0.17

%

1.55

%

27.72

%

JP Morgan Mid Cap Value (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

6

 

14.43

 

90

 

2.50

%

1.35

%

1.06

%

 

 

2006

 

15

 

14.28

 

208

 

2.28

%

1.35

%

15.27

%

 

 

2005

 

24

 

12.39

 

292

 

0.52

%

1.35

%

7.74

%

 

 

2004

 

17

 

11.50

 

201

 

0.00

%

1.35

%

15.00

%

JP Morgan Mid Cap Value (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

21

 

17.54

 

361

 

2.34

%

1.45

%

0.96

%

 

 

2006

 

26

 

17.37

 

447

 

2.08

%

1.45

%

15.15

%

 

 

2005

 

49

 

15.08

 

735

 

0.65

%

1.45

%

7.63

%

 

 

2004

 

125

 

14.01

 

1,750

 

1.05

%

1.45

%

19.23

%

 

 

2003

 

57

 

11.75

 

667

 

0.25

%

1.45

%

27.72

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

54



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Mid Cap Value (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

23

 

$

16.54

 

$

386

 

2.32

%

1.67

%

0.75

%

 

 

2006

 

26

 

16.42

 

422

 

1.84

%

1.67

%

14.90

%

 

 

2005

 

39

 

14.29

 

554

 

0.83

%

1.67

%

7.40

%

 

 

2004

 

22

 

13.31

 

296

 

0.62

%

1.67

%

19.05

%

 

 

2003

 

10

 

11.18

 

109

 

0.00

%

1.67

%

11.80

%

Non-Affiliated Initial Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

410

 

58.03

 

23,768

 

2.19

%

1.35

%

0.15

%

 

 

2006

 

499

 

57.94

 

28,918

 

4.79

%

1.35

%

18.58

%

 

 

2005

 

702

 

48.86

 

34,308

 

2.21

%

1.35

%

4.44

%

 

 

2004

 

883

 

46.78

 

41,289

 

1.65

%

1.35

%

10.02

%

 

 

2003

 

1,099

 

42.52

 

46,746

 

1.87

%

1.35

%

28.58

%

Fidelity VIP Growth (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

217

 

69.96

 

15,151

 

0.96

%

1.35

%

25.24

%

 

 

2006

 

301

 

55.86

 

16,805

 

0.43

%

1.35

%

5.41

%

 

 

2005

 

406

 

52.99

 

21,500

 

0.54

%

1.35

%

4.38

%

 

 

2004

 

531

 

50.77

 

26,957

 

0.28

%

1.35

%

1.99

%

 

 

2003

 

688

 

49.78

 

34,226

 

0.28

%

1.35

%

31.03

%

Fidelity VIP High Income (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

222

 

18.09

 

4,022

 

8.11

%

1.35

%

1.40

%

 

 

2006

 

268

 

17.84

 

4,775

 

6.83

%

1.35

%

9.74

%

 

 

2005

 

455

 

16.26

 

7,395

 

16.92

%

1.35

%

1.32

%

 

 

2004

 

615

 

16.05

 

9,873

 

8.60

%

1.35

%

8.15

%

 

 

2003

 

974

 

14.84

 

14,455

 

6.02

%

1.35

%

25.55

%

Fidelity VIP II Asset Manager (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

318

 

38.80

 

12,332

 

5.87

%

1.35

%

13.95

%

 

 

2006

 

379

 

34.05

 

12,892

 

2.94

%

1.35

%

5.87

%

 

 

2005

 

493

 

32.17

 

15,860

 

2.93

%

1.35

%

2.64

%

 

 

2004

 

618

 

31.34

 

19,362

 

2.52

%

1.35

%

4.05

%

 

 

2003

 

615

 

30.12

 

18,515

 

3.88

%

1.35

%

16.38

%

Fidelity VIP II Contrafund (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

579

 

47.21

 

27,333

 

5.18

%

1.35

%

16.01

%

 

 

2006

 

714

 

40.69

 

29,048

 

1.26

%

1.35

%

10.21

%

 

 

2005

 

783

 

36.92

 

28,895

 

0.33

%

1.35

%

15.36

%

 

 

2004

 

928

 

32.01

 

29,710

 

0.36

%

1.35

%

13.91

%

 

 

2003

 

1,109

 

28.10

 

31,160

 

0.48

%

1.35

%

26.75

%

Fidelity VIP II Index 500 (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

297

 

34.23

 

10,182

 

3.50

%

1.35

%

4.01

%

 

 

2006

 

391

 

32.91

 

12,857

 

1.93

%

1.35

%

14.17

%

 

 

2005

 

544

 

28.82

 

15,684

 

1.99

%

1.35

%

3.41

%

 

 

2004

 

762

 

27.87

 

21,242

 

1.43

%

1.35

%

9.12

%

 

 

2003

 

991

 

25.54

 

25,304

 

1.54

%

1.35

%

26.69

%

Fidelity VIP II Index 500 (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

76

 

11.34

 

868

 

3.55

%

1.45

%

3.95

%

 

 

2006

 

92

 

10.91

 

1,008

 

1.86

%

1.45

%

14.06

%

 

 

2005

 

116

 

9.57

 

1,105

 

1.96

%

1.45

%

3.31

%

 

 

2004

 

150

 

9.26

 

1,391

 

1.53

%

1.45

%

8.94

%

 

 

2003

 

230

 

8.50

 

1,956

 

1.52

%

1.45

%

26.68

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

55



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Initial Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP II Investment Grade Bond (AnnuiChoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

86

 

$

10.19

 

$

878

 

0.10

%

1.00

%

1.87

%

Fidelity VIP II Investment Grade Bond (AnnuiChoice II ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.18

 

81

 

0.12

%

1.60

%

1.77

%

Fidelity VIP II Investment Grade Bond (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

188

 

30.50

 

5,747

 

4.60

%

1.35

%

2.92

%

 

 

2006

 

274

 

29.64

 

8,107

 

4.25

%

1.35

%

2.95

%

 

 

2005

 

346

 

28.79

 

9,956

 

4.58

%

1.35

%

0.82

%

 

 

2004

 

424

 

28.55

 

12,110

 

6.55

%

1.35

%

3.03

%

 

 

2003

 

662

 

27.71

 

18,341

 

5.96

%

1.35

%

3.78

%

Fidelity VIP II Investment Grade Bond (Grandmaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

130

 

10.15

 

1,320

 

0.11

%

1.55

%

1.49

%

Fidelity VIP II Investment Grade Bond (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

161

 

14.47

 

2,329

 

2.56

%

1.45

%

2.81

%

 

 

2006

 

98

 

14.07

 

1,384

 

4.26

%

1.45

%

2.84

%

 

 

2005

 

119

 

13.68

 

1,622

 

4.59

%

1.45

%

0.71

%

 

 

2004

 

133

 

13.58

 

1,804

 

6.70

%

1.45

%

2.96

%

 

 

2003

 

185

 

13.19

 

2,443

 

5.50

%

1.45

%

3.61

%

Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

27

 

10.14

 

275

 

0.12

%

1.67

%

1.40

%

Fidelity VIP III Balanced (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

84

 

16.73

 

1,413

 

6.38

%

1.35

%

7.58

%

 

 

2006

 

122

 

15.55

 

1,896

 

2.17

%

1.35

%

10.20

%

 

 

2005

 

163

 

14.11

 

2,303

 

2.94

%

1.35

%

4.34

%

 

 

2004

 

199

 

13.52

 

2,697

 

2.11

%

1.35

%

4.00

%

 

 

2003

 

243

 

13.00

 

3,156

 

2.88

%

1.35

%

16.18

%

Fidelity VIP III Growth & Income (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

192

 

19.62

 

3,767

 

4.62

%

1.35

%

10.58

%

 

 

2006

 

243

 

17.74

 

4,312

 

1.42

%

1.35

%

11.66

%

 

 

2005

 

589

 

15.88

 

9,349

 

1.62

%

1.35

%

6.19

%

 

 

2004

 

748

 

14.96

 

11,197

 

0.97

%

1.35

%

4.40

%

 

 

2003

 

564

 

14.33

 

8,075

 

1.20

%

1.35

%

22.06

%

Fidelity VIP III Growth Opportunities (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

96

 

14.74

 

1,408

 

0.00

%

1.35

%

21.51

%

 

 

2006

 

132

 

12.13

 

1,604

 

0.81

%

1.35

%

4.04

%

 

 

2005

 

210

 

11.66

 

2,449

 

1.04

%

1.35

%

7.43

%

 

 

2004

 

298

 

10.85

 

3,235

 

0.58

%

1.35

%

5.75

%

 

 

2003

 

377

 

10.26

 

3,869

 

0.82

%

1.35

%

28.09

%

Fidelity VIP Overseas (AnnuiChoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

37

 

10.62

 

390

 

2.42

%

1.00

%

6.17

%

Fidelity VIP Overseas (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

10.61

 

112

 

2.22

%

1.15

%

6.06

%

Fidelity VIP Overseas (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

197

 

37.94

 

7,457

 

3.26

%

1.35

%

15.73

%

 

 

2006

 

278

 

32.78

 

9,111

 

1.62

%

1.35

%

16.49

%

 

 

2005

 

355

 

28.14

 

9,987

 

1.28

%

1.35

%

17.45

%

 

 

2004

 

437

 

23.96

 

10,467

 

1.19

%

1.35

%

12.07

%

 

 

2003

 

517

 

21.38

 

11,058

 

0.88

%

1.35

%

41.50

%

Fidelity VIP Overseas (Grandmaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

27

 

10.58

 

291

 

1.67

%

1.55

%

5.77

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

56



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Initial Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Overseas (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

36

 

$

10.58

 

$

378

 

2.54

%

1.45

%

5.84

%

Fidelity VIP Overseas (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

35

 

10.57

 

366

 

2.39

%

1.67

%

5.68

%

Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Aggressive ETF (Annuichoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

32

 

11.33

 

365

 

2.22

%

1.00

%

3.72

%

 

 

2006

 

21

 

10.92

 

225

 

4.44

%

1.00

%

0.00

%

Touchstone Aggressive ETF (Annuichoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

15

 

11.11

 

165

 

2.10

%

1.15

%

3.59

%

 

 

2006

 

1

 

10.72

 

15

 

10.74

%

1.15

%

0.00

%

Touchstone Aggressive ETF (Grandmaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

14

 

9.82

 

134

 

4.44

%

1.55

%

(1.76

)%

Touchstone Aggressive ETF (IQ Advisor Standard ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

9.89

 

 

0.04

%

0.60

%

(1.11

)%

Touchstone Aggressive ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

9.82

 

64

 

4.84

%

1.67

%

(1.84

)%

Touchstone Conservative ETF (Annuichoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

20

 

11.07

 

226

 

2.14

%

1.00

%

4.42

%

 

 

2006

 

14

 

10.60

 

151

 

2.95

%

1.00

%

0.00

%

Touchstone Conservative ETF (Annuichoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.88

 

85

 

3.47

%

1.15

%

4.28

%

 

 

2006

 

*

10.43

 

5

 

21.32

%

1.15

%

0.00

%

Touchstone Conservative ETF (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.08

 

77

 

3.68

%

1.55

%

0.76

%

Tocuhstone Conservative ETF (IQ Advisor Enhanced ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

6

 

10.14

 

59

 

3.49

%

0.80

%

1.42

%

Touchstone Conservative ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.07

 

24

 

3.21

%

1.67

%

0.67

%

Touchstone Enhanced ETF (Annuichoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

33

 

11.34

 

372

 

2.22

%

1.00

%

2.67

%

 

 

2006

 

16

 

11.05

 

176

 

2.77

%

1.00

%

0.00

%

Touchstone Enhanced ETF (Annuichoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

11.13

 

81

 

2.88

%

1.15

%

2.55

%

 

 

2006

 

*

10.85

 

2

 

18.62

%

1.15

%

0.00

%

Touchstone Enhanced ETF (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

36

 

9.64

 

345

 

4.41

%

1.55

%

(3.61

)%

Touchstone Enhanced ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

34

 

9.63

 

329

 

3.54

%

1.67

%

(3.69

)%

Touchstone GMAB Aggressive (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

9

 

11.02

 

103

 

2.38

%

1.15

%

10.15

%

Touchstone GMAB Conservative (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

10.97

 

11

 

20.52

%

1.00

%

9.73

%

Touchstone GMAB Conservative (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

21

 

10.79

 

224

 

5.74

%

1.15

%

7.89

%

Touchstone GMAB Moderate ETF (Annuichoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

11.07

 

37

 

1.38

%

1.00

%

3.26

%

 

 

2006

 

3

 

10.72

 

36

 

3.25

%

1.00

%

0.00

%

Touchstone GMAB Moderate ETF (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.88

 

25

 

11.38

%

1.15

%

8.82

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

57



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Affiliated Service Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Touchstone Moderate ETF (Annuichoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

63

 

$

11.17

 

$

702

 

1.73

%

1.00

%

3.96

%

 

 

2006

 

30

 

10.74

 

323

 

3.28

%

1.00

%

0.00

%

Touchstone Moderate ETF (Annuichoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

23

 

10.97

 

248

 

2.51

%

1.15

%

3.79

%

 

 

2006

 

1

 

10.57

 

13

 

5.59

%

1.15

%

0.00

%

Touchstone Moderate ETF (GrandM aster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

380

 

9.92

 

3,770

 

2.89

%

1.55

%

(0.77

)%

Touchstone Moderate ETF (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

9.99

 

16

 

19.90

%

0.60

%

(0.12

)%

Touchstone Moderate ETF (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

9.91

 

96

 

2.90

%

1.67

%

(0.85

)%

Touchstone Money Market (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

366

 

10.95

 

4,002

 

4.78

%

1.00

%

3.87

%

 

 

2006

 

530

 

10.54

 

5,586

 

4.60

%

1.00

%

3.62

%

 

 

2005

 

439

 

10.17

 

4,467

 

2.91

%

1.00

%

1.87

%

 

 

2004

 

443

 

9.99

 

4,422

 

1.09

%

1.00

%

0.10

%

 

 

2003

 

469

 

9.98

 

4,681

 

0.00

%

1.00

%

(0.20

)%

Touchstone Money Market (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

38

 

10.50

 

399

 

4.75

%

1.15

%

3.66

%

 

 

2006

 

14

 

10.13

 

141

 

5.10

%

1.15

%

0.00

%

Touchstone Money Market (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

296

 

10.68

 

3,164

 

4.76

%

1.55

%

3.28

%

 

 

2006

 

182

 

10.34

 

1,878

 

4.60

%

1.55

%

3.05

%

 

 

2005

 

162

 

10.04

 

1,628

 

2.78

%

1.55

%

1.31

%

 

 

2004

 

113

 

9.91

 

1,120

 

0.98

%

1.55

%

(0.50

)%

 

 

2003

 

144

 

9.96

 

1,434

 

0.00

%

1.55

%

(0.40

)%

Touchstone Money Market (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

499

 

10.73

 

5,358

 

4.79

%

1.45

%

3.35

%

 

 

2006

 

581

 

10.38

 

6,030

 

4.56

%

1.45

%

3.15

%

 

 

2005

 

980

 

10.06

 

9,862

 

2.88

%

1.45

%

1.41

%

 

 

2004

 

602

 

9.92

 

5,970

 

1.06

%

1.45

%

(0.40

)%

 

 

2003

 

765

 

9.96

 

7,620

 

0.00

%

1.45

%

(0.40

)%

Touchstone Money Market (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

141

 

10.62

 

1,497

 

4.68

%

1.67

%

3.12

%

 

 

2006

 

32

 

10.30

 

330

 

4.61

%

1.67

%

2.92

%

 

 

2005

 

25

 

10.01

 

247

 

2.99

%

1.67

%

1.18

%

 

 

2004

 

15

 

9.89

 

152

 

1.08

%

1.67

%

(0.60

)%

 

 

2003

 

27

 

9.95

 

264

 

0.00

%

1.67

%

(0.50

)%

Touchstone Money Market (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

111

 

11.15

 

1,242

 

4.69

%

0.60

%

4.28

%

 

 

2006

 

25

 

10.69

 

267

 

4.75

%

0.60

%

4.04

%

 

 

2005

 

6

 

10.28

 

61

 

3.23

%

0.60

%

2.28

%

Non-Affiliated Service Class:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

64

 

13.82

 

888

 

1.94

%

1.45

%

(0.09

)%

 

 

2006

 

89

 

13.83

 

1,228

 

4.58

%

1.45

%

18.34

%

 

 

2005

 

102

 

11.68

 

1,186

 

2.28

%

1.45

%

4.23

%

 

 

2004

 

154

 

11.21

 

1,732

 

1.49

%

1.45

%

9.79

%

 

 

2003

 

175

 

10.21

 

1,784

 

1.98

%

1.45

%

28.27

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

58



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Growth (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

63

 

$

11.36

 

$

711

 

0.71

%

1.45

%

25.01

%

 

 

2006

 

81

 

9.09

 

732

 

0.30

%

1.45

%

5.19

%

 

 

2005

 

112

 

8.64

 

966

 

0.51

%

1.45

%

4.15

%

 

 

2004

 

257

 

8.30

 

2,133

 

0.19

%

1.45

%

1.84

%

 

 

2003

 

320

 

8.15

 

2,606

 

0.20

%

1.45

%

30.82

%

Fidelity VIP High Income (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

27

 

10.22

 

276

 

4.56

%

1.45

%

1.16

%

 

 

2006

 

64

 

10.10

 

650

 

5.90

%

1.45

%

9.57

%

 

 

2005

 

150

 

9.22

 

1,379

 

16.05

%

1.45

%

1.04

%

 

 

2004

 

254

 

9.12

 

2,319

 

16.00

%

1.45

%

7.80

%

 

 

2003

 

608

 

8.46

 

5,143

 

7.79

%

1.45

%

25.15

%

Fidelity VIP II Asset Manager (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

19

 

12.37

 

234

 

5.70

%

1.45

%

13.66

%

 

 

2006

 

22

 

10.88

 

234

 

3.13

%

1.45

%

5.69

%

 

 

2005

 

34

 

10.29

 

348

 

2.67

%

1.45

%

2.43

%

 

 

2004

 

31

 

10.05

 

312

 

2.86

%

1.45

%

3.82

%

 

 

2003

 

36

 

9.68

 

344

 

3.34

%

1.45

%

16.21

%

Fidelity VIP II Contrafund (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

129

 

17.46

 

2,253

 

5.44

%

1.45

%

15.81

%

 

 

2006

 

154

 

15.08

 

2,323

 

1.26

%

1.45

%

9.98

%

 

 

2005

 

214

 

13.71

 

2,941

 

0.25

%

1.45

%

15.16

%

 

 

2004

 

208

 

11.91

 

2,478

 

0.29

%

1.45

%

13.65

%

 

 

2003

 

251

 

10.48

 

2,628

 

0.40

%

1.45

%

26.57

%

Fidelity VIP III Balanced (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

13

 

12.23

 

154

 

5.57

%

1.45

%

7.29

%

 

 

2006

 

14

 

11.40

 

158

 

2.32

%

1.45

%

10.03

%

 

 

2005

 

22

 

10.36

 

223

 

3.40

%

1.45

%

4.08

%

 

 

2004

 

36

 

9.95

 

363

 

2.13

%

1.45

%

3.86

%

 

 

2003

 

47

 

9.58

 

449

 

3.35

%

1.45

%

15.84

%

Fidelity VIP III Growth & Income (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

22

 

12.20

 

269

 

4.32

%

1.45

%

10.40

%

 

 

2006

 

26

 

11.05

 

284

 

1.00

%

1.45

%

11.38

%

 

 

2005

 

42

 

9.92

 

418

 

2.09

%

1.45

%

5.97

%

 

 

2004

 

82

 

9.36

 

763

 

0.97

%

1.45

%

4.12

%

 

 

2003

 

103

 

8.99

 

923

 

1.13

%

1.45

%

21.82

%

Fidelity VIP III Growth Opportunities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

9.64

 

74

 

0.00

%

1.45

%

21.20

%

 

 

2006

 

13

 

7.95

 

104

 

0.70

%

1.45

%

3.78

%

 

 

2005

 

24

 

7.66

 

187

 

0.88

%

1.45

%

7.29

%

 

 

2004

 

32

 

7.14

 

230

 

0.54

%

1.45

%

5.62

%

 

 

2003

 

43

 

6.76

 

291

 

0.61

%

1.45

%

27.79

%

Fidelity VIP III Mid Cap (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

103

 

36.33

 

3,748

 

0.99

%

1.35

%

13.92

%

 

 

2006

 

265

 

31.89

 

8,461

 

0.99

%

1.35

%

11.08

%

 

 

2005

 

200

 

28.71

 

5,743

 

0.00

%

1.35

%

16.62

%

 

 

2004

 

276

 

24.62

 

6,807

 

0.00

%

1.35

%

23.10

%

 

 

2003

 

474

 

20.00

 

9,478

 

0.31

%

1.35

%

36.61

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

59



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP III Mid Cap (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

45

 

$

37.89

 

$

1,690

 

0.88

%

1.45

%

13.79

%

 

 

2006

 

64

 

33.30

 

2,140

 

1.49

%

1.45

%

10.96

%

 

 

2005

 

88

 

30.01

 

2,649

 

0.00

%

1.45

%

16.51

%

 

 

2004

 

111

 

25.75

 

2,870

 

0.00

%

1.45

%

22.91

%

 

 

2003

 

131

 

20.95

 

2,751

 

0.31

%

1.45

%

36.57

%

Fidelity VIP Overseas (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

16.47

 

158

 

3.16

%

1.45

%

15.47

%

 

 

2006

 

16

 

14.26

 

229

 

1.44

%

1.45

%

16.24

%

 

 

2005

 

21

 

12.26

 

257

 

1.15

%

1.45

%

17.25

%

 

 

2004

 

30

 

10.46

 

315

 

1.38

%

1.45

%

11.87

%

 

 

2003

 

46

 

9.35

 

429

 

0.41

%

1.45

%

41.03

%

Non-Affiliated Service Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Asset Manager (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

33

 

12.81

 

429

 

5.98

%

1.00

%

14.06

%

 

 

2006

 

41

 

11.23

 

463

 

2.60

%

1.00

%

6.07

%

 

 

2005

 

56

 

10.59

 

596

 

2.86

%

1.00

%

2.75

%

 

 

2004

 

56

 

10.31

 

580

 

2.28

%

1.00

%

4.14

%

 

 

2003

 

62

 

9.90

 

610

 

2.36

%

1.00

%

16.47

%

Fidelity VIP Asset Manager (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

11.90

 

1

 

6.25

%

1.15

%

19.03

%

Fidelity VIP Asset Manager (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

23

 

12.65

 

297

 

5.36

%

1.55

%

13.39

%

 

 

2006

 

26

 

11.16

 

289

 

1.53

%

1.55

%

5.48

%

 

 

2005

 

12

 

10.58

 

125

 

0.96

%

1.55

%

2.18

%

 

 

2004

 

4

 

10.36

 

39

 

0.00

%

1.55

%

3.60

%

Fidelity VIP Asset Manager (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

35

 

12.79

 

442

 

5.70

%

1.45

%

13.47

%

 

 

2006

 

41

 

11.27

 

457

 

4.20

%

1.45

%

5.59

%

 

 

2005

 

104

 

10.67

 

1,115

 

3.10

%

1.45

%

2.28

%

 

 

2004

 

45

 

10.43

 

471

 

1.63

%

1.45

%

3.57

%

 

 

2003

 

22

 

10.07

 

221

 

3.72

%

1.45

%

16.01

%

Fidelity VIP Asset Manager (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

18

 

13.18

 

234

 

10.23

%

1.67

%

13.20

%

 

 

2006

 

10

 

11.64

 

111

 

2.78

%

1.67

%

5.35

%

 

 

2005

 

12

 

11.04

 

137

 

2.81

%

1.67

%

2.05

%

 

 

2004

 

16

 

10.82

 

173

 

0.83

%

1.67

%

3.44

%

 

 

2003

 

2

 

10.46

 

22

 

0.00

%

1.67

%

4.60

%

Fidelity VIP Balanced (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

124

 

12.95

 

1,606

 

5.67

%

1.00

%

7.63

%

 

 

2006

 

132

 

12.03

 

1,590

 

1.83

%

1.00

%

10.39

%

 

 

2005

 

137

 

10.90

 

1,491

 

2.67

%

1.00

%

4.48

%

 

 

2004

 

163

 

10.43

 

1,696

 

1.82

%

1.00

%

4.09

%

 

 

2003

 

152

 

10.02

 

1,527

 

2.43

%

1.00

%

16.24

%

Fidelity VIP Balanced (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

11.37

 

52

 

4.50

%

1.15

%

7.44

%

 

 

2006

 

*

10.58

 

*

0.00

%

1.15

%

0.00

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

60



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Balanced (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

33

 

$

14.11

 

$

469

 

5.49

%

1.55

%

7.04

%

 

 

2006

 

34

 

13.18

 

448

 

1.51

%

1.55

%

9.78

%

 

 

2005

 

31

 

12.01

 

369

 

2.08

%

1.55

%

3.90

%

 

 

2004

 

21

 

11.56

 

244

 

0.95

%

1.55

%

3.49

%

 

 

2003

 

8

 

11.17

 

93

 

0.00

%

1.55

%

11.70

%

Fidelity VIP Balanced (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

129

 

12.90

 

1,658

 

3.73

%

1.45

%

28.96

%

Fidelity VIP Balanced (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

70

 

12.78

 

898

 

5.18

%

1.45

%

7.16

%

 

 

2006

 

62

 

11.93

 

739

 

1.58

%

1.45

%

9.89

%

 

 

2005

 

60

 

10.86

 

653

 

2.83

%

1.45

%

4.00

%

 

 

2004

 

84

 

10.44

 

878

 

1.63

%

1.45

%

3.57

%

 

 

2003

 

80

 

10.08

 

802

 

2.70

%

1.45

%

15.73

%

Fidelity VIP Balanced (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

13.10

 

147

 

4.93

%

1.67

%

6.90

%

 

 

2006

 

6

 

12.25

 

71

 

2.14

%

1.67

%

9.64

%

 

 

2005

 

8

 

11.17

 

89

 

3.06

%

1.67

%

3.77

%

 

 

2004

 

15

 

10.77

 

158

 

1.29

%

1.67

%

3.46

%

 

 

2003

 

6

 

10.41

 

62

 

0.00

%

1.67

%

4.10

%

Fidelity VIP Balanced (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

13

 

12.97

 

173

 

16.95

%

0.60

%

29.73

%

Fidelity VIP Contrafund (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

579

 

17.25

 

9,995

 

5.96

%

1.00

%

16.11

%

 

 

2006

 

583

 

14.86

 

8,656

 

1.07

%

1.00

%

10.32

%

 

 

2005

 

505

 

13.47

 

6,803

 

0.15

%

1.00

%

15.48

%

 

 

2004

 

389

 

11.66

 

4,532

 

0.17

%

1.00

%

13.98

%

 

 

2003

 

281

 

10.23

 

2,870

 

0.26

%

1.00

%

26.92

%

Fidelity VIP Contrafund (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

47

 

12.43

 

583

 

9.17

%

1.15

%

15.96

%

 

 

2006

 

8

 

10.72

 

83

 

3.91

%

1.15

%

0.00

%

Fidelity VIP Contrafund (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

412

 

17.92

 

7,392

 

5.58

%

1.55

%

15.49

%

 

 

2006

 

568

 

15.52

 

8,810

 

1.22

%

1.55

%

9.71

%

 

 

2005

 

580

 

14.15

 

8,200

 

0.16

%

1.55

%

14.85

%

 

 

2004

 

445

 

12.32

 

5,483

 

0.19

%

1.55

%

13.34

%

 

 

2003

 

279

 

10.87

 

3,030

 

0.15

%

1.55

%

26.25

%

Fidelity VIP Contrafund (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

390

 

17.85

 

6,960

 

5.19

%

1.45

%

15.62

%

 

 

2006

 

466

 

15.44

 

7,193

 

1.04

%

1.45

%

9.82

%

 

 

2005

 

588

 

14.06

 

8,274

 

0.13

%

1.45

%

14.96

%

 

 

2004

 

382

 

12.23

 

4,673

 

0.15

%

1.45

%

13.45

%

 

 

2003

 

244

 

10.78

 

2,633

 

0.25

%

1.45

%

26.38

%

Fidelity VIP Contrafund (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

119

 

18.50

 

2,206

 

5.56

%

1.67

%

15.32

%

 

 

2006

 

115

 

16.04

 

1,848

 

1.09

%

1.67

%

9.58

%

 

 

2005

 

100

 

14.64

 

1,457

 

0.11

%

1.67

%

14.71

%

 

 

2004

 

58

 

12.76

 

739

 

0.10

%

1.67

%

13.22

%

 

 

2003

 

11

 

11.27

 

121

 

0.00

%

1.67

%

12.70

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

61



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Contrafund (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

$

17.01

 

$

178

 

4.88

%

0.60

%

16.60

%

 

 

2006

 

12

 

14.59

 

177

 

1.05

%

0.60

%

10.77

%

 

 

2005

 

12

 

13.17

 

153

 

0.09

%

0.60

%

15.95

%

 

 

2004

 

6

 

11.36

 

67

 

0.00

%

0.60

%

13.60

%

Fidelity VIP Disciplined Small Cap (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

27

 

9.03

 

248

 

0.41

%

1.00

%

(9.71

)%

Fidelity VIP Disciplined Small Cap (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

9.02

 

4

 

0.47

%

1.15

%

(9.80

)%

Fidelity VIP Disciplined Small Cap (GrandMaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

9.01

 

102

 

0.33

%

1.35

%

(9.93

)%

Fidelity VIP Disciplined Small Cap (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

8.99

 

86

 

0.42

%

1.55

%

(10.05

)%

Fidelity VIP Disciplined Small Cap (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

27

 

9.00

 

244

 

0.43

%

1.67

%

(9.99

)%

Fidelity VIP Disciplined Small Cap (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

8.99

 

29

 

0.46

%

1.67

%

(10.13

)%

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

15.68

 

129

 

3.92

%

1.00

%

5.66

%

 

 

2006

 

9

 

14.84

 

140

 

0.40

%

1.00

%

12.68

%

 

 

2005

 

2

 

13.17

 

25

 

0.00

%

1.00

%

19.47

%

 

 

2004

 

1

 

11.02

 

16

 

0.00

%

1.00

%

0.27

%

 

 

2003

 

1

 

10.99

 

15

 

0.00

%

1.00

%

23.62

%

Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

11.52

 

7

 

10.20

%

1.15

%

5.48

%

 

 

2006

 

*

10.92

 

*

0.00

%

1.15

%

0.00

%

Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

14.89

 

125

 

6.98

%

1.55

%

5.08

%

 

 

2006

 

4

 

14.17

 

61

 

0.33

%

1.55

%

12.06

%

 

 

2005

 

3

 

12.65

 

36

 

0.00

%

1.55

%

18.81

%

Fidelity VIP Dynamic Capital
Appreciation (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

15.00

 

149

 

6.72

%

1.35

%

5.27

%

 

 

2006

 

7

 

14.25

 

105

 

0.30

%

1.35

%

12.28

%

 

 

2005

 

2

 

12.69

 

30

 

0.00

%

1.35

%

19.05

%

 

 

2004

 

1

 

10.66

 

15

 

0.00

%

1.35

%

6.60

%

Fidelity VIP Dynamic Capital Appreciation (IQ Annuity ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

14.22

 

3

 

3.98

%

1.45

%

5.16

%

 

 

2006

 

1

 

13.52

 

11

 

0.07

%

1.45

%

12.17

%

 

 

2005

 

1

 

12.05

 

8

 

0.00

%

1.45

%

18.93

%

 

 

2004

 

1

 

10.13

 

8

 

0.00

%

1.45

%

(0.20

)%

 

 

2003

 

1

 

10.15

 

7

 

0.00

%

1.45

%

23.03

%

Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

14.82

 

112

 

5.50

%

1.67

%

4.91

%

 

 

2006

 

7

 

14.13

 

94

 

0.20

%

1.67

%

11.92

%

 

 

2005

 

8

 

12.62

 

107

 

0.00

%

1.67

%

18.67

%

Fidelity VIP Dynamic Capital Appreciation (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

13.75

 

32

 

5.32

%

0.60

%

6.12

%

 

 

2006

 

2

 

12.96

 

30

 

1.72

%

0.60

%

13.13

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

62



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Equity-Income (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

288

 

$

13.59

 

$

3,912

 

2.18

%

1.00

%

0.28

%

 

 

2006

 

285

 

13.55

 

3,869

 

4.52

%

1.00

%

18.73

%

 

 

2005

 

374

 

11.41

 

4,273

 

1.87

%

1.00

%

4.52

%

 

 

2004

 

392

 

10.92

 

4,276

 

1.31

%

1.00

%

10.08

%

 

 

2003

 

366

 

9.92

 

3,635

 

1.54

%

1.00

%

28.83

%

Fidelity VIP Equity-Income (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

15

 

11.00

 

167

 

5.27

%

1.15

%

0.07

%

 

 

2006

 

*

10.99

 

1

 

17.76

%

1.15

%

0.00

%

Fidelity VIP Equity-Income (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

63

 

13.84

 

877

 

1.51

%

1.55

%

(0.27

)%

 

 

2006

 

113

 

13.88

 

1,564

 

4.21

%

1.55

%

18.08

%

 

 

2005

 

159

 

11.76

 

1,865

 

1.96

%

1.55

%

3.94

%

 

 

2004

 

180

 

11.31

 

2,032

 

1.14

%

1.55

%

9.49

%

 

 

2003

 

117

 

10.33

 

1,205

 

1.19

%

1.55

%

28.00

%

Fidelity VIP Equity-Income (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

158

 

13.21

 

2,085

 

1.70

%

1.45

%

(0.19

)%

 

 

2006

 

282

 

13.23

 

3,731

 

4.28

%

1.45

%

18.20

%

 

 

2005

 

209

 

11.20

 

2,345

 

2.04

%

1.45

%

4.05

%

 

 

2004

 

290

 

10.76

 

3,120

 

1.25

%

1.45

%

9.57

%

 

 

2003

 

294

 

9.82

 

2,883

 

1.65

%

1.45

%

28.20

%

Fidelity VIP Equity-Income (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

35

 

15.15

 

525

 

2.53

%

1.67

%

(0.40

)%

 

 

2006

 

26

 

15.21

 

391

 

4.70

%

1.67

%

17.93

%

 

 

2005

 

41

 

12.90

 

531

 

1.50

%

1.67

%

3.81

%

 

 

2004

 

28

 

12.43

 

347

 

0.27

%

1.67

%

9.42

%

 

 

2003

 

3

 

11.36

 

30

 

0.00

%

1.67

%

13.60

%

Fidelity Freedom 2010 (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

10.26

 

67

 

23.13

%

1.00

%

2.59

%

Fidelity Freedom 2010 (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

10.25

 

41

 

13.75

%

1.15

%

2.48

%

Fidelity Freedom 2010 (GrandMaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

10.23

 

27

 

41.67

%

1.45

%

2.34

%

Fidelity Freedom 2010 (GrandmMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

10.22

 

40

 

10.43

%

1.55

%

2.20

%

Fidelity Freedom 2010 (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.23

 

79

 

15.34

%

1.35

%

2.27

%

Fidelity Freedom 2010 (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.21

 

25

 

19.64

%

1.67

%

2.12

%

Fidelity Freedom 2015 (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.26

 

85

 

8.87

%

1.15

%

2.61

%

Fidelity Freedom 2015 (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

10.24

 

74

 

27.54

%

1.35

%

2.39

%

Fidelity Freedom 2015 (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

10.22

 

45

 

18.72

%

1.67

%

2.24

%

Fidelity Freedom 2020 (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

27

 

10.28

 

278

 

10.27

%

1.00

%

2.82

%

Fidelity Freedom 2020 (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.27

 

25

 

22.59

%

1.15

%

2.72

%

 


(1)   Results for periods of less than one year have been annualized.

(2)   Results for periods of less than one year have not been annualized.

* -   Less than 1,000.

 

63



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity Freedom 2020 (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

$

10.23

 

$

26

 

19.29

%

1.67

%

2.35

%

Fidelity Freedom 2025 (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

7

 

10.27

 

69

 

7.47

%

1.15

%

2.74

%

Fidelity Freedom 2025 (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.24

 

25

 

19.74

%

1.67

%

2.37

%

Fidelity Freedom 2030 (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

10.26

 

1

 

5.75

%

1.45

%

2.64

%

Fidelity Freedom 2030 (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.25

 

24

 

21.15

%

1.67

%

2.48

%

Fidelity VIP Growth & Income (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

104

 

12.57

 

1,312

 

4.11

%

1.00

%

10.76

%

 

 

2006

 

98

 

11.35

 

1,110

 

1.01

%

1.00

%

11.73

%

 

 

2005

 

199

 

10.16

 

2,020

 

1.33

%

1.00

%

6.33

%

 

 

2004

 

218

 

9.56

 

2,087

 

0.89

%

1.00

%

4.48

%

 

 

2003

 

287

 

9.15

 

2,622

 

0.56

%

1.00

%

22.33

%

Fidelity VIP Growth & Income (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

11.88

 

41

 

1.73

%

1.15

%

18.84

%

 

 

2006

 

*

10.55

 

4

 

0.00

%

1.15

%

0.00

%

Fidelity VIP Growth & Income (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

25

 

14.17

 

359

 

4.47

%

1.55

%

10.11

%

 

 

2006

 

32

 

12.87

 

414

 

0.75

%

1.55

%

11.11

%

 

 

2005

 

43

 

11.58

 

504

 

1.29

%

1.55

%

5.74

%

 

 

2004

 

49

 

10.95

 

536

 

0.48

%

1.55

%

3.89

%

 

 

2003

 

22

 

10.54

 

227

 

0.31

%

1.55

%

21.43

%

Fidelity VIP Growth & Income (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

68

 

12.72

 

865

 

4.29

%

1.45

%

10.23

%

 

 

2006

 

74

 

11.54

 

857

 

0.70

%

1.45

%

11.22

%

 

 

2005

 

99

 

10.38

 

1,026

 

1.40

%

1.45

%

5.85

%

 

 

2004

 

120

 

9.80

 

1,179

 

0.84

%

1.45

%

3.92

%

 

 

2003

 

164

 

9.43

 

1,542

 

0.89

%

1.45

%

21.68

%

Fidelity VIP Growth & Income (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

30

 

14.15

 

425

 

4.02

%

1.67

%

10.00

%

 

 

2006

 

29

 

12.86

 

374

 

0.86

%

1.67

%

10.98

%

 

 

2005

 

41

 

11.59

 

475

 

1.22

%

1.67

%

5.61

%

 

 

2004

 

37

 

10.97

 

402

 

0.61

%

1.67

%

3.69

%

 

 

2003

 

22

 

10.58

 

236

 

0.00

%

1.67

%

5.80

%

Fidelity VIP Growth (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

205

 

10.12

 

2,075

 

0.46

%

1.00

%

25.46

%

 

 

2006

 

185

 

8.07

 

1,494

 

0.19

%

1.00

%

5.51

%

 

 

2005

 

255

 

7.65

 

1,951

 

0.33

%

1.00

%

4.45

%

 

 

2004

 

438

 

7.33

 

3,208

 

0.10

%

1.00

%

2.09

%

 

 

2003

 

312

 

7.18

 

2,237

 

0.07

%

1.00

%

31.26

%

Fidelity VIP Growth (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

13.20

 

6

 

0.42

%

1.15

%

25.15

%

Fidelity VIP Growth (GrandMaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

75

 

11.71

 

884

 

0.16

%

1.35

%

17.10

%

 


(1)   Results for periods of less than one year have been annualized.

(2)   Results for periods of less than one year have not been annualized.

* -   Less than 1,000.

 

64



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Growth (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

71

 

$

13.41

 

$

958

 

0.50

%

1.55

%

24.71

%

 

 

2006

 

64

 

10.75

 

688

 

0.16

%

1.55

%

4.93

%

 

 

2005

 

62

 

10.25

 

632

 

0.34

%

1.55

%

3.87

%

 

 

2004

 

145

 

9.86

 

1,427

 

0.10

%

1.55

%

1.44

%

 

 

2003

 

106

 

9.72

 

1,031

 

0.03

%

1.55

%

30.47

%

Fidelity VIP Growth (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

187

 

10.55

 

1,971

 

0.42

%

1.45

%

24.86

%

 

 

2006

 

114

 

8.45

 

960

 

0.34

%

1.45

%

5.03

%

 

 

2005

 

147

 

8.05

 

1,186

 

0.39

%

1.45

%

3.98

%

 

 

2004

 

430

 

7.74

 

3,330

 

0.13

%

1.45

%

1.57

%

 

 

2003

 

256

 

7.62

 

1,951

 

0.06

%

1.45

%

30.70

%

Fidelity VIP Growth (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

12

 

15.13

 

184

 

0.44

%

1.67

%

24.52

%

 

 

2006

 

7

 

12.15

 

81

 

0.21

%

1.67

%

4.80

%

 

 

2005

 

12

 

11.59

 

139

 

0.28

%

1.67

%

3.75

%

 

 

2004

 

14

 

11.17

 

151

 

0.06

%

1.67

%

1.36

%

 

 

2003

 

4

 

11.02

 

39

 

0.00

%

1.67

%

10.20

%

Fidelity VIP Growth Opportunities (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

31

 

13.30

 

418

 

0.00

%

1.00

%

21.71

%

 

 

2006

 

8

 

10.93

 

87

 

0.74

%

1.00

%

4.07

%

 

 

2005

 

8

 

10.51

 

82

 

0.72

%

1.00

%

7.59

%

 

 

2004

 

9

 

9.76

 

91

 

0.33

%

1.00

%

5.74

%

 

 

2003

 

17

 

9.23

 

154

 

0.25

%

1.00

%

28.19

%

Fidelity VIP Growth Opportunities (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

6

 

14.57

 

91

 

0.00

%

1.55

%

21.04

%

 

 

2006

 

3

 

12.04

 

38

 

0.55

%

1.55

%

3.49

%

 

 

2005

 

5

 

11.64

 

57

 

1.03

%

1.55

%

7.00

%

 

 

2004

 

11

 

10.88

 

119

 

0.50

%

1.55

%

5.22

%

 

 

2003

 

16

 

10.34

 

164

 

0.01

%

1.55

%

27.50

%

Fidelity VIP Growth Opportunities (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

76

 

12.51

 

955

 

0.00

%

1.45

%

21.13

%

 

 

2006

 

10

 

10.33

 

103

 

3.04

%

1.45

%

3.60

%

 

 

2005

 

16

 

9.97

 

164

 

0.66

%

1.45

%

7.11

%

 

 

2004

 

18

 

9.31

 

165

 

0.16

%

1.45

%

5.32

%

 

 

2003

 

14

 

8.84

 

125

 

0.37

%

1.45

%

27.56

%

Fidelity VIP Growth Opportunities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

15

 

15.44

 

237

 

0.00

%

1.67

%

20.88

%

 

 

2006

 

3

 

12.77

 

39

 

0.36

%

1.67

%

3.37

%

 

 

2005

 

2

 

12.36

 

28

 

0.56

%

1.67

%

6.87

%

 

 

2004

 

2

 

11.56

 

26

 

0.00

%

1.67

%

5.09

%

 

 

2003

 

*

11.00

 

*

0.00

%

1.67

%

10.00

%

Fidelity VIP Growth Opportunities (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

14.40

 

153

 

0.00

%

0.60

%

44.05

%

Fidelity VIP Growth (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

13.73

 

144

 

0.23

%

0.80

%

37.28

%

 


(1)   Results for periods of less than one year have been annualized.

(2)   Results for periods of less than one year have not been annualized.

* -   Less than 1,000.

 

65



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP High Income (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

55

 

$

12.68

 

$

702

 

5.61

%

1.00

%

1.54

%

 

 

2006

 

105

 

12.49

 

1,318

 

7.70

%

1.00

%

9.92

%

 

 

2005

 

72

 

11.37

 

814

 

14.59

%

1.00

%

1.29

%

 

 

2004

 

280

 

11.22

 

3,146

 

10.18

%

1.00

%

8.30

%

 

 

2003

 

300

 

10.36

 

3,111

 

5.52

%

1.00

%

25.42

%

Fidelity VIP High Income (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

10.64

 

3

 

11.95

%

1.15

%

6.41

%

Fidelity VIP High Income (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

65

 

13.74

 

898

 

5.24

%

1.55

%

0.94

%

 

 

2006

 

146

 

13.61

 

1,985

 

8.13

%

1.55

%

9.31

%

 

 

2005

 

163

 

12.45

 

2,029

 

11.51

%

1.55

%

0.73

%

 

 

2004

 

597

 

12.36

 

7,374

 

7.63

%

1.55

%

7.67

%

 

 

2003

 

296

 

11.48

 

3,396

 

0.00

%

1.55

%

14.80

%

Fidelity VIP High Income (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

47

 

13.77

 

651

 

5.06

%

1.45

%

1.03

%

 

 

2006

 

114

 

13.63

 

1,549

 

5.53

%

1.45

%

9.42

%

 

 

2005

 

349

 

12.45

 

4,346

 

18.70

%

1.45

%

0.83

%

 

 

2004

 

602

 

12.35

 

7,435

 

8.30

%

1.45

%

7.77

%

 

 

2003

 

708

 

11.46

 

8,117

 

1.11

%

1.45

%

24.97

%

Fidelity VIP High Income (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

15

 

12.73

 

188

 

11.67

%

1.67

%

0.84

%

 

 

2006

 

9

 

12.62

 

117

 

7.88

%

1.67

%

9.18

%

 

 

2005

 

9

 

11.56

 

99

 

15.09

%

1.67

%

0.61

%

 

 

2004

 

7

 

11.49

 

75

 

6.28

%

1.67

%

7.58

%

 

 

2003

 

1

 

10.68

 

8

 

0.00

%

1.67

%

6.80

%

Fidelity VIP High Income (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

12.21

 

17

 

2.39

%

0.60

%

1.92

%

 

 

2006

 

5

 

11.98

 

56

 

5.95

%

0.60

%

10.36

%

Fidelity VIP Index 500 (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

222

 

11.01

 

2,443

 

2.78

%

1.00

%

4.17

%

 

 

2006

 

131

 

10.57

 

1,383

 

1.64

%

1.00

%

14.29

%

 

 

2005

 

174

 

9.25

 

1,608

 

1.79

%

1.00

%

3.51

%

 

 

2004

 

237

 

8.94

 

2,118

 

1.18

%

1.00

%

9.29

%

 

 

2003

 

284

 

8.18

 

2,322

 

1.22

%

1.00

%

26.82

%

Fidelity VIP Index 500 (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

159

 

11.68

 

1,862

 

2.68

%

1.45

%

3.64

%

 

 

2006

 

84

 

11.27

 

949

 

1.62

%

1.45

%

13.77

%

 

 

2005

 

103

 

9.91

 

1,022

 

1.81

%

1.45

%

3.04

%

 

 

2004

 

136

 

9.61

 

1,303

 

1.74

%

1.45

%

8.71

%

 

 

2003

 

275

 

8.84

 

2,427

 

0.86

%

1.45

%

26.29

%

Fidelity VIP Index 500 (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

16

 

9.86

 

161

 

3.46

%

1.15

%

(1.39

)%

Fidelity VIP Index 500 (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

221

 

9.85

 

2,175

 

2.51

%

1.35

%

(1.52

)%

Fidelity VIP Index 500 (Grandmaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

78

 

9.83

 

769

 

2.32

%

1.55

%

(1.66

)%

Fidelity VIP Index 500 (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

26

 

9.90

 

259

 

3.83

%

0.60

%

(1.01

)%

 


(1)   Results for periods of less than one year have been annualized.

(2)   Results for periods of less than one year have not been annualized.

* -   Less than 1,000.

 

66



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Index 500 (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

30

 

$

14.48

 

$

439

 

3.03

%

1.67

%

3.41

%

 

 

2006

 

2

 

14.00

 

23

 

1.50

%

1.67

%

13.52

%

 

 

2005

 

2

 

12.33

 

20

 

1.58

%

1.67

%

2.82

%

 

 

2004

 

2

 

11.99

 

20

 

0.47

%

1.67

%

8.51

%

Fidelity VIP Investment Grade Bond (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

427

 

13.30

 

5,674

 

4.17

%

1.00

%

3.07

%

 

 

2006

 

446

 

12.90

 

5,749

 

4.02

%

1.00

%

3.10

%

 

 

2005

 

533

 

12.52

 

6,674

 

4.35

%

1.00

%

0.88

%

 

 

2004

 

573

 

12.41

 

7,113

 

6.03

%

1.00

%

3.16

%

 

 

2003

 

620

 

12.03

 

7,463

 

5.31

%

1.00

%

3.89

%

Fidelity VIP Investment Grade Bond (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

40

 

10.45

 

418

 

1.09

%

1.15

%

4.49

%

Fidelity VIP Investment Grade Bond (GrandMaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

126

 

10.14

 

1,278

 

0.16

%

1.35

%

1.42

%

Fidelity VIP Investment Grade Bond (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

178

 

10.87

 

1,940

 

2.67

%

1.55

%

2.45

%

 

 

2006

 

88

 

10.61

 

936

 

3.24

%

1.55

%

2.53

%

 

 

2005

 

71

 

10.35

 

738

 

2.18

%

1.55

%

0.32

%

 

 

2004

 

18

 

10.31

 

183

 

0.00

%

1.55

%

3.10

%

Fidelity VIP Investment Grade Bond (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

344

 

12.65

 

4,347

 

4.05

%

1.45

%

2.57

%

 

 

2006

 

353

 

12.33

 

4,352

 

4.01

%

1.45

%

2.63

%

 

 

2005

 

384

 

12.01

 

4,609

 

4.13

%

1.45

%

0.42

%

 

 

2004

 

398

 

11.96

 

4,765

 

4.90

%

1.45

%

2.66

%

 

 

2003

 

329

 

11.65

 

3,836

 

6.55

%

1.45

%

3.37

%

Fidelity VIP Investment Grade Bond (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

65

 

10.77

 

704

 

3.87

%

1.67

%

2.37

%

 

 

2006

 

57

 

10.52

 

597

 

3.71

%

1.67

%

2.40

%

 

 

2005

 

55

 

10.28

 

569

 

4.07

%

1.67

%

0.20

%

 

 

2004

 

44

 

10.26

 

452

 

4.94

%

1.67

%

2.50

%

 

 

2003

 

30

 

10.01

 

300

 

0.00

%

1.67

%

0.10

%

Fidelity VIP Investment Grade Bond (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

17

 

11.10

 

189

 

3.68

%

0.60

%

3.42

%

 

 

2006

 

6

 

10.73

 

65

 

3.91

%

0.60

%

3.51

%

 

 

2005

 

5

 

10.36

 

47

 

4.19

%

0.60

%

1.29

%

 

 

2004

 

5

 

10.23

 

46

 

0.00

%

0.60

%

2.30

%

Fidelity VIP Mid Cap (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

270

 

22.80

 

6,155

 

0.62

%

1.00

%

14.16

%

 

 

2006

 

337

 

19.97

 

6,734

 

1.14

%

1.00

%

11.28

%

 

 

2005

 

327

 

17.94

 

5,872

 

0.00

%

1.00

%

16.85

%

 

 

2004

 

325

 

15.35

 

4,992

 

0.00

%

1.00

%

23.39

%

 

 

2003

 

274

 

12.44

 

3,404

 

0.24

%

1.00

%

36.85

%

Fidelity VIP Mid Cap (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

28

 

11.96

 

334

 

0.50

%

1.15

%

14.03

%

 

 

2006

 

7

 

10.49

 

72

 

0.00

%

1.15

%

0.00

%

 


(1)   Results for periods of less than one year have been annualized.

(2)   Results for periods of less than one year have not been annualized.

* -   Less than 1,000.

 

67



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Mid Cap (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

159

 

$

20.63

 

$

3,275

 

0.66

%

1.55

%

13.55

%

 

 

2006

 

258

 

18.17

 

4,695

 

1.43

%

1.55

%

10.67

%

 

 

2005

 

265

 

16.42

 

4,354

 

0.00

%

1.55

%

16.20

%

 

 

2004

 

177

 

14.13

 

2,495

 

0.00

%

1.55

%

22.76

%

 

 

2003

 

107

 

11.51

 

1,232

 

0.05

%

1.55

%

36.05

%

Fidelity VIP Mid Cap (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

206

 

17.99

 

3,705

 

0.35

%

1.35

%

13.77

%

 

 

2006

 

2

 

15.81

 

26

 

0.54

%

1.35

%

10.89

%

 

 

2005

 

1

 

14.26

 

8

 

0.00

%

1.35

%

16.43

%

 

 

2004

 

1

 

12.25

 

7

 

0.00

%

1.35

%

22.50

%

Fidelity VIP Mid Cap (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

146

 

22.59

 

3,309

 

0.62

%

1.45

%

13.68

%

 

 

2006

 

212

 

19.87

 

4,219

 

1.24

%

1.45

%

10.78

%

 

 

2005

 

222

 

17.94

 

3,977

 

0.00

%

1.45

%

16.32

%

 

 

2004

 

288

 

15.42

 

4,446

 

0.00

%

1.45

%

22.87

%

 

 

2003

 

256

 

12.55

 

3,213

 

0.14

%

1.45

%

36.26

%

Fidelity VIP Mid Cap (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

69

 

21.75

 

1,505

 

0.66

%

1.67

%

13.39

%

 

 

2006

 

64

 

19.18

 

1,234

 

1.10

%

1.67

%

10.53

%

 

 

2005

 

47

 

17.35

 

812

 

0.00

%

1.67

%

16.06

%

 

 

2004

 

36

 

14.95

 

533

 

0.00

%

1.67

%

22.54

%

 

 

2003

 

7

 

12.20

 

81

 

0.00

%

1.67

%

22.00

%

Fidelity VIP Mid Cap (IQ Advisor Enhanced™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

18.34

 

14

 

0.60

%

0.80

%

14.40

%

 

 

2006

 

1

 

16.03

 

12

 

1.24

%

0.80

%

11.51

%

 

 

2005

 

1

 

14.37

 

11

 

0.00

%

0.80

%

17.08

%

 

 

2004

 

1

 

12.28

 

9

 

0.00

%

0.80

%

22.80

%

Fidelity VIP Mid Cap (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

18.48

 

65

 

0.59

%

0.60

%

14.67

%

 

 

2006

 

5

 

16.12

 

76

 

0.52

%

0.60

%

11.73

%

 

 

2005

 

1

 

14.43

 

13

 

0.00

%

0.60

%

17.31

%

 

 

2004

 

*

12.30

 

4

 

0.00

%

0.60

%

23.00

%

Fidelity VIP Overseas (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

191

 

15.33

 

2,933

 

3.13

%

1.00

%

15.84

%

 

 

2006

 

81

 

13.23

 

1,067

 

1.04

%

1.00

%

16.60

%

 

 

2005

 

54

 

11.34

 

617

 

0.68

%

1.00

%

17.60

%

 

 

2004

 

35

 

9.65

 

341

 

0.90

%

1.00

%

12.21

%

 

 

2003

 

64

 

8.60

 

547

 

0.20

%

1.00

%

41.68

%

Fidelity VIP Overseas (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

10

 

12.63

 

129

 

2.99

%

1.15

%

15.68

%

 

 

2006

 

2

 

10.92

 

23

 

0.00

%

1.15

%

0.00

%

Fidelity VIP Overseas (GrandMaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

145

 

10.57

 

1,532

 

2.57

%

1.45

%

5.73

%

Fidelity VIP Overseas (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

76

 

17.27

 

1,311

 

2.52

%

1.55

%

15.21

%

 

 

2006

 

50

 

14.99

 

748

 

1.49

%

1.55

%

15.95

%

 

 

2005

 

31

 

12.93

 

399

 

0.19

%

1.55

%

16.95

%

 

 

2004

 

1

 

11.05

 

9

 

0.00

%

1.55

%

10.50

%

 


(1)   Results for periods of less than one year have been annualized.

(2)          Results for periods of less than one year have not been annualized.

* -   Less than 1,000.

 

68



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Service Class 2 (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fidelity VIP Overseas (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

171

 

$

15.55

 

$

2,656

 

2.81

%

1.45

%

15.35

%

 

 

2006

 

61

 

13.48

 

821

 

1.39

%

1.45

%

16.07

%

 

 

2005

 

84

 

11.61

 

978

 

0.74

%

1.45

%

17.07

%

 

 

2004

 

74

 

9.92

 

733

 

0.88

%

1.45

%

11.71

%

 

 

2003

 

56

 

8.88

 

499

 

0.10

%

1.45

%

40.95

%

Fidelity VIP Overseas (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

54

 

21.29

 

1,154

 

2.69

%

1.67

%

15.09

%

 

 

2006

 

14

 

18.50

 

261

 

1.43

%

1.67

%

15.81

%

 

 

2005

 

6

 

15.97

 

100

 

0.99

%

1.67

%

16.81

%

 

 

2004

 

6

 

13.68

 

79

 

0.88

%

1.67

%

11.49

%

 

 

2003

 

5

 

12.27

 

59

 

0.00

%

1.67

%

22.70

%

Fidelity VIP Overseas (IQ Advisor Enhanced™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

17.46

 

22

 

2.91

%

0.80

%

16.14

%

 

 

2006

 

1

 

15.03

 

19

 

1.29

%

0.80

%

16.83

%

 

 

2005

 

1

 

12.87

 

16

 

1.02

%

0.80

%

17.84

%

 

 

2004

 

1

 

10.92

 

14

 

0.00

%

0.80

%

9.20

%

Fidelity VIP Overseas (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

30

 

17.60

 

533

 

3.67

%

0.60

%

16.38

%

 

 

2006

 

9

 

15.12

 

140

 

1.28

%

0.60

%

17.07

%

 

 

2005

 

10

 

12.92

 

124

 

0.00

%

0.60

%

18.07

%

 

 

2005

 

10

 

12.92

 

124

 

0.00

%

0.60

%

18.07

%

Non-Affiliated Class 1:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

22

 

18.12

 

399

 

7.84

%

1.00

%

5.47

%

 

 

2006

 

24

 

17.18

 

420

 

3.74

%

1.00

%

9.70

%

 

 

2005

 

18

 

15.66

 

283

 

9.11

%

1.00

%

11.13

%

 

 

2004

 

8

 

14.09

 

113

 

7.42

%

1.00

%

8.97

%

 

 

2003

 

22

 

12.93

 

286

 

0.00

%

1.00

%

26.52

%

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

11.13

 

24

 

8.75

%

1.15

%

5.26

%

 

 

2006

 

2

 

10.57

 

23

 

0.00

%

1.15

%

0.00

%

Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

13

 

17.52

 

230

 

8.73

%

1.55

%

4.86

%

 

 

2006

 

39

 

16.71

 

657

 

3.12

%

1.55

%

9.10

%

 

 

2005

 

22

 

15.31

 

340

 

10.27

%

1.55

%

10.52

%

 

 

2004

 

13

 

13.86

 

176

 

10.37

%

1.55

%

8.37

%

 

 

2003

 

14

 

12.79

 

175

 

0.00

%

1.55

%

25.89

%

Van Kampen UIF Emerging Markets Debt (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

16

 

17.71

 

284

 

8.04

%

1.45

%

4.96

%

 

 

2006

 

26

 

16.87

 

435

 

5.72

%

1.45

%

9.21

%

 

 

2005

 

47

 

15.45

 

720

 

7.07

%

1.45

%

10.63

%

 

 

2004

 

12

 

13.96

 

169

 

5.78

%

1.45

%

8.47

%

 

 

2003

 

47

 

12.87

 

609

 

0.00

%

1.45

%

26.05

%

Van Kampen UIF U.S. Real Estate (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

63

 

21.86

 

1,369

 

2.14

%

1.00

%

(17.92

)%

 

 

2006

 

106

 

26.63

 

2,818

 

1.21

%

1.00

%

36.67

%

 

 

2005

 

125

 

19.48

 

2,436

 

1.44

%

1.00

%

15.89

%

 

 

2004

 

198

 

16.81

 

3,325

 

1.77

%

1.00

%

35.02

%

 

 

2003

 

128

 

12.45

 

1,593

 

0.00

%

1.00

%

36.21

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

69



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 1 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)

 

2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

12

 

$

9.30

 

$

112

 

2.59

%

1.15

%

(18.03

)%

 

 

2006

 

4

 

11.35

 

45

 

0.00

%

1.15

%

0.00

%

Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

39

 

21.44

 

842

 

2.25

%

1.55

%

(18.35

)%

 

 

2006

 

99

 

26.26

 

2,590

 

1.53

%

1.55

%

35.92

%

 

 

2005

 

107

 

19.32

 

2,073

 

1.47

%

1.55

%

15.24

%

 

 

2004

 

89

 

16.77

 

1,490

 

1.88

%

1.55

%

34.27

%

 

 

2003

 

106

 

12.49

 

1,327

 

0.00

%

1.55

%

35.47

%

Van Kampen UIF U.S. Real Estate (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

49

 

20.98

 

1,022

 

2.03

%

1.45

%

(18.29

)%

 

 

2006

 

88

 

25.67

 

2,252

 

1.29

%

1.45

%

36.05

%

 

 

2005

 

80

 

18.87

 

1,501

 

1.68

%

1.45

%

15.36

%

 

 

2004

 

80

 

16.35

 

1,303

 

1.82

%

1.45

%

34.35

%

 

 

2003

 

105

 

12.17

 

1,278

 

0.00

%

1.45

%

35.52

%

Non-Affiliated Class 2:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Foreign Securities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

99

 

21.68

 

2,148

 

2.14

%

1.45

%

13.75

%

 

 

2006

 

89

 

19.06

 

1,697

 

1.19

%

1.45

%

19.69

%

 

 

2005

 

124

 

15.92

 

1,972

 

0.77

%

1.45

%

8.58

%

 

 

2004

 

32

 

14.66

 

471

 

0.89

%

1.45

%

16.81

%

 

 

2003

 

25

 

12.55

 

310

 

0.00

%

1.45

%

25.50

%

Franklin Growth and Income Securities (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

341

 

14.57

 

4,972

 

3.89

%

1.00

%

(4.70

)%

 

 

2006

 

107

 

15.29

 

1,636

 

2.69

%

1.00

%

15.59

%

 

 

2005

 

142

 

13.22

 

1,873

 

2.46

%

1.00

%

2.48

%

 

 

2004

 

208

 

12.90

 

2,677

 

2.44

%

1.00

%

9.51

%

 

 

2003

 

126

 

11.78

 

1,484

 

0.00

%

1.00

%

17.80

%

Franklin Growth and Income Securities (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

10.33

 

83

 

3.88

%

1.15

%

(4.82

)%

 

 

2006

 

2

 

10.85

 

24

 

0.00

%

1.15

%

0.00

%

Franklin Growth and Income Securities (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

129

 

14.17

 

1,822

 

4.02

%

1.55

%

(5.20

)%

 

 

2006

 

47

 

14.95

 

698

 

2.73

%

1.55

%

14.95

%

 

 

2005

 

34

 

13.01

 

445

 

2.41

%

1.55

%

1.92

%

 

 

2004

 

57

 

12.76

 

722

 

2.83

%

1.55

%

8.87

%

 

 

2003

 

38

 

11.72

 

445

 

0.00

%

1.55

%

17.20

%

Franklin Growth and Income Securities (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

109

 

14.32

 

1,561

 

3.99

%

1.35

%

(5.00

)%

 

 

2006

 

43

 

15.07

 

646

 

2.75

%

1.35

%

15.18

%

 

 

2005

 

44

 

13.09

 

578

 

2.76

%

1.35

%

2.12

%

 

 

2004

 

57

 

12.81

 

724

 

2.59

%

1.35

%

9.11

%

 

 

2003

 

40

 

11.74

 

465

 

0.00

%

1.35

%

17.40

%

Franklin Growth and Income Securities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

291

 

14.24

 

4,148

 

3.94

%

1.45

%

(5.10

)%

 

 

2006

 

64

 

15.01

 

956

 

2.90

%

1.45

%

15.07

%

 

 

2005

 

122

 

13.05

 

1,598

 

2.42

%

1.45

%

2.02

%

 

 

2004

 

156

 

12.79

 

1,990

 

2.41

%

1.45

%

9.04

%

 

 

2003

 

149

 

11.73

 

1,748

 

0.00

%

1.45

%

17.30

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

70



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Growth and Income Securities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

83

 

$

13.66

 

$

1,130

 

3.78

%

1.67

%

(5.34

)%

 

 

2006

 

27

 

14.43

 

396

 

2.86

%

1.67

%

14.81

%

 

 

2005

 

16

 

12.57

 

206

 

2.31

%

1.67

%

1.79

%

 

 

2004

 

7

 

12.34

 

89

 

2.52

%

1.67

%

8.72

%

 

 

2003

 

3

 

11.35

 

34

 

0.00

%

1.67

%

13.50

%

Franklin Growth and Income Securities (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

12.41

 

3

 

4.94

%

0.60

%

24.14

%

Franklin Income Securities (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

414

 

17.22

 

7,125

 

3.69

%

1.00

%

2.69

%

 

 

2006

 

480

 

16.77

 

8,052

 

3.83

%

1.00

%

17.06

%

 

 

2005

 

398

 

14.32

 

5,697

 

3.91

%

1.00

%

0.59

%

 

 

2004

 

261

 

14.24

 

3,723

 

3.21

%

1.00

%

12.75

%

 

 

2003

 

201

 

12.63

 

2,539

 

0.00

%

1.00

%

26.30

%

Franklin Income Securities (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

59

 

10.91

 

643

 

2.30

%

1.15

%

2.58

%

 

 

2006

 

20

 

10.64

 

216

 

0.00

%

1.15

%

0.00

%

Franklin Income Securities (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

395

 

16.75

 

6,624

 

3.63

%

1.55

%

2.13

%

 

 

2006

 

393

 

16.40

 

6,444

 

3.80

%

1.55

%

16.41

%

 

 

2005

 

323

 

14.09

 

4,551

 

4.06

%

1.55

%

0.04

%

 

 

2004

 

159

 

14.08

 

2,234

 

2.72

%

1.55

%

12.10

%

 

 

2003

 

73

 

12.56

 

919

 

0.00

%

1.55

%

25.60

%

Franklin Income Securities (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

363

 

16.92

 

6,146

 

3.67

%

1.35

%

2.36

%

 

 

2006

 

409

 

16.53

 

6,755

 

4.75

%

1.35

%

16.65

%

 

 

2005

 

204

 

14.17

 

2,889

 

3.49

%

1.35

%

0.24

%

 

 

2004

 

172

 

14.14

 

2,436

 

3.11

%

1.35

%

12.31

%

 

 

2003

 

141

 

12.59

 

1,779

 

0.00

%

1.35

%

25.90

%

Franklin Income Securities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

469

 

16.83

 

7,899

 

3.46

%

1.45

%

2.27

%

 

 

2006

 

442

 

16.46

 

7,279

 

3.12

%

1.45

%

16.53

%

 

 

2005

 

256

 

14.13

 

3,620

 

4.27

%

1.45

%

0.14

%

 

 

2004

 

115

 

14.11

 

1,618

 

2.61

%

1.45

%

12.16

%

 

 

2003

 

66

 

12.58

 

824

 

0.00

%

1.45

%

25.80

%

Franklin Income Securities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

187

 

14.84

 

2,782

 

4.11

%

1.67

%

2.02

%

 

 

2006

 

181

 

14.55

 

2,627

 

3.68

%

1.67

%

16.27

%

 

 

2005

 

119

 

12.51

 

1,495

 

2.79

%

1.67

%

(0.09

)%

 

 

2004

 

50

 

12.52

 

630

 

3.13

%

1.67

%

11.89

%

 

 

2003

 

20

 

11.19

 

218

 

0.00

%

1.67

%

11.90

%

Franklin Income Securities (IQ Advisor Enhanced™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

13.55

 

11

 

3.55

%

0.80

%

2.95

%

 

 

2006

 

1

 

13.16

 

10

 

3.76

%

0.80

%

17.30

%

Franklin Income Securities (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

13.66

 

4

 

5.98

%

0.60

%

36.56

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

71



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Large Cap Growth Securities (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

25

 

$

14.74

 

$

376

 

0.69

%

1.00

%

5.13

%

 

 

2006

 

25

 

14.02

 

353

 

0.72

%

1.00

%

9.79

%

 

 

2005

 

18

 

12.77

 

236

 

0.69

%

1.00

%

0.05

%

 

 

2004

 

11

 

12.76

 

138

 

0.46

%

1.00

%

6.87

%

 

 

2003

 

27

 

11.94

 

318

 

0.00

%

1.00

%

19.40

%

Franklin Large Cap Growth Securities (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

11.36

 

44

 

0.56

%

1.15

%

4.96

%

 

 

2006

 

*

10.82

 

3

 

0.00

%

1.15

%

0.00

%

Franklin Large Cap Growth Securities (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

26

 

14.34

 

379

 

0.60

%

1.55

%

4.56

%

 

 

2006

 

28

 

13.71

 

379

 

0.75

%

1.55

%

9.18

%

 

 

2005

 

43

 

12.55

 

542

 

0.48

%

1.55

%

(0.50

)%

 

 

2004

 

69

 

12.62

 

870

 

0.41

%

1.55

%

6.23

%

 

 

2003

 

9

 

11.88

 

108

 

0.00

%

1.55

%

18.80

%

Franklin Large Cap Growth Securities (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

14.48

 

64

 

0.57

%

1.35

%

4.78

%

 

 

2006

 

7

 

13.82

 

92

 

0.82

%

1.35

%

9.40

%

 

 

2005

 

11

 

12.63

 

137

 

0.60

%

1.35

%

(0.30

)%

 

 

2004

 

11

 

12.67

 

137

 

0.48

%

1.35

%

6.47

%

 

 

2003

 

6

 

11.90

 

75

 

0.00

%

1.35

%

19.00

%

Franklin Large Cap Growth Securities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

46

 

14.41

 

662

 

0.95

%

1.45

%

4.71

%

 

 

2006

 

17

 

13.76

 

230

 

0.77

%

1.45

%

9.29

%

 

 

2005

 

29

 

12.59

 

369

 

1.01

%

1.45

%

(0.40

)%

 

 

2004

 

33

 

12.64

 

413

 

0.44

%

1.45

%

6.31

%

 

 

2003

 

10

 

11.89

 

122

 

0.00

%

1.45

%

18.90

%

Franklin Large Cap Growth Securities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

20

 

13.08

 

266

 

0.69

%

1.67

%

4.47

%

 

 

2006

 

21

 

12.52

 

265

 

0.71

%

1.67

%

9.05

%

 

 

2005

 

26

 

11.48

 

300

 

0.69

%

1.67

%

(0.62

)%

 

 

2004

 

40

 

11.55

 

462

 

0.45

%

1.67

%

6.06

%

 

 

2003

 

6

 

10.89

 

68

 

0.00

%

1.67

%

8.90

%

Franklin Large Cap Growth Securities (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

12.34

 

62

 

0.63

%

0.60

%

23.43

%

Franklin Mutual Shares Securities (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

248

 

17.82

 

4,417

 

2.03

%

1.00

%

2.45

%

 

 

2006

 

251

 

17.39

 

4,367

 

2.02

%

1.00

%

17.20

%

 

 

2005

 

264

 

14.84

 

3,916

 

0.99

%

1.00

%

9.45

%

 

 

2004

 

180

 

13.56

 

2,443

 

0.74

%

1.00

%

11.51

%

 

 

2003

 

88

 

12.16

 

1,075

 

0.00

%

1.00

%

21.60

%

Franklin Mutual Shares Securities (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

29

 

11.05

 

324

 

1.65

%

1.15

%

2.29

%

 

 

2006

 

4

 

10.80

 

41

 

0.00

%

1.15

%

0.00

%

Franklin Mutual Shares Securities (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

259

 

17.33

 

4,492

 

2.01

%

1.55

%

1.87

%

 

 

2006

 

244

 

17.01

 

4,148

 

2.07

%

1.55

%

16.55

%

 

 

2005

 

191

 

14.60

 

2,786

 

0.97

%

1.55

%

8.85

%

 

 

2004

 

117

 

13.41

 

1,574

 

0.83

%

1.55

%

10.92

%

 

 

2003

 

37

 

12.09

 

442

 

0.00

%

1.55

%

20.90

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* -  Less than 1,000.

 

72



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Mutual Shares Securities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

165

 

$

17.42

 

$

2,880

 

2.36

%

1.45

%

1.97

%

 

 

2006

 

167

 

17.08

 

2,846

 

1.99

%

1.45

%

16.67

%

 

 

2005

 

155

 

14.64

 

2,264

 

0.83

%

1.45

%

8.96

%

 

 

2004

 

141

 

13.44

 

1,889

 

0.88

%

1.45

%

11.07

%

 

 

2003

 

110

 

12.10

 

1,327

 

0.00

%

1.45

%

21.00

%

Franklin Mutual Shares Securities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

126

 

15.90

 

2,005

 

2.25

%

1.67

%

1.73

%

 

 

2006

 

112

 

15.63

 

1,743

 

2.24

%

1.67

%

16.41

%

 

 

2005

 

78

 

13.42

 

1,043

 

0.72

%

1.67

%

8.72

%

 

 

2004

 

34

 

12.35

 

426

 

0.66

%

1.67

%

10.76

%

 

 

2003

 

5

 

11.15

 

60

 

0.00

%

1.67

%

11.50

%

Franklin Mutual Shares Securities (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

29

 

14.77

 

432

 

2.04

%

0.60

%

2.82

%

 

 

2006

 

9

 

14.36

 

130

 

0.43

%

0.60

%

17.67

%

 

 

2005

 

1

 

12.20

 

8

 

1.20

%

0.60

%

9.89

%

Franklin Mutual Shares Securities (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

306

 

17.50

 

5,348

 

1.86

%

1.35

%

2.07

%

 

 

2006

 

151

 

17.15

 

2,593

 

1.98

%

1.35

%

16.79

%

 

 

2005

 

150

 

14.68

 

2,202

 

0.85

%

1.35

%

9.07

%

 

 

2004

 

126

 

13.46

 

1,692

 

0.80

%

1.35

%

11.06

%

 

 

2003

 

117

 

12.12

 

1,419

 

0.00

%

1.35

%

21.20

%

Franklin Small Cap Value Securities (Annuichoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

3

 

8.90

 

23

 

0.00

%

1.00

%

(10.96

)%

Franklin Small Cap Value Securities (Annuichoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

8.89

 

31

 

0.00

%

1.15

%

(11.05

)%

Franklin Small Cap Value Securities (Grandmaster ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

8.88

 

9

 

4.52

%

1.35

%

(11.18

)%

Franklin Small Cap Value Securities (Grandmaster flex3 ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

8.87

 

5

 

0.00

%

1.55

%

(11.30

)%

Franklin Small Cap Value Securities (IQ Annuuity ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

*

8.88

 

1

 

0.00

%

1.35

%

(11.24

)%

Franklin Small Cap Value Securities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

8.86

 

12

 

0.00

%

1.67

%

(11.37

)%

Templeton Foriegn Securities Fund (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

113

 

21.57

 

2,438

 

2.08

%

1.55

%

13.65

%

 

 

2006

 

89

 

18.98

 

1,686

 

1.20

%

1.55

%

19.57

%

 

 

2005

 

99

 

15.87

 

1,579

 

1.08

%

1.55

%

8.47

%

 

 

2004

 

68

 

14.63

 

1,002

 

1.13

%

1.55

%

16.67

%

 

 

2003

 

34

 

12.54

 

421

 

0.00

%

1.55

%

25.40

%

Templeton Foriegn Securities Fund (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

34

 

21.79

 

743

 

1.79

%

1.35

%

13.91

%

 

 

2006

 

29

 

19.13

 

560

 

1.31

%

1.35

%

19.81

%

 

 

2005

 

44

 

15.97

 

695

 

1.20

%

1.35

%

8.69

%

 

 

2004

 

33

 

14.69

 

478

 

1.06

%

1.35

%

16.87

%

 

 

2003

 

15

 

12.57

 

184

 

0.00

%

1.35

%

25.70

%

 


(1)  Results for periods of less than one year have been annualized.

 

 

 

(2)  Results for periods of less than one year have not been annualized.

 

 

 

* -  Less than 1,000.

 

 

 

 

73



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Templeton Foriegn Securities Fund (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

22

 

$

20.12

 

$

449

 

2.33

%

1.67

%

13.50

%

 

 

2006

 

20

 

17.73

 

356

 

1.17

%

1.67

%

19.42

%

 

 

2005

 

21

 

14.84

 

316

 

1.13

%

1.67

%

8.34

%

 

 

2004

 

13

 

13.70

 

178

 

1.22

%

1.67

%

16.50

%

 

 

2003

 

3

 

11.76

 

36

 

0.00

%

1.67

%

17.60

%

Templeton Foreign Securities Fund (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

113

 

22.18

 

2,503

 

2.12

%

1.00

%

14.32

%

 

 

2006

 

93

 

19.40

 

1,809

 

1.14

%

1.00

%

20.24

%

 

 

2005

 

104

 

16.14

 

1,682

 

1.10

%

1.00

%

9.07

%

 

 

2004

 

62

 

14.80

 

924

 

0.94

%

1.00

%

17.37

%

 

 

2003

 

23

 

12.61

 

291

 

0.00

%

1.00

%

26.10

%

Templeton Foreign Securities Fund (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

13

 

12.51

 

163

 

1.95

%

1.15

%

14.16

%

 

 

2006

 

5

 

10.96

 

56

 

0.00

%

1.15

%

0.00

%

Templeton Foriegn Securities Fund (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

6

 

17.48

 

104

 

3.13

%

0.60

%

14.77

%

 

 

2006

 

4

 

15.23

 

66

 

1.49

%

0.60

%

20.72

%

 

 

2005

 

5

 

12.62

 

67

 

1.19

%

0.60

%

9.51

%

 

 

2004

 

5

 

11.52

 

54

 

0.00

%

0.60

%

15.20

%

Templeton Growth Securities (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

89

 

18.89

 

1,683

 

1.71

%

1.00

%

1.34

%

 

 

2006

 

195

 

18.64

 

3,636

 

1.38

%

1.00

%

20.59

%

 

 

2005

 

129

 

15.46

 

1,989

 

1.19

%

1.00

%

7.78

%

 

 

2004

 

30

 

14.34

 

437

 

1.64

%

1.00

%

14.81

%

 

 

2003

 

7

 

12.49

 

88

 

0.00

%

1.00

%

24.90

%

Templeton Growth Securities (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

20

 

11.15

 

228

 

1.27

%

1.15

%

1.17

%

 

 

2006

 

2

 

11.02

 

20

 

0.00

%

1.15

%

0.00

%

Templeton Growth Securities (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

124

 

18.37

 

2,278

 

1.62

%

1.55

%

0.73

%

 

 

2006

 

153

 

18.24

 

2,793

 

1.27

%

1.55

%

19.93

%

 

 

2005

 

133

 

15.21

 

2,028

 

1.14

%

1.55

%

7.18

%

 

 

2004

 

90

 

14.19

 

1,271

 

1.03

%

1.55

%

14.25

%

 

 

2003

 

43

 

12.42

 

536

 

0.00

%

1.55

%

24.20

%

Templeton Growth Securities (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

62

 

18.56

 

1,151

 

1.77

%

1.35

%

0.98

%

 

 

2006

 

256

 

18.38

 

4,706

 

1.83

%

1.35

%

20.17

%

 

 

2005

 

69

 

15.30

 

1,052

 

1.08

%

1.35

%

7.40

%

 

 

2004

 

64

 

14.24

 

907

 

0.86

%

1.35

%

14.38

%

 

 

2003

 

31

 

12.45

 

387

 

0.00

%

1.35

%

24.50

%

Templeton Growth Securities (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

105

 

18.47

 

1,934

 

1.92

%

1.45

%

0.85

%

 

 

2006

 

136

 

18.31

 

2,492

 

1.24

%

1.45

%

20.05

%

 

 

2005

 

109

 

15.25

 

1,662

 

1.09

%

1.45

%

7.29

%

 

 

2004

 

72

 

14.22

 

1,020

 

1.42

%

1.45

%

14.40

%

 

 

2003

 

9

 

12.43

 

109

 

0.00

%

1.45

%

24.30

%

 


(1)  Results for periods of less than one year have been annualized.

(2)  Results for periods of less than one year have not been annualized.

* - Less than 1,000.

 

74



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Templeton Growth Securities (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

58

 

$

16.99

 

$

988

 

1.72

%

1.67

%

0.65

%

 

 

2006

 

66

 

16.88

 

1,108

 

1.38

%

1.67

%

19.78

%

 

 

2005

 

38

 

14.10

 

530

 

0.62

%

1.67

%

7.05

%

 

 

2004

 

6

 

13.17

 

73

 

0.82

%

1.67

%

14.12

%

Van Kampen LIT Comstock (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

53

 

16.37

 

872

 

1.77

%

1.00

%

(3.31

)%

 

 

2006

 

68

 

16.93

 

1,153

 

2.63

%

1.00

%

14.89

%

 

 

2005

 

72

 

14.74

 

1,056

 

0.83

%

1.00

%

3.07

%

 

 

2004

 

57

 

14.30

 

816

 

0.54

%

1.00

%

16.26

%

 

 

2003

 

23

 

12.30

 

282

 

0.00

%

1.00

%

23.00

%

Van Kampen LIT Comstock (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

10.44

 

54

 

1.35

%

1.15

%

(3.50

)%

 

 

2006

 

*

10.82

 

4

 

0.00

%

1.15

%

0.00

%

Van Kampen LIT Comstock (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

41

 

15.92

 

654

 

1.90

%

1.55

%

(3.86

)%

 

 

2006

 

67

 

16.56

 

1,116

 

2.60

%

1.55

%

14.25

%

 

 

2005

 

63

 

14.49

 

918

 

0.96

%

1.55

%

2.50

%

 

 

2004

 

62

 

14.14

 

872

 

0.66

%

1.55

%

15.62

%

 

 

2003

 

43

 

12.23

 

529

 

0.00

%

1.55

%

22.30

%

Van Kampen LIT Comstock (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

16

 

16.08

 

254

 

2.07

%

1.35

%

(3.64

)%

 

 

2006

 

26

 

16.69

 

427

 

2.90

%

1.35

%

14.48

%

 

 

2005

 

44

 

14.58

 

639

 

1.11

%

1.35

%

2.71

%

 

 

2004

 

39

 

14.20

 

560

 

0.63

%

1.35

%

15.92

%

 

 

2003

 

12

 

12.25

 

144

 

0.00

%

1.35

%

22.50

%

Van Kampen LIT Comstock (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

68

 

16.00

 

1,096

 

1.82

%

1.45

%

(3.78

)%

 

 

2006

 

88

 

16.63

 

1,459

 

2.52

%

1.45

%

14.37

%

 

 

2005

 

86

 

14.54

 

1,252

 

0.84

%

1.45

%

2.61

%

 

 

2004

 

115

 

14.17

 

1,626

 

0.23

%

1.45

%

15.77

%

 

 

2003

 

13

 

12.24

 

155

 

0.00

%

1.45

%

22.40

%

Van Kampen LIT Comstock (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

21

 

14.62

 

309

 

1.73

%

1.67

%

(3.94

)%

 

 

2006

 

22

 

15.22

 

330

 

2.54

%

1.67

%

14.11

%

 

 

2005

 

21

 

13.34

 

284

 

0.74

%

1.67

%

2.38

%

 

 

2004

 

11

 

13.03

 

138

 

0.71

%

1.67

%

15.41

%

 

 

2003

 

4

 

11.29

 

41

 

0.00

%

1.67

%

12.90

%

Van Kampen LIT Strategic Growth (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

15.82

 

130

 

0.00

%

1.00

%

15.46

%

 

 

2006

 

3

 

13.70

 

34

 

0.00

%

1.00

%

1.60

%

 

 

2005

 

4

 

13.48

 

57

 

0.01

%

1.00

%

6.57

%

 

 

2004

 

4

 

12.65

 

52

 

0.00

%

1.00

%

5.68

%

 

 

2003

 

4

 

11.97

 

51

 

0.00

%

1.00

%

19.70

%

Van Kampen LIT Strategic Growth (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

12.43

 

9

 

0.00

%

1.15

%

15.32

%

 

 

2006

 

1

 

10.78

 

7

 

0.00

%

1.15

%

0.00

%

 


(1)

Results for periods of less than one year have been annualized.

(2)

Results for periods of less than one year have not been annualized.

* -

Less than 1,000.

 

75



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen LIT Strategic Growth (GrandMaster flex3™)

 

2007

 

6

 

$

15.39

 

$

96

 

0.00

%

1.55

%

14.82

%

 

 

2006

 

7

 

13.40

 

92

 

0.00

%

1.55

%

1.04

%

 

 

2005

 

6

 

13.26

 

80

 

0.01

%

1.55

%

5.98

%

 

 

2004

 

4

 

12.51

 

56

 

0.00

%

1.55

%

5.13

%

 

 

2003

 

*

11.90

 

 

0.00

%

1.55

%

19.00

%

Van Kampen LIT Strategic Growth (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

15.54

 

11

 

0.00

%

1.35

%

15.04

%

 

 

2006

 

2

 

13.51

 

20

 

0.00

%

1.35

%

1.24

%

 

 

2005

 

4

 

13.34

 

49

 

0.02

%

1.35

%

6.19

%

 

 

2004

 

6

 

12.56

 

69

 

0.00

%

1.35

%

5.28

%

 

 

2003

 

5

 

11.93

 

65

 

0.00

%

1.35

%

19.30

%

Van Kampen LIT Strategic Growth (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

15.46

 

69

 

0.00

%

1.45

%

14.97

%

 

 

2006

 

*

13.45

 

4

 

0.00

%

1.45

%

1.14

%

 

 

2005

 

1

 

13.30

 

11

 

0.01

%

1.45

%

6.08

%

 

 

2004

 

1

 

12.54

 

16

 

0.00

%

1.45

%

5.20

%

 

 

2003

 

*

11.92

 

6

 

0.00

%

1.45

%

19.20

%

Van Kampen LIT Strategic Growth (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

13.62

 

28

 

0.00

%

1.67

%

14.72

%

 

 

2006

 

1

 

11.87

 

17

 

0.00

%

1.67

%

0.92

%

 

 

2005

 

1

 

11.77

 

9

 

0.01

%

1.67

%

5.85

%

 

 

2004

 

1

 

11.12

 

6

 

0.00

%

1.67

%

5.00

%

Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

13

 

10.20

 

129

 

4.05

%

1.00

%

2.00

%

Van Kampen UIF Emerging Markets Debt (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

5

 

10.19

 

50

 

1.74

%

1.15

%

1.89

%

Van Kampen UIF Emerging Markets Debt (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

19

 

17.16

 

324

 

6.45

%

1.35

%

4.93

%

 

 

2006

 

17

 

16.35

 

279

 

8.22

%

1.35

%

9.31

%

 

 

2005

 

22

 

14.95

 

331

 

9.60

%

1.35

%

10.63

%

 

 

2004

 

21

 

13.52

 

284

 

9.82

%

1.35

%

8.59

%

 

 

2003

 

28

 

12.45

 

349

 

0.00

%

1.35

%

24.50

%

Van Kampen UIF Emerging Markets Debt (GrandMaste flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

54

 

10.16

 

554

 

6.54

%

1.35

%

1.61

%

Van Kampen UIF Emerging Markets Debt (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

25

 

17.07

 

426

 

8.04

%

1.45

%

4.85

%

 

 

2006

 

6

 

16.28

 

104

 

7.69

%

1.45

%

9.20

%

 

 

2005

 

15

 

14.91

 

228

 

10.37

%

1.45

%

10.52

%

 

 

2004

 

20

 

13.49

 

270

 

9.39

%

1.45

%

8.44

%

 

 

2003

 

36

 

12.44

 

450

 

0.00

%

1.45

%

24.40

%

Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

15

 

14.88

 

222

 

6.65

%

1.67

%

4.60

%

 

 

2006

 

10

 

14.23

 

135

 

10.03

%

1.67

%

8.96

%

 

 

2005

 

7

 

13.06

 

90

 

5.83

%

1.67

%

10.27

%

 

 

2004

 

5

 

11.84

 

60

 

10.73

%

1.67

%

8.23

%

 

 

2003

 

1

 

10.94

 

8

 

0.00

%

1.67

%

9.40

%

Van Kampen UIF Emerging Markets Debt (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

1

 

13.81

 

20

 

13.06

%

0.60

%

38.11

%

 


(1)

Results for periods of less than one year have been annualized.

(2)

Results for periods of less than one year have not been annualized.

* -

Less than 1,000.

 

76



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

42

 

$

43.96

 

$

1,841

 

0.80

%

1.00

%

39.04

%

 

 

2006

 

31

 

31.62

 

982

 

0.71

%

1.00

%

35.80

%

 

 

2005

 

40

 

23.28

 

920

 

0.35

%

1.00

%

32.43

%

 

 

2004

 

48

 

17.58

 

840

 

0.52

%

1.00

%

21.75

%

 

 

2003

 

5

 

14.44

 

69

 

0.00

%

1.00

%

44.40

%

Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

16.65

 

41

 

0.80

%

1.15

%

38.83

%

 

 

2006

 

*

11.99

 

5

 

0.00

%

1.15

%

0.00

%

Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

32

 

42.76

 

1,355

 

0.87

%

1.55

%

38.30

%

 

 

2006

 

30

 

30.92

 

942

 

0.62

%

1.55

%

35.05

%

 

 

2005

 

41

 

22.90

 

946

 

0.12

%

1.55

%

31.70

%

 

 

2004

 

23

 

17.39

 

401

 

0.67

%

1.55

%

21.10

%

 

 

2003

 

9

 

14.36

 

132

 

0.00

%

1.55

%

43.60

%

Van Kampen UIF Emerging Markets Equity (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

14

 

43.19

 

611

 

0.91

%

1.35

%

38.53

%

 

 

2006

 

13

 

31.18

 

403

 

0.69

%

1.35

%

35.32

%

 

 

2005

 

11

 

23.04

 

247

 

0.34

%

1.35

%

31.97

%

 

 

2004

 

2

 

17.46

 

37

 

1.09

%

1.35

%

21.33

%

 

 

2003

 

1

 

14.39

 

17

 

0.00

%

1.35

%

43.90

%

Van Kampen UIF Emerging Markets Equity (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

67

 

42.98

 

2,863

 

0.69

%

1.45

%

38.41

%

 

 

2006

 

35

 

31.05

 

1,094

 

1.10

%

1.45

%

35.19

%

 

 

2005

 

46

 

22.97

 

1,057

 

0.50

%

1.45

%

31.83

%

 

 

2004

 

88

 

17.42

 

1,535

 

1.54

%

1.45

%

21.22

%

 

 

2003

 

4

 

14.37

 

60

 

0.00

%

1.45

%

43.70

%

Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

19

 

37.33

 

724

 

0.86

%

1.67

%

38.12

%

 

 

2006

 

12

 

27.03

 

326

 

0.73

%

1.67

%

34.89

%

 

 

2005

 

6

 

20.04

 

113

 

0.32

%

1.67

%

31.54

%

 

 

2004

 

4

 

15.24

 

64

 

0.73

%

1.67

%

20.95

%

 

 

2003

 

5

 

12.60

 

67

 

0.00

%

1.67

%

26.00

%

Van Kampen UIF Emerging Markets Equity (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

4

 

30.28

 

131

 

0.40

%

0.60

%

39.62

%

 

 

2006

 

1

 

21.69

 

20

 

0.00

%

0.60

%

36.35

%

Van Kampen UIF U.S. Real Estate (AnnuiChoice ™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

55

 

7.72

 

421

 

2.09

%

1.00

%

(22.80

)%

Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

8

 

7.71

 

59

 

2.72

%

1.15

%

(22.88

)%

Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

31

 

19.48

 

603

 

2.04

%

1.67

%

(18.67

)%

 

 

2006

 

30

 

23.95

 

723

 

1.23

%

1.67

%

35.38

%

 

 

2005

 

23

 

17.69

 

413

 

1.27

%

1.67

%

14.81

%

 

 

2004

 

19

 

15.41

 

296

 

2.11

%

1.67

%

33.77

%

 

 

2003

 

3

 

11.52

 

29

 

0.00

%

1.67

%

15.20

%

 


(1)

Results for periods of less than one year have been annualized.

(2)

Results for periods of less than one year have not been annualized.

* -

Less than 1,000.

 

77



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class 2 (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Van Kampen UIF U.S. Real Estate (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

25

 

$

22.63

 

$

568

 

2.04

%

1.35

%

(18.38

)%

 

 

2006

 

39

 

27.73

 

1,095

 

1.28

%

1.35

%

35.82

%

 

 

2005

 

45

 

20.42

 

915

 

1.34

%

1.35

%

15.18

%

 

 

2004

 

41

 

17.73

 

732

 

1.81

%

1.35

%

34.22

%

 

 

2003

 

34

 

13.21

 

455

 

0.00

%

1.35

%

32.10

%

Van Kampen UIF U.S. Real Estate (Grandmaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

64

 

7.69

 

494

 

2.20

%

1.55

%

(23.09

)%

Van Kampen UIF U.S. Real Estate (IQ Annuity™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

21

 

22.52

 

482

 

2.30

%

1.45

%

(18.47

)%

 

 

2006

 

30

 

27.62

 

837

 

1.25

%

1.45

%

35.68

%

 

 

2005

 

30

 

20.36

 

610

 

1.43

%

1.45

%

15.06

%

 

 

2004

 

28

 

17.69

 

497

 

2.11

%

1.45

%

34.12

%

 

 

2003

 

13

 

13.19

 

172

 

0.00

%

1.45

%

31.90

%

Van Kampen UIF U.S. Real Estate (IQ Advisor Standard™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

18

 

17.53

 

323

 

1.94

%

0.60

%

(17.77

)%

 

 

2006

 

8

 

21.32

 

176

 

0.74

%

0.60

%

36.84

%

 

 

2005

 

3

 

15.58

 

44

 

1.41

%

0.60

%

16.05

%

 

 

2004

 

3

 

13.43

 

38

 

0.00

%

0.60

%

34.30

%

Non-Affiliated Class B:

DWS Small Cap Index (AnnuiChoice™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

51

 

14.98

 

770

 

1.10

%

1.00

%

(3.13

)%

 

 

2006

 

61

 

15.46

 

943

 

0.55

%

1.00

%

16.02

%

 

 

2005

 

54

 

13.33

 

714

 

0.66

%

1.00

%

2.96

%

 

 

2004

 

59

 

12.94

 

761

 

0.27

%

1.00

%

16.26

%

 

 

2003

 

97

 

11.13

 

1,078

 

0.05

%

1.00

%

44.55

%

DWS Small Cap Index (AnnuiChoice II™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

2

 

10.54

 

26

 

1.06

%

1.15

%

(3.26

)%

 

 

2006

 

*

10.90

 

4

 

0.00

%

1.15

%

0.00

%

DWS Small Cap Index (GrandMaster flex3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

12

 

14.40

 

174

 

1.31

%

1.55

%

(3.66

)%

 

 

2006

 

22

 

14.95

 

335

 

0.54

%

1.55

%

15.38

%

 

 

2005

 

24

 

12.96

 

309

 

0.64

%

1.55

%

2.39

%

 

 

2004

 

21

 

12.66

 

267

 

0.24

%

1.55

%

15.72

%

 

 

2003

 

46

 

10.94

 

499

 

0.22

%

1.55

%

43.76

%

DWS Small Cap Index (Grandmaster™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

11

 

13.25

 

144

 

1.07

%

1.35

%

(3.52

)%

 

 

2006

 

7

 

13.73

 

101

 

0.14

%

1.35

%

15.61

%

 

 

2005

 

8

 

11.87

 

98

 

0.17

%

1.35

%

2.59

%

 

 

2004

 

2

 

11.57

 

24

 

0.00

%

1.35

%

15.70

%

DWS Small Cap Index (IQ3™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

37

 

14.48

 

534

 

0.99

%

1.45

%

(3.56

)%

 

 

2006

 

43

 

15.01

 

646

 

0.56

%

1.45

%

15.50

%

 

 

2005

 

52

 

13.00

 

681

 

0.78

%

1.45

%

2.49

%

 

 

2004

 

109

 

12.68

 

1,381

 

0.27

%

1.45

%

15.69

%

 

 

2003

 

45

 

10.96

 

491

 

0.70

%

1.45

%

44.02

%

 


(1)

Results for periods of less than one year have been annualized.

(2)

Results for periods of less than one year have not been annualized.

* -

Less than 1,000.

 

78



 

Separate Account I

of

Integrity Life Insurance Company

 

Notes to Financial Statements (continued)

 

4.  Financial Highlights (continued)

 

 

 

 

 

 

 

 

 

 

 

Investment

 

 

 

 

 

 

 

 

 

Units

 

Unit

 

Net Assets

 

Income

 

Expense

 

Total

 

Division

 

Year

 

(000s)

 

Value

 

(000s)

 

Ratio (1)

 

Ratio

 

Return (2)

 

Non-Affiliated Class B (continued):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DWS Small Cap Index (Pinnacle Plus™)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2007

 

12

 

$

15.13

 

$

188

 

1.00

%

1.67

%

(3.79

)%

 

 

2006

 

11

 

15.73

 

168

 

0.53

%

1.67

%

15.24

%

 

 

2005

 

13

 

13.65

 

181

 

0.64

%

1.67

%

2.26

%

 

 

2004

 

13

 

13.35

 

172

 

0.18

%

1.67

%

15.48

%

 

 

2003

 

3

 

11.56

 

40

 

0.00

%

1.67

%

15.60

%

 


(1)

Results for periods of less than one year have been annualized.

(2)

Results for periods of less than one year have not been annualized.

* -

Less than 1,000.

 

79



 

STATUTORY-BASIS FINANCIAL STATEMENTS

AND SCHEDULES

 

Integrity Life Insurance Company

Years Ended December 31, 2007, 2006 and 2005

 



 

Integrity Life Insurance Company

 

Statutory-Basis Financial Statements and Schedules

 

Years Ended December 31, 2007, 2006 and 2005

 

Contents

 

Report of Independent Registered Public Accounting Firm

1

 

 

Financial Statements

 

 

 

Balance Sheets (Statutory-Basis)

2

Statements of Operations (Statutory-Basis)

3

Statements of Changes in Capital and Surplus (Statutory-Basis)

4

Statements of Cash Flow (Statutory-Basis)

5

Notes to Financial Statements (Statutory-Basis)

6

 

 

Financial Statement Schedules (Statutory-Basis)

 

 

 

Schedule I – Summary of Investments – Other Than Investments in Related Parties

35

Schedule III – Supplementary Insurance Information

36

Schedule IV – Reinsurance

37

 



 

Report of Independent Registered Public Accounting Firm

 

The Board of Directors

Integrity Life Insurance Company

 

We have audited the accompanying statutory-basis balance sheets of Integrity Life Insurance Company (the Company) as of December 31, 2007 and 2006, and the related statutory-basis statements of operations, changes in capital and surplus, and cash flow for each of the three years in the period ended December 31, 2007.  Our audits also included the statutory-basis financial statement schedules listed in the contents page. These financial statements and schedules are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements and schedules based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

 

As described in Note 1 to the financial statements, the Company presents its financial statements in conformity with accounting practices prescribed or permitted by the Ohio Insurance Department, which practices differ from U.S. generally accepted accounting principles.  The variances between such practices and U.S. generally accepted accounting principles and the effects on the accompanying financial statements are also described in Note 1.

 

In our opinion, because of the effects of the matter described in the preceding paragraph, the financial statements referred to above do not present fairly, in conformity with U.S. generally accepted accounting principles, the financial position of Integrity Life Insurance Company at December 31, 2007 and 2006, or the results of its operations or its cash flows for each of the three years in the period ended December 31, 2007.

 

However, in our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Integrity Life Insurance Company at December 31, 2007 and 2006, and the results of its operations and its cash flow for each of the three years in the period ended December 31, 2007, in conformity with accounting practices prescribed or permitted by the Ohio Insurance Department.  Also, in our opinion, the related financial statement schedules, when considered in relation to the basic statutory-basis financial statements taken as a whole, present fairly in all material respects the information set forth therein.

 

 

 

/s/ Ernst & Young LLP

 

Cincinnati, Ohio

April 7, 2008

 

1



 

Integrity Life Insurance Company

 

Balance Sheets (Statutory-Basis)

 

 

 

December 31

 

 

 

2007

 

2006

 

 

 

(in thousands)

 

Admitted Assets

 

 

 

 

 

Cash and invested assets:

 

 

 

 

 

Debt securities

 

$

1,461,466

 

$

1,324,042

 

Preferred and common stocks

 

151,733

 

246,555

 

Investment in common stock of subsidiary

 

142,135

 

129,074

 

Mortgage loans

 

63,066

 

44,011

 

Policy loans

 

115,736

 

116,450

 

Cash, cash equivalents and short-term investments

 

76,536

 

73,063

 

Receivable for securities

 

3,228

 

16,295

 

Other invested assets

 

107,965

 

79,827

 

Total cash and invested assets

 

2,121,865

 

2,029,317

 

 

 

 

 

 

 

Investment income due and accrued

 

20,675

 

20,920

 

Premiums deferred and uncollected

 

(75

)

(515

)

Current federal income taxes receivable

 

7,429

 

 

Net deferred income tax asset

 

25,886

 

30,745

 

Receivables from parent, subsidiaries and affiliates

 

7,923

 

4,799

 

Other admitted assets

 

7,815

 

4,455

 

Separate account assets

 

2,500,894

 

2,559,276

 

Total admitted assets

 

$

4,692,412

 

$

4,648,997

 

 

 

 

 

 

 

Liabilities and Capital and Surplus

 

 

 

 

 

Liabilities:

 

 

 

 

 

Policy and contract liabilities:

 

 

 

 

 

Life and annuity reserves

 

$

1,647,448

 

$

1,494,654

 

Liability for deposit-type contracts

 

41,568

 

41,506

 

Policy and contract claims

 

65

 

48

 

Deposits on policies to be issued

 

9,208

 

7,012

 

Total policy and contract liabilities

 

1,698,289

 

1,543,220

 

 

 

 

 

 

 

General expense due and accrued

 

745

 

780

 

Current federal income taxes payable

 

 

9,907

 

Transfer to separate accounts due and accrued, net

 

3,221

 

32,040

 

Asset valuation reserve

 

50,341

 

46,159

 

Other liabilities

 

35,733

 

64,272

 

Borrowed money and interest

 

47,848

 

54,970

 

Separate account liabilities

 

2,500,894

 

2,559,276

 

Total liabilities

 

4,337,071

 

4,310,624

 

 

 

 

 

 

 

Capital and surplus:

 

 

 

 

 

Common stock, $2 par value, 1,500 shares authorized, issued and outstanding

 

3,000

 

3,000

 

Paid-in surplus

 

405,795

 

405,795

 

Accumulated deficit

 

(53,454

)

(70,422

)

Total capital and surplus

 

355,341

 

338,373

 

Total liabilities and capital and surplus

 

$

4,692,412

 

$

4,648,997

 

 

See accompanying notes.

 

2



 

Integrity Life Insurance Company

 

Statements of Operations (Statutory-Basis)

 

 

 

Year Ended December 31

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Premiums and other revenues:

 

 

 

 

 

 

 

Premiums and annuity considerations

 

$

550,712

 

$

554,848

 

$

366,717

 

Net investment income

 

103,599

 

101,533

 

97,542

 

Considerations for supplementary contracts with life contingencies

 

2,628

 

1,168

 

1,024

 

Amortization of the interest maintenance reserve

 

(2,123

)

(1,259

)

(383

)

Reserve adjustments on reinsurance ceded

 

(207,171

)

(150,270

)

(116,379

)

Fees from management of separate account mutual funds

 

13,216

 

12,988

 

15,512

 

Other revenues

 

4,896

 

5,122

 

4,135

 

Total premiums and other revenues

 

465,757

 

524,130

 

368,168

 

 

 

 

 

 

 

 

 

Benefits paid or provided:

 

 

 

 

 

 

 

Death benefits

 

5,419

 

3,404

 

6,782

 

Annuity benefits

 

79,726

 

68,606

 

57,437

 

Surrender benefits

 

344,824

 

358,899

 

243,647

 

Payments on supplementary contracts

 

1,974

 

1,865

 

1,778

 

Other benefits

 

1,944

 

2,021

 

2,008

 

Increase (decrease) in policy reserves and other policyholders’ funds

 

153,431

 

(28,583

)

25,267

 

Total benefits paid or provided

 

587,318

 

406,212

 

336,919

 

 

 

 

 

 

 

 

 

Insurance expenses and other deductions:

 

 

 

 

 

 

 

Commissions

 

27,492

 

28,213

 

22,075

 

Commissions and expenses on reinsurance assumed

 

136

 

139

 

153

 

General expenses

 

21,716

 

18,924

 

21,747

 

Net transfers to (from) separate accounts

 

(181,352

)

55,274

 

(8,367

)

Other deductions

 

4,559

 

2,038

 

248

 

Total insurance expenses and other deductions

 

(127,449

)

104,588

 

35,856

 

 

 

 

 

 

 

 

 

Gain (loss) from operations before federal income tax expense and net realized capital gains (losses)

 

5,888

 

13,330

 

(4,605

)

Federal income tax expense (benefit), excluding tax on capital gains

 

(3,626

)

(26,122

)

 

Gain (loss) from operations before net realized capital gains (losses)

 

9,514

 

39,452

 

(4,605

)

Net realized capital gains or (losses) (excluding gains (losses) transferred to IMR and capital gains tax)

 

20,992

 

36,254

 

15,164

 

Net income (loss)

 

$

30,506

 

$

75,706

 

$

10,559

 

 

See accompanying notes.

 

3



 

Integrity Life Insurance Company

 

Statements of Changes in Capital and Surplus (Statutory-Basis)

 

Years Ended December 31, 2007, 2006 and 2005

 

 

 

Common Stock

 

Paid-In
Surplus

 

Accumulated
Deficit

 

Total Capital
and Surplus

 

 

 

(in thousands)

 

Balance, January 1, 2005

 

$

3,000

 

$

405,795

 

$

(163,800

)

$

244,995

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

10,559

 

10,559

 

Change in net deferred income tax asset

 

 

 

(48,903

)

(48,903

)

Net change in unrealized gains on investments (net of deferred tax expense (benefit) of $2,950)

 

 

 

(8,847

)

(8,847

)

Net change in nonadmitted assets and related items

 

 

 

51,470

 

51,470

 

Change in asset valuation reserve

 

 

 

2,152

 

2,152

 

Other

 

 

 

 

 

(3,483

)

(3,483

)

Change in surplus in separate accounts

 

 

 

(11,322

)

(11,322

)

Balance, December 31, 2005

 

3,000

 

405,795

 

(172,174

)

236,621

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

75,706

 

75,706

 

Change in net deferred income tax asset

 

 

 

(46,973

)

(46,973

)

Net change in unrealized gains on investments (net of deferred tax expense (benefit) of $5,620)

 

 

 

42,992

 

42,992

 

Net change in nonadmitted assets and related items

 

 

 

52,774

 

52,774

 

Change in asset valuation reserve

 

 

 

(13,351

)

(13,351

)

Change in surplus in separate accounts

 

 

 

(9,396

)

(9,396

)

Balance, December 31, 2006

 

3,000

 

405,795

 

(70,422

)

338,373

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

30,506

 

30,506

 

Change in net deferred income tax asset

 

 

 

(22,733

)

(22,733

)

Net change in unrealized gains on investments (net of deferred tax expense (benefit) of $(7,802))

 

 

 

(1,438

)

(1,438

)

Net change in nonadmitted assets and related items

 

 

 

14,161

 

14,161

 

Change in asset valuation reserve

 

 

 

(4,182

)

(4,182

)

Change in reserve on account of change in valuation basis

 

 

 

 

 

5,135

 

5,135

 

Change in surplus in separate accounts

 

 

 

(4,481

)

(4,481

)

Balance, December 31, 2007

 

$

3,000

 

$

405,795

 

$

(53,454

)

$

355,341

 

 

See accompanying notes.

 

4



 

Integrity Life Insurance Company

 

Statements of Cash Flow (Statutory-Basis)

 

 

 

Year Ended December 31

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Cash from Operations:

 

 

 

 

 

 

 

Premiums collected net of reinsurance

 

$

548,875

 

$

555,169

 

$

370,624

 

Net investment income received

 

101,165

 

99,122

 

96,495

 

Benefits paid

 

(643,952

)

(584,185

)

(434,381

)

Net transfers from (to) separate accounts

 

152,533

 

(11,775

)

(3,863

)

Commissions and expense paid

 

(52,669

)

(53,701

)

(44,312

)

Other, net

 

29,882

 

79,237

 

19,647

 

Net cash from (for) operations

 

135,834

 

83,867

 

4,210

 

 

 

 

 

 

 

 

 

Cash from Investments:

 

 

 

 

 

 

 

Proceeds from investments sold, matured or repaid:

 

 

 

 

 

 

 

Debt securities

 

1,146,872

 

1,178,471

 

743,601

 

Preferred and common stocks

 

128,003

 

102,074

 

24,649

 

Mortgage loans

 

836

 

2,057

 

1,457

 

Other invested assets

 

19,391

 

12,445

 

 

Miscellaneous proceeds

 

673

 

867

 

4,017

 

Net proceeds from investments sold, matured or repaid

 

1,295,775

 

1,295,914

 

773,724

 

 

 

 

 

 

 

 

 

Cost of investments acquired:

 

 

 

 

 

 

 

Debt securities

 

1,284,285

 

1,123,131

 

816,674

 

Preferred and common stocks

 

61,071

 

148,904

 

61,035

 

Mortgage loans

 

20,279

 

26,171

 

5,832

 

Other invested assets

 

43,650

 

90,334

 

 

Miscellaneous applications

 

2

 

3,440

 

11,889

 

Total cost of investments acquired

 

1,409,287

 

1,391,980

 

895,430

 

 

 

 

 

 

 

 

 

Net change in policy and other loans

 

714

 

(5,190

)

2,480

 

Net cash from (for) investments

 

(112,798

)

(101,256

)

(119,226

)

 

 

 

 

 

 

 

 

Cash from Financing and Miscellaneous Sources:

 

 

 

 

 

 

 

Borrowed money

 

(7,122

)

6,772

 

48,198

 

Net deposits on deposit-type contract funds and other insurance liabilities

 

62

 

1,328

 

3,274

 

Other cash applied

 

(12,503

)

79,145

 

(28,913

)

Net cash from (for) financing and miscellaneous sources

 

(19,563

)

87,245

 

22,559

 

 

 

 

 

 

 

 

 

Net change in cash, cash equivalents and short-term investments

 

3,473

 

69,856

 

(92,457

)

Cash, cash equivalents and short-term investments:

 

 

 

 

 

 

 

Beginning of year

 

73,063

 

3,207

 

95,664

 

End of year

 

$

76,536

 

$

73,063

 

$

3,207

 

 

See accompanying notes.

 

5



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis)

 

December 31, 2007

 

1. Nature of Operations and Significant Accounting Policies

 

Integrity Life Insurance Company (the Company) is a wholly-owned subsidiary of The Western and Southern Life Insurance Company (Western and Southern).  The Company, domiciled in the state of Ohio and currently licensed in 46 states and the District of Columbia, specializes in the asset accumulation business with particular emphasis on retirement savings and investment products.  The Company’s wholly-owned insurance subsidiary, National Integrity Life Insurance Company (National Integrity), is currently licensed in 8 states and the District of Columbia and distributes similar products, principally in the state of New York.  Fort Washington Investment Advisors, Inc. (Fort Washington), a registered investment adviser, is a non-life insurance subsidiary of Western and Southern and is the investment manager for the Company.

 

Use of Estimates

 

The preparation of financial statements requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

Basis of Presentation

 

The accompanying financial statements of the Company have been prepared in conformity with accounting practices prescribed or permitted by the Ohio Insurance Department (the Department).  These practices differ in some respects from accounting principles generally accepted in the United States (GAAP).  The more significant differences follow.

 

Investments

 

Investments in debt securities and mandatory redeemable preferred stocks are reported at amortized cost or fair value based on the National Association of Insurance Commissioners’ (NAIC) rating; for GAAP, such fixed maturity investments are designated at purchase as held-to-maturity, trading or available-for-sale. Held-to-maturity fixed investments are reported at amortized cost, and the remaining fixed maturity investments are reported at fair value with unrealized holding gains and losses reported in operations for those designated as trading and as a separate component of other comprehensive income for those designated as available-for-sale.

 

All single class and multi-class mortgage-backed/asset-backed securities (e.g., CMOs) are adjusted for the effects of changes in prepayment assumptions on the related accretion of discount or amortization of premium of such securities using the retrospective method. If it is determined that a decline in fair value is other than temporary, the cost basis of the security is written down to the undiscounted estimated future cash flows.  For GAAP purposes, all securities, purchased or retained, that represent beneficial interests in securitized assets (e.g., CMO, CBO, CDO, CLO, MBS and ABS securities), other than high credit quality securities, are adjusted using the

 

6



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

retrospective method when there is a change in estimated future cash flows. If it is determined that a decline in fair value is other than temporary, the cost basis of the security is written down to the discounted fair value. If high credit quality securities are adjusted, the retrospective method is used.

 

The Company monitors investments to determine if there has been an other-than-temporary decline in fair market value.  Factors management considers for each identified security include the following:

-                    the length of time and the extent to which the fair value is below the book/adjusted carry value;

-                    the financial condition and near term prospects of the issuer, including specific events that may affect its operations; and

-                    the Company’s intent and ability to hold the security long enough for it to recover its value to book/adjusted carry value.

 

If the decline is judged to be other-than-temporary, an impairment charge is recorded as a net realized capital loss in the period the determination is made.

 

Under a formula prescribed by the NAIC, the Company defers the portion of realized capital gains and losses on sales of fixed income investments, principally debt securities and mortgage loans, attributable to changes in the general level of interest rates and amortizes those deferrals over the remaining period to maturity of the individual security sold using the seriatim method.  The net deferral is reported as the interest maintenance reserve (IMR) in the accompanying balance sheets. Realized capital gains and losses are reported in income net of federal income tax and transfers to the IMR. Under GAAP, realized capital gains and losses are reported in the statement of operations on a pretax basis in the period that the assets giving rise to the gains or losses are sold.

 

The “asset valuation reserve” (AVR) provides a valuation allowance for invested assets. The AVR is determined by an NAIC prescribed formula with changes reflected directly in capital and surplus. AVR is not recognized for GAAP.

 

Subsidiary

 

The accounts and operations of the Company’s subsidiary are not consolidated with the accounts and operations of the Company as would be required under GAAP.

 

Policy Acquisition Costs

 

The costs of acquiring and renewing business are expensed when incurred.  Under GAAP, policy acquisition costs, related to traditional life insurance and certain long-duration accident and health insurance, to the extent recoverable from future policy revenues, would be deferred and amortized over the premium-paying period of the related policies using assumptions consistent with those used in computing policy benefit reserves; for universal life insurance and investment products, to

 

7



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

the extent recoverable from future gross profits, deferred policy acquisition costs are amortized generally in proportion to the present value of expected gross profits from surrender charges and investments, mortality, and expense margins.

 

Nonadmitted Assets

 

Certain assets designated as “nonadmitted” (principally a portion of deferred tax assets), and other assets not specifically identified as an admitted asset within the NAIC’s Accounting Practices and Procedures Manual, are excluded from the accompanying balance sheets and are charged directly to accumulated deficit. Under GAAP, such assets are included in the balance sheets.

 

Premiums and Benefits

 

Revenues for universal life and annuity policies with mortality or morbidity risk, except for guaranteed interest and group annuity contracts, consist of the entire premium received, and benefits incurred represent the total of death benefits paid and the change in policy reserves. Premiums received for annuity policies without mortality or morbidity risk and for guaranteed interest and group annuity contracts are recorded using deposit accounting, and credited directly to an appropriate policy reserve account, without recognizing premium income. Under GAAP, premiums received in excess of policy charges would not be recognized as premium revenue and benefits would represent the excess of benefits paid over the policy account value and interest credited to the account values.

 

Benefit Reserves

 

Certain policy reserves are calculated using statutorily prescribed interest and mortality assumptions rather than on estimated expected experience or actual account balances as would be required under GAAP.

 

Reinsurance

 

A liability for reinsurance balances is required to be provided for unsecured policy reserves ceded to reinsurers not authorized to assume such business. Changes to those amounts are credited or charged directly to capital and surplus. Under GAAP, an allowance for amounts deemed uncollectible would be established through a charge to earnings.

 

Policy and contract liabilities ceded to reinsurers have been reported as reductions of the related reserves rather than as assets as would be required under GAAP.

 

Commissions allowed by reinsurers on business ceded are reported as income when incurred rather than being deferred and amortized with policy acquisition costs as required under GAAP.

 

8



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

Deferred Income Taxes

 

Deferred tax assets are limited to 1) the amount of federal income taxes paid in prior years that can be recovered through loss carrybacks for existing temporary differences that reverse by the end of the subsequent calendar year, plus 2) the lesser of the remaining gross deferred tax assets expected to be realized within one year of the balance sheet date or 10% of capital and surplus excluding any net deferred tax assets, electronic data processing equipment and operating software and any net positive goodwill, plus 3) the amount of remaining gross deferred tax assets that can be offset against existing gross deferred tax liabilities. The remaining deferred tax assets are nonadmitted.  Under GAAP, a deferred tax asset is recorded for the amount of gross deferred tax assets expected to be realized in future years, and a valuation allowance is established for deferred tax assets not realizable.

 

Statements of Cash Flow

 

Cash, cash equivalents and short-term investments in the statements of cash flow represent cash balances and investments with initial maturities of one year or less. Under GAAP, the corresponding captions of cash and cash equivalents include cash balances and investments with initial maturities of three months or less.

 

9



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

A reconciliation of capital and surplus and net income of the Company as determined in accordance with statutory accounting practices to amounts determined in accordance with GAAP as of December 31 and for the years then ended is as follows:

 

 

 

December 31

 

 

 

2007

 

2006

 

 

 

(in thousands)

 

Capital and surplus as reported in the accompanying statutory-basis financial statements

 

$

355,341

 

$

338,373

 

Adjustments to customer deposits

 

(110,395

)

(123,540

)

Adjustments to invested asset carrying values

 

4,559

 

67,958

 

Asset valuation reserve

 

50,341

 

46,159

 

Value of insurance in force

 

34,672

 

39,948

 

Deferred policy acquisition costs

 

103,864

 

88,598

 

Deferred sales inducements

 

10,819

 

8,173

 

Adjustments to investment in subsidiary excluding net unrealized gains (losses)

 

102,626

 

104,281

 

Western and Southern reinsurance

 

(106,169

)

(92,842

)

Other

 

12,165

 

(14,204

)

Stockholder’s equity, GAAP basis

 

$

457,823

 

$

462,904

 

 

 

 

Year Ended December 31

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Net income as reported in the accompanying statutory-basis financial statements

 

$

30,506

 

$

75,706

 

$

10,559

 

Deferred policy acquisition costs, net of amortization

 

10,894

 

17,887

 

8,030

 

Deferred sales inducements, net of amortization

 

1,689

 

1,595

 

1,576

 

Adjustments to customer deposits

 

(4,445

)

(11,719

)

(14,357

)

Adjustments to invested asset carrying values at acquisition date

 

18,953

 

6,635

 

3,348

 

Amortization of value of insurance in force

 

(10,074

)

(11,230

)

(19,671

)

Amortization of interest maintenance reserve

 

2,123

 

1,259

 

383

 

Adjustments for realized investment gains/losses

 

8,860

 

(11,535

)

10,355

 

Adjustments for federal income tax expense

 

(27,838

)

(47,191

)

1,674

 

Investment in subsidiary

 

9,832

 

6,071

 

19,374

 

Income from modco reinsurance treaty

 

(13,328

)

(6,700

)

(1,914

)

Other

 

963

 

33

 

1,108

 

Net income, GAAP basis

 

$

28,135

 

$

20,811

 

$

20,465

 

 

10



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

Other significant statutory accounting practices follow.

 

Investments

 

Debt securities, preferred stocks, common stocks, and short-term investments are stated at values prescribed by the NAIC, as follows:

 

Debt securities not backed by other loans are principally stated at amortized cost using the interest method.

 

Single class and multi-class mortgage-backed/asset-backed securities are valued at amortized cost using the interest method including anticipated prepayments. Prepayment assumptions are obtained from Bloomberg, Trepp, dealer surveys or internal estimates and are based on the current interest rate and economic environment.  The retrospective adjustment method is used to value all such securities except principal-only and interest-only securities, which are valued using the prospective method.

 

Non-affiliated common stocks are reported at fair value as determined by the Securities Valuation Office (SVO) of the NAIC and the related unrealized capital gains and losses are reported in capital and surplus along with any adjustment for federal income taxes.

 

Redeemable preferred stocks that have characteristics of debt securities and are rated as high quality or better are reported at cost or amortized cost.  All other redeemable preferred stocks are reported at the lower of cost, amortized cost or fair value.  Nonredeemable preferred stocks are reported at fair value or lower of cost or fair value as determined by the SVO and the related unrealized capital gains and losses are reported in capital and surplus along with any adjustment for federal income taxes.

 

There are no restrictions on non-affiliated common or preferred stocks.

 

Short-term investments include investments with remaining maturities of one year or less at the date of acquisition and are principally stated at amortized cost, which approximates fair value.

 

Cash equivalents are short-term highly liquid investments with original maturities of three months or less and are principally stated at amortized cost, which approximates fair value.

 

The Company’s insurance subsidiary is reported at its underlying statutory equity.  The net change in the subsidiary’s equity is included in capital and surplus.

 

Joint ventures, partnerships, and limited liability companies are carried at the Company’s interest in the underlying audited GAAP equity of the investee.  Undistributed earnings allocated to the

 

11



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

Company are reported in the change in net unrealized capital gains or losses.  Distributions from earnings of the investees are reported as net investment income when received.

 

Mortgage loans are reported at unpaid principal balances, less an allowance for impairment.  A mortgage loan is considered to be impaired when, based on current information and events, it is probable that the Company will be unable to collect all principal and interest amounts due according to the contractual terms of the mortgage agreement.  When management determines foreclosure is probable, the impairment is other than temporary; the mortgage loan is written down to realized value and a realized loss is recognized.

 

Policy loans are reported at unpaid principal balances.

 

Realized capital gains and losses are determined using the specific identification method.

 

Changes in admitted asset carrying amounts of debt securities, non-redeemable preferred stocks, non-affiliated common stocks and mortgage loans are credited or charged directly to capital and surplus.

 

Premiums

 

Life and accident and health premiums are recognized as revenue when due. Premiums for annuity policies with mortality and morbidity risk, except for guaranteed interest and group annuity contracts, are also recognized as revenue when due. Premiums received for annuity policies without mortality or morbidity risk and for guaranteed interest and group annuity contracts are recorded using deposit accounting.

 

Policy Reserves

 

Life, annuity and accident and health disability benefit reserves are developed by actuarial methods and are determined based on published tables using statutorily specified interest rates and valuation methods that will provide, in the aggregate, reserves that are greater than or equal to the minimum or guaranteed policy cash values or the amounts required by the Department. The Company waives deduction of deferred fractional premiums on the death of life and annuity policy insureds and does not return any premium beyond the date of death. Surrender values on policies do not exceed the corresponding benefit reserves. Policies issued subject to multiple table substandard extra premiums are valued on the standard reserve basis which recognizes the non-level incidence of the excess mortality costs. Additional reserves are established when the results of cash flow testing under various interest rate scenarios indicate the need for such reserves, or the net premiums exceed the gross premiums on any insurance in-force.

 

12



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

The mean reserve method is used to adjust the calculated terminal reserve to the appropriate reserve at December 31. Mean reserves are determined by computing the regular mean reserve for the plan at the rated age and holding, in addition, one-half of the extra premium charge for the year. Policies issued after July 1 for substandard lives, are charged an extra premium plus the regular premium for the true age. Mean reserves are based on appropriate multiples of standard rates of mortality. An asset is recorded for deferred premiums net of loading to adjust the reserve for modal premium payments.

 

For substandard table ratings, mean reserves are based on 125% to 500% of standard mortality rates.  For flat extra ratings, mean reserves are based on the standard or substandard mortality rates increased by one to twenty-five deaths per thousand.

 

Tabular interest, tabular less actual reserve released, and tabular cost have been determined by formula as prescribed by the NAIC. Tabular interest on funds not involving life contingencies was derived from basic data.

 

The establishment of appropriate reserves is an inherently uncertain process, and there can be no assurance that the ultimate liability will not exceed the Company’s policy reserves and have an adverse effect on the Company’s results of operations and financial condition.  Due to the inherent uncertainty of estimating reserves, it has been necessary, and may over time continue to be necessary, to revise estimated future liabilities as reflected in the Company’s policy reserves.

 

Reinsurance

 

Reinsurance premiums and benefits paid or provided are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts.   The change in reserves for modified coinsurance contracts is recorded on the reserve adjustments on reinsurance ceded line in the statements of operations.

 

Borrowed Money

 

The Company has entered into several dollar-roll reverse repurchase agreements.  The transactions were reflected as financing transactions, requiring the asset sold and the liability for the repurchase to remain on the Company’s financial statements.  The collateral received for the transactions is reported in short-term investments and the liability for the repurchase is reported in borrowed money on the balance sheets.  There were $47.7 million and $55.0 million of mortgage-backed securities that were subject to the reverse repurchase agreements at December 31, 2007 and 2006, respectively.

 

13



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

Securities Lending

 

The Company has loaned $40.9 million and $87.1 million of various U.S. Treasury and corporate debt securities and common stocks as part of a securities lending program administered by the Bank of New York as of December 31, 2007 and 2006, respectively.  The Company requires collateral in the amount of 102% of fair value of the applicable securities loaned.  The Company monitors the fair value of the underlying securities as compared with the related receivable or payable, including accrued interest, and requests additional collateral as necessary. The Company maintains effective control over all loaned securities, and, therefore, continues to report such securities as invested assets in the balance sheets.  Unrestricted collateral is invested primarily in debt securities and short-term investments with an offsetting liability recognized in other liabilities for the obligation to return the unrestricted collateral.  Restricted collateral is not reflected on the balance sheets as an asset or a liability.  The Company had $30.3 million and $47.3 million of unrestricted collateral and $10.9 million and $41.9 million of restricted collateral held in the Bank of New York Cash Reserves as of December 31, 2007 and 2006, respectively.

 

Separate Accounts

 

Separate account assets and liabilities reported in the accompanying balance sheets represent funds that are separately administered, principally for variable annuity contracts and market value adjustment annuity contracts. Separate account assets are reported at fair value. Surrender charges collectible by the general account in the event of annuity contract surrenders are reported as a negative liability rather than an asset. Policy related activity involving cash flow, such as premiums and benefits, are reported in the accompanying statements of operations in separate line items combined with related general account amounts. Investment income and interest credited on deposits held in guaranteed separate accounts are included in the accompanying statements of operations as a net amount included in net transfers to (from) separate accounts. The Company receives administrative fees for managing the nonguaranteed separate accounts and other fees for assuming mortality and certain expense risks.

 

Federal Income Taxes

 

Western and Southern files a consolidated income tax return with its eligible subsidiaries, including the Company. The provision for federal income taxes is allocated to the Company using a separate return method based upon a written tax sharing agreement. The benefits from losses of subsidiaries, which are utilized in the consolidated return, will be retained by the subsidiaries under the tax sharing agreement.  Western and Southern pays all federal income taxes due for all members of the consolidated group.  The Company will then charge or reimburse, as the case may be, the members of the group an amount consistent with the method described in the tax sharing agreement.

 

The Company includes interest and penalties in the federal income tax line on the statements of operations.

 

14



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1. Nature of Operations and Significant Accounting Policies (continued)

 

Change in Valuation Basis of Reserves

 

In 2007, the Company changed the method for calculating statutory reserves for the fixed rate option associated with certain annuity products from fund value to the Commissioner’s Reserve Valuation Method.  SSAP No. 51 – Life Contracts requires such a change in valuation basis to be recorded directly to surplus rather than as a part of the reserve change recognized in the summary of operations.  SSAP No. 56 – Separate Accounts requires changes in the surplus of the separate accounts business of an insurer except for changes resulting from the net gain from operations of the separate account, to be charged or credited directly to the unassigned surplus of the general account.  The Company has recorded a $5.1 million increase directly to surplus as a result of the change in valuation basis.

 

Reclassifications

 

Certain prior year amounts in the Company’s statutory basis financial statements have been reclassified to conform to the 2007 financial statement presentation.

 

15



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2.  Investments

 

Fair values for debt and equity securities are based on quoted market prices, where available. For debt securities not actively traded, fair values are estimated using values obtained from independent pricing services, or, in the case of private placements, are estimated by discounting the expected future cash flows using current market rates applicable to the coupon rate, credit and maturity of the investments.  The fair values for equity securities that are not actively traded are estimated based on fair values of issues of comparable yield and quality.

 

The book/adjusted carrying value and fair value of the Company’s investments in debt securities are summarized as follows:

 

 

 

Book/
Adjusted
Carrying
Value

 

Gross
Unrealized
Gains

 

Gross
Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2007:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligations of U.S. government agencies

 

$

8,181

 

$

210

 

$

(36

)

$

8,355

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

67,046

 

222

 

(510

)

66,758

 

Corporate securities/asset-backed securities

 

959,066

 

34,289

 

(20,309

)

973,046

 

Mortgage-backed securities

 

427,173

 

5,156

 

(4,355

)

427,974

 

Total

 

$

1,461,466

 

$

39,877

 

$

(25,210

)

$

1,476,133

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2006:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligations of U.S. government agencies

 

$

32,116

 

$

5

 

$

(303

)

$

31,818

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

54,771

 

141

 

(582

)

54,330

 

Corporate securities/asset-backed securities

 

903,732

 

37,752

 

(18,410

)

923,074

 

Mortgage-backed securities

 

333,423

 

4,254

 

(3,553

)

334,124

 

Total

 

$

1,324,042

 

$

42,152

 

$

(22,848

)

$

1,343,346

 

 

16



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2.  Investments (continued)

 

At December 31, 2007 and 2006, the Company held unrated or less-than-investment grade corporate debt securities with a book value of $48.0 million and $66.0 million, respectively, with an aggregate fair value of $54.1 million and $71.7 million, respectively.  Such holdings amount to 3.3% and 5.0%, respectively, of the Company’s investments in debt securities and 1.0% and 1.4%, respectively, of the Company’s total admitted assets as December 31, 2007 and 2006.  The Company performs periodic evaluations of the relative credit standing of the issuers of these debt securities.  The Company considers these evaluations in its overall investment strategy.

 

The following table shows gross unrealized losses and fair values, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

 

 

 

Unrealized Losses Less
Than or Equal To 12
Months

 

Unrealized Losses Greater
Than 12 Months

 

 

 

Unrealized
Losses

 

Fair Value

 

Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31,2007:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligations of U.S. government corporations and agencies

 

$

(36

)

$

1,785

 

$

 

$

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

(97

)

4,903

 

(413

)

7,703

 

Corporate securities/asset-backed securities

 

(8,219

)

242,542

 

(12,090

)

148,415

 

Mortgage-backed securities

 

(3,781

)

170,972

 

(574

)

53,664

 

Total

 

$

(12,133

)

$

420,202

 

$

(13,077

)

$

209,782

 

 

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

(4,704

)

$

41,668

 

$

(121

)

$

3,236

 

Common stocks, unaffiliated

 

$

(1,139

)

$

10,241

 

$

 

$

 

 

17



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2.  Investments (continued)

 

 

 

Unrealized Losses Less
Than or Equal To 12
Months

 

Unrealized Losses Greater
Than 12 Months

 

 

 

Unrealized
Losses

 

Fair Value

 

Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2006:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligation of U.S. government corporations and agencies

 

$

(303

)

$

30,843

 

$

 

$

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

 

 

(582

)

10,683

 

Corporate securities/asset-backed securities

 

(3,231

)

198,226

 

(15,179

)

177,293

 

Mortgage-backed securities

 

(2,051

)

166,060

 

(1,502

)

85,473

 

Total

 

$

(5,585

)

$

395,129

 

$

(17,263

)

$

273,449

 

 

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

(166

)

$

12,756

 

$

(2,366

)

$

21,253

 

Common stocks, unaffiliated

 

$

(306

)

$

3,547

 

$

 

$

 

 

Investments that are impaired at December 31, 2007 and 2006, for which an other-than-temporary impairment has not been recognized, consist mainly of corporate debt securities and asset-backed securities.  The impairment of these securities has been deemed as temporary due to the assigned rating and the typical fluctuations of these particular securities in the marketplace.  The aggregated unrealized loss is approximately 4.4% and 3.6% of the carrying value of these securities at December 31, 2007 and 2006, respectively. At December 31, 2007, there were a total of 268 securities held that are considered temporarily impaired, 75 of which have been impaired for 12 months or longer.  At December 31, 2006, there were a total of 223 securities held that are considered temporarily impaired, 97 of which had been impaired for 12 months or longer.  The Company recorded other-than-temporary impairments on securities of $3.9 million, $0.1 million, and $3.3 million for the years ended December 31, 2007, 2006 and 2005, respectively.

 

18



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2.  Investments (continued)

 

A summary of the cost or amortized cost and fair value of the Company’s debt securities at December 31, 2007, by contractual maturity, is as follows:

 

 

 

Cost or
Amortized Cost

 

Fair Value

 

 

 

(in thousands)

 

Years to maturity:

 

 

 

 

 

One or less

 

$

41,376

 

$

41,652

 

After one through five

 

157,768

 

161,401

 

After five through ten

 

253,644

 

244,887

 

After ten

 

581,505

 

600,219

 

Mortgage-backed securities

 

427,173

 

427,974

 

 

 

 

 

 

 

Total

 

$

1,461,466

 

$

1,476,133

 

 

The expected maturities in the foregoing table may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties and because asset-backed and mortgage-backed securities (including floating-rate securities) provide for periodic payments throughout their lives.

 

Proceeds from the sales of investments in debt securities during 2007, 2006 and 2005 were $663.6 million, $487.8 million, and $264.2 million; gross gains of $5.8 million, $9.4 million, and $9.8 million, and gross losses of $3.4 million, $7.9 million, and $4.2 million were realized on those sales, respectively.

 

Realized capital gains (losses) are reported net of federal income taxes and amounts transferred to the IMR are follows for the years ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Realized capital gains (losses)

 

$

(1,103

)

$

3,074

 

$

11,545

 

Less amount transferred to IMR

 

3,393

 

(6,631

)

(3,704

)

Less federal income taxes of realized capital gains

 

(25,488

)

(26,549

)

85

 

Net realized capital gains (losses)

 

$

20,992

 

$

36,254

 

$

15,164

 

 

19



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2.  Investments (continued)

 

Unrealized gains and losses on investment in common stocks and non-affiliated common stock of subsidiaries are reported directly in capital and surplus and do not affect net income. The unrealized gains and unrealized losses on, and the cost and fair value of those are as follows:

 

 

 

Cost

 

Gross
Unrealized
Gains

 

Gross
Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2007:

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

77,117

 

$

497

 

$

(4,825

)

$

72,789

 

 

 

 

 

 

 

 

 

 

 

Common stocks, unaffiliated

 

$

25,610

 

$

50,145

 

$

(1,139

)

$

74,616

 

Common stock of subsidiaries and affiliates

 

123,125

 

19,010

 

 

142,135

 

 

 

$

148,735

 

$

69,155

 

$

(1,139

$

216,751

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2006:

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

143,446

 

$

2,549

 

$

(2,532

)

$

143,463

 

 

 

 

 

 

 

 

 

 

 

Common stocks, unaffiliated

 

$

24,260

 

$

79,155

 

$

(306

)

$

103,109

 

Common stock of subsidiaries and affiliates

 

123,125

 

5,949

 

 

129,074

 

 

 

$

147,385

 

$

85,104

 

$

(306

$

232,183

 

 

Proceeds from the sales of investments in equity securities during 2007, 2006 and 2005 were $82.3 million, $48.6 million, and $24.4 million; gross gains of $2.6 million, $1.9 million, and $7.7 million and gross losses of $4.1 million, $0.7 million, and $0.6 million were realized on those sales in 2007, 2006 and 2005, respectively.

 

20



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2.  Investments (continued)

 

Net investment income consisted of the following for the years ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

Debt securities

 

$

78,760

 

$

73,709

 

$

79,584

 

Equity securities

 

9,810

 

13,752

 

5,812

 

Mortgage loans

 

4,826

 

2,226

 

1,302

 

Policy loans

 

9,118

 

8,839

 

8,602

 

Cash, cash equivalents and short-term investments

 

2,396

 

3,992

 

3,832

 

Other invested assets

 

344

 

128

 

 

Other

 

130

 

374

 

(53

)

Gross investment income

 

105,384

 

103,020

 

99,079

 

Investment expenses

 

1,785

 

1,487

 

1,537

 

Net investment income

 

$

103,599

 

$

101,533

 

$

97,542

 

 

The Company’s investments in mortgage loans principally involve commercial loans.  At December 31, 2007, 69.0% of such mortgages, or $43.5 million, involved properties located in California and Florida.  Such investments consist of first mortgage liens on completed income producing properties.  The aggregate mortgage outstanding to any one borrower does not exceed $20.1 million.  During 2007, the respective maximum and minimum lending rates for mortgage loans issued were 6.08% and 6.04%.  At the issuance of a loan, the percentage of any one loan to value of security is exclusive of insured, guaranteed or purchase money mortgage does not exceed 80%.

 

At December 31, 2007, the Company’s investments in mortgage loans were not subject to prior liens.  All properties covered by mortgage loans have fire insurance at least equal to the excess of the loan over the maximum loan that would be allowed on the land without the building.  During 2007, the Company did not reduce interest rates on any outstanding mortgages.

 

3. Fair Values of Financial Instruments

 

The following methods and assumptions were used by the Company in estimating the fair value of financial instruments in the accompanying financial statements and notes thereto.

 

The methods and assumptions used in estimating fair values for debt and equity securities are disclosed in Note 2.

 

Fair values for cash, cash equivalents and short-term investments approximate cost.

 

21



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

3. Fair Values of Financial Instruments (continued)

 

The fair values for mortgage loans, consisting principally of commercial real estate loans, are estimated using discounted cash flow analyses, using interest rates currently being offered for similar loans collateralized by properties with similar investment risk.  The fair values for mortgage loans in default are established at the lower of the fair market value of the related underlying collateral or carrying value of the loan.

 

The fair values of single premium immediate annuity reserves are based on discounted cash flow calculations using a market yield rate for assets with similar durations.  The fair value of deposit fund liabilities and the remaining annuity reserves are primarily based on the cash surrender values of the underlying contracts.

 

The fair value of separate account liabilities for investment-type products equals the cash surrender values.

 

The Company does not believe it is practicable to estimate the fair value of policy loans because the loans have no stated maturity and are an integral part of the related insurance contracts.

 

The carrying amounts and fair values of the Company’s significant financial instruments follow.

 

 

 

December 31, 2007

 

December 31, 2006

 

 

 

Carrying
Amount

 

Fair
Value

 

Carrying
Amount

 

Fair
Value

 

 

 

(In thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

Debt securities

 

$

1,461,466

 

$

1,476,133

 

$

1,324,042

 

$

1,343,346

 

Preferred stocks

 

77,117

 

72,789

 

143,446

 

143,463

 

Non-affiliated common stocks

 

74,616

 

74,616

 

103,109

 

103,109

 

Mortgage loans

 

63,066

 

64,185

 

44,011

 

45,100

 

Cash, cash equivalents and short-term investments

 

76,536

 

76,536

 

73,063

 

73,063

 

Separate account assets

 

2,500,894

 

2,500,894

 

2,559,276

 

2,559,276

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

Life and annuity reserves for investment-type contracts and deposit fund liabilities

 

$

1,407,095

 

$

1,525,848

 

$

1,253,500

 

$

1,424,600

 

Separate account liabilities

 

2,500,894

 

2,400,424

 

2,559,276

 

2,446,400

 

 

22



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

4. Related Party Transactions

 

Western and Southern, Fort Washington and IFS Financial Services, Inc. (IFS), perform certain administrative and special services for the Company to assist with its business operations.  These services include tax compliance and reporting, payroll functions, administrative support services, investment functions, policyholder services, accounting and auditing, underwriting, marketing and product development, functional support services and personnel functions.  During 2007, the Company paid $12.6 million, $1.4 million and $5.6 million to Western and Southern, Fort Washington, and IFS, respectively.  During 2006, the Company paid $11.9 million, $1.3 million, and $6.1 million to Western and Southern, Fort Washington, and IFS, respectively. During 2005, the Company paid $1.2 million and $1.1 million to Western and Southern and Fort Washington, respectively, and received $10.8 million from National Integrity relating to these services.  The charges for services are considered reasonable and in accordance with the requirements of applicable insurance law and regulations.

 

The Company has entered into a reinsurance agreement with Western and Southern.  See Note 5 for a further description.

 

23



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

5. Reinsurance

 

Certain premiums and benefits are assumed from and ceded to other insurance companies under various reinsurance agreements.  The ceded insurance agreements provide the Company with increased capacity to write larger risks and maintain its exposure to loss within capital resources.

 

The Company has a modified coinsurance agreement with Western and Southern, whereby the Company cedes structured settlements, guaranteed rate option annuities, and accumulation products written before July 1, 2002.  Under the terms of the agreement, the Company retains the reserves and the related assets of this business.

 

The effect of reinsurance on premiums, annuity considerations and deposit-type funds is as follows for the years ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Direct premiums

 

$

552,497

 

$

560,068

 

$

381,600

 

Assumed premiums

 

 

 

 

 

 

 

Affiliates

 

 

 

 

Non-affiliates

 

169

 

185

 

190

 

Ceded premiums

 

 

 

 

 

 

 

Affiliates

 

(727

)

(3,009

)

(12,615

)

Non-affiliates

 

(1,227

)

(2,396

)

(2,458

)

Net premiums

 

$

550,712

 

$

554,848

 

$

366,717

 

 

The Company’s ceded reinsurance arrangements reduced other certain items in the accompanying financial statements by the following amounts as of and for the years ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Benefits paid or provided:

 

 

 

 

 

 

 

Affiliates

 

$

218,086

 

$

156,555

 

$

127,447

 

Non-affiliates

 

4,812

 

4,048

 

5,573

 

Policy and contract liabilities:

 

 

 

 

 

 

 

Affiliates

 

 

 

 

Non-affiliates

 

11,283

 

12,320

 

15,903

 

 

24



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

5. Reinsurance (continued)

 

In 2007 and 2006, respectively, the Company did not commute any ceded reinsurance nor did it enter into or engage in any agreement that reinsures policies or contracts that were in-force or had existing reserves as of the effective date of such agreements.

 

Other than as described above, neither the Company nor any of its related parties control, directly or indirectly, any reinsurers with whom the Company conducts business. No policies issued by the Company have been reinsured with a foreign company, which is controlled, either directly or indirectly, by a party not primarily engaged in the business of insurance. The Company does not have any reinsurance agreements in effect under which the reinsurer may unilaterally cancel the agreement. At December 31, 2007, there are no reinsurance agreements in effect such that the amount of losses paid or accrued exceed the total direct premium collected.  The Company remains obligated for amounts ceded in the event that the reinsurers do not meet their obligations.

 

There would be no reduction in surplus at December 31, 2007, if all reinsurance ceded agreements were cancelled.

 

6. Federal Income Taxes

 

The Company is included in the consolidated federal income tax return of Western and Southern. The Company had a receivable (payable) from (to) Western and Southern in the amount of $7.4 million and $(9.9) million at December 31, 2007 and 2006, respectively.  The tax years of 2007, 2006, 2005 and 2004 remain subject to examination by major tax jurisdictions.

 

The components of other tax-related carryovers for the Company are as follows:

 

 

 

Carryover

 

Expiration Dates

 

 

 

(in thousands)

 

General business credit carryover

 

$

338

 

2008 – 2010

 

Foreign tax credit carryover

 

145

 

2008

 

Alternative minimum tax (AMT) credit carryover

 

2,459

 

Indefinitely

 

 

The change in net deferred income taxes is comprised of the following:

 

 

 

December 31

 

 

 

 

 

2007

 

2006

 

Change

 

 

 

(in thousands)

 

Total deferred tax assets

 

$

54,562

 

$

79,539

 

$

(24,977

)

Total deferred tax liabilities

 

(19,973

)

(30,019

)

10,046

 

Net deferred tax asset (liability)

 

$

34,589

 

$

49,520

 

(14,931

)

Less tax (expense) benefit from unrealized gains or losses

 

 

 

 

 

7,802

 

Change in net deferred income taxes

 

 

 

 

 

$

(22,733

 

25



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

6. Federal Income Taxes (continued)

 

Nonadmitted deferred tax assets increased (decreased) by $(10.1) million, $(61.1) million and $(54.1) million for the years ended December 31, 2007, 2006 and 2005, respectively.

 

Current income taxes incurred for the years ended December 31, consist of the following major components:

 

 

 

Year Ended December 31

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Federal income tax expense on operating gain

 

$

634

 

$

(566

)

$

(5,775

)

Federal income tax expense on capital gains

 

(3,363

)

(9,436

)

(35,460

)

Capital loss carryforward (utilized)

 

(22,125

)

(17,113

)

35,545

 

NOL carryforward adjustment

 

 

(25,556

)

8,022

 

Prior year under (over) accrual

 

(4,260

)

 

(2,247

)

Current federal income tax incurred

 

$

(29,114

)

$

(52,671

)

$

85

 

 

The main components of the deferred tax amounts at December 31, are as follows:

 

 

 

2007

 

2006

 

 

 

(in thousands)

 

Deferred tax assets:

 

 

 

 

 

Reserves

 

$

18,572

 

$

16,860

 

Debt securities/stocks

 

10,679

 

15,109

 

Deferred policy acquisition costs

 

7,428

 

6,515

 

Capital loss carryover

 

 

22,125

 

Tax credit carryovers

 

2,942

 

2,942

 

Fixed assets and other assets

 

27

 

97

 

Acquisition related goodwill

 

946

 

1,095

 

Deferred hedge losses

 

1,387

 

1,618

 

Reserve strengthening

 

3,783

 

5,311

 

Reinsurance ceded

 

7,508

 

7,507

 

Other

 

1,290

 

360

 

Total deferred tax assets

 

54,562

 

79,539

 

 

 

 

 

 

 

Nonadmitted deferred tax assets

 

8,703

 

18,775

 

Admitted deferred tax assets

 

45,859

 

60,764

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

Stocks /debt securities deferred future gains

 

19,973

 

27,889

 

Separate accounts

 

 

2,130

 

Total deferred tax liabilities

 

19,973

 

30,019

 

Net admitted deferred income tax assets

 

$

25,886

 

$

30,745

 

 

26



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

6. Federal Income Taxes (continued)

 

The Company’s federal income tax expense and change in net deferred income taxes differs from the amount obtained by applying the federal statutory rate of 35% to gain from operations before federal income tax expense and net realized capital gains.  The significant differences for the year ended December 31, are as follows:

 

 

 

 

 

Effective

 

 

 

Effective

 

 

 

Effective

 

 

 

2007

 

Tax Rate

 

2006

 

Tax Rate

 

2005

 

Tax Rate

 

Provision computed at statutory rate

 

$

2,061

 

35.00

%

$

4,665

 

35.00

%

$

(1,612

)

35.00

%

Dividends received deduction

 

(7,222

)

-122.66

 

(1,665

)

-12.49

 

(1,407

)

30.55

 

Nonadmitted assets

 

5

 

0.09

 

129

 

0.97

 

107

 

-2.32

 

Separate account adjustment

 

(1,568

)

-26.64

 

(3,288

)

-24.67

 

(3,963

)

86.04

 

IRS audit adjustment

 

 

 

(7,035

)

-52.78

 

 

 

Write off of capital losses

 

 

 

 

 

51,723

 

-1123.09

 

Other

 

730

 

12.41

 

420

 

3.15

 

100

 

-2.17

 

Total

 

$

(5,994

)

-101.80

%

$

(6,774

)

-50.82

%

$

44,948

 

-975.99

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal income taxes incurred

 

$

(3,626

)

-61.58

%

$

(26,122

)

-195.97

%

$

 

%

Change in net deferred income taxes*

 

(2,368

)

-40.22

 

19,348

 

145.15

 

44,948

 

-975.99

 

Total statutory income taxes

 

$

(5,994

)

-101.80

%

$

(6,774

)

-50.82

%

$

44,948

 

-975.99

%

 


*Excludes change in net deferred income taxes on realized gains/losses of $25,101, $27,625 and $3,955 for the years ended December 31, 2007, 2006 and 2005, respectively.

 

As of December 31, 2007, the Company had a balance of $1.7 million in its policyholder surplus account under the provisions of the Internal Revenue Code.  This amount could become taxable to the extent that future shareholder dividends are paid from this account.

 

27



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

7. Regulatory Matters

 

The Company is required by statutory regulations to meet minimum risk-based capital standards.  Risk-based capital is a method of measuring the minimum amount of capital appropriate for an insurance company to support its overall business operations in consideration of its size and risk profile.  At December 31, 2007 and 2006, the Company exceeded the minimum risk-based capital.

 

State regulatory authorities have powers relating to granting and revoking licenses to transact business, the licensing of agents, the regulation of premium rates and trade practices, the form and content of insurance policies, the content of advertising material, financial statements and the nature of permitted practices.

 

Ohio insurance law limits the amount of dividends that can be paid to a parent in a holding company structure without prior approval of the regulators to the greater of ten percent of statutory surplus or statutory net income as of the preceding December 31, but only to the extent of earned surplus as of the preceding December 31. The Company may not pay any dividends during 2008 without prior approval.

 

8. Commitments and Contingencies

 

The Company is named as a defendant in various legal actions arising principally from claims made under insurance policies and contracts.  The Company believes the resolution of these actions will not have a material effect on the Company’s financial position or results of operations.

 

At December 31, 2007, the Company does not have any material lease agreements for office space or equipment.

 

28



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

9. Annuity Reserves

 

At December 31, 2007, the Company’s general and separate account annuity reserves and deposit fund liabilities that are subject to discretionary withdrawal (with adjustment), subject to discretionary withdrawal (without adjustment), and not subject to discretionary withdrawal provisions are summarized as follows:

 

 

 

Amount

 

Percent

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

Subject to discretionary withdrawal:

 

 

 

 

 

With market value adjustment

 

$

1,517,147

 

39.3

%

At book value less current surrender charge of 5% or more

 

310,843

 

8.0

 

At fair value

 

846,293

 

21.9

 

Total with adjustment or at market value

 

2,674,283

 

69.2

 

Subject to discretionary withdrawal (without adjustment) at book value with minimal or no charge or adjustment

 

307,782

 

8.0

 

Not subject to discretionary withdrawal

 

880,377

 

22.8

 

Total annuity reserves and deposit fund liabilities (before reinsurance)

 

3,862,442

 

100.0

%

Less reinsurance ceded

 

10,609

 

 

 

Net annuity reserves and deposit fund liabilities

 

$

3,851,833

 

 

 

 

Interest changes may have temporary effects on the sale and profitability of annuity products offered by the Company. Although the rates offered by the Company are adjustable in the long-term, in the short-term they may be subject to contractual and competitive restrictions which may prevent timely adjustment. The Company’s management constantly monitors interest rates with respect to a spectrum of duration and sells annuities that permit flexible responses to interest rate changes as part of the Company’s management of interest spreads. However, adverse changes in investment yields on invested assets will affect the earnings on those products with a guaranteed return.

 

29



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Separate Accounts

 

The Company’s guaranteed separate accounts include indexed products (i.e. equity-indexed annuities) and non-indexed products and options (i.e. guaranteed rate options and systematic transfer options).  The guaranteed rate options are sold as a fixed annuity product or as an investment option within the Company’s variable annuity.  These options carry a minimum interest guarantee based on the guarantee period selected by the policyholder.  The fixed annuity products currently offered generally provide a death benefit equal to the account value, with one product offering an optional death benefit ranging from 25% to 40% of the gain in the contract.  The fixed investment options currently offered within the Company’s variable annuity products provide the death benefits listed below for variable annuities.  The Company’s equity-indexed annuities provide participation in the S&P 500 price index.

 

The Company’s nonguaranteed separate accounts primarily include variable annuities.  The net investment experience of variable annuities is credited directly to the policyholder and can be positive or negative.  Variable annuities include minimum guaranteed death benefits that vary by product and include optional death benefits available on some products.  The death benefits currently offered by the Company include the following: account value, return of premium paid, a death benefit that is adjusted after 7 years to the current account value, a death benefit that is adjusted periodically to the current account value and an additional death benefit ranging from 25% to 40% of the gain in the contract.  Assets held in separate accounts are carried at estimated fair values.

 

30



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Separate Accounts (continued)

 

Information regarding the separate accounts of the Company as of and for the year ended December 31, 2007, is as follows:

 

 

 

Separate Accounts with Guarantees

 

 

 

 

 

 

 

Indexed

 

Nonindexed
Guaranteed
Less than /
equal to 4%

 

Nonindexed
Guaranteed
More than 4%

 

Nonguaranteed
Separate
Accounts

 

Total

 

 

 

(in thousands)

 

Premiums, deposits and other considerations

 

$

 

$

8,631

 

$

245,910

 

$

58,072

 

$

312,613

 

 

 

 

 

 

 

 

 

 

 

 

 

Reserves for separate accounts with assets at fair value

 

$

4,117

 

$

403,800

 

$

1,190,528

 

$

861,137

 

$

2,459,582

 

 

 

 

 

 

 

 

 

 

 

 

 

Reserves for separate accounts by withdrawal characteristics:

 

 

 

 

 

 

 

 

 

 

 

Subject to discretionary withdrawal (with adjustment):

 

 

 

 

 

 

 

 

 

 

 

With market value adjustment

 

$

 

$

392,546

 

$

1,123,616

 

$

 

$

1,516,162

 

At book value without market value adjustment and with current surrender charge of 5% or more

 

19

 

11,254

 

66,912

 

 

78,185

 

At fair value

 

 

 

 

861,137

 

861,137

 

At book value without market value adjustment and with current surrender charge of less than 5%

 

4,098

 

 

 

 

4,098

 

Subtotal

 

4,117

 

403,800

 

1,190,528

 

861,137

 

2,459,582

 

Not subject to discretionary withdrawal

 

 

 

 

 

 

Total separate accounts liabilities

 

$

4,117

 

$

403,800

 

$

1,190,528

 

$

861,137

 

$

2,459,582

 

 

31



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Separate Accounts (continued)

 

A reconciliation of the amounts transferred to and from the separate accounts for the year ended December 31, 2007, is presented below:

 

 

 

2007

 

 

 

(in thousands)

 

Transfers as reported in the summary of operations of the Separate Accounts Statement:

 

 

 

Transfers to separate accounts

 

$

312,613

 

Transfers from separate accounts

 

479,384

 

Net transfers to separate accounts

 

(166,771

)

 

 

 

 

Reconciling adjustments:

 

 

 

Policy deductions and other expense reported elsewhere in the statement of operations

 

(10,100

)

Other changes in surplus in separate account statement

 

(4,481

)

 

 

 

 

 

Transfers as reported in the summary of operations of the Company

 

$

(181,352

)

 

32



 

Integrity Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

11. Direct Premiums Written by Managing General Agents/Third Party Administrators

 

The Company issued business through the following managing general agents in 2007:

 

Name and Address

 

EIN

 

Exclusive
Contract

 

Type of
Business
Written

 

Authority
Granted

 

Total
Premiums
Written

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Ann Arbor Annuity Exchange
45 Research Drive
Ann Arbor, MI 48103

 

38-2929874

 

No

 

Fixed Annuities

 

Writing premium

 

$

27,747

 

Insource Inc.
10401 N Meridian St
Suite 200
Indianapolis, IN 46290

 

35-1738936

 

No

 

Fixed Annuities

 

Writing premium

 

$

26,285

 

AXA Network LLC
4251 Crums Mill Road
Harrisburg, PA 17112

 

06-1555494

 

No

 

Fixed Annuities

 

Writing premium

 

$

25,585

 

BISYS Insurance Services
4250 Crums Mill Road
Harrisburg, PA 17112

 

23-2232460

 

No

 

Fixed Annuities

 

Writing premium

 

$

23,987

 

 

The aggregate remaining premiums written by other managing general agents for 2007 were $214.9 million.

 

33



 

Financial Statement Schedules (Statutory-Basis)

 



 

Integrity Life Insurance Company

 

Summary of Investments - Other Than Investments in Related Parties

(in thousands)

 

December 31, 2007

 

Schedule I

 

Type of Investment

 

Cost (1)

 

Market Value

 

Amount at which shown in
the Balance Sheet

 

Debt Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bonds:

 

 

 

 

 

 

 

United States government and government agencies and authorities

 

$8,181

 

$8,355

 

$8,181

 

States, municipalities and political subdivisions

 

158,685

 

157,658

 

158,685

 

Foreign governments

 

 

 

 

Public utilities

 

128,824

 

131,209

 

128,824

 

All other corporate bonds

 

1,165,776

 

1,177,186

 

1,165,776

 

Preferred stocks

 

77,117

 

72,789

 

77,117

 

Total fixed maturities

 

1,538,583

 

1,547,197

 

1,538,583

 

 

 

 

 

 

 

 

 

Equity securities

 

 

 

 

 

 

 

Common stocks:

 

 

 

 

 

 

 

Public utilities

 

727

 

887

 

887

 

Banks, trust and insurance

 

3,694

 

33,365

 

33,365

 

Industrial, miscellaneous and all other

 

21,189

 

40,364

 

40,364

 

Total equity securities

 

25,610

 

74,616

 

74,616

 

 

 

 

 

 

 

 

 

Mortgage loans on real estate

 

63,066

 

 

 

63,066

 

Real estate

 

 

 

 

 

Policy loans

 

115,736

 

 

 

115,736

 

Other long-term investments

 

54,254

 

 

 

54,254

 

Cash, cash equivalents and short-term investments

 

76,536

 

 

 

76,536

 

Total investments

 

$1,873,785

 

 

 

$1,922,791

 

 


(1)  Original cost of equity securities and, as to fixed maturities, original cost reduced by repayments and adjusted for amortization of premiums or accrual discounts.

 

35



 

Integrity Life Insurance Company

 

Supplementary Insurance Information

(in thousands)

 

Schedule III

 

 

 

Future Policy
Benefits and
Expenses

 

Unearned
Premiums

 

Policy and
Contract
Liabilities

 

Premium
Revenue

 

Net Investment
Income*

 

Benefits,
Claims Losses
and Settlement
Expenses

 

Other
Operating
Expenses*

 

Premiums
 Written

 

Year ended December 31, 2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

274,468

 

$

 

$

5

 

$

2,827

 

$

28,103

 

$

13,461

 

$

1,769

 

 

 

Individual health

 

 

 

 

 

 

 

 

$

 

Group life and health

 

22,771

 

 

 

 

1,366

 

365

 

122

 

 

Annuity

 

1,350,209

 

 

60

 

550,513

 

74,130

 

573,492

 

19,825

 

 

 

 

 

$

1,647,448

 

$

 

$

65

 

$

553,340

 

$

103,599

 

$

587,318

 

$

21,716

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

273,559

 

$

 

$

5

 

$

261

 

$

27,559

 

$

15,809

 

$

1,559

 

 

 

Individual health

 

 

 

 

 

 

 

 

$

 

Group life and health

 

22,845

 

 

 

 

1,393

 

(151

)

112

 

 

Annuity

 

1,198,250

 

 

43

 

555,755

 

72,581

 

390,554

 

17,253

 

 

 

 

 

$

1,494,654

 

$

 

$

48

 

$

556,016

 

$

101,533

 

$

406,212

 

$

18,924

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

269,057

 

$

 

$

6

 

$

216

 

$

26,290

 

$

8,146

 

$

1,868

 

 

 

Individual health

 

 

 

 

 

 

 

 

$

 

Group life and health

 

23,721

 

 

 

 

1,356

 

(153

)

137

 

 

Annuity

 

1,231,144

 

 

37

 

367,525

 

69,896

 

328,926

 

19,742

 

 

 

 

 

$

1,523,922

 

$

 

$

43

 

$

367,741

 

$

97,542

 

$

336,919

 

$

21,747

 

 

 

 


*Allocations of net investment income and other operating expenses are based on a number of assumptions and estimates, and the results would change if different methods were applied.

 

36



 

Integrity Life Insurance Company

 

Reinsurance

(in thousands)

 

Schedule IV

 

 

 

Gross Amount

 

Ceded to Other
Companies

 

Assumed From
Other
Companies

 

Net Amount

 

Percentage of
Amount
Assumed to
Net

 

Year ended December 31, 2007

 

 

 

 

 

 

 

 

 

 

 

Life insurance in force

 

$

571,983

 

$

288,850

 

$

35,246

 

$

318,379

 

11

%

Premiums:

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

3,651

 

$

993

 

$

169

 

$

2,827

 

6

%

Individual health

 

 

 

 

 

 

Group life and health

 

 

 

 

 

 

Annuity

 

551,474

 

961

 

 

550,513

 

 

 

 

$

555,125

 

$

1,954

 

$

169

 

$

553,340

 

0

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2006

 

 

 

 

 

 

 

 

 

 

 

Life insurance in force

 

$

595,603

 

$

367,646

 

$

37,322

 

$

265,279

 

14

%

Premiums:

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

2,156

 

$

2,080

 

$

185

 

$

261

 

71

%

Individual health

 

 

 

 

 

 

Group life and health

 

 

 

 

 

 

Annuity

 

559,080

 

3,325

 

 

555,755

 

 

 

 

$

561,236

 

$

5,405

 

$

185

 

$

556,016

 

0

%

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2005

 

 

 

 

 

 

 

 

 

 

 

Life insurance in force

 

$

621,705

 

$

451,349

 

$

41,047

 

$

211,403

 

19

%

Premiums:

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

2,099

 

$

2,073

 

$

190

 

$

216

 

88

%

Individual health

 

 

 

 

 

 

Group life and health

 

 

 

 

 

 

Annuity

 

380,525

 

13,000

 

 

367,525

 

 

 

 

$

382,624

 

$

15,073

 

$

190

 

$

367,741

 

0

%

 

37



 

STATUTORY-BASIS FINANCIAL STATEMENTS

AND SCHEDULES

 

The Western and Southern Life Insurance Company

Years Ended December 31, 2007, 2006 and 2005

 



 

The Western and Southern Life Insurance Company

 

Statutory-Basis Financial Statements and Schedules

 

Years Ended December 31, 2007, 2006 and 2005

 

Contents

 

Report of Independent Registered Public Accounting Firm

1

 

 

Financial Statements (Statutory-Basis)

 

 

 

Balance Sheets (Statutory-Basis)

2

Statements of Operations (Statutory-Basis)

3

Statements of Changes in Capital and Surplus (Statutory-Basis)

4

Statements of Cash Flow (Statutory-Basis)

5

Notes to Financial Statements (Statutory-Basis)

6

 

 

Financial Statement Schedules (Statutory-Basis)

 

 

 

Schedule I – Summary of Investments – Other Than Investments in Related Parties

40

Schedule III – Supplementary Insurance Information

41

Schedule IV – Reinsurance

42

 



 

Report of Independent Registered Public Accounting Firm

 

The Board of Directors

The Western and Southern Life Insurance Company

 

We have audited the accompanying statutory-basis balance sheets of The Western and Southern Life Insurance Company (the Company) as of December 31, 2007 and 2006, and the related statutory-basis statements of operations, changes in capital and surplus, and cash flow for each of the three years in the period ended December 31, 2007.  Our audits also included the statutory-basis financial statement schedules listed in the contents page. These financial statements and schedules are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements and schedules based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

 

As described in Note 1 to the financial statements, the Company presents its financial statements in conformity with accounting practices prescribed or permitted by the Ohio Insurance Department, which practices differ from U.S. generally accepted accounting principles.  The variances between such practices and U.S. generally accepted accounting principles and the effects on the accompanying financial statements are also described in Note 1.

 

In our opinion, because of the effects of the matter described in the preceding paragraph, the financial statements referred to above do not present fairly, in conformity with U.S. generally accepted accounting principles, the financial position of The Western and Southern Life Insurance Company at December 31, 2007 and 2006, or the results of its operations or its cash flows for each of the three years in the period ended December 31, 2007.

 

However, in our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The Western and Southern Life Insurance Company at December 31, 2007 and 2006, and the results of its operations and its cash flow for each of the three years in the period ended December 31, 2007, in conformity with accounting practices prescribed or permitted by the Ohio Insurance Department.  Also, in our opinion, the related financial statement schedules, when considered in relation to the basic statutory-basis financial statements taken as a whole, present fairly in all material respects the information set forth therein.

 

As discussed in Note 1 to the financial statements, in 2005 the Company adopted Statement of Statutory Accounting Principles No. 88, which changed its method of accounting for certain non-insurance subsidiaries, controlled, and affiliated entities.

 

 

/s/ Ernst & Young LLP

 

Cincinnati, Ohio

April 7, 2008

 

1



 

The Western and Southern Life Insurance Company

 

Balance Sheets (Statutory-Basis)

 

 

 

December 31

 

 

 

2007

 

2006

 

 

 

(in thousands)

 

Admitted Assets

 

 

 

 

 

Cash and invested assets:

 

 

 

 

 

Debt securities

 

$

3,091,569

 

$

3,340,616

 

Preferred and common stocks

 

2,297,944

 

2,574,789

 

Investments in common stocks of subsidiaries

 

1,480,670

 

1,373,004

 

Mortgage loans

 

53,273

 

56,300

 

Policy loans

 

161,007

 

158,874

 

Real estate:

 

 

 

 

 

Properties held for the production of income

 

43,147

 

45,079

 

Properties occupied by the Company

 

31,143

 

31,943

 

Properties held for sale

 

 

7,123

 

Cash, cash equivalents and short-term investments

 

119,693

 

178,718

 

Receivable for securities

 

10,477

 

2,847

 

Other invested assets

 

575,656

 

337,111

 

Total cash and invested assets

 

7,864,579

 

8,106,404

 

 

 

 

 

 

 

Investment income due and accrued

 

69,996

 

57,605

 

Premiums deferred and uncollected

 

59,946

 

60,599

 

Current federal income taxes recoverable

 

2,380

 

12,627

 

Receivables from parent, subsidiaries and affiliates

 

1,994

 

12,618

 

Other admitted assets

 

6,866

 

6,494

 

Separate account assets

 

826,556

 

841,255

 

Total admitted assets

 

$

8,832,317

 

$

9,097,602

 

 

 

 

 

 

 

Liabilities and Capital and Surplus

 

 

 

 

 

Liabilities:

 

 

 

 

 

Policy and contract liabilities:

 

 

 

 

 

Life and annuity reserves

 

$

2,580,404

 

$

2,555,385

 

Accident and health reserves

 

267,317

 

256,046

 

Liability for deposit-type contracts

 

242,761

 

245,568

 

Policy and contract claims

 

49,476

 

46,240

 

Dividends payable to policyholders

 

41,225

 

40,463

 

Premiums received in advance

 

5,850

 

7,820

 

Total policy and contract liabilities

 

3,187,033

 

3,151,522

 

 

 

 

 

 

 

General expense due and accrued

 

21,305

 

22,028

 

Current federal income taxes payable

 

1,663

 

36,490

 

Net deferred income tax liability

 

256,051

 

422,649

 

Asset valuation reserve

 

185,542

 

347,976

 

Interest maintenance reserve

 

41,097

 

51,886

 

Other liabilities

 

379,120

 

467,940

 

Liability for postretirement benefits other than pensions

 

225,699

 

215,640

 

Borrowed money and interest

 

2,286

 

25,204

 

Separate account liabilities

 

826,556

 

841,255

 

Total liabilities

 

5,126,352

 

5,582,590

 

 

 

 

 

 

 

Capital and surplus:

 

 

 

 

 

Common stock, $1 par value, authorized 1,000 shares, issued and outstanding 1,000 shares

 

1,000

 

1,000

 

Paid-in surplus

 

5,000

 

5,000

 

Accumulated surplus

 

3,699,965

 

3,509,012

 

Total capital and surplus

 

3,705,965

 

3,515,012

 

Total liabilities and capital and surplus

 

$

8,832,317

 

$

9,097,602

 

 

See accompanying notes.

 

2



 

The Western and Southern Life Insurance Company

 

Statements of Operations (Statutory-Basis)

 

 

 

Year ended December 31

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Premiums and other revenues:

 

 

 

 

 

 

 

Premiums and annuity considerations

 

$

370,598

 

$

382,345

 

$

394,386

 

Net investment income

 

469,515

 

349,338

 

345,193

 

Considerations for supplementary contracts with life contingencies

 

 

8

 

88

 

Amortization of the interest maintenance reserve

 

6,872

 

8,777

 

10,431

 

Reserve adjustments on reinsurance ceded

 

1,527

 

1,418

 

1,440

 

Other revenues

 

593

 

1,191

 

385

 

Total premiums and other revenues

 

849,105

 

743,077

 

751,923

 

 

 

 

 

 

 

 

 

Benefits paid or provided:

 

 

 

 

 

 

 

Death benefits

 

198,612

 

200,578

 

201,918

 

Annuity benefits

 

95,138

 

94,974

 

96,060

 

Disability and accident and health benefits

 

27,106

 

26,194

 

28,799

 

Surrender benefits

 

247,659

 

184,645

 

148,546

 

Payments on supplementary contracts

 

130

 

129

 

133

 

Other benefits

 

15,941

 

16,939

 

23,850

 

Increase (decrease) in policy reserves and other policyholders’ funds

 

35,328

 

42,881

 

35,382

 

Total benefits paid or provided

 

619,914

 

566,340

 

534,688

 

 

 

 

 

 

 

 

 

Insurance expenses and other deductions:

 

 

 

 

 

 

 

Commissions

 

46,809

 

46,821

 

48,857

 

Commissions and expenses on reinsurance assumed

 

24,495

 

25,389

 

27,677

 

General expenses

 

151,614

 

156,091

 

144,415

 

Net transfers to (from) separate account

 

(40,425

)

(39,254

)

(37,728

)

Reserve adjustments on reinsurance assumed

 

(263,510

)

(203,810

)

(168,448

)

Other deductions

 

40,737

 

35,881

 

1,732

 

Total insurance expenses and other deductions

 

(40,280

)

21,118

 

16,505

 

 

 

 

 

 

 

 

 

Gain (loss) from operations before dividends to policyholders, federal income tax expense, and net realized capital gains (losses)

 

269,471

 

155,619

 

200,730

 

 

 

 

 

 

 

 

 

Dividends to policyholders

 

58,729

 

58,403

 

56,605

 

Gain (loss) from operations before federal income tax expense and net realized capital gains (losses)

 

210,742

 

97,216

 

144,125

 

Federal income tax expense (benefit), excluding tax on capital gains

 

286

 

32,278

 

19,262

 

Gain (loss) from operations before net realized capital gains (losses)

 

210,456

 

64,938

 

124,863

 

Net realized capital gains or (losses) (excluding gains (losses) transferred to IMR and capital gains tax)

 

53,889

 

89,110

 

19,145

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

264,345

 

$

154,048

 

$

144,008

 

 

See accompanying notes.

 

3



 

The Western and Southern Life Insurance Company

 

Statements of Changes in Capital and Surplus (Statutory-Basis)

 

Years Ended December 31, 2007, 2006 and 2005

 

 

 

Common Stock

 

Paid-In Surplus

 

Accumulated
Surplus

 

Total Capital
and Surplus

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

Balance, January 1, 2005

 

$

1,000

 

$

5,000

 

$

2,918,503

 

$

2,924,503

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

144,008

 

144,008

 

Change in net deferred income tax asset

 

 

 

(10,636

)

(10,636

)

Net change in unrealized gains on investments (net of deferred tax expense (benefit) of ($22,239))

 

 

 

725

 

725

 

Net change in nonadmitted assets and related items

 

 

 

(9,144

)

(9,144

)

Change in asset valuation reserve

 

 

 

9,830

 

9,830

 

Cumulative effect of change in accounting principle

 

 

 

9,660

 

9,660

 

Other changes, net

 

 

 

1,580

 

1,580

 

Balance, December 31, 2005

 

1,000

 

5,000

 

3,064,526

 

3,070,526

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

154,048

 

154,048

 

Change in net deferred income tax asset

 

 

 

14,558

 

14,558

 

Net change in unrealized gains on investments (net of deferred tax expense (benefit) of $89,297)

 

 

 

341,062

 

341,062

 

Net change in nonadmitted assets and related items

 

 

 

(15,422

)

(15,422

)

Change in asset valuation reserve

 

 

 

(37,033

)

(37,033

)

Dividends to stockholder

 

 

 

(14,375

)

(14,375

)

Other changes, net

 

 

 

1,648

 

1,648

 

Balance, December 31, 2006

 

1,000

 

5,000

 

3,509,012

 

3,515,012

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

264,345

 

264,345

 

Change in net deferred income tax asset

 

 

 

32,421

 

32,421

 

Net change in unrealized gains on investments (net of deferred tax expense (benefit) of ($134,177))

 

 

 

(212,414

)

(212,414

)

Net change in nonadmitted assets and related items

 

 

 

(12,414

)

(12,414

)

Change in asset valuation reserve

 

 

 

162,434

 

162,434

 

Dividends to stockholder

 

 

 

(44,375

)

(44,375

)

Other changes, net

 

 

 

956

 

956

 

Balance, December 31, 2007

 

$

1,000

 

$

5,000

 

$

3,699,965

 

$

3,705,965

 

 

See accompanying notes.

 

4



 

The Western and Southern Life Insurance Company

 

Statements of Cash Flow (Statutory-Basis)

 

 

 

Year ended December 31

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Cash from Operations:

 

 

 

 

 

 

 

Premiums collected net of reinsurance

 

$

372,885

 

$

381,876

 

$

396,553

 

Net investment income received

 

443,089

 

347,345

 

396,914

 

Benefits paid

 

(549,812

)

(480,249

)

(510,409

)

Net transfers from (to) separate accounts

 

40,425

 

39,254

 

37,728

 

Commissions and expense paid

 

(23,692

)

(83,838

)

(103,148

)

Dividends paid to policyholders

 

(57,967

)

(57,347

)

(56,896

)

Federal income taxes recovered (paid)

 

(72,477

)

(59,876

)

(51,819

)

Net cash from operations

 

152,451

 

87,165

 

108,923

 

 

 

 

 

 

 

 

 

Cash from Investments:

 

 

 

 

 

 

 

Proceeds from investments sold, matured or repaid:

 

 

 

 

 

 

 

Debt securities

 

3,672,971

 

2,928,114

 

1,402,305

 

Preferred and common stocks

 

934,338

 

660,888

 

325,561

 

Mortgage loans

 

3,027

 

20,592

 

59,850

 

Real estate

 

7,925

 

94,903

 

 

Other invested assets

 

139,091

 

92,983

 

92,737

 

Net gains (losses) on cash, cash equivalents and short-term investments

 

81

 

24

 

 

Miscellaneous proceeds

 

850

 

163

 

1,543

 

Net proceeds from investments sold, matured or repaid

 

4,758,283

 

3,797,667

 

1,881,996

 

 

 

 

 

 

 

 

 

Cost of investments acquired:

 

 

 

 

 

 

 

Debt securities

 

(3,446,280

)

(3,288,681

)

(1,652,288

)

Preferred and common stocks

 

(1,049,524

)

(768,097

)

(366,169

)

Mortgage loans

 

 

 

(3,366

)

Real estate

 

(271

)

(25,261

)

(2,549

)

Other invested assets

 

(287,399

)

(100,519

)

(58,848

)

Miscellaneous applications

 

(7,152

)

(2,651

)

(16,925

)

Total cost of investments acquired

 

(4,790,626

)

(4,185,209

)

(2,100,145

)

 

 

 

 

 

 

 

 

Net change in policy and other loans

 

(2,133

)

(555

)

(25

)

Net cash from (for) investments

 

(34,476

)

(388,097

)

(218,174

)

 

 

 

 

 

 

 

 

Cash from Financing and Miscellaneous Sources:

 

 

 

 

 

 

 

Borrowed money

 

(22,918

)

(6,699

)

31,903

 

Net deposits on deposit-type contract funds and other insurance liabilities

 

(2,807

)

(2,944

)

(112,642

)

Dividends paid to stockholder

 

(58,750

)

 

 

Other cash provided (applied)

 

(92,525

)

348,515

 

32,929

 

Net cash from (for) financing and miscellaneous sources

 

(177,000

)

338,872

 

(47,810

)

 

 

 

 

 

 

 

 

Net change in cash, cash equivalents and short-term investments

 

(59,025

)

37,940

 

(157,061

)

Cash, cash equivalents and short-term investments:

 

 

 

 

 

 

 

Beginning of year

 

178,718

 

140,778

 

297,839

 

End of year

 

$

119,693

 

$

178,718

 

$

140,778

 

 

See accompanying notes.

 

5



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis)

 

December 31, 2007

 

1.  Nature of Operations and Significant Accounting Policies

 

The Western and Southern Life Insurance Company (the Company) is a home service insurance company that offers individual traditional and whole life insurance policies.  The Company is licensed in 43 states and the District of Columbia.  For the year ended December 31, 2007, approximately 69% of the gross premiums and annuity considerations for the Company were derived from Ohio, Indiana, North Carolina, Illinois, Florida and Pennsylvania.  The Company is domiciled in Ohio.  The Company is an indirect, wholly-owned subsidiary of Western & Southern Mutual Holding Company (Mutual Holding), a mutual holding company formed pursuant to the insurance regulations of the state of Ohio.  Ohio law requires Mutual Holding to hold at least a majority voting interest in the Company.  Currently, Mutual Holding indirectly holds 100% of the voting interest through Western & Southern Financial Group, its wholly-owned subsidiary.  The Company wholly owns the following insurance entities:  Western-Southern Life Assurance Company (WSLAC), Columbus Life Insurance Company (Columbus Life) and Integrity Life Insurance Company.  Integrity Life Insurance Company wholly owns National Integrity Life Insurance Company.

 

The Company has established and operates a closed block for the benefit of holders of most participating individual ordinary and weekly industrial life insurance policies issued on or before the formation of Mutual Holding in 2000 (the Closed Block).  Assets have been allocated to the Closed Block in an amount that is expected to produce cash flows which, together with anticipated revenue from the policies included in the Closed Block, are reasonably expected to be sufficient to support the Closed Block policies, the continuation of policyholder dividends, in aggregate, in accordance with the 2000 dividend scale if the experience underlying such scale continues, and for appropriate adjustments in the dividend scale if the experience changes. Invested assets allocated to the Closed Block consist primarily of high quality debt securities, mortgage loans, policy loans, short-term investments, and other invested assets.  Invested assets of $2,489.6 million and $2,522.0 million were allocated to the Closed Block as of December 31, 2007 and 2006, respectively. The assets allocated to the Closed Block inure solely for the benefit of the Closed Block policyholders and will not revert to the benefit of the Company.  The purpose of the Closed Block is to protect the policy dividend expectations of these policies after the formation of Mutual Holding. The Closed Block will continue in effect until the last policy in the Closed Block is no longer in force.

 

6



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Use of Estimates

 

The preparation of financial statements requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates.

 

Basis of Presentation

 

The accompanying financial statements of the Company have been prepared in conformity with accounting practices prescribed or permitted by the Ohio Insurance Department (the Department).  These practices differ in some respects from accounting principles generally accepted in the United States (GAAP).  The more significant differences follow.

 

Investments

 

Investments in debt securities and mandatory redeemable preferred stocks are reported at amortized cost or fair value based on the National Association of Insurance Commissioners’ (NAIC) rating; for GAAP, such fixed maturity investments are designated at purchase as held-to-maturity, trading or available-for-sale. Held-to-maturity fixed investments are reported at amortized cost, and the remaining fixed maturity investments are reported at fair value with unrealized holding gains and losses reported in operations for those designated as trading and as a separate component of other comprehensive income for those designated as available-for-sale.

 

All single class and multi-class mortgage-backed/asset-backed securities (e.g., CMOs) are adjusted for the effects of changes in prepayment assumptions on the related accretion of discount or amortization of premium of such securities using the retrospective method. If it is determined that a decline in fair value is other than temporary, the cost basis of the security is written down to the undiscounted estimated future cash flows.  For GAAP purposes, all securities, purchased or retained, that represent beneficial interests in securitized assets (e.g., CMO, CBO, CDO, CLO, MBS and ABS securities), other than high credit quality securities, are adjusted using the retrospective method when there is a change in estimated future cash flows. If it is determined that a decline in fair value is other than temporary, the cost basis of the security is written down to the discounted fair value. If high credit quality securities are adjusted, the retrospective method is used.

 

7



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

The Company monitors investments to determine if there has been an other-than-temporary decline in fair market value.  Factors management considers for each identified security include the following:

 

·                  the length of time and the extent to which the fair value is below the book/adjusted carry value;

·                  the financial condition and near term prospects of the issuer, including specific events that may affect its operations; and

·                  the Company’s intent and ability to hold the security long enough for it to recover its value to book/adjusted carry value.

 

If the decline is judged to be other-than-temporary, an impairment charge is recorded as a net realized capital loss in the period the determination is made.

 

Investments in real estate are reported net of required obligations rather than on a gross basis as for GAAP.  Real estate owned and occupied by the Company is included in investments rather than reported as an operating asset as under GAAP, and investment income and operating expenses include rent for the Company’s occupancy of those properties.

 

Under a formula prescribed by the NAIC, the Company defers the portion of realized capital gains and losses on sales of fixed income investments, principally debt securities and mortgage loans, attributable to changes in the general level of interest rates and amortizes those deferrals over the remaining period to maturity based on groupings of individual security sold in 5-year bands. The net deferral is reported as the interest maintenance reserve (IMR) in the accompanying balance sheets. Realized capital gains and losses are reported in income net of federal income tax and transfers to the IMR. Under GAAP, realized capital gains and losses are reported in the statement of operations on a pretax basis in the period that the assets giving rise to the gains or losses are sold.

 

The “asset valuation reserve” (AVR) provides a valuation allowance for invested assets. The AVR is determined by an NAIC prescribed formula with changes reflected directly in capital and surplus. AVR is not recognized for GAAP.

 

Subsidiaries

 

The accounts and operations of the Company’s subsidiaries are not consolidated with the accounts and operations of the Company as would be required under GAAP.

 

Policy Acquisition Costs

 

The costs of acquiring and renewing business are expensed when incurred.  Under GAAP, policy acquisition costs, related to traditional life insurance and certain long-duration accident and health insurance, to the extent recoverable from future policy revenues, would be deferred and

 

8



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

amortized over the premium-paying period of the related policies using assumptions consistent with those used in computing policy benefit reserves; for universal life insurance and investment products, to the extent recoverable from future gross profits, deferred policy acquisition costs are amortized generally in proportion to the present value of expected gross profits from surrender charges and investments, mortality, and expense margins.

 

Nonadmitted Assets

 

Certain assets designated as “nonadmitted” (principally the prepaid pension asset and electronic data processing equipment, software, and furniture and other equipment), and other assets not specifically identified as admitted assets within the NAIC’s Accounting Practices and Procedures Manual, are excluded from the accompanying balance sheets and are charged directly to accumulated surplus.  Under GAAP, such assets are included in the balance sheets.

 

Premiums and Benefits

 

Revenues for universal life and annuity policies with mortality or morbidity risk, except for guaranteed interest and group annuity contracts, consist of the entire premium received, and benefits incurred represent the total of death benefits paid and the change in policy reserves. Premiums received for annuity policies without mortality or morbidity risk and for guaranteed interest and group annuity contracts are recorded using deposit accounting, and credited directly to an appropriate policy reserve account, without recognizing premium income. Under GAAP, premiums received in excess of policy charges would not be recognized as premium revenue and benefits would represent the excess of benefits paid over the policy account value and interest credited to the account values.

 

Benefit Reserves

 

Certain policy reserves are calculated using statutorily prescribed interest and mortality assumptions rather than on estimated expected experience or actual account balances as would be required under GAAP.

 

Reinsurance

 

A liability for reinsurance balances is required to be provided for unsecured policy reserves ceded to reinsurers not authorized to assume such business. Changes to those amounts are credited or charged directly to capital and surplus. Under GAAP, an allowance for amounts deemed uncollectible would be established through a charge to earnings.

 

Policy and contract liabilities ceded to reinsurers have been reported as reductions of the related reserves rather than as assets as would be required under GAAP.

 

9



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Commissions allowed by reinsurers on business ceded are reported as income when incurred rather than being deferred and amortized with policy acquisition costs as required under GAAP.

 

Employee Benefits

 

For purposes of calculating the Company’s pension and postretirement benefit obligations, only vested participants and current retirees are included in the valuation.  Under GAAP, active participants not currently eligible also would be included.  In addition, unrecognized gains or losses and unrecognized prior service cost are included in other comprehensive income under GAAP.

 

Deferred Income Taxes

 

Deferred tax assets are limited to 1) the amount of federal income taxes paid in prior years that can be recovered through loss carrybacks for existing temporary differences that reverse by the end of the subsequent calendar year, plus 2) the lesser of the remaining gross deferred tax assets expected to be realized within one year of the balance sheet date or 10% of capital and surplus excluding any net deferred tax assets, electronic data processing equipment and operating software and any net positive goodwill, plus 3) the amount of remaining gross deferred tax assets that can be offset against existing gross deferred tax liabilities. The remaining deferred tax assets are nonadmitted.  Under GAAP, a deferred tax asset is recorded for the amount of gross deferred tax assets expected to be realized in future years, and a valuation allowance is established for deferred tax assets not realizable.

 

Policyholder Dividends

 

Policyholder dividends are recognized when declared rather than over the term of the related policies.

 

Statements of Cash Flow

 

Cash, cash equivalents and short-term investments in the statements of cash flow represent cash balances and investments with initial maturities of one year or less. Under GAAP, the corresponding captions of cash and cash equivalents include cash balances and investments with initial maturities of three months or less.

 

10



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

A reconciliation of capital and surplus and net income of the Company as determined in accordance with statutory accounting practices to amounts determined in accordance with GAAP as of December 31 and for the year then ended is as follows:

 

 

 

2007

 

2006

 

 

 

(in thousands)

 

Capital and surplus as reported in the accompanying statutory-basis financial statements

 

$

3,705,965

 

$

3,515,012

 

Deferred policy acquisition costs

 

229,528

 

231,547

 

Policy reserves

 

80,649

 

85,666

 

Asset valuation and interest maintenance reserves

 

226,639

 

399,862

 

Unrecognized benefit plan losses

 

(374,532

)

 

Employee benefit income

 

394,844

 

419,527

 

Income taxes

 

(165,115

)

(295,768

)

Net unrealized gain on available-for-sale securities

 

82,820

 

98,676

 

Subsidiary equity

 

471,536

 

520,406

 

Policyholder dividend obligation

 

(147,206

)

(171,636

)

Subsidiary reinsurance recoverable

 

195,441

 

188,528

 

Other, net

 

33,173

 

34,042

 

Stockholder’s equity, GAAP basis

 

$

4,733,742

 

$

5,025,862

 

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Net income as reported in the accompanying statutory-basis financial statements

 

$

264,345

 

$

154,048

 

$

144,008

 

Deferred policy acquisition costs

 

(3,444

)

1,611

 

7,225

 

Policy reserves

 

(2,153

)

526

 

(7,746

)

Employee benefit income

 

2,766

 

921

 

1,586

 

Income taxes

 

16,381

 

(5,962

)

(40,455

)

Interest maintenance reserve

 

(10,789

)

(15,270

)

(3,564

)

SAP vs. GAAP subsidiary income

 

139,933

 

142,689

 

113,556

 

Private equity adjustments

 

(1,839

)

(3,228

)

23,701

 

Other, net

 

(74,994

)

3,814

 

11,486

 

Net income, GAAP basis

 

$

330,206

 

$

279,149

 

$

249,797

 

 

11



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Other significant statutory accounting practices follow.

 

Investments

 

Debt securities, preferred stocks, common stocks, and short-term investments are stated at values prescribed by the NAIC, as follows:

 

Debt securities not backed by other loans are principally stated at amortized cost using the interest method.

 

Single class and multi-class mortgage-backed/asset-backed securities are valued at amortized cost using the interest method including anticipated prepayments. Prepayment assumptions are obtained from Bloomberg, Trepp, dealer surveys or internal estimates and are based on the current interest rate and economic environment.  The retrospective adjustment method is used to value all such securities except principal-only and interest-only securities, which are valued using the prospective method.

 

Non-affiliated common stocks are reported at fair value as determined by the Securities Valuation Office (SVO) of the NAIC and the related unrealized capital gains and losses are reported in capital and surplus along with any adjustment for federal income taxes.

 

Redeemable preferred stocks that have characteristics of debt securities and are rated as high quality or better are reported at cost or amortized cost.  All other redeemable preferred stocks are reported at the lower of cost, amortized cost or fair value.  Nonredeemable preferred stocks are reported at fair value or lower of cost or fair value as determined by the SVO and the related unrealized capital gains and losses are reported in capital and surplus along with any adjustment for federal income taxes.

 

There are no restrictions on non-affiliated common or preferred stocks.

 

Short-term investments include investments with remaining maturities of one year or less at the date of acquisition and are principally stated at amortized cost, which approximates fair value.

 

Cash equivalents are short-term highly liquid investments with original maturities of three months or less and are principally stated at amortized cost, which approximates fair value.

 

The Company’s insurance subsidiaries are reported at their underlying statutory equity.  The Company’s noninsurance subsidiaries are reported based on underlying audited GAAP equity.  The net change in the subsidiaries’ equity is included in capital and surplus.

 

12



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Joint ventures, partnerships, and limited liability companies are carried at the Company’s interest in the underlying audited GAAP equity of the investee.  Undistributed earnings allocated to the Company are reported in the change in net unrealized capital gains or losses.  Distributions from earnings of the investees are reported as net investment income when received.

 

Mortgage loans are reported at unpaid principal balances, less an allowance for impairment.  A mortgage loan is considered to be impaired when, based on current information and events, it is probable that the Company will be unable to collect all principal and interest amounts due according to the contractual terms of the mortgage agreement.  When management determines foreclosure is probable, the impairment is other than temporary; the mortgage loan is written down to realized value and a realized loss is recognized.

 

Policy loans are reported at unpaid principal balances.

 

Real estate occupied by the Company and real estate held for the production of income are reported at depreciated cost net of related obligations. Real estate that the Company has the intent to sell is reported at the lower of depreciated cost or fair value, net of related obligations.  Depreciation is computed by the straight-line method over the estimated useful life of the properties.

 

Property acquired in the satisfaction of debt is recorded at the lower of cost less accumulated depreciation or fair market value.

 

Realized capital gains and losses are determined using the specific identification method.

 

Changes in admitted asset carrying amounts of debt securities, non-redeemable preferred stocks, non-affiliated common stocks and mortgage loans are credited or charged directly to capital and surplus.

 

Premiums

 

Life and accident and health premiums are recognized as revenue when due.  Premiums for annuity policies with mortality and morbidity risk, except for guaranteed interest and group annuity contracts, are also recognized as revenue when due. Premiums received for annuity policies without mortality or morbidity risk and for guaranteed interest and group annuity contracts are recorded using deposit accounting.

 

13



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Policy Reserves

 

Life, annuity and accident and health disability benefit reserves are developed by actuarial methods and are determined based on published tables using statutorily specified interest rates and valuation methods that will provide, in the aggregate, reserves that are greater than or equal to the minimum or guaranteed policy cash values or the amounts required by the Department. The Company waives deduction of deferred fractional premiums on the death of life and annuity policy insureds and does return any premium beyond the date of death. Surrender values on policies do not exceed the corresponding benefit reserves. Policies issued subject to multiple table substandard extra premiums are valued on the standard reserve basis which recognizes the non-level incidence of the excess mortality costs. Additional reserves are established when the results of cash flow testing under various interest rate scenarios indicate the need for such reserves, or the net premiums exceed the gross premiums on any insurance in-force.

 

Policy reserves for life insurance and supplemental benefits are computed on the Commissioner’s Reserve Valuation Method.  The following mortality tables and interest rates are used:

 

 

 

Percentage of Reserves

 

 

 

2007

 

2006

 

Life insurance:

 

 

 

 

 

1941 Commissioners Standard Ordinary, 2-1/4% – 3-1/2%

 

12

%

12

%

1941 Standard Industrial, 2-1/2% – 3-1/2%

 

16

 

16

 

1958 Commissioners Standard Ordinary, 2-1/2% – 6%

 

29

 

30

 

1980 Commissioners Standard Ordinary, 4% – 5-1/2%

 

33

 

31

 

2001 Commissioners Standard Ordinary, 4-1/2%

 

1

 

1

 

Other, 2-1/2% – 6%

 

6

 

6

 

 

 

97

 

96

 

Other benefits (including annuities):

 

 

 

 

 

Various, 2-1/2% – 8-1/4%

 

3

 

4

 

 

 

100

%

100

%

 

The mean reserve method is used to adjust the calculated terminal reserve to the appropriate reserve at December 31. Mean reserves are determined by computing the regular mean reserve for the plan at the rated age and holding, in addition, one-half of the extra premium charge for the year. Policies issued after July 1st for substandard lives, are charged an extra premium plus the regular premium for the true age. Mean reserves are based on appropriate multiples of standard rates of mortality. An asset is recorded for deferred premiums net of loading to adjust the reserve for modal premium payments.

 

14



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

For substandard table ratings, mean reserves are based on 125% to 500% of standard mortality rates.  For flat extra ratings, mean reserves are based on the standard or substandard mortality rates increased by one to twenty-five deaths per thousand.

 

As of December 31, 2007 and 2006, reserves of $52.1 million and $58.8 million, respectively, were recorded on inforce amounts of $2,090.8 million and $2,262.6 million, respectively, for which gross premiums are less than the net premiums according to the standard of valuation required by the Department.  The Company anticipates investment income as a factor in the premium deficiency calculation.

 

Tabular interest, tabular less actual reserves released, and tabular cost have been determined by formula. Tabular interest on funds not involving life contingencies is calculated as one-hundredth of the product of such valuation rate of interest times the mean of the amount of funds subject to such valuation rate of interest held at the beginning and end of the year of valuation.

 

The establishment of appropriate reserves is an inherently uncertain process, and there can be no assurance that the ultimate liability will not exceed the Company’s policy reserves and have an adverse effect on the Company’s results of operations and financial condition.  Due to the inherent uncertainty of estimating reserves, it has been necessary, and may over time continue to be necessary, to revise estimated future liabilities as reflected in the Company’s policy reserves.

 

Policyholders’ Dividends

 

The amount of policyholders’ dividends to be paid (including those on policies included in the Closed Block) is determined annually by the Company’s Board of Directors.  The aggregate amount of policyholders’ dividends is related to actual interest, mortality, morbidity and expense experience for the year and judgment as to the appropriate level of statutory surplus to be retained by the Company.

 

Policy and Contract Claims

 

Policy and contract claims in process of settlement represent the estimated ultimate net cost of all reported and unreported claims incurred through December 31, 2007 and 2006.   The reserves for unpaid claims are estimated using individual case-basis valuations and statistical analysis.  These estimates are subject to the effects of trends in claim severity and frequency.  Although considerable variability is inherent in such estimates, management believes that the reserves for claims are adequate.  The estimates are continually reviewed and adjusted as necessary as experience develops or new information becomes known; such adjustments are included in current operations.

 

15



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Reinsurance

 

Reinsurance premiums and benefits paid or provided are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts.

 

Borrowed Money

 

The Company has entered into a dollar-roll reverse repurchase agreement.  The transactions were reflected as financing transactions requiring the asset sold and the liability for the repurchase to remain on the Company’s financial statements.  The collateral received for the transactions is reported in short-term investments and the liability for the repurchase is reported in borrowed money on the balance sheets.  There were $2.3 million and $25.2 million of mortgage-backed securities that were subject to the agreements at December 31, 2007 and 2006, respectively.

 

Securities Lending

 

The Company loaned $434.0 million and $329.1 million of various U.S. Treasury and corporate debt securities and common stocks as part of a securities lending program administered by the Bank of New York as of December 31, 2007 and 2006, respectively.  The Company requires collateral in the amount of 102% of fair value of the applicable securities loaned.  The Company monitors the fair value of the underlying securities as compared with the related receivable or payable, including accrued interest, and requests additional collateral as necessary.  The Company maintains effective control over all loaned securities, and, therefore, continues to report such securities as invested assets in the balance sheets.  Unrestricted collateral is invested primarily in debt securities and short-term investments with an offsetting liability recognized in other liabilities for the obligation to return the unrestricted collateral.  Restricted collateral is not reflected on the balance sheets as an asset or a liability.  The Company had $238.8 million and $324.9 million of unrestricted collateral and $206.8 million and $12.6 million of restricted collateral held in the Bank of New York Cash Reserves as of December 31, 2007 and 2006, respectively.

 

16



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Separate Account

 

The Company maintains a separate account, which holds all of the Company’s pension plan assets.  The assets of the separate account consist primarily of marketable securities, which are recorded at market value.

 

The activity within the separate account, including realized and unrealized gains or losses on its investments, has no effect on net income or capital and surplus of the Company.  The Company’s statements of operations reflect annuity payments to pension plan participants and other expenses of the separate account, as well as the reimbursement of such expenses from the separate account.

 

Federal Income Taxes

 

The Company files a consolidated income tax return with its eligible subsidiaries.  The provision for federal income taxes is allocated to the individual companies using a separate return method based upon a written tax sharing agreement.  Under the agreement, the benefits from losses of subsidiaries are retained by the subsidiary companies.  The Company pays all federal income taxes due for all members of the group.  The Company then immediately charges or reimburses, as the case may be, the members of the group an amount consistent with the method described in the tax sharing agreement.

 

The Company includes interest and penalties in the federal income tax line on the statements of operations.

 

Postretirement Benefits Other Than Pensions

 

The Company accounts for its postretirement benefits other than pensions on an accrual basis.  The postretirement benefit obligation for current retirees and fully eligible employees is measured by estimating the actuarial present value of benefits expected to be received at retirement using explicit assumptions.

 

Actuarial and investment gains and losses arising from differences between assumptions and actual experience upon subsequent remeasurement of the obligation may be recognized as a component of the net periodic benefit cost in the current period or amortized.  The net gain or loss will be included as a component of net postretirement benefit cost for a year if, as of the beginning of the year, the unrecognized net gain or loss exceeds ten percent of the postretirement benefit obligation.  That gain or loss, if not recognized immediately, will be amortized over the average life expectancy of the employer’s fully vested and retiree group.

 

17



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

1.   Nature of Operations and Significant Accounting Policies (continued)

 

Recent Accounting Standard

 

As of January 1, 2005, the Company adopted Statement of Statutory Accounting Principles (SSAP) No. 88, Investments in Subsidiary, Controlled, and Affiliated Entities, A Replacement of SSAP No. 46 (SSAP 88).  SSAP 88 replaces SSAP No. 46, Investments in Subsidiary, Controlled, and Affiliated Entities, and establishes guidance on how to value non-insurance subsidiaries, controlled and affiliated entities (SCA’s).  This statement requires SCA’s involved in specified activities where 20% or more of the SCA’s revenue is generated from the reporting entity and its affiliates to be recorded based on the GAAP equity reported in the SCA’s audited GAAP financial statements adjusted for specified GAAP to SAP differences.  Investments in SCA’s that do not meet the specified criteria are recorded based on the audited GAAP equity of the SCA.  Upon adoption of SSAP 88, the Company recorded an increase to surplus of $9.7 million.

 

Reclassifications

 

Certain prior year amounts in the Company’s statutory-basis financial statements have been reclassified to conform to the 2007 financial statement presentation.

 

18



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2. Investments

 

Fair values for debt and equity securities are based on quoted market prices, where available. For debt securities not actively traded, fair values are estimated using values obtained from independent pricing services, or, in the case of private placements, are estimated by discounting the expected future cash flows using current market rates applicable to the coupon rate, credit and maturity of the investments.  The fair values for equity securities that are not actively traded are estimated based on fair values of issues of comparable yield and quality.

 

The book/adjusted carrying value and fair value of the Company’s investments in debt securities are summarized as follows:

 

 

 

Book/
Adjusted
Carrying
Value

 

Gross
Unrealized
Gains

 

Gross
Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2007:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligations of U.S. government corporation and agencies

 

$

65,215

 

$

4,087

 

$

(52

)

$

69,250

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

34,493

 

71

 

(130

)

34,434

 

Corporate securities/asset-backed securities

 

2,433,284

 

115,409

 

(27,260

)

2,521,433

 

Mortgage-backed securities

 

558,577

 

6,466

 

(10,837

)

554,206

 

Total

 

$

3,091,569

 

$

126,033

 

$

(38,279

)

$

3,179,323

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2006:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligations of U.S. government corporation and agencies

 

$

209,019

 

$

2,495

 

$

(858

)

$

210,656

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

89,107

 

23

 

(388

)

88,742

 

Corporate securities/asset-backed securities

 

2,365,783

 

125,538

 

(23,107

)

2,468,214

 

Mortgage-backed securities

 

676,707

 

6,076

 

(6,293

)

676,490

 

Total

 

$

3,340,616

 

$

134,132

 

$

(30,646

)

$

3,444,102

 

 

19



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2. Investments (continued)

 

At December 31, 2007 and 2006, the Company held unrated or less-than-investment grade corporate debt securities with a book value of $81.4 million and $132.7 million, respectively, and an aggregate fair value of $89.2 million and $147.9 million, respectively. Such holdings amounted to 2.6% and 4.0%, respectively, of the Company’s investments in debt securities and 0.9% and 1.5%, respectively, of the Company’s total admitted assets as of December 31, 2007 and 2006.  The Company performs periodic evaluations of the relative credit standing of the issuers of these debt securities.  The Company considers these evaluations in its overall investment strategy.

 

The following table shows gross unrealized losses and fair values, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

 

 

 

Unrealized Losses Less Than
or Equal To 12 Months

 

Unrealized Losses Greater
Than 12 Months

 

 

 

Unrealized
Losses

 

Fair Value

 

Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2007:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligations of U.S. government corporations and agencies

 

$

(52

)

$

2,550

 

$

 

$

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

(8

)

8,567

 

(122

)

2,879

 

Corporate securities/asset-backed securities

 

(19,858

)

541,500

 

(7,402

)

179,003

 

Mortgage-backed securities

 

(8,501

)

254,623

 

(2,336

)

89,806

 

Total

 

$

(28,419

)

$

807,240

 

$

(9,860

)

$

271,688

 

 

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

(4,622

)

$

49,165

 

$

(769

)

$

10,558

 

Common stocks, unaffiliated

 

$

(53,023

)

$

457,821

 

$

 

$

 

 

20



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2. Investments (continued)

 

 

 

Unrealized Losses Less Than
or Equal To 12 Months

 

Unrealized Losses Greater
Than 12 Months

 

 

 

Unrealized
Losses

 

Fair Value

 

Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2006:

 

 

 

 

 

 

 

 

 

U.S. Treasury securities and obligation of U.S. government corporations and agencies

 

$

(776

)

$

118,683

 

$

(82

)

$

2,920

 

Debt securities issued by states of the U.S. and political subdivisions of the states

 

(63

)

7,987

 

(325

)

8,250

 

Corporate securities/asset-backed securities

 

(11,278

)

506,552

 

(11,829

)

266,218

 

Mortgage-backed securities

 

(2,634

)

282,494

 

(3,659

)

138,551

 

Total

 

$

(14,751

)

$

915,716

 

$

(15,895

)

$

415,939

 

 

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

(1,025

)

$

50,401

 

$

(665

)

$

13,869

 

Common stocks, unaffiliated

 

$

(8,453

)

$

86,747

 

$

 

$

 

 

Investments that are impaired at December 31, 2007 and 2006, for which an other-than- temporary impairment has not been recognized, consist mainly of corporate debt securities, asset-backed securities and unaffiliated common stocks.  The impairment of these securities has been deemed as temporary due to the assigned rating and the typical fluctuations of these particular securities in the marketplace.  The aggregated unrealized loss is approximately 6.1% and 2.7% of the carrying value of these securities at December 31, 2007 and 2006, respectively.  At December 31, 2007, there were a total of 355 securities held that are considered temporarily impaired, 69 of which have been impaired for 12 months or longer.  At December 31, 2006, there were a total of 346 securities held that are considered temporarily impaired, 100 of which had been impaired for 12 months or longer.  The Company recorded other-than-temporary impairments on securities of $35.9 million, $4.5 million and $0.7 million for the years ended December 31, 2007, 2006 and 2005, respectively.

 

21



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2. Investments (continued)

 

A summary of the cost or amortized cost and fair value of the Company’s debt securities at December 31, 2007, by contractual maturity, is as follows:

 

 

 

Cost or
Amortized
Cost

 

Fair Value

 

 

 

(in thousands)

 

Years to maturity:

 

 

 

 

 

One or less

 

$

16,670

 

$

16,690

 

After one through five

 

194,861

 

207,000

 

After five through ten

 

476,909

 

482,356

 

After ten

 

1,844,552

 

1,919,071

 

Mortgage-backed securities

 

558,577

 

554,206

 

Total

 

$

3,091,569

 

$

3,179,323

 

 

The expected maturities in the foregoing table may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties and because asset-backed and mortgage-backed securities (including floating-rate securities) provide for periodic payments throughout their lives.

 

Proceeds from sales of investments in debt securities during 2007, 2006 and 2005 were $3,270.6 million, $2,477.8 million, and $968.6 million; gross gains of $6.9 million, $20.9 million, and $22.7 million and gross losses of $15.9 million, $20.2 million, and $12.0 million were realized on these sales in 2007, 2006 and 2005, respectively.

 

Realized capital gains (losses) are reported net of federal income taxes and amounts transferred to the IMR as follows for the year ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Realized capital gains (losses)

 

$

97,583

 

$

115,425

 

$

35,773

 

Less amount transferred to IMR (net of related taxes (benefits) of ($2,109) in 2007, ($3,496) in 2006, and $3,698 in 2005)

 

(3,917

)

(6,493

)

6,867

 

Less federal income tax expense (benefit) of realized capital gains

 

47,611

 

32,808

 

9,761

 

Net realized capital gains (losses)

 

$

53,889

 

$

89,110

 

$

19,145

 

 

22



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2. Investments (continued)

 

Unrealized gains and losses on investments in common stocks and non-affiliated common stock of subsidiaries are reported directly in capital and surplus and do not affect net income.  The unrealized gains and unrealized losses on, and the cost and fair value of those investments are as follows:

 

 

 

Cost

 

Gross
Unrealized
Gains

 

Gross
Unrealized
Losses

 

Fair Value

 

 

 

(in thousands)

 

At December 31, 2007:

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

104,875

 

$

1,323

 

$

(5,391

)

$

100,807

 

 

 

 

 

 

 

 

 

 

 

Common stocks, unaffiliated

 

$

1,057,073

 

$

1,189,020

 

$

(53,023

)

$

2,193,069

 

Common stocks of subsidiaries and affiliates

 

1,001,197

 

482,360

 

(2,888

)

1,480,670

 

 

 

$

2,058,270

 

$

1,671,380

 

$

(55,911

)

$

3,673,739

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2006:

 

 

 

 

 

 

 

 

 

Preferred stocks

 

$

165,692

 

$

2,748

 

$

(1,690

)

$

166,750

 

 

 

 

 

 

 

 

 

 

 

Common stocks, unaffiliated

 

$

870,471

 

$

1,547,079

 

$

(8,453

)

$

2,409,097

 

Common stocks of subsidiaries and affiliates

 

952,078

 

495,784

 

(74,858

)

1,373,004

 

 

 

$

1,822,549

 

$

2,042,863

 

$

(83,311

)

$

3,782,101

 

 

Proceeds from the sales of investments in equity securities during 2007, 2006 and 2005 were $902.8 million, $550.3 million, and $224.1 million; gross gains of $124.5 million, $81.7, and $34.9 million and gross losses of $38.7 million, $18.4 million, and $12.2 million were realized on these sales in 2007, 2006 and 2005, respectively.

 

23



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

2. Investments (continued)

 

Net investment income consisted of the following for the years ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

Debt securities

 

$

205,822

 

$

192,742

 

$

170,251

 

Equity securities

 

177,149

 

75,093

 

88,149

 

Mortgage loans

 

3,654

 

6,012

 

10,030

 

Real estate

 

22,835

 

22,848

 

27,374

 

Policy loans

 

10,342

 

10,168

 

9,995

 

Cash, cash equivalents and short-term investments

 

11,574

 

17,855

 

15,898

 

Other invested assets

 

60,760

 

48,521

 

50,473

 

Other

 

1,951

 

2,615

 

760

 

Gross investment income

 

494,087

 

375,854

 

372,930

 

Investment expenses

 

24,572

 

26,516

 

27,737

 

Net investment income

 

$

469,515

 

$

349,338

 

$

345,193

 

 

The Company’s investments in mortgage loans principally involve commercial real estate. At December 31, 2007, 44.1% of such mortgages ($23.5 million) involved properties located in Ohio and Florida.  Such investments consist of first mortgage liens on completed income producing properties. The aggregate mortgage outstanding to any one borrower does not exceed $14.6 million.  During 2007, no new mortgage loans were issued.  At the issuance of a loan, the percentage of any one loan to value of security, exclusive of insured, guaranteed or purchase money mortgage does not exceed 80%.

 

At December 31, 2007, the Company’s investments in mortgage loans were not subject to prior liens.  All properties covered by mortgage loans have fire insurance at least equal to the excess of the loan over the maximum loan that would be allowed on the land without the building.  During 2007, the Company did not reduce interest rates on any outstanding mortgages.

 

Proceeds from the sales of real estate during 2007 and 2006 were $7.9 million and $94.9 million, respectively; gross gains of $0.7 million and $50.4 million were realized on those sales during 2007 and 2006, respectively.  No gross losses were realized on the sales of real estate in 2007 and 2006.  There were no directly owned properties sold in 2005.

 

24



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

3.  Fair Values of Financial Instruments

 

The following methods and assumptions were used by the Company in estimating the fair value of financial instruments in the accompanying financial statements and notes thereto.

 

The methods and assumptions used in estimating fair values for debt and equity securities are disclosed in Note 2.

 

Fair values for cash, cash equivalents and short-term investments approximate cost.

 

The fair values for mortgage loans, consisting principally of commercial real estate loans, are estimated using discounted cash flow analyses, using interest rates currently being offered for similar loans collateralized by properties with similar investment risk.  The fair values for mortgage loans in default are established at the lower of the fair market value of the related underlying collateral or carrying value of the loan.

 

The Company does not believe it is practicable to estimate the fair value of policy loans because the loans have no stated maturity and are an integral part of the related insurance contracts.

 

Fair values for insurance reserves are not required to be disclosed. However, the estimated fair values of all insurance reserves and investment contracts are taken into consideration in the Company’s overall management of interest rate risk.

 

The carrying amounts and fair values of the Company’s significant financial instruments follow.

 

 

 

December 31, 2007

 

December 31, 2006

 

 

 

Carrying
Amount

 

Fair
Value

 

Carrying
Amount

 

Fair
Value

 

 

 

(in thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

Debt securities

 

$

3,091,569

 

$

3,179,323

 

$

3,340,616

 

$

3,444,102

 

Preferred stocks

 

104,875

 

100,807

 

165,692

 

166,750

 

Non-affiliated common stocks

 

2,193,069

 

2,193,069

 

2,409,097

 

2,409,097

 

Mortgage loans

 

53,273

 

55,819

 

56,300

 

58,000

 

Cash, cash equivalents and short-term investments

 

119,693

 

119,693

 

178,718

 

178,718

 

 

25



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

4.   Related Party Transactions

 

Intercompany fees for management services to WSLAC and Columbus Life, both wholly-owned subsidiaries, included in net income of the Company were $67.6 million, $57.3 million and $56.3 million, and $7.1 million, $6.2 million and $6.6 million in 2007, 2006 and 2005, respectively.

 

The Company received payments of principal and interest under mortgage financing arrangements in the amount of $20.1 million, $26.5 million and $49.4 million in 2007, 2006 and 2005, respectively, on behalf of certain partnerships in which the Company has an equity interest. The principal balance of the mortgage financing arrangements was $185.6 million and $173.7 million at December 31, 2007 and 2006, respectively.

 

At December 31, 2007 and 2006, the Company had $209.9 million and $173.1 million, respectively, invested in the Touchstone Funds, which are mutual funds administered by Touchstone Advisors, Inc., an indirect subsidiary of the Company.

 

On December 26, 2007, the Company received a dividend of $50.0 million from Columbus Life. A portion of this dividend, $25.7 million, was extraordinary.  On December 27, 2005, the Company received a dividend of $25.0 million from Columbus Life.  Both dividends were in the form of cash.

 

On December 28, 2007, the Company received a dividend of $30.0 million from WSLAC.  The Company also accrued a dividend of $12.0 million from WSLAC on December 28, 2007.  This dividend was received on January 3, 2008.  Both dividends were in the form of cash.

 

On July 30 and December 28, 2007, the Company paid dividends to its parent, Western & Southern Financial Group, Inc., in the amounts of $14.4 million and $30.0 million, respectively.  The dividends were in the form of cash.

 

The Company has entered into multiple reinsurance agreements with affiliated entities.  See Note 5 for further description.

 

26



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

5. Reinsurance

 

Certain premiums and benefits are assumed from and ceded to other insurance companies under various reinsurance agreements.  The ceded reinsurance agreements provide the Company with increased capacity to write larger risks and maintain its exposure to loss within its capital resources.

 

The Company has two modified coinsurance agreements with its subsidiary, WSLAC, whereby the Company assumes certain universal life business issued by its subsidiary prior to 2004.  Under the terms of the agreements, the subsidiary retains the reserves and the related assets of this business. The Company records, in its statements of operations, premiums less experience refunds, commissions, adjustments to reserves as specified in the agreement, benefits incurred and other related expenses of this business.

 

The Company also has a modified coinsurance agreement with Integrity, whereby the Company assumes structured settlements, guaranteed rate option annuities, and accumulation products written before July 1, 2002.  Under the terms of the agreement, Integrity retains the reserves and the related assets of this business.

 

The Company has a ceded reinsurance agreement with Columbus Life.  Under the reinsurance agreement, Columbus Life reinsures the former liabilities of Columbus Mutual, a former affiliate, which was merged into the Company.  Life and accident and health reserves ceded from the Company to Columbus Life totaled $729.9 million and $756.7 million at December 31, 2007 and 2006, respectively.

 

The Company has entered into a retrocession reinsurance agreement with RGA Reinsurance Company.  This coinsurance agreement reinsures certain extended-term life insurance policy reserves totaling $19.8 million and $21.5 million at December 31, 2007 and 2006, respectively.

 

Certain premiums and benefits are ceded to other insurance companies under various reinsurance agreements. The majority of the ceded business is due to ceding substandard business to reinsurers (facultative basis).

 

In 2006, the Company entered into a yearly renewable term reinsurance agreement with Lafayette Life Insurance Company (Lafayette Life), an affiliated entity, whereby the Company provides reinsurance coverage on certain life products and associated riders as this coverage is recaptured by Lafayette Life from non-affiliated reinsurers.  Life reserves ceded from Lafayette Life to the Company under this agreement totaled $1.0 million and $0.9 million at December 31, 2007 and 2006, respectively.

 

27



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

5. Reinsurance (continued)

 

The effects of reinsurance on premiums, annuity considerations and deposit-type funds are as follows for the year ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Direct premiums

 

$

296,303

 

$

297,287

 

$

298,083

 

Assumed premiums:

 

 

 

 

 

 

 

Affiliated

 

84,426

 

94,808

 

105,474

 

Non-affiliates

 

 

 

 

Ceded premiums:

 

 

 

 

 

 

 

Affiliates

 

 

 

 

Non-affiliates

 

(10,131

)

(9,750

)

(9,171

)

Net premiums

 

$

370,598

 

$

382,345

 

$

394,386

 

 

The Company’s ceded reinsurance arrangements reduced other certain items in the accompanying financial statements by the following amounts as of and for the year ended December 31:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Benefits paid or provided:

 

 

 

 

 

 

 

Non-affiliates

 

$

7,683

 

$

2,044

 

$

5,189

 

Policy and contract liabilities:

 

 

 

 

 

 

 

Affiliated

 

724,158

 

750,276

 

776,552

 

Non-affiliates

 

7,110

 

7,609

 

7,794

 

 

During 2007, 2006, and 2005, the Company did not write off any reinsurance balances as a charge to operations.

 

Other than as described above, neither the Company nor any of its related parties control, directly or indirectly, any reinsurers with whom the Company conducts business.  No policies issued by the Company have been reinsured with a foreign company, which is controlled, either directly or indirectly, by a party not primarily engaged in the business of insurance.  The Company does not have any reinsurance agreements in effect under which the reinsurer may unilaterally cancel the agreement.  At December 31, 2007, there are no reinsurance agreements in effect such that the amount of losses paid or accrued exceed the total direct premium collected.   The Company remains obligated for amounts ceded in the event that the reinsurers do not meet their obligations.

 

The reduction in capital and surplus at December 31, 2007, if all reinsurance agreements were cancelled, would be $79.7 million.

 

28



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

6. Federal Income Taxes

 

The Company and its subsidiaries file a consolidated federal income tax return. Amounts due from the subsidiaries for federal income taxes were $2.4 million and $12.6 million at December 31, 2007 and 2006, respectively.  The tax years of 2007, 2006, 2005 and 2004 remain subject to examination by major tax jurisdictions.

 

The amount of federal income taxes incurred that will be available for recoupment at December 31, 2007, in the event of future net losses is $67.7 million, $67.6 million, and $30.5 million from 2007, 2006, and 2005, respectively.

 

The change in net deferred income taxes is comprised of the following:

 

 

 

December 31

 

 

 

 

 

2007

 

2006

 

Change

 

 

 

(in thousands)

 

Total deferred tax assets

 

$

258,653

 

$

256,109

 

$

2,544

 

Total deferred tax liabilities

 

(514,704

)

(678,758

)

164,054

 

Net deferred tax asset (liability)

 

$

(256,051

)

$

(422,649

)

166,598

 

Less tax (expense) benefit from unrealized gains or losses

 

 

 

 

 

134,177

 

Change in net deferred income taxes

 

 

 

 

 

$

32,421

 

 

Current income taxes incurred for the years ended December 31, consist of the following major components:

 

 

 

2007

 

2006

 

2005

 

 

 

(in thousands)

 

Federal income tax expense on operating income

 

$

20,109

 

$

25,484

 

$

21,899

 

Federal income tax expense on capital gains

 

47,611

 

32,808

 

9,761

 

Tax credits

 

(39

)

(392

)

(1,171

)

Change in tax contingency reserves

 

(29,500

)

 

 

Prior year under (over) accrual

 

9,716

 

7,186

 

(1,466

)

Current income taxes incurred

 

$

47,897

 

$

65,086

 

$

29,023

 

 

29



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

6. Federal Income Taxes (continued)

 

The main components of the deferred tax amounts at December 31 are as follows:

 

 

 

2007

 

2006

 

 

 

(in thousands)

 

Deferred tax assets:

 

 

 

 

 

 

 

Reserves

 

$

86,191

 

$

92,543

 

Deferred acquisition costs

 

46,744

 

46,224

 

Benefit for employees and agents

 

117,611

 

106,315

 

Other

 

8,107

 

11,027

 

Total deferred tax assets

 

258,653

 

256,109

 

 

 

 

 

 

 

Nonadmitted deferred tax assets

 

 

 

Admitted deferred tax assets

 

258,653

 

256,109

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

Stocks/debt securities

 

456,014

 

608,969

 

Other invested assets

 

28,767

 

39,978

 

Other

 

29,923

 

29,811

 

Total deferred tax liabilities

 

514,704

 

678,758

 

Net admitted deferred income tax liabilities

 

$

(256,051

)

$

(422,649

)

 

30



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

6. Federal Income Taxes (continued)

 

The Company’s federal income tax expense and change in net deferred income taxes differs from the amount obtained by applying the federal statutory rate of 35% to gain from operations before federal income tax expense and net realized capital gains.  The significant differences for the year ended December 31, are as follows (in thousands):

 

 

 

 

 

Effective

 

 

 

Effective

 

 

 

Effective

 

 

 

2007

 

Tax Rate

 

2006

 

Tax Rate

 

2005

 

Tax Rate

 

Provision computed at statutory rate

 

$

73,760

 

35.00

%

$

34,026

 

35.00

%

$

50,444

 

35.00

%

Dividends received deduction

 

(51,392

)

-24.39

 

(10,344

)

-10.64

 

(18,035

)

-12.51

 

Tax credits

 

(193

)

-0.09

 

(563

)

-0.58

 

(1,180

)

-0.82

 

Other invested assets

 

(626

)

-0.30

 

(10,420

)

-10.72

 

366

 

0.25

 

Change in tax contingency reserves

 

(29,500

)

-14.00

 

 

 

 

 

Other

 

(8,299

)

-3.93

 

(2,570

)

-2.64

 

(4,457

)

-3.09

 

Total

 

$

(16,250

)

-7.71

%

$

10,129

 

10.42

%

$

27,138

 

18.83

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal income taxes incurred

 

$

286

 

0.14

%

$

32,278

 

33.20

%

$

19,262

 

13.36

%

Change in net deferred income taxes*

 

(16,536

)

-7.85

 

(22,149

)

-22.78

 

7,876

 

5.46

 

Total statutory income taxes

 

$

(16,250

)

-7.71

%

$

10,129

 

10.42

%

$

27,138

 

18.83

%

 


*Excludes change in net deferred income taxes on realized gains/losses of $(15,885), $7,591 and $2,760 for the years ended December 31, 2007, 2006 and 2005, respectively.

 

31



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

7. Regulatory Matters

 

The Company is required by statutory regulations to meet minimum risk-based capital standards.  Risk-based capital is a method of measuring the minimum amount of capital appropriate for an insurance company to support its overall business operations in consideration of its size and risk profile.  At December 31, 2007 and 2006, the Company exceeded the minimum risk-based capital.

 

State regulatory authorities have powers relating to granting and revoking licenses to transact business, the licensing of agents, the regulation of premium rates and trade practices, the form and content of insurance policies, the content of advertising material, financial statements and the nature of permitted practices.

 

Ohio insurance law limits the amount of dividends that can be paid to a parent in a holding company structure without prior approval of the regulators to the greater of ten percent of statutory surplus or statutory net income as of the preceding December 31, but only to the extent of earned surplus as of the preceding December 31. In 2008, the Company has $326.1 million available for payment of dividends based on capital and surplus of $3,705.0 million at December 31, 2007, less dividends paid in 2007 of $44.4 million.

 

8. Commitments and Contingencies

 

The Company is named as a defendant in various legal actions arising principally from claims made under insurance policies and contracts.  The Company believes the resolution of these actions will not have a material effect on the Company’s financial position or results of operations.

 

At December 31, 2007, the Company does not have any material lease agreements for office space or equipment.

 

32



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

9. Annuity Reserves and Deposit-Type Contract Liabilities

 

At December 31, 2007, the Company’s annuity reserves and deposit-type contract liabilities that are subject to discretionary withdrawal (without adjustment) and not subject to discretionary withdrawal provisions are summarized as follows:

 

 

 

Amount

 

Percent

 

 

 

(in thousands)

 

 

 

At book value without adjustment (with minimal or no charge or adjustment)

 

$

425,935

 

33.9

%

Not subject to discretionary withdrawal

 

830,683

 

66.1

 

Total annuity reserves and deposit fund liabilities (before reinsurance)

 

1,256,618

 

100.0

%

Less reinsurance ceded

 

182,184

 

 

 

Net annuity reserves and deposit fund liabilities

 

$

1,074,434

 

 

 

 

Interest changes may have temporary effects on the sale and profitability of annuity products offered by the Company. Although the rates offered by the Company are adjustable in the long-term, in the short-term they may be subject to contractual and competitive restrictions, which may prevent timely adjustment. The Company’s management constantly monitors interest rates with respect to a spectrum of duration and sells annuities that permit flexible responses to interest rate changes as part of the Company’s management of interest spreads. However, adverse changes in investment yields on invested assets will affect the earnings on those products with a guaranteed return.

 

33



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Employee Retirement Benefits

 

The Company has a noncontributory pension plan under group annuity contracts covering substantially all employees and field representatives.  In addition, the Company provides certain healthcare and life insurance benefits for retired employees or their beneficiaries.

 

Substantially all of the Company’s employees and field representatives may become eligible for those benefits when they reach normal retirement age while working for the Company.

 

The Company uses a December 31 measurement date for all plans.

 

A summary of assets, obligations and assumptions of the pension and other postretirement benefit plans at December 31, are as follows:

 

 

 

Pension Benefits

 

Postretirement Medical

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

(in thousands)

 

Change in benefit obligation:

 

 

 

 

 

 

 

 

 

Benefit obligation at beginning of year

 

$

667,251

 

$

660,058

 

$

222,914

 

$

231,706

 

Service cost

 

14,494

 

15,686

 

8,954

 

11,209

 

Interest cost

 

38,620

 

37,638

 

13,283

 

13,471

 

Medicare Part D payments received

 

 

 

1,703

 

1,279

 

Contribution by plan participants

 

 

 

2,214

 

1,931

 

Actuarial (gain) loss

 

(1,816

)

(7,798

)

(6,362

)

(341

)

Benefits paid

 

(39,587

)

(38,333

)

(15,079

)

(14,077

)

Plan amendments

 

 

 

 

(22,264

)

Benefit obligation at end of year

 

$

678,962

 

$

667,251

 

$

227,627

 

$

222,914

 

 

 

 

 

 

 

 

 

 

 

Change in plan assets:

 

 

 

 

 

 

 

 

 

Fair value of plan assets at beginning of year

 

$

841,255

 

$

792,361

 

$

 

$

 

Actual return on plan assets

 

24,888

 

87,227

 

 

 

Employer contribution

 

 

 

11,162

 

10,867

 

Plan participants’ contributions

 

 

 

2,214

 

1,931

 

Medicare Part D payments received

 

 

 

1,703

 

1,279

 

Benefits paid

 

(39,587

)

(38,333

)

(15,079

)

(14,077

)

Fair value of plan assets at end of year

 

$

826,556

 

$

841,255

 

$

 

$

 

 

 

 

 

 

 

 

 

 

 

Funded status:

 

 

 

 

 

 

 

 

 

(Unfunded) overfunded obligation

 

$

147,594

 

$

174,004

 

$

(227,627

)

$

(222,914

)

Unamortized prior service cost

 

12,424

 

13,989

 

(35,874

)

(38,746

)

Unrecognized net (gain) or loss

 

368,836

 

349,509

 

37,802

 

46,020

 

Prepaid assets* (accrued liabilities)

 

$

528,854

 

$

537,502

 

$

(225,699

)

$

(215,640

)

 

 

 

 

 

 

 

 

 

 

Accumulated benefit obligation for vested employees and partially vested employees to the extent vested

 

$

597,428

 

$

584,933

 

$

227,627

 

$

222,914

 

 

 

 

 

 

 

 

 

 

 

Benefit obligation for non-vested employees:

 

 

 

 

 

 

 

 

 

Projected pension obligation

 

$

5,862

 

$

5,754

 

$

 

$

 

Accumulated benefit obligation

 

$

4,090

 

$

3,424

 

$

 

$

 

 


* Indicates non-admitted

 

34



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Employee Retirement Benefits (continued)

 

Components of net periodic benefit cost:

 

 

 

Pension Benefits

 

 

 

2007

 

2006

 

2005

 

Service cost

 

$

14,494

 

$

15,686

 

$

13,406

 

Interest cost

 

38,620

 

37,638

 

34,993

 

Expected return on plan assets

 

(70,849

)

(71,131

)

(71,083

)

Amount of recognized gains and losses

 

24,818

 

26,410

 

17,473

 

Amount of prior service cost recognized

 

1,565

 

1,565

 

31

 

Total net periodic benefit cost (benefit)

 

$

8,648

 

$

10,168

 

$

(5,180

)

 

Components of net periodic benefit cost:

 

 

 

Postretirement Medical

 

 

 

2007

 

2006

 

2005

 

Service cost

 

$

8,954

 

$

11,209

 

$

10,487

 

Interest cost

 

13,283

 

13,471

 

12,552

 

Amount of recognized gains and losses

 

1,855

 

2,142

 

1,161

 

Amount of prior service cost recognized

 

(2,872

)

(1,481

)

(1,481

)

Total net periodic benefit cost (benefit)

 

$

21,220

 

$

25,341

 

$

22,719

 

 

Weighted-average assumptions used to determine net periodic benefit cost as of December 31:

 

 

 

Pension Benefits

 

Postretirement Medical

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

Weighted average discount rate

 

6.00

%

5.75

%

6.00

%

5.75

%

Rate of compensation increase

 

4.60

%

4.60

%

4.60

%

4.60

%

Expected long-term rate of return on plan assets

 

8.50

%

8.50

%

N/A

 

N/A

 

 

 

Weighted-average assumptions used to determine net periodic benefit obligation as of December 31:

 

 

 

Pension Benefits

 

Postretirement Medical

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

Weighted average discount rate

 

6.00

%

6.00

%

6.00

%

6.00

%

Rate of compensation increase

 

4.60

%

4.60

%

4.60

%

4.60

%

 

35



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Employee Retirement Benefits (continued)

 

The Company’s discount rate assumption is determined by utilizing a discounted cash flow analysis of the Company’s obligations.  The yield curve utilized in the cash flow analysis is comprised of highly rated (Aaa or Aa) corporate bonds.

 

The Company employs a prospective building block approach in determining the long-term expected rate of return for plan assets.  Historical returns are determined by asset class.  The historical relationships between equities, fixed income securities, and other assets are reviewed.  The Company applies long-term asset return estimates to the plan’s target asset allocation to determine the weighted-average long-term return.  The Company’s long-term asset allocation was determined through modeling long-term returns and asset return volatilities and is guided by an investment policy statement created for the plan.

 

The asset allocation for the defined benefit pension plan at the end of 2007 and 2006, and the target allocation for 2008 by asset category, are as follows:

 

 

 

Target
Allocation
Percentage

 

Percentage of Plan Assets

 

 

 

2008

 

2007

 

2006

 

Asset category:

 

 

 

 

 

 

 

Equity securities

 

55

%

61

%

65

%

Fixed income securities

 

40

 

23

 

27

 

Short-term investments

 

 

 

 

Other

 

5

 

16

 

8

 

Total

 

100

%

100

%

100

%

 

The plan employs a total return investment approach whereby a mix of fixed income and equity investments are used to maximize the long-term return of plan assets for a prudent level of risk.  Risk tolerance is established through careful consideration of plan liabilities, plan funded status, and corporate financial condition.  The total portfolio is structured with multiple sub-portfolios, each with a specific fixed income or equity asset management discipline.  Each sub-portfolio is subject to individual limitations and performance benchmarks as well as limitations at the consolidated portfolio level.  Quarterly asset allocation meetings are held to evaluate portfolio asset allocations and to establish the optimal mix of assets given current market conditions and risk tolerance.  Investment mix is measured and monitored on an on-going basis through regular investment reviews, annual liability measurements, and periodic asset/liability studies.

 

For measurement purposes of the postretirement benefit obligation, a 7.0% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2007.  The rate was assumed to decrease gradually to 4.75% for 2011 and remain at that level thereafter.

 

36



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Employee Retirement Benefits (continued)

 

Increasing or decreasing the assumed health care cost trend rate assumption by one percentage point in each year would increase (decrease) the postretirement benefit obligation as of December 31, 2007, by $25.4 million and $(21.7) million, respectively, and the estimated interest cost components of net period postretirement benefit cost for 2007 by $2.8 million and $(2.4) million, respectively.

 

The Company made contributions to the postretirement medical plan of $12.9 million in 2007 and expects to contribute $210.4 million between 2008 and 2017, inclusive.  The Company received $1.7 million of subsidies in 2007 and expects to receive $24.1 million of subsidies between 2008 and 2017, inclusive, related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003.

 

At December 31, 2007 and 2006, the pension plan had $71.3 million and $77.3 million, respectively, invested in Touchstone Funds, which are mutual funds administered by Touchstone Advisors, Inc., an indirect subsidiary of the Company.

 

As of December 31, 2007, future benefit payments for the pension plan are expected as follows (in millions):

 

2008:

 

$

38.4

 

2009:

 

$

38.9

 

2010:

 

$

39.5

 

2011:

 

$

40.3

 

2012:

 

$

41.6

 

Five years thereafter:

 

$

229.0

 

 

Future benefit payments for the postretirement healthcare plan are expected as follows (in millions):

 

2008:

 

$

16.7

 

2009:

 

$

17.4

 

2010:

 

$

18.0

 

2011:

 

$

18.6

 

2012:

 

$

18.7

 

Five years thereafter:

 

$

96.9

 

 

37



 

The Western and Southern Life Insurance Company

 

Notes to Financial Statements (Statutory-Basis) (continued)

 

10. Employee Retirement Benefits (continued)

 

The Company does not expect to make contributions to the pension plan during 2008.  The Company expects to contribute approximately $20.4 million during 2008 to its postretirement healthcare plan.

 

The Company sponsors a contributory employee retirement savings plan covering substantially all eligible, full-time employees.  This plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).  The Company’s contributions to the plan are based on a combination of the employee’s contributions to the plan and a percentage of the employee’s earnings for the year.  Total Company contributions to the defined contribution plan were $3.1 million, $2.9 million, and $1.2 million for 2007, 2006 and 2005, respectively.

 

11. Premium and Annuity Considerations Deferred and Uncollected

 

Deferred and uncollected life insurance premiums and annuity considerations at December 31, 2007, were as follows:

 

 

 

Gross

 

Net of Loading

 

 

 

(in thousands)

 

 

 

 

 

 

 

Ordinary new business

 

$

9,576

 

$

818

 

Ordinary renewal

 

80,293

 

58,935

 

Accident and health renewal

 

296

 

118

 

Assumed investment type contracts

 

75

 

75

 

Total

 

$

90,240

 

$

59,946

 

 

38



 

Financial Statement Schedules (Statutory-Basis)

 



 

The Western and Southern Life Insurance Company

 

Summary of Investments - Other Than Investments in Related Parties

(in thousands)

 

December 31, 2007

 

Schedule I

 

Type of Investment

 

Cost (1)

 

Market Value

 

Amount at which shown
in the Balance Sheet

 

Debt Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bonds:

 

 

 

 

 

 

 

United States government and government agencies and authorities

 

$

74,025

 

$

79,234

 

$

74,025

 

States, municipalities and political subdivisions

 

144,101

 

147,595

 

144,101

 

Foreign governments

 

 

 

 

Public utilities

 

474,166

 

498,300

 

474,166

 

All other corporate bonds

 

2,394,440

 

2,449,357

 

2,394,440

 

Preferred stocks

 

103,603

 

99,535

 

103,603

 

Total fixed maturities

 

3,190,335

 

3,274,021

 

3,190,335

 

 

 

 

 

 

 

 

 

Equity securities

 

 

 

 

 

 

 

Common stocks:

 

 

 

 

 

 

 

Public utilities

 

16,262

 

19,871

 

19,871

 

Banks, trust and insurance

 

286,362

 

1,248,660

 

1,248,660

 

Industrial, miscellaneous and all other

 

754,449

 

924,538

 

924,538

 

Total equity securities

 

1,057,073

 

2,193,069

 

2,193,069

 

 

 

 

 

 

 

 

 

Mortgage loans on real estate

 

53,273

 

 

 

53,273

 

Real estate

 

74,290

 

 

 

74,290

 

Policy loans

 

161,007

 

 

 

161,007

 

Other long-term investments

 

66,478

 

 

 

66,478

 

Cash, cash equivalents and short-term investments

 

119,693

 

 

 

119,693

 

Total investments

 

$

4,722,149

 

 

 

$

5,858,145

 

 


(1)  Original cost of equity securities and, as to fixed maturities, original cost reduced by repayments and adjusted for amortization of premiums or accrual discounts.

 

40



 

The Western and Southern Life Insurance Company

 

Supplementary Insurance Information

(in thousands)

 

Schedule III

 

 

 

Future Policy
Benefits and
Expenses

 

Unearned
Premiums

 

Policy and
Contract
Liabilities

 

Premium
Revenue

 

Net Investment
Income*

 

Benefits,
Claims Losses
and Settlement
Expenses

 

Other
Operating
Expenses*

 

Premiums
Written

 

Year ended December 31, 2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

2,453,410

 

$

 

$

31,458

 

$

332,624

 

$

212,027

 

$

331,198

 

$

90,803

 

 

 

Individual health

 

267,316

 

3,015

 

4,131

 

33,986

 

20,183

 

32,729

 

15,239

 

$

33,989

 

Group life and health

 

112,365

 

 

1,104

 

3,128

 

1,806

 

5,222

 

164

 

 

Annuity

 

14,630

 

 

12,783

 

860

 

1,005

 

250,765

 

927

 

 

 

Corporate and other

 

 

 

 

 

234,494

 

 

44,481

 

 

 

 

 

$

2,847,721

 

$

3,015

 

$

49,476

 

$

370,598

 

$

469,515

 

$

619,914

 

$

151,614

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

2,427,769

 

$

 

$

27,812

 

$

340,572

 

$

206,440

 

$

331,249

 

$

94,431

 

 

 

Individual health

 

256,046

 

2,974

 

3,864

 

34,444

 

19,478

 

38,447

 

15,862

 

$

34,438

 

Group life and health

 

111,511

 

 

527

 

3,454

 

1,727

 

6,124

 

198

 

 

Annuity

 

16,105

 

 

14,037

 

3,883

 

1,045

 

190,520

 

1,375

 

 

 

Corporate and other

 

 

 

 

 

120,648

 

 

44,225

 

 

 

 

 

$

2,811,431

 

$

2,974

 

$

46,240

 

$

382,353

 

$

349,338

 

$

566,340

 

$

156,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

2,404,159

 

$

 

$

30,850

 

$

341,779

 

$

168,697

 

$

341,347

 

$

92,187

 

 

 

Individual health

 

238,917

 

3,056

 

4,567

 

35,226

 

14,148

 

26,733

 

14,804

 

$

35,333

 

Group life and health

 

108,961

 

 

790

 

4,102

 

2,995

 

8,635

 

201

 

 

Annuity

 

16,512

 

 

14,521

 

13,367

 

4,451

 

157,973

 

1,126

 

 

 

Corporate and other

 

 

 

 

 

154,902

 

 

36,097

 

 

 

 

 

$

2,768,549

 

$

3,056

 

$

50,728

 

$

394,474

 

$

345,193

 

$

534,688

 

$

144,415

 

 

 

 


*Allocations of net investment income and other operating expenses are based on a number of assumptions and estimates, and the results would change if different methods were applied.

 

41



 

The Western and Southern Life Insurance Company

 

Reinsurance

(in thousands)

 

Schedule IV

 

 

 

Gross Amount

 

Ceded to Other
Companies

 

Assumed From
Other
Companies

 

Net Amount

 

Percentage of
Amount
Assumed to Net

 

Year ended December 31, 2007

 

 

 

 

 

 

 

 

 

 

 

Life insurance in force

 

$

17,719,397

 

$

3,240,782

 

$

14,383,528

 

$

28,862,143

 

50

%

Premiums:

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

253,686

 

$

4,758

 

$

83,696

 

$

332,624

 

25

%

Individual health

 

39,359

 

5,373

 

 

33,986

 

 

Group life and health

 

3,128

 

 

 

3,128

 

 

Annuity

 

130

 

 

730

 

860

 

85

 

 

 

$

296,303

 

$

10,131

 

$

84,426

 

$

370,598

 

23

%

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2006

 

 

 

 

 

 

 

 

 

 

 

Life insurance in force

 

$

17,912,837

 

$

3,454,695

 

$

15,309,216

 

$

29,767,358

 

51

%

Premiums:

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

254,180

 

$

4,839

 

$

91,230

 

$

340,571

 

27

%

Individual health

 

39,356

 

4,911

 

 

34,445

 

 

Group life and health

 

3,454

 

 

 

3,454

 

 

Annuity

 

305

 

 

3,578

 

3,883

 

92

 

 

 

$

297,295

 

$

9,750

 

$

94,808

 

$

382,353

 

25

%

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2005

 

 

 

 

 

 

 

 

 

 

 

Life insurance in force

 

$

18,002,796

 

$

3,652,179

 

$

16,088,508

 

$

30,439,125

 

53

%

Premiums:

 

 

 

 

 

 

 

 

 

 

 

Individual life

 

$

254,254

 

$

4,802

 

$

92,327

 

$

341,779

 

27

%

Individual health

 

39,595

 

4,369

 

 

35,226

 

 

Group life and health

 

4,102

 

 

 

4,102

 

 

Annuity

 

220

 

 

13,147

 

13,367

 

98

 

 

 

$

298,171

 

$

9,171

 

$

105,474

 

$

394,474

 

27

%

 

42



 

INT Sep Acct I (Combo and Pinn Plus)

April 2008

 

 

PART C - Other Information

 

Item 24.                     Financial Statements and Exhibits

 

(a)          Financial Statements included in Part A:

 

Condensed Financial Information for the Portfolios

 

Financial Statements included in Part B:

 

Separate Account I of Integrity Life Insurance Company:

 

Report of Independent Registered Public Accounting Firm

Statements of Assets and Liabilities as of December 31, 2007

Statements of Operations for the Year Ended December 31, 2007

Statements of Changes in Net Assets for the Years Ended December 31, 2007 and 2006

Notes to Financial Statements

 

Integrity Life Insurance Company (Depositor):

 

Report of Independent Registered Public Accounting Firm

Balance Sheets (Statutory-Basis) as of December 31, 2007 and 2006

Statements of Operations (Statutory-Basis) for the Years Ended December 31, 2007, 2006 and 2005

Statements of Changes in Capital and Surplus (Statutory-Basis) for the Years Ended December 31, 2007, 2006 and 2005

Statements of Cash Flow (Statutory-Basis) for the Years Ended December 31, 2007, 2006 and 2005

Notes to Financial Statements (Statutory-Basis)

 

The Western and Southern Life Insurance Company (Guarantor):

 

Report of Independent Registered Public Accounting Firm

Balance Sheets (Statutory-Basis) as of December 31, 2007 and 2006

Statements of Operations (Statutory-Basis) for the Years Ended December 31, 2007, 2006 and 2005

Statements of Changes in Capital and Surplus (Statutory-Basis) for the Years Ended December 31, 2007, 2006 and 2005

Statements of Cash Flow (Statutory-Basis) for the Years Ended December 31, 2007, 2006 and 2005

Notes to Financial Statements (Statutory-Basis)

 

(b)  Exhibits:

 

The following exhibits are filed herewith or incorporated by reference as indicated:

 

1.              Resolutions of the Board of Directors of Integrity Life Insurance Company (Integrity) authorizing the establishment of Separate Account I, the Registrant.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 333-44876) filed on July 19, 2006.

2.              Not applicable.

3.

a.         Form of Selling/General Agent Agreement between Integrity, Touchstone Securities, Inc. and broker dealers.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 333-44876) filed on July 19, 2006.

b.        Form of Variable Contract Principal Underwriter Agreement with Touchstone Securities, Inc. dated January 1, 2006.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 27 to registration statement on Form N-4 (File No. 033-51268) filed on February 12, 2007.

4.

a.         Form of variable annuity contract.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 333-44876) filed on July 19, 2006.

b.        Form of Guaranteed Minimum Accumulation Benefit Rider.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 25 to registration statement on Form N-4 (File No. 033-51268), filed February 17, 2006.

c.         Form of Guaranteed Minimum Withdrawal Benefit and Schedule Page.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 27 to registration statement on Form N-4

 

1



 

(File No. 033-51268) filed on February 12, 2007.

d.        Form of Individual Guaranteed Lifetime Withdrawal Benefit and Schedule Page.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

e.         Form of Spousal Guaranteed Lifetime Withdrawal Benefit and Schedule Page.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

5.              Form of application.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 333-44876) filed on July 19, 2006.

6.

a.               Certificate of Incorporation of Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 333-44876) filed on July 19, 2006.

b.              By-Laws of Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 333-44876) filed on July 19, 2006.

7.              Reinsurance Agreement between Integrity and Connecticut General Life Insurance Company effective January 1, 1995.  Incorporated by reference from Registrant’s Post Effective Amendment No. 5 to registration statement on Form N-4 (File No. 033-56654), filed on May 1, 1996.

8.

a.               Form of Amended and Restated Participation Agreement among Variable Insurance Products Funds, Fidelity Distributors Corporation and Integrity, dated August 10, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

b.              Form of Amendment #1 to Amended and Restated Participation Agreement among Variable Insurance Products Funds, Fidelity Distributors Corporation and Integrity, dated August 10, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

c.               Form of Service Agreement between Fidelity Investments Institutional Operations Company, Inc. and Integrity dated May 1, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

d.              Form of Rule 22C-2 Agreement between Fidelity Distributors Corporation and Integrity dated March 26, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

e.               Form of Participation Agreement among Franklin Templeton Variable Insurance Products Trust, Franklin Templeton Distributors, Inc., Touchstone Securities, Inc. and Integrity dated January 6, 2003.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 25 registration statement on form N-4 (File No. 033-51268), filed February 17, 2006.

f.                 Form of Amendment #3 to Participation Agreement among Franklin Templeton Variable Insurance Products Trust, Franklin Templeton Distributors, Inc., Touchstone Securities, Inc. and Integrity dated May 1, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

g.              Form of Amendment #4 to Participation Agreement among Franklin Templeton Variable Insurance Products Trust, Franklin Templeton Distributors, Inc., Touchstone Securities, Inc. and Integrity dated November 29, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

h.              Form of Participation Agreement between JPM Series Trust II and Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 13 to registration statement on Form N-4 (File No. 033-51268) filed on April 28, 1999.

i.                  Form of Rule 22C-2 Agreement between JPM Series Trust II and Integrity dated April 17, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

j.                  Form of Participation Agreement among PIMCO Variable Insurance Trust, Allianz Global Investors LLC and Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

k.               Form of Selling Agreement between Allianz Global Investors Distributors LLC and Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

l.                  Form of Services Agreement between Pacific Investment Management Company LLC and Integrity. 

 

2



 

Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

m.           Form of Participation Agreement among Rydex Variable Trust, Rydex Distributors, Inc. and Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

n.              Form of Services Agreement between Rydex Distributors, Inc. and Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

o.              Form of Administrative Services Agreement between PADCO Advisors II and Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 30 to registration statement on Form N-4 (File No. 033-56654) filed on December 5, 2007.

p.              Form of Participation Agreement among Touchstone Variable Series Trust and Integrity dated April 30, 2001 incorporated by reference to Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 033-56654) filed October 15, 2001.

q.              Form of 22c-2 Agreement between Touchstone Variable Series Trust and Integrity dated February 14, 2008.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

r.                 Form of Shareholder Services Agreement between Touchstone Advisors, Inc. and Integrity dated January 1, 2008.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

s.               Form of Participation Agreement among Deutsche Asset Management VIT Funds (formerly BT Insurance Funds Trust), Deutsche Asset Management, Inc. (formerly Bankers Trust Company) and Integrity dated October 2, 1997.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 25 to registration statement on form N-4 (File No. 033-51268), filed February 17, 2006.

t.                 Form of 22c-2 Agreement between DWS Scudder Distributors and Integrity dated February 16, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

u.              Form of Participation Agreement among The Universal Institutional Funds, Inc., Morgan Stanley & Co., Inc., Morgan Stanley Investment Management, Incorporated and Integrity, dated January 2, 2003, incorporated by reference from Registrant’s Post-Effective Amendment No. 25 to registration statement on form N-4 (File No. 033-51268), filed February 17, 2006.

v.              Form of 22c-2 Agreement among The Universal Institutional Funds, Inc., Morgan Stanley & Co., Incorporated, Morgan Stanley Investment Management, Inc. and Integrity dated February 16, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

w.            Form of Administrative Service Agreement between Morgan Stanley Distribution, Inc. (successor to Morgan Stanley & Co. Incorporated) and Integrity dated May 1, 2008.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

x.               Form of administrative services agreement between Morgan Stanley Investment Management Inc. and Integrity dated May 1, 2008.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

y.              Form of Participation Agreement among Van Kampen Investments Trust, Van Kampen Funds, Inc., Van Kampen Asset Management, Inc. and Integrity dated January 2, 2003.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 25 to registration statement on Form N-4 (File No. 033-51268), filed February 17, 2006.

z.               Form of 22c-2 Agreement between Van Kampen Investments Trust, Van Kampen Funds, Inc., Van Kampen Asset Management, Inc. and Integrity dated February 16, 2007.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 14 to registration statement on Form N-4 (File No. 333-44876), filed on April 23, 2008.

9.               Opinion and Consent of Rhonda S. Malone, Esq. as to the legality of the securities registered, filed herewith.

10.         Consent of Independent Registered Public Accounting Firm, filed herewith.

11.         Not applicable.

12.         Not applicable.

13.         Powers of Attorney of the Board of Directors of The Western and Southern Life Insurance Company (WSLIC).  Incorporated by reference to Registrant’s Post-Effective Amendment No. 27 to registration statement on Form N-4 (File No. 033-51268) filed on February 12, 2007.

 

3



 

14.         Guarantee from WSLIC to the policy holders of Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 27 to registration statement on Form N-4 (File No. 033-51268) filed on February 12, 2007.

 

Item 25.       Directors and Officers of the Depositor

 

The names and principal business addresses* of the directors and officers of, and their positions with the Depositor, are as follows:

 

Directors:

 

John F. Barrett

 

Director, Chairman of the Board

Edward J. Babbitt

 

Director, Secretary

Jill T. McGruder(1)

 

Director, President and Chief Executive Officer

John R. Lindholm(2)

 

Director

Robert L. Walker

 

Director

William J. Williams

 

Director

Donald J. Wuebbling

 

Director

 

Officers:

 

John F. Barrett

 

Director, Chairman of the Board

Jill T. McGruder

 

Director, President and CEO

Nicholas P. Sargen(1)

 

Senior Vice President and Chief Investment Officer

Edward J. Haines(1)

 

Senior Vice President

Kevin L. Howard

 

Senior Vice President and General Counsel

Constance M. Maccarone

 

Senior Vice President

Nora E. Moushey

 

Senior Vice President and Chief Actuary

Floyd D. Buchannan

 

Vice President

Maureen M. Firestone

 

Vice President

Michael F. Furgiuele(3)

 

Vice President

Daniel W. Harris

 

Vice President

D. Todd Henderson

 

Vice President and Chief Risk Officer

Bradley J. Hunkler

 

Vice President and Comptroller

Phillip E. King

 

Vice President

Paul M. Kruth(1)

 

Vice President

Michael R. Moser

 

Vice President and Chief Compliance Officer

Gerald Rusnak

 

Vice President

Denise L. Sparks

 

Vice President

Richard K. Taulbee

 

Vice President

James J. Vance

 

Vice President and Treasurer

Patty J. Wilson(1)

 

Vice President

Donald P. Myers

 

Assistant Vice President

Andrew P. Shull

 

Assistant Vice President

John A. Tak

 

Assistant Vice President

Gerald J. Ulland

 

Assistant Vice President

M. Lisa Cooper

 

Product Compliance Officer

Marvin J. Cox, Jr.

 

Manager, New Business

David L. DiMartino

 

Managing Actuary

Michael W. Collier

 

Manager, Financial Services

Edward J. Babbitt

 

Secretary

Thomas M. Barth

 

Assistant Treasurer

Douglas B. Perry

 

Assistant Treasurer

Cheryl J. Stotts

 

Assistant Treasurer

Timothy D. Speed

 

Assistant Treasurer

Sharon A. Cummings(1)

 

Licensing Officer

Brenda L. Feige(1)

 

Manager, Licensing

Cynthia A. Lyons

 

Manager, Annuity Operations

 


*The principal business address for the above is 400 Broadway, Cincinnati, Ohio 45202, unless otherwise noted.

 

4



 

(1) Principal Business Address: 303 Broadway, Cincinnati, Ohio 45202

(2) Principal Business Address: 3600 Chamberlain Lane, Suite 736, Louisville, KY 40241

(3) Principal Business Address: 333 Ludlow Street, Stamford, Connecticut 06902

 

Item 26.                     Persons Controlled by or Under Common Control with Integrity or Registrant

 

1.               303 Broadway QCS, LLC; Ohio Limited Liability Company; 100% owned by The Western and Southern Life Insurance Company (WSLIC); ownership and operation of real estate

2.               Airport Exchange Hotel Partners; Kentucky General Partnership; 74% owned by WS Airport Exchange GP, LLC; 1% owned by Eagle Realty Investments, Inc. (ERI); ownership and operation of real estate

3.               AMLIWS Summit Ridge, LLC; Missouri Limited Liability Company; 74% owned by WSLIC, 1% owned by Eagle; ownership and operation of real estate

4.               Buckeye Venture Partners, LLC; Ohio Limited Liability Company; 60% owned by Fort Washington Investment Advisors, Inc. (FWIA); private equity fund management

5.               CAI Holding Company, Inc.; Ohio Corporation; 100% owned by Columbus Life Insurance Company (CLIC); holding company

6.               Capital Analysts Agency, Inc.; Ohio Corporation; 99% owned by Capital Analysts Incorporated; general insurance agency

7.               Capital Analysts Agency, Inc.; Texas Corporation; 100% owned by an individual who is a resident of Texas, but under contractual association with Capital Analysts Incorporated; general insurance agency

8.               Capital Analysts Incorporated; Delaware Corporation; 100% owned by CAI Holding Company, Inc.; securities broker-dealer and registered investment advisor

9.               Capital Analysts Insurance Agency, Inc.; Massachusetts Corporation; 100% owned by Capital Analysts Incorporated; general insurance agency

10.         Capital Analysts Insurance Agency, Inc.; Alabama Corporation; 100% owned by Capital Analysts Incorporated; general insurance agency

11.         Carmel Holdings, LLC; Ohio limited liability company; 49% owned by W&S Real Estate Holdings, LLC; 1% owned by ERI; ownership in real estate entity

12.         Carmel Hotel Investor, LLC; Ohio limited liability company; 100% owned by Carmel Holdings, LLC; ownership in real estate entity

13.         Carmel Hotel, LLC; Indiana limited liability company; 74% owned by Carmel Hotel Investor, LLC;1% owned by ERI; ownership and operation of real estate

14.         Carthage Senior Housing, Ltd.; Ohio Limited Liability Company; 98% owned by W&S Real Estate Holdings, LLC; 1% owned by ERI; ownership and operation of real estate

15.         Centreport Hotels LLC; Texas Limited Liability Company; 75% owned by ERI; ownership and operation of real estate

16.         Centreport Partners LP; Texas limited partnership; 25.25% owned by WSLIC, 49% owned by WSLR Dallas LLC, 1% owned by ERI; ownership and operation of real estate

17.         Cleveland East Hotel, LLC; Ohio Limited Liability Company; 74% owned by WSALD CEH, LLC; 1% owned by ERI; ownership and operation of real estate

18.         Columbus Hotel Partners; Ohio General Partnership; 74% owned by WS Columbus Homewood GP, LLC; 1% owned by ERI; ownership and operation of real estate

19.         Columbus Life Insurance Company; Ohio Corporation; 100% owned by WSLIC

20.         Country Place Associates; Ohio General Partnership; 90% owned by WS Country Place GP, LLC; 10% owned by ERI; ownership and operation of real estate

21.         Courtyard Nursing Care, LLC; Ohio Limited Liability Company; 100% owned by WSLAC; ownership and operation of real estate.

22.         Dublin Hotel LLC; Ohio Limited Liability Company; 25% owned by WSLIC, 49% owned by WSLR Columbus LLC, 1% owned by ERI; ownership and operation of real estate

23.         Eagle Realty Group, LLC; Ohio Limited Liability Company; 100% owned by W&S Operating Holdings, LLC; real estate holding company

24.         Eagle Realty Investments, Inc. (ERI); Ohio Corporation; 100% owned by Eagle Realty Group, LLC; real estate

25.         Fort Washington Active Fixed Income LLC, a Delaware Limited Liability Company; managing member is Fort Washington Fixed Income LLC and investors include WSLIC; managing member for private fixed income fund

26.         Fort Washington Capital Partners, LLC (FWCP); Delaware Limited Liability Company; 100% owned by FWIA; managing partner for numerous private equity funds

 

5



 

27.         Fort Washington Fixed Income Alpha LLC; Delaware Limited Liability Company; managing member is Fort Washington Fixed Income LLC; investors include WSLIC; private fixed income fund

28.         Fort Washington Fixed Income LLC; Delaware Limited Liability Company; 100% owned by FWIA; private fixed income fund

29.         Fort Washington High Yield Investors LLC; Delaware Limited Liability Company; managing member is FWCP; private fixed income fund

30.         Fort Washington High Yield Investors II, LLC; Delaware Limited Liability Company; managing member is FWCP; private fixed income fund

31.         Fort Washington Investment Advisors, Inc. (FWIA); Ohio Corporation; 100% owned by W&S Operating Holdings, LLC; registered investment adviser

32.         Fort Washington Private Equity Investors II, L.P.; Delaware Limited Partnership; general partner is FWCP and investors include WSLIC; private equity fund

33.         Fort Washington Private Equity Investors III, L.P.; Delaware Limited Partnership; general partner is FWCP and investors include WSLIC; private equity fund

34.         Fort Washington Private Equity Investors IV, L.P.; Delaware Limited Partnership; general partner is FWCP and investors include WSLIC; private equity fund

35.         Fort Washington Private Equity Investors V, L.P.; Delaware Limited Partnership; general partner is FWPEI V GP, LLC and investors include WSLIC; private equity fund

36.         Fort Washington Private Equity Investors V-B, L.P.; Delaware Limited Partnership; general partner is FWPEI V GP, LLC and investors include WSLIC; private equity fund

37.         Fort Washington Private Equity Investors V-VC, L.P.; Delaware Limited Partnership; general partner is FWPEI V GP, LLC and investors include WSLIC; private equity fund

38.         Fort Washington Private Equity Investors VI, L.P.; Delaware Limited Partnership; general partner is FWPEI VI GP, LLC and investors include WSLIC; private equity fund

39.         Fort Washington Private Equity Investors VI-B, L.P.; Delaware Limited Partnership; general partner is FWPEI VI GP, LLC and investors include WSLIC; private equity fund

40.         Fort Washington Private Equity Investors VI-VC, L.P.; a Delaware Limited Partnership; general partner is FWPEI V GP, LLC and investors include WSLIC; private equity fund

41.         Fort Washington Savings Company; Ohio Corporation; 100% owned by WSLIC; bank

42.         FWPEI V GP LLC; Delaware Limited Liability Company; 100% owned by FWIA; general partner of the three private equity funds

43.         FWPEI VI GP LLC; Delaware Limited Liability Company; 100% owned by FWIA; general partner of the three private equity funds

44.         Galveston Summerbrooke Apts., LLC; Texas limited liability company; 54% owned by Summerbrooke Apartments Investor, LLC; 1% owned by ERI; ownership and operation of real estate

45.         IFS Agency, Inc.; Texas Corporation; 100% owned by IFS Financial Services, Inc.; general insurance agency

46.         IFS Agency Services, Inc.; Pennsylvania Corporation; 100% owned by IFS Financial Services, Inc.; general insurance agency

47.         IFS General Agency, Inc.; Pennsylvania Corporation; 100% owned by IFS Financial Services, Inc.; general insurance agency.

48.         IFS Financial Services, Inc. (IFS); Ohio Corporation; 100% owned by Western-Southern Life Assurance Company (WSLAC); development and marketing of financial products for distribution

49.         IFS Fund Distributors, Inc.; Delaware Corporation; 100% owned by IFS; registered broker dealer

50.         IFS Insurance Agency, Inc.; Ohio Corporation; 99% owned by IFS; general insurance agency

51.         Insurance Profillment Services, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; insurance marketing services

52.         IR Mall Associates, Ltd.; Florida limited partnership; 49.50% owned by WSLIC; ownership and operation of real estate

53.         IR Mall Company, L.C.; Florida Limited Liability Company; 50% owned by ERI; ownership and operation of real estate

54.         Kentucky Co-Investment Partners, L.P.;  Delaware Limited Partnership; general partner is FWCP; private equity fund

55.         The Lafayette Life Insurance Company; Indiana Corporation; 100% owned by Western & Southern Financial Group, Inc. (WSFG)

56.         LaFrontera Hotel LLC; Texas Limited Liability Company; 75% owned by ERI; ownership and operation of real estate

 

6



 

57.         LaFrontera Lodging Partners LP; Texas limited Partnership; 74.25% owned by W&S Real Estate Holdings, LLC; ownership and operation of real estate

58.         Lookout Corporate Center, Ohio Joint Venture; 50% owned by WS Lookout GP, LLC; ownership and operation of real estate

59.         Mission Club Apartments General Partnership; Florida General Partnership; 95.5% owned by WSLIC, 4.5% owned by ERI; ownership and operation of real estate

60.         National Integrity Life Insurance Company; New York corporation; 100% owned by ILIC

61.         New Mexico Co-Investment Partners, L.P.; Delaware Limited Partnership; general partner is FWCP; private equity fund

62.         North Pittsburgh Hotel LLC; Pennsylvania Limited Liability Company; 74% owned by WSALD NPH, LLC; 1% owned by ERI; ownership and operation of real estate

63.         Northeast Cincinnati Hotel LLC; Ohio Limited Liability Company; 25% owned by WSLIC, 49% owned by WSLR Cincinnati LLC, 1% owned by ERI; ownership and operation of real estate.

64.         The Ohio Capital Fund LLC; Ohio Limited Liability Company; 60% owned by FWIA and managed by Buckeye Venture Partners, LLC; state funded private equity fund

65.         OTR Housing Associates, L.P.; Ohio Limited Partnership; 98% owned by WSLIC; 1% owned by ERI; ownership and operation of real estate

66.         OTR Redevelopment Group, LLC; Ohio Limited Liability Company; 100% owned by OTR Walnut Housing, Ltd.; ownership of real estate

67.         OTR Transitional Housing, L.P.; Ohio Limited Partnership; 99% owned by WSLIC; ownership and operation of real estate

68.         OTR-Walnut Housing, Ltd.; Ohio Limited Liability Company; 100% owned by ERI; ownership and operation of real estate

69.         Queen City Development I, LLC; Ohio Limited Liability Company; 100% owned by Eagle Realty Group, LLC; operation of real estate

70.         Park Avenue Lofts, LLC; Colorado limited liability company; 49% owned by Uptown Denver Investor, LLC; 1% owned by ERI; ownership and operation of real estate

71.         Race Street Development, Ltd.; Ohio Limited Liability Company; 100% owned by W&S Real Estate Holdings, LLC ; ownership and operation of real estate

72.         Seasons Health Care Limited Partnership; Ohio Limited Partnership; 90% owned by WSLAC, 10% owned by Courtyard Nursing Care, LLC; ownership and operation of real estate

73.         ServerVault Corp.; Delaware Corporation; 50% owned by WSLIC; technology

74.         Shelbourne Campus Properties, LLC; Delaware limited liability company; 54% owned by Shelbourne Housing Investor, LLC; 1% owned by ERI; ownership and operation of real estate

75.         Shelbourne Holdings, LLC; Ohio limited liability company; 98% owned by W&S Real Estate Holdings, LLC; 2% owned by ERI; ownership in real estate entity

76.         Shelbourne Housing Investor, LLC; Ohio limited liability company; 100% owned by Shelbourne Holdings, LLC; ownership in real estate entity

77.         Sixth and Race Development, LLC; Ohio Limited Liability Company; 71% owned by Race Street Development, Ltd., 25% owned by ERI; ownership and operation of real estate

78.         Skyport Hotel LLC; Kentucky limited liability company; 25% owned by WSLIC; 49% owned by WSLR Skyport LLC; 1% owned by ERI; ownership and operation of real estate

79.         Summerbrooke Apartments Investor, LLC; Ohio limited liability company; 100% owned by Summerbrooke Holdings, LLC; ownership in real estate entity

80.         Summerbrooke Holdings, LLC; Ohio limited liability company; 98% owned by W&S Real Estate Holdings, LLC; 2% owned by ERI; ownership in real estate entity

81.         Todd Investment Advisors, Inc.; Kentucky Corporation; 100% owned by FWIA; registered investment adviser

82.         Touchstone Advisors, Inc.; Ohio Corporation; 100% owned by IFS; registered investment adviser

83.         Touchstone Fund Group and Institutional Funds Trusts (Delaware statutory trusts), Touchstone Investment, Strategic, Tax Free and Variable Series Trusts (Massachusetts Business Trusts); WSFG and affiliates hold positions of 5% or greater in certain portfolios of these mutual fund trusts; registered investment companies.

84.         Touchstone Securities, Inc.; Nebraska Corporation; 100% owned by WSLAC; securities broker-dealer

85.         Tri-State Growth Capital Fund I, L.P.; Delaware Limited Partnership; general partner is Tri-State Ventures, LLC and investors include WSLIC; private equity fund

 

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86.         Tri-State Growth Capital Fund II, L.P.; Delaware Limited Partnership; general partner is Tri-State Ventures, II LLC and investors include WSLIC; private equity fund

87.         Tri-State Ventures, LLC; Delaware Limited Liability Company; 100% owned by FWIA; private equity fund

88.         Tri-State Ventures II, LLC; Delaware Limited Liability Company; 100% owned by FWIA; private equity fund

89.         Uptown Denver Investor, LLC; Ohio limited liability company; 100% owned by Uptown Denver Apartment Holdings, LLC; ownership in real estate entity

90.         Uptown Denver Apartment Holdings, LLC; Ohio limited liability company; 98% owned by W&S Real Estate Holdings, LLC; 2% owned by ERI; ownership in real estate entity

91.         Union Centre Hotel LLC; Ohio Limited Liability Company; 25% owned by WSLIC; 49% owned by WSLR Union LLC; 1% owned by ERI; ownership and operation of real estate

92.         Vinings Trace, LLC; Indiana Limited Liability Company; 99% owned by WSLIC, 1% owned by ERI; ownership and operation of real estate

93.         Vulcan Hotel LLC; Alabama Limited Liability Company; 25% owned by WSLIC, 49% owned by WSLR Birmingham LLC, 1% owned by ERI; ownership and operation of real estate

94.         W&S Brokerage Services, Inc.; Ohio Corporation; 100% owned by WSLAC; investment advisor and broker dealer

95.         W&S Financial Group Distributors Inc.; Ohio Corporation; 100% owned by IFS; general insurance agency

96.         W&S Operating Holdings, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; ownership of operating entities

97.         W&S Real Estate Holdings, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; ownership of real estate entities

98.         WestAd Inc.; Ohio corporation; 100% owned by WSLIC; general advertising, book selling and publishing

99.         West-Whi Columbus NW Partners; Ohio General Partnership; 74% owned by WS Columbus Northwest GP, LLC; 1% owned by ERI; ownership and operation of real estate

100.   Western & Southern Agency, Inc.; Ohio corporation; 100% owned by WSLIC; general insurance agency

101.   Western & Southern Agency Services, Inc.; Pennsylvania Corporation; 100% owned by WSLIC; general insurance agency.

102.   Western & Southern Financial Fund Inc.; Ohio non profit corporation; charitable giving

103.   Western-Southern Life Assurance Company (WSLAC); Ohio Corporation; 100% owned by WSLIC

104.   The Western and Southern Life Insurance Company (WSLIC); Ohio Corporation; 100% owned by WSFG

105.   The Western and Southern Life Insurance Company VEBA Trust; 501(c)(9) trust organized under laws of Ohio; employee health and welfare

106.   Western & Southern Financial Group, Inc. (WSFG); Ohio Corporation; 100% owned by WSMHC; holding company

107.   Western & Southern Mutual Holding Company (WSMHC); Ohio Mutual Insurance Holding Company

108.   Windsor Hotel LLC; Connecticut Limited Liability Company; 25% owned by WSLIC; 49% owned by WSLR Hartford LLC; 1% owned by ERI; ownership and operation of real estate

109.   Wright Executive Hotel Limited Partners; Ohio Limited Partnership; 60.50% owned by WSLIC; 0.61% owned by WS Wright Hotel GP, LLC; ownership and operation of real estate

110.   WSA Commons, LLC; Georgia Limited Liability Company; 50% owned by WSLIC; ownership and operation of real estate

111.   WS Airport Exchange GP, LLC; Ohio Limited Liability Company; 100% owned by W&S Real Estate Holdings, LLC; ownership and operation of real estate

112.   WS Columbus Homewood GP, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; ownership and operation of real estate

113.   WS Columbus Northwest GP, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; ownership and operation of real estate

114.   WS Country Place GP, LLC; Ohio Limited Liability Company; 100% owned by W&S Real Estate Holdings, LLC; ownership and operation of real estate

115.   WS Lookout JV, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; ownership and operation of real estate

116.   WSL Partners, L.P.; Delaware Limited Partnership;, general partner is FWCP and investors include WSLIC; private equity fund

117.   WS Wright Hotel GP, LLC; Ohio Limited Liability Company; 100% owned by WSLIC; ownership and operation of real estate

 

8



 

118.   WSALD NPH, LLC; Ohio Limited Liability Company; 50% owned by WSLIC; 1% owned by Eagle; ownership and operation of real estate

119.   WSALD CEH, LLC; Ohio Limited Liability Company; 50% owned by WSLIC; ownership and operation of real estate.

120.   WSLR Birmingham LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

121.   WSLR Cincinnati LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

122.   WSLR Columbus LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

123.   WSLR Dallas LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

124.   WSLR Hartford LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

125.   WSLR Holdings LLC; Delaware limited liability company; 24.49% owned by WSLIC; ownership of real estate entity

126.   WSLR LLC; Delaware limited liability company; 100% owned by WSLR Holdings, LLC; ownership of real estate entities

127.   WSLR Skyport LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

128.   WSLR Union LLC; Ohio limited liability company; 100% owned by WSLR LLC; ownership of real estate

 

Item 27.     Number of Contract Owners

 

As of February 29, 2008, there were 7944 contract owners of Separate Account I of Integrity.

 

Item 28.     Indemnification

 

Integrity’s By-Laws provide, in Article V, Section 5.1 provides:

To the extent permitted by the laws of the State of Ohio, subject to all applicable requirements thereof:

 

(a)      The Corporation shall indemnify or agree to indemnify any person who was or is a party or is threatened to be made a party, to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative, other than an action by or in the right of the Corporation, by reason of the fact that he is or was a Director, officer, employee, or agent of the Corporation or is or was serving at the request of the Corporation as a Director, trustee, officer, employee, or agent of another corporation, domestic or foreign, non-profit or for profit, partnership, joint venture, trust, or other enterprise, against expenses, including attorney’s fees, judgments, fines, and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit, or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, and with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.  The termination of any action, suit, or proceeding by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation and, with respect to any criminal action or proceeding, he had reasonable cause to believe that his conduct was unlawful.

(b)     The Corporation shall indemnify or agree to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he is or was a Director, officer, employee, or agent of the Corporation, or is or was serving at the request of the Corporation as a Director, trustee, officer, employee, or agent of another corporation, domestic or foreign, non-profit or for profit, partnership, joint venture, trust, or other enterprise, against expenses, including attorney’s fees, actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, except that no indemnification shall be made in respect to any of the following:

(1)    Any claim, issue, or matter as to which such person is adjudged to be liable for negligence or misconduct in the performance of his duty to the Corporation unless, and only to the extent the court of common pleas or the court in which such action or suit was brought determines upon application that, despite the adjudication of liability, but in view of all circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses as the court of common pleas or such other court shall deem proper;

(2)    Any action of suit in which the only liability asserted against a Director is pursuant to Section 1701.95 of the Ohio Revised Code.

(c)      To the extent that a Director, trustee, officer, employee, or agent has been successful in the merits or otherwise in defense of any action, suit, or proceeding referred to in division (a) and (b) of this Article, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses, including attorney’s fees, actually and reasonably incurred by him in connection with the action, suit, or proceeding.

 

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(d)     Any indemnification under divisions (a) and (b) of this Article, unless ordered by a court, shall be made by the Corporation only as authorized in the specific case upon the determination that indemnification of the Director, officer, employee, or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in divisions (a) and (b) of this Article.  Such determination shall be made as follows:

(1)    By a majority vote of a quorum consisting of Directors of the Corporation who were not and are not parties to or threatened with any such action, suit, or proceeding;

(2)    If the quorum described in division (d)(1) of this Article is not obtainable or if a majority vote of a quorum of disinterested Directors so directs, in a written opinion by independent legal counsel other than an attorney, or a firm having associated with it an attorney, who has been retained by or who has performed services for the Corporation or any person to be indemnified within the past five years;

(3)    By the Shareholders; or

(4)    By the court of common pleas or the court in which such action, suit or proceeding was brought.

Any determination made by the disinterested Directors under Article (d)(1) or by independent legal counsel under Article (d)(2) shall be promptly communicated to the person who threatened or brought the action or suit by in the right of the Corporation under (b) of this Article, and within ten days after receipt of such notification, such person shall have the right to petition the court of common pleas or the court in which such action or suit was brought to review the reasonableness of such determination.

(e)       (1)    Expenses, including attorney’s fees, incurred by a Director in defending the action, suit, or proceeding shall be paid by the Corporation as they are incurred, in advance of the final disposition of the action, suit, or proceeding upon receipt of an undertaking by or on behalf of the Director in which he agrees to do both of the following:

(i)      Repay such amount if it is proved by clear and convincing evidence in a court of competent jurisdiction that his action or failure to act involved an act or omission undertaken with deliberate intent to cause injury to the Corporation or undertaken with reckless disregard for the best interests of the Corporation;

(ii)     Reasonably cooperate with the Corporation concerning the action, suit or proceeding.

(2)    Expenses, including attorney’s fees, incurred by a Director, officer, employee, or agent in defending any action, suit, or proceeding referred to in divisions (a) and (b) of this Article, may be paid by the Corporation as they are incurred, in advance of the final disposition of the action, suit, or proceeding as authorized by the Directors in the specific case upon receipt of an undertaking by or on behalf of the Director, officer, employee, or agent to repay such amount, if it ultimately is determined that he is not entitled to be indemnified by the Corporation.

(f)      The indemnification authorized by this section shall not be exclusive of, and shall be in addition to, any other rights granted to those seeking indemnification under the Articles or the Regulations for any agreement, vote of Shareholders or disinterested Directors, or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a Director, officer, employee, or agent and shall inure to the benefit of the heirs, executors, and administrators of such a person.

(g)     The Corporation may purchase and maintain insurance or furnish similar protection, including but not limited to trust funds, letters of credit, or self insurance, on behalf of or for any person who is or was a Director, officer, employee, or agent of the Corporation, or is or was serving at the request of the Corporation as a Director, officer, employee, or agent of another corporation, domestic or foreign, non-profit or for profit, partnership, joint venture, trust, or other enterprise, against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Corporation would have the power to indemnify him against such liability under this section.  Insurance may be purchased from or maintained with a person in whom the Corporation has a financial interest. Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

 

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Item 29.     Principal Underwriters

 

(a)      Touchstone Securities, Inc. (Touchstone Securities) is the principal underwriter for Integrity Life Insurance Company Separate Account I.  Touchstone Securities also serves as an underwriter for Integrity Life Insurance Company Separate Account II and VUL, National Integrity Life Insurance Company Separate Accounts I and II, Western-Southern Life Assurance Company’s Separate Accounts 1 and 2, Columbus Life Insurance Company Separate Account I and for the shares of several series of Touchstone Variable Series Trust, Touchstone Strategic Trust, Touchstone Investment Trust, Touchstone Tax-Free Trust, Touchstone Institutional Funds Trust and Touchstone Funds Group Trust, each of which is affiliated with the Depositor.

(b)     The names and principal business addresses* of the officers and directors of, and their positions with, Touchstone Securities, Inc. are as follows:

 

Directors:

 

James N. Clark(1)

 

Director

Jill T. McGruder

 

Director

Donald J. Wuebbling(1)

 

Director

 

Officers:

 

James H. Grifo

 

President

Richard K. Taulbee(1)

 

Vice President

Patricia J. Wilson

 

Chief Compliance Officer

James J. Vance

 

Vice President and Treasurer

Terrie A. Wiedenheft

 

Chief Financial Officer

Douglas B. Perry(1)

 

Assistant Treasurer

Timothy D. Speed(1)

 

Assistant Treasurer

Cheryl J. Stotts(1)

 

Assistant Treasurer

Rhonda S. Malone(1)

 

Secretary

 


*The principal business address for the above is 303 Broadway, Cincinnati, Ohio 45202, unless otherwise noted.

(1) Principal Business Address: 400 Broadway, Cincinnati, Ohio 45202

 

(c)                Not applicable.

 

Item 30.       Location of Accounts and Records

 

The records required to be maintained by Section 31(a) of the Investment Company Act of 1940 and Rules 31a-1 to 31a-3 promulgated thereunder, are maintained by Integrity at 400 Broadway, Cincinnati, Ohio 45202

 

Item 31.       Management Services

 

There are currently no management-related services provided to the Registrant.

 

Item 32.       Undertakings

 

The Registrant hereby undertakes:

 

(a)          to file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements of the Registrant, Depositor and Guarantor in the registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted;

(b)         to include either (1) as part of any application to purchase a contract offered by the prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a postcard or similar written communication affixed to or included in the prospectus that the applicant can remove to send for a Statement of Additional Information; and

(c)          to deliver any Statement of Additional Information and any financial statements required to be made available under this Form, including the WSLIC financial statements, promptly upon written or oral request.

(d)         to update the registration statement if WSLIC terminates its guarantee to Integrity policy holders.

 

During any time there are insurance obligations outstanding and covered by the Guarantee issued by WSLIC, filed as an exhibit to this registration statement, Integrity hereby undertakes to provide notice to contract owners promptly

 

11



 

after the happening of significant events related to the Guarantee.  These significant events include: (i) termination of the Guarantee that has a material adverse effect on the contract owner’s rights under the Guarantee; (ii) a default under the Guarantee that has a material adverse effect on the contract owner’s rights under the Guarantee; or (iii) the insolvency of WSLIC.

 

Integrity represents that the aggregate charges under variable annuity contracts described in this Registration Statement are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by Integrity.

 

Integrity represents that it recognizes the requirements of Section 17(h) of the Investment Company Act of 1940, specifically that it shall not protect or purport to protect any director or officer of the Registrant or Depositor against any liability to them or to their security holders to which he would otherwise be subject by reason or willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his office.

 

12



 

INT Sep Acct I

 

April 2008

 

SIGNATURES

 

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant, the Depositor and the Guarantor, certify that they meet all of the requirements for effectiveness of this post-effective amendment to their Registration Statement pursuant to Rule 485 under the Securities Act of 1933 and have duly caused this amendment to the Registration Statement to be signed on their behalf, in the City of Cincinnati and State of Ohio on this 18th day of April, 2008.

 

 

SEPARATE ACCOUNT I OF

INTEGRITY LIFE INSURANCE COMPANY

(Registrant)

 

By: Integrity Life Insurance Company

(Depositor)

 

 

By:   

              /s/ Jill T. McGruder

 

Jill T. McGruder, President and CEO

 

 

 

INTEGRITY LIFE INSURANCE COMPANY

(Depositor)

 

 

By:   

              /s/ Jill T. McGruder

 

Jill T. McGruder, President and CEO

 

 

 

THE WESTERN AND SOUTHERN LIFE INSURANCE COMPANY

(Guarantor)

 

 

 

By:   

              /s/ John F. Barrett

 

John F. Barrett, Chairman, President and CEO

 



 

SIGNATURES

 

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Depositor has duly caused this amendment to the Registration Statement to be signed on its behalf, in the City of Cincinnati and State of Ohio on this 18th day of April, 2008.

 

 

 

INTEGRITY LIFE INSURANCE COMPANY

(Depositor)

 

 

By:  

              /s/ Jill T. McGruder

 

Jill T. McGruder, President and CEO

 

The following persons, in the capacities and on the dates indicated, have signed this amendment to the Registration Statement as required by the Securities Act of 1933:

 

 

PRINCIPAL EXECUTIVE OFFICER:

              /s/ Jill T. McGruder

 

 

Jill T. McGruder, President and CEO

 

April 18, 2008

 

 

 

 

PRINCIPAL FINANCIAL OFFICER:

        /s/ Bradley J. Hunkler

 

 

Bradley J. Hunkler, Vice President and Comptroller

 

April 18, 2008

 

 

 

 

PRINCIPAL ACCOUNTING OFFICER:

        /s/ Bradley J. Hunkler

 

 

Bradley J. Hunkler, Vice President and Comptroller

 

April 18, 2008

 

DIRECTORS:

 

 

/s/ John F. Barrett

 

/s/ Robert L. Walker

John F. Barrett

 

Robert L. Walker

April 18, 2008

 

April 18, 2008

 

 

 

 

 

 

/s/ Edward J. Babbitt

 

/s/ Edward S. Heenan, attorney-in-fact for William J. Williams

Edward J. Babbitt

 

William J. Williams

April 18, 2008

 

April 18, 2008

 

 

 

 

 

 

/s/ Jill T. McGruder

 

/s/ Donald J. Wuebbling

Jill T. McGruder

 

Donald J. Wuebbling

April 18, 2008

 

April 18, 2008

 



 

SIGNATURES

 

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Guarantor has duly caused this amendment to the Registration Statement to be signed on its behalf, in the City of Cincinnati and State of Ohio on this 18th day of April, 2008.

 

 

THE WESTERN AND SOUTHERN LIFE INSURANCE COMPANY

(Guarantor)

 

 

By:  

           /s/ John F. Barrett

 

John F. Barrett, Chairman, President and CEO

 

 

PRINCIPAL EXECUTIVE OFFICER:

           /s/ John F. Barrett

 

 

John F. Barrett, Chairman, President and CEO

 

April 18, 2008

 

 

 

 

PRINCIPAL FINANCIAL OFFICER:

                /s/ Robert L. Walker

 

 

Robert L. Walker, Senior Vice President and Chief Financial Officer

 

April 18, 2008

 

 

 

 

PRINCIPAL ACCOUNTING OFFICER:

                /s/ Robert L. Walker

 

 

Robert L. Walker, Senior Vice President and Chief Financial Officer

 

April 18, 2008

 

DIRECTORS:

 

 

/s/ John F. Barrett

 

/s/ Edward S. Heenan, attorney-in-fact for George H. Walker, III

John F. Barrett

 

George H. Walker, III

April 18, 2008

 

April 18, 2008

 

 

 

 

 

 

/s/ James N. Clark

 

/s/ Edward S. Heenan, attorney-in-fact for Thomas L. Williams

James N. Clark

 

Thomas L. Williams

April 18, 2008

 

April 18, 2008

 

 

 

 

 

 

/s/ Edward S. Heenan, attorney-in-fact for Jo Ann Davidson

 

/s/ Edward S. Heenan, attorney-in-fact for William J. Williams

Jo Ann Davidson

 

William J. Williams

April 18, 2008

 

April 18, 2008

 

 

 

 

 

 

/s/ Edward S. Heenan, attorney-in-fact for Eugene P. Ruehlmann

 

/s/ Edward S. Heenan, attorney-in-fact for Donald A. Bliss

Eugene P. Ruehlmann

 

Donald A. Bliss

April 18, 2008

 

April 18, 2008