485BPOS

Combo

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

Registration Nos. 333-56658 and 811-04846

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:  33	x

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

Amendment Number:  59 x

(Check appropriate box or boxes)

Separate Account I of National Integrity Life Insurance Company

(Exact Name of Registrant)

National 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:  AdvantEdge and IQ3 flexible premium variable annuities

AdvantEdge Variable Annuity

May 1, 2008

National Integrity Life Insurance Company

Separate Account I

This prospectus describes the AdvantEdge 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 Manager^SM Portfolio

Fidelity VIP Balanced Portfolio

Fidelity VIP Contrafund^â 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 CommodityRealReturn^TMStrategy 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

Touchstone VST Third Avenue Value Fund

Touchstone VST Aggressive ETF Fund

Touchstone VST Conservative ETF Fund

Touchstone VST Enhanced ETF Fund

Touchstone VST Moderate ETF Fund

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

Guaranteed Rate Options

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.

AN - - 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 811-04846 and 033-56658).  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 sit 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 National Integrity is the licensing of certain trademarks and trade names of BGI.  National Integrity’s variable annuity products are not sponsored, endorsed, sold or promoted by BGI.  BGI makes no representations or warranties to the owners of National 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 National Integrity’s variable annuity products.

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

Name:

Address:

Phone:

AN - - 2

TABLE OF CONTENTS

	Page GMI-
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	11
Summary of Contract	11
Investment Goals and Risks	11
Your Rights and Benefits	11
Account Value and Surrender Value	11
Your Right to Revoke (Free Look Period)	12
How Your Contract is Taxed	12
Part 2 – National Integrity and the Separate Account	12
National 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	22
Part 4 – Deductions and Charges	24
Mortality and Expense Risk Charge	24
Annual Administrative Charge	24
Reduction of the Mortality and Expense Risk Charge or Annual Administrative Charge	25
Portfolio Charges	25
Withdrawal Charge	25
Reduction or Elimination of the Withdrawal Charge	25
Disability Waiver	26
Commission Allowance and Additional Payments to Distributors	26
Optional Benefit Charges	26
Transfer Charge	26
Tax Reserve	26
State Premium Tax	27
Part 5 – Terms of Your Variable Annuity	27
Your Contributions	27
Units in Our Separate Account	27
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	29
Withdrawals	30
Assignments	31
Death Benefit Paid on Death of Annuitant	31
Distribution on Death of Owner	32
Spousal Continuation	33
Death Claims	33
Maximum Retirement Date and Annuity Benefit	33
Annuity Benefit Payments	34
Timing of Payment	34
How You Make Requests and Give Instructions	35

AN - 3

Part 6 – Optional Benefits	35
Guaranteed Lifetime Income Advantage Rider	35
Highest Anniversary Death Benefit Rider	41
Part 7 – Voting Rights	41
How Portfolio Shares Are Voted	41
How We Determine Your Voting Shares	42
Separate Account Voting Rights	42
Part 8 – Tax Aspects of the Contract	42
Introduction	42
Your Contract is an Annuity	43
Taxation of Annuities Generally	43
Tax-Favored Retirement Programs	44
Federal and State Income Tax Withholding	44
Impact of Taxes on the Company	45
Transfers Among Investment Options	45
Part 9 – Additional Information	45
Systematic Withdrawal Program	45
Income Plus Withdrawal Program	45
Choices Plus Required Minimum Distribution Program	46
Dollar Cost Averaging Program	46
Systematic Transfer Program	46
Customized Asset Rebalancing Program	47
Systematic Contributions Program	47
Legal Proceedings	47
Table of Contents of Statement of Additional Information	47
Part 10 – Prior Contracts	48
GrandMaster flex3 (Contracts Issued between May 1, 2002 and February 25, 2008)	48
GrandMaster I, II and III (Contracts issued until May 1, 2002)	49
Appendices	53
Appendix A – Financial Information for Separate Account I of National Integrity	53
Appendix B – Illustration of a Market Value Adjustment	79
Appendix C – Illustration of Guaranteed Lifetime Income Advantage	82

AN - 4

GLOSSARY

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

Adjusted Account Value – your Account Value increased or decreased by any Market Value Adjustment made to your Guaranteed Rate Options.

Administrative Office – National Integrity Life Insurance Company, 15 Matthews Street, #200, Goshen, New York 10924.  You may also call us at 1-800-433-1778.  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.

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.

Fixed Accounts – Guaranteed Rate Options 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.

Guaranteed Lifetime Income Advantage (GLIA) - an optional benefit that provides guaranteed lifetime payments will be available for withdrawal when a GLIA Rider is purchased.

GLIA Investment Strategies - - Investment strategies available when a GLIA Rider is purchased.

Guaranteed Rate Option (GRO) – a Fixed Account which offers Guarantee Periods of two, three, five, seven and ten years and locks in a fixed annual effective interest rate.

Guarantee Period – the length of time from the date of your contribution into a GRO, until the GRO matures.

Market Value Adjustment (MVA) – an upward or downward adjustment made to the value of your GRO if you make withdrawals or transfers from the GRO, or elect an Annuity Benefit before the end of the Guarantee Period.

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

Maximum Retirement Date - the last Annuitant’s 90^th birthday or the tenth Contract Anniversary, whichever is later, 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.

AN - 5

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

Rider– a supplement to your contract or additional feature that provides an optional benefit at an additional cost.

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

Surrender Value– your Adjusted Account Value reduced by any withdrawal charge, 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.

AN - 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.(1)

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.(2)

Contract Owner Transaction Expenses

Maximum Deferred Sales Load (Withdrawal Charge) as a percentage of contributions(3)	7		%
Transfer Charge (for each transfer after 12 transfers in one Contract Year)(4)	$	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(5) $ 50

Separate Account Annual Expenses as a percentage of value charged

	Maximum  Charge		Current  Charge
Mortality and Expense Risk Charge(6)	1.60	%	1.60	%
Optional Highest Anniversary Death Benefit Charge(7)	0.20	%	0.20	%
Optional Guaranteed Lifetime Income Advantage – Individual Rider Charge(8)	1.20	%	0.60	%
Optional Guaranteed Lifetime Income Advantage – Spousal Rider Charge(9)	1.60	%	0.80	%
Highest Possible Total Separate Account Annual Expenses(10)	3.40	%	2.60	%

(1) Expenses for prior versions of the contract, if different, are located in Part 10.

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

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

(4) This charge does not apply to transfers made in the Dollar Cost Averaging, Customized Asset Rebalancing, or Systematic Transfer programs.

(5) This charge will be waived if the Account Value is at least $50,000 on the last day of the Contract Year.

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

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

(8) Assessed quarterly based on the Payment Base-see Part 6; only one of the GLIA Riders, either Individual or Spousal, can be elected.

(9) Assessed quarterly based on the Payment Base-see Part 6; only one of the GLIA Riders, either Individual or Spousal, can be elected.

(10) You may elect only one of the following optional benefits: Individual GLIA, or Spousal GLIA.  Therefore the highest possible total separate account annual expenses reflect the election of the Spousal GLIA, which carries the higher cost.

AN - 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	%
Touchstone VST High Yield Fund (12), (13)	0.50	%	0.25	%	0.44	%	N/A		1.19	%	1.05	%

AN - 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 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, Initial 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, Initial Class (12), (13), (14)	0.40	%	0.25	%	0.50	%	0.21	%	1.36	%	0.96	%
Touchstone VST Conservative ETF Fund, Initial Class (12), (13), (14)	0.40	%	0.25	%	0.51	%	0.20	%	1.36	%	0.95	%
Touchstone VST Enhanced ETF Fund, Initial Class (12), (13), (14)	0.40	%	0.25	%	0.35	%	0.25	%	1.25	%	1.00	%
Touchstone VST Moderate ETF Fund, Initial 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, 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%.

(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

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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.  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, maximum Portfolio operating expenses, the cost of the Highest Anniversary Death Benefit and the maximum cost of the GLIA Spousal Rider, where the younger Annuitant is age 65 on the Contract Date.  If the current cost of the GLIA Spousal rider was used, the total cost would be less than indicated in this example.  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
$	1,306	$	2,328	$	3,065	$	6,205

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
$	606	$	1,828	$	3,065	$	6,205

If you do not surrender the contract:

1 year		3 years		5 years		10 years
$	606	$	1,828	$	3,065	$	6,205

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
$	1,117	$	1,761	$	2,118	$	4,316

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
$	417	$	1,261	$	2,118	$	4,316

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If you do not surrender the contract:

1 year		3 years		5 years		10 years
$	417	$	1,261	$	2,118	$	4,316

Accumulation Unit Values

See Appendix A

Summary of Contract

“We,” “our,” “us,” “the Company” and “National Integrity” mean National 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.”

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 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, subject to any applicable MVAs.  Your Account Value is subject to various charges.  See Part 4.

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Your Adjusted Account Value is your Account Value, as increased or decreased by any MVAs.  See Part 3, Market Value Adjustments.

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

Your minimum Account Value is $5,000.  If the Account Value goes below $5,000 and we have received no contributions from you for three 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 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 1966, as amended (the Tax 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.

PART 2 – NATIONAL INTEGRITY AND THE SEPARATE ACCOUNT

National Integrity Life Insurance Company

National Integrity is a stock life insurance company incorporated under the laws of New York on November 22, 1968.  Our home office is located at 15 Matthews Street, #200, Goshen, New York 10924.  We are authorized to sell life insurance and annuities in 8 states and the District of Columbia.  National 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 National 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 New York.  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 name.  We 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.

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Under New York 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.

Distribution of Variable Annuity Contracts

Touchstone Securities, Inc., an affiliate of National 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 Option.  We 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 National 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.  (If you purchase the GLIA Rider, your Investment Options are limited.  See Part 6.)

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 the 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 1-800-433-1778.

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

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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 prospectus carefully before investing.

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 Manager^SM Portfolio

VIP Asset Manager^SM 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.

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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 “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 500^SM 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 2015seeks 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 2025seeks 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

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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).

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

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smaller or larger market capitalizations.  FMR uses fundamental analysis of each 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.

The Franklin Templeton Variable Insurance Products Trust

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.

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

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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 CommodityRealReturn^TM 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.

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.

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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-ended management investment company.  Touchstone Advisors, Inc., 303 Broadway, Suite 1100, Cincinnati, Ohio 45202, which is affiliated with National 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 National 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 National 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 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 National 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.

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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 National 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 iShares^Ò 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.  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 any 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

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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 National 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 over weighted 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.

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.

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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 Captial 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 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, General Account and the non-unitized separate 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 (unless otherwise supported by a separate account), the Death Benefit in excess of Account Value and the Annuity Benefit and any guarantees offered under a Rider.  The non-unitized separate account supports the GROs.  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

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Accounts or the General Account are subject to certain provisions of the federal securities laws relating to the accuracy and completeness of statements made in prospectuses.

Guaranteed Rate Options

We offer GROs with Guarantee Periods of two, three, five, seven and ten years.  Each GRO matures at the end of the Guarantee Period you have selected.  We can change the Guarantee Periods available from time to time.  Each contribution or transfer to a GRO establishes a new GRO for the Guarantee Period you choose at the guaranteed interest rate that we declare as the current rate (Guaranteed Interest Rate).  When you put a contribution into a GRO, a Guaranteed Interest Rate is locked in for the entire Guarantee Period you select. We credit interest daily at an annual effective rate equal to the Guaranteed Interest Rate.  The Guaranteed Interest Rate will never be less than the minimum interest rate stated on the schedule page of your contract, which will never be less than 1%.

The value of a contribution to your GRO is called the GRO Value.  Assuming you haven’t transferred or withdrawn any amounts, the GRO Value will be the amount you contributed plus interest at the Guaranteed Interest Rate less any annual administrative charge and optional benefit charges that may apply.

We may declare an enhanced rate of interest in the first year for any contribution allocated to a GRO that exceeds the Guaranteed Interest Rate credited during the rest of the Guarantee Period.  This enhanced rate will be guaranteed for the Guarantee Period’s first year and declared at the time of purchase.  We may also declare and credit a special interest rate or additional interest at any time on any nondiscriminatory basis.  Any enhanced rate, special interest rate or additional interest credited to your GRO will be separate from the Guaranteed Interest Rate and will not be used in the MVA formula.

If you have more than one GRO with the same Guarantee Period, the GROs are considered one GRO for Account Value reporting purposes.  For example, when you receive a statement from us, all of your three-year GROs will be shown as one GRO while all of your five-year GROs will appear as another GRO, even though they may have different maturity dates.  However, you will receive separate notices concerning GRO renewals for each contribution you have made, since each contribution will have a different maturity date.

All contributions you make to a GRO are placed in a non-unitized separate account.  The value of your GROs is supported by the reserves in our non-unitized separate account.  You can get our current Guaranteed Interest Rates by calling our Administrative Office.

Renewals of GROs

We’ll notify you in writing before the end of your GRO Guarantee Period.  You must tell us before the end of your Guarantee Period if you want to transfer your GRO Value to another Investment Option.  If you do nothing, when the Guarantee Period ends, we will set up a new GRO for the same length of time as your old one, at the then-current Guaranteed Interest Rate for that Guarantee Period.

If a GRO matures and it can’t be renewed for the same length of time, the new GRO will be set up for the next shortest available Guarantee Period.  For example, if your mature GRO was for 10 years and when it matures, we don’t offer a 10-year Guarantee Period, but we do offer a seven-year Guarantee Period, your new GRO will be for seven years.  You can’t renew a GRO that would mature after your Maximum Retirement Date.

Market Value Adjustments

An MVA is an adjustment, either up or down, that we make to your GRO Value if you make an early withdrawal, surrender or transfer from your GRO or if you elect an Annuity Benefit before the end of the Guarantee Period.  An MVA also applies on a Distribution on Death of the owner before the end of the Guarantee Period, but not on the calculation of Death Benefits (which are paid on the death of the Annuitant).  No MVA is made for withdrawals of the Free Withdrawal Amount or for withdrawals or transfers, election of Annuity Benefits or calculations of Distributions on Death, which are made within 30 days of the expiration of the GRO Guarantee Period.  No MVA shall apply when withdrawals are taken to meet required minimum distributions under the Tax Code.  The value after the MVA may be higher or lower than the GRO Value, but will never be less than an amount equal to your contribution to the GRO, less withdrawals and associated withdrawal charges, less transfers out of a GRO, plus interest accumulated at the minimum interest rate declared in your contract, less

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any annual administrative charge and less any charges for the optional benefits, if applicable.

The MVA we make to your GRO is based on the changes in our Guaranteed Interest Rate.  Generally, if our Guaranteed Interest Rate has increased since the time of your contribution, the MVA will reduce your GRO Value.  On the other hand, if our Guaranteed Interest Rate has decreased since the time of your contribution, the MVA will generally increase your GRO Value.

The MVA for a GRO is determined by the following formula:

MVA = GRO Value x [(1 + A)^N/12 / (1 + B + .0025)^N/12 – 1], where:

A is the Guaranteed Interest Rate being credited to the GRO subject to the MVA;

B is the current Guaranteed Interest Rate, as of the effective date of the application of the MVA, for current allocations to a GRO, the length of which is equal to the number of whole months remaining in your GRO.  Subject to certain adjustments, if that remaining period isn’t equal to an exact period for which we have declared a new Guaranteed Interest Rate, B will be determined by a formula that finds a value between the Guaranteed Interest Rates for GROs of the next highest and next lowest Guarantee Period; and

N is the number of whole months remaining in your GRO.

If the remaining term of your GRO is 30 days or less, the MVA for your GRO will be zero.  If for any reason we are no longer declaring current Guaranteed Interest Rates, then to determine B we will use the yield to maturity of United States Treasury Notes with the same remaining term as your GRO, using a formula when necessary, in place of the current Guaranteed Interest Rate or Rates.  See Appendix B for illustrations of the MVA.

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

We deduct a daily charge equal to an annual effective rate of 1.60% of your Account Value in each of the Variable Account Options to cover mortality and expense risk and certain administrative expenses.  A portion of the 1.60% 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 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 1.60% 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.

Annual Administrative Charge

We charge an annual administrative charge of $50, which is deducted on the last day of the Contract Year if your Account Value is less than $50,000 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

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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 if you surrender the contract, 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 7%.  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
1	7	%
2	6	%
3	5	%
4	4	%
thereafter	0	%

The maximum of 7% 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 four years prior to 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 National Integrity or an affiliate, receiving distributions or making internal transfers from other contracts we

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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.

Disability Waiver

We may waive the withdrawal charges on full or partial withdrawal requests of $1,000 or more if you become disabled anytime before you reach age 65, and have been disabled for a continuous period of at least six months after the Contract Date.  We may also waive the MVA on any amounts withdrawn from the GROs.  You will be considered disabled if you are unable to engage in any substantial gainful activity by reason of any medically determinable physical impairment which can be expected to result in death or to be of long-continued and indefinite duration.  We may require proof of disability, including written confirmation of receipt and approval of any claim for Social Security Disability Benefits.  We reserve the right to obtain an examination by a licensed physician of our choice and our expense.  Written request for any withdrawal or partial withdrawals must be made while you are still disabled.  Once the disability waiver election has been made, no additional contributions will be accepted under your Contract.  The waivers of withdrawal charges and Market Value Adjustment apply to the owner, not to the Annuitant.  If there are joint owners, the waivers apply to both the primary and the joint owner.  The Disability Waiver is not available in New Hampshire or Vermont.

Commission Allowance and Additional Payments to Distributors

We generally pay a commission to the sales representative equal to a maximum of 5.00% of contributions, plus up to 1.00% trail commission paid on Account Value starting in the fourth 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.

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 details about the benefit, 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.

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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	$20,000
·	Minimum additional contribution	$  1,000
·	Maximum total contribution	$1,000,000 if the Annuitant is age 75 or younger
		$   500,000 if the Annuitant is age 76 or older

Different contribution limits apply if you select the GLIA Rider.  See Part 6.  Contributions may also be limited by various state or federal laws or prohibited by us for all owners under the contract.  If our 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 five 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.

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.  Different rules apply to the GLIA Investment Options.  See Part 6.

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

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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 1.60%.

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 GROs, subject to our transfer restrictions:

·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.

·Transfers into a GRO must be to a newly elected GRO (that is, to a GRO you haven’t already purchased) at the then-current Guaranteed Interest Rate.

·Transfers out of a GRO more than 30 days before the end of the Guarantee Period are subject to an MVA.  See Part 3.

·Transfers into and out of the GLIA Investment Options are restricted.  See Part 6.

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 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.

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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 are 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. Different rules apply to the GLIA Investment Options.  See Part 6.

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.

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

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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.

·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. 

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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,

·        plus or minus any MVA that applies (see Part 3, “Market Value Adjustments”),

·        minus any withdrawal charge that applies (see Part 4, “Withdrawal Charge”).

The net amount you receive will be the amount you requested, less any applicable tax withholding.  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 are reduced by withdrawals on a proportional basis.  See Part 5, “Death Benefits Paid on Death of Annuitant.”

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

Additional restrictions apply to withdrawals from the GLIA Investment Options.  See Part 6.

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.

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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

For contracts where the Annuitant’s age on the Contract Date is up to and including age 85, the Death Benefit will be the greater of:

·your total contributions, minus a proportional adjustment 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.

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.

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 Tax 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.

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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 Tax Code

If you (as owner) die, the Tax Code allows your surviving spouse to continue the annuity contract, along with its tax-deferred status, so long as your spouse is your sole 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;

·no joint owner is named; and

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

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 if he or she had 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, but the MVA will apply.  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 90th birthday or the tenth Contract Anniversary, whichever is later.  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.

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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 Adjusted Account Value, less any pro-rata annual administrative charge, 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 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 don’t 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.  However, we can defer our action as to Account Value allocated to the Variable Account Options 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.

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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 provides an optional benefit 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.

Guaranteed Lifetime Income Advantage Rider

Guaranteed Lifetime Income Advantage (GLIA), which is a guaranteed lifetime withdrawal benefit, is an optional Rider you may purchase for an additional charge.  You may select the Individual GLIA Rider or the Spousal GLIA Rider.  The GLIA Rider guarantees lifetime payments for you (or you and your spouse) regardless of how your investments perform, as long as the Rider is in effect.  If you take Nonguaranteed Withdrawals, as explained below, your lifetime payments will decrease and the Rider may terminate.

Lifetime Payout Amount (LPA)

The amount you can receive each Contract Year for your lifetime (or for as long as either you or your spouse is alive) is called an LPA.  The LPA is first determined and available to you when you take your first withdrawal on or after the Age 60 Contract Anniversary.

The Age 60 Contract Anniversary is the first Contract Anniversary on or after you reach age 60.  For the Spousal GLIA, it is the Contract Anniversary on or after the younger of you and your spouse reaches age 60.

Your LPA is always equal to your Payment Base multiplied by your Withdrawal Percentage.  Your Payment Base may change but your Withdrawal Percentage is locked in at the time of your first withdrawal on or after the Age 60 Contract Anniversary depending on your age at that time.

Age of (younger) Annuitant	Withdrawal Percentage
60-64	4.50	%
65-69	5.00	%
70-74	5.50	%
75-79	6.00	%
80 and above	7.00	%

The LPA is not cumulative.  If you withdraw less than the LPA in any Contract Year, you cannot carry over or add the remaining LPA to withdrawals made in future years.

Payment Base

Your Payment Base will always be the larger of your Bonus Base or your Step-Up Base.

Your Bonus Base (until a Bonus is applied) is:

1)             the Account Value on the date you purchase the GLIA Rider; plus

2)             additional Contributions; less

3)             Adjusted Nonguaranteed Withdrawals.

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After a Bonus is applied (but before a subsequent Bonus), your Bonus Base is:

1)the Bonus Base immediately before the Bonus is applied; plus

2)the Bonus amount (see “Bonus” section below); plus

3)additional Contributions received after the date of the Bonus; less

4)Adjusted Nonguaranteed Withdrawals taken after the date of the Bonus.

Your Step-Up Base (until a Step-Up is applied) is:

1)             the Account Value on the date you purchase the GLIA Rider; plus

2)             additional Contributions; less

3)             Adjusted Nonguaranteed Withdrawals.

On the last day of each Contract Year, we will compare your Account Value to your Step-Up Base.  If your Account Value is greater than the Step-Up Base, we will increase or “step up” the Step-Up Base to equal the Account Value.

After a Step-Up is applied (but before a subsequent Step-Up), the Step-Up Base is:

1)the Step-Up Base immediately before the Step-Up is applied; plus

2)the Step-Up amount; plus

3)additional Contributions received after the date of the Step-Up; less

4)Adjusted Nonguaranteed Withdrawals taken after the date of the Step-Up.

Effect of Withdrawals

Before the Age 60 Contract Anniversary, all withdrawals are Nonguaranteed Withdrawals and will reduce your Bonus Base and Step-Up Base (and therefore your Payment Base) by the Adjusted Nonguaranteed Withdrawal amount including Withdrawal Charges, if any.

After the Age 60 Contract Anniversary, withdrawals do not reduce your Bonus Base and Step-Up Base, as long as your total withdrawals in any Contract Year are not more than your LPA.  However, if you withdraw more than your LPA in any Contract Year, the amount which exceeds your LPA (including any Withdrawal Charges) is a Nonguaranteed Withdrawal.

Each time you make a Nonguaranteed Withdrawal, we will reduce your Bonus Base or Step-Up Base (and therefore your Payment Base) by the Adjusted Nonguaranteed Withdrawal amount.  The Adjusted Nonguaranteed Withdrawal amount is the amount of the Nonguaranteed Withdrawal (which includes any Withdrawal Charges) multiplied by the greater of:

·1.0; or

·Payment Base divided by Account Value, where both values are determined immediately before the Nonguaranteed Withdrawal.  If the withdrawal includes all or a portion of your LPA, the Account Value will be reduced by such portion prior to this calculation.

If your Payment Base is more than your Account Value when you take a Nonguaranteed Withdrawal, your Payment Base will be reduced by more than the amount of your Nonguaranteed Withdrawal.  Here’s an example assuming you take the withdrawal prior to your Age 60 Contract Anniversary and no withdrawal charges apply:

·Your Account Value is $75,000 and your Payment Base is $100,000

·You take a Nonguaranteed Withdrawal in the amount of $5,000

·Your Account Value will be reduced by $5,000, and your Payment Base will be reduced by $6,667

Other Important Facts about Withdrawals:

·You will not receive the intended benefit of this Rider if you take Nonguaranteed Withdrawals.  Nonguaranteed Withdrawals can have a significant negative effect on your Payment Base and LPA.

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·Withdrawal Charges may apply.  If you withdraw more than your Free Withdrawal amount (10% of the Account Value in any Contract Year) but the withdrawal does not exceed your LPA, any applicable Withdrawal Charges will be waived.  If you withdraw more than the Free Withdrawal amount and the withdrawal is a Nonguaranteed Withdrawal, Withdrawal Charges, if any, will be applied.  See Part 4, “Withdrawal Charge” and Part 5, “Withdrawals.”

·Withdrawals must be taken pro-rata from your Investment Options.  You cannot make a Withdrawal from specific Investment Options.

Annual Processing Date

The Annual Processing Date is the close of business the last day of each Contract Year.  If a withdrawal is taken on an Annual Processing Date, we will process the withdrawal first.  We will then reduce your Account Value by the Annual Administrative Charge, if applicable.  See Part 4, “Annual Administrative Charge.”  We will also deduct any quarterly charges that may apply and be due on that day.  We will then calculate Bonuses and Step-Ups, if any.  If the Annual Processing Date is not a Business Day, the Account Value for the purpose of the Step-Up is determined on the next Business Day after the Annual Processing Date.

Bonus

The Bonus amount is equal to your Bonus Percentage multiplied by the sum of all contributions minus your Bonus Percentage multiplied by the sum of all withdrawals (including Withdrawal Charges if any.)  Your Bonus Percentage is determined by your age (or the age of the younger of you and your spouse) at the time each Bonus is calculated.

Age of (younger) Annuitant	Bonus Percentage
69 or below	5.00	%
70-74	5.50	%
75-79	6.00	%
80 and above	7.00	%

If you do not take withdrawals in a Contract Year, we will apply the Bonus on the last day of the Contract Year.  The Bonus is available during the first 10 Contract Years after the GLIA Rider is purchased.

GLIA Charge

We deduct an annual charge for the Individual GLIA Rider of 0.60% and an annual charge for the Spousal GLIA Rider of 0.80%.  The 0.60% (or 0.80%) charge is multiplied by the Payment Base as of the last day of each calendar quarter and divided by 4.  We will deduct the charge from your Investment Options in the same proportion that the value of each of the Options bears to the Account Value (pro-rata).  This charge decreases your Account Value dollar-for-dollar, but does not decrease your Payment Base.

If the GLIA Rider takes effect or terminates on any day other than the first day of the quarter, we will deduct a proportional share of the charge for the part of the quarter the Rider was in effect.

We reserve the right to increase the annual charge for the Individual GLIA Rider up to a maximum of 1.20%, and the annual charge for the Spousal GLIA Rider up to a maximum of 1.60%.  If we do increase the charge, we will give you prior written notice of the increase and an opportunity to reject the increase.  If you do not reject the increase in writing, the annual charge for your GLIA Rider will increase and you will continue to receive Step-Ups under the terms of the Rider.

If you reject the increase by giving us written notice, your charge will remain the same, but you will not receive any Step-Ups after the effective date of the increase.  Your decision to reject an increase is permanent and once an increase is rejected, you will no longer be eligible to receive notice or accept additional charge increases and will not receive additional Step-Ups.

GLIA Investment Strategies

If you elect to purchase the GLIA Rider, you must invest 100% of your Account Value at all times in only one of the three GLIA Investment Strategies described below.  (Note that the Investment Options available in the GLIA Investment Strategies are also available without the Rider.)

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GLIA Investment Strategy 1 – You may select one or more of the three Investment Options, as long as your allocations add up to 100% and do not exceed the percentage indicated for any particular Investment Option.

Touchstone VST 
Conservative ETF Portfolio
0 – 100% Touchstone VST
Moderate ETF Portfolio
0 – 100% Touchstone VST
Aggressive ETF Portfolio 
0 – 50%

GLIA Investment Strategy 2 – You may select one or more of the four Portfolios, as long as your allocations add up to 100%.

Fidelity VIP Freedom 
2010 Portfolio Fidelity VIP Freedom
2015 Portfolio Fidelity VIP Freedom
2020 Portfolio Fidelity VIP Freedom
2025 Portfolio

GLIA Investment Strategy 3 – You may select one or more of the Investment Options in one or more columns, as long as your allocations add up to 100% and are within the minimum and maximum allocation percentages indicated for each column.

Minimum Allocation 30% Maximum Allocation 60%	Minimum Allocation 40% Maximum Allocation-70%	Maximum Allocation 20%	Maximum Allocation 10%
Fixed Income	Core Equity	Non Core Equity	Alternative
Fidelity VIP Investment Grade Bond	Fidelity VIP Asset Manager	DWS Small Cap Index VIP	PIMCO VIT All Asset
PIMCO VIT Total Return	Fidelity VIP Balanced	Fidelity VIP Disciplined Small Cap	PIMCO VIT Commodity RealReturn Strategy
Touchstone VST Core Bond	Fidelity VIP Contrafund	Fidelity VIP Dynamic Capital Appreciation	Rydex VT Absolute Return Strategies
	Fidelity VIP Equity-Income	Fidelity VIP Mid Cap	Rydex VT Hedged Equity
	Fidelity VIP Growth & Income	Fidelity VIP Value Strategies	Rydex VT Sector Rotation
	Fidelity VIP Growth Opportunities	FTVIPT Franklin Small Cap Value Securities	Van Kampen UIF U.S. Real Estate
	Fidelity VIP Growth	Touchstone VST Baron Small Cap Growth	High Yield
	Fidelity VIP Index 500	Touchstone VST Mid Cap Growth	Fidelity VIP High Income
	FTVIPT Franklin Growth and Income Securities	Touchstone VST Third Avenue Value	FTVIPT Franklin Income Securities
	FTVIPT Franklin Large Cap Growth Securities	Van Kampen LIT Capital Growth	Touchstone VST High Yield
	FTVIPT Mutual Shares Securities	International	Short Duration
	Touchstone VST Aggressive ETF	Fidelity VIP Overseas	PIMCO VIT Low Duration
	Touchstone VST Conservative ETF	FTVIPT Templeton Foreign Securities	PIMCO VIT Real Return
	Touchstone VST Enhanced ETF	FTVIPT Templeton Growth Securities	Touchstone VST Money Market
	Touchstone VST Large Cap Core Equity	Van Kampen UIF Emerging Markets Debt
	Touchstone VST Moderate ETF	Van Kampen UIF Emerging Markets Equity
	Van Kampen LIT Comstock
	Van Kampen UIF U.S. Mid Cap Value

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For more information regarding these Investment Options, including information relating to their investment objectives and policies, and the risks of investing, see Part 3, “Your Investment Options” as well as the underlying Portfolio prospectuses.  You can obtain a copy of the Portfolio prospectuses by contacting the Administrative Office.  You should read the Portfolio prospectuses carefully before investing.

Subject to required approvals by federal and state authorities, we reserve the right to add, close, eliminate or substitute the GLIA Investment Strategies, the Investment Options or the underlying Portfolios at any time.

Transfer and Allocation Restrictions

The following limitations apply to your allocations and transfers among the Investment Strategies and the GLIA Investment Options.

·Only one investment allocation may be in place at any time.  This allocation applies to all current and future contributions and automatic rebalancing.

·To change your investment allocation, you can make one or more transfers among the Investment Options within a GLIA Investment Strategy, or you can move 100% of your investment from one GLIA Investment Strategy to another GLIA Investment Strategy.  You must make your transfers at the same time.

·Your first transfer is allowed 90 days after the Contract Date.  Each transfer starts a 90-day waiting period before you can make another transfer.

·We will automatically rebalance your Investment Options quarterly.  The transfers resulting from automatic rebalancing do not trigger a 90-day waiting period.

Your financial professional or a third party may offer you asset allocation or investment advisory services related to this annuity Contract or Rider for an additional fee to be deducted from your contract.  Such fees are considered withdrawals and could cause a Nonguaranteed Withdrawal or make you ineligible to receive a Bonus.  Therefore, if you purchase the GLIA Rider, we do not recommend using this annuity Contract to pay for such services.

Contribution Limits

·Your initial contribution must be at least $25,000 but not more than $1,000,000 if you are 75 or younger ($500,000 if you are 76 or older), without our prior approval.

·Each additional contribution must be at least $1,000.

·You cannot make additional contributions after the older Annuitant’s 80^th birthday or during the Guaranteed Payment Phase.

·Your total contributions cannot be more than $1 million if you are 75 or younger ($500,000 if you are 76 or older), without our prior approval.

We reserve the right to refuse to accept additional contributions (on a nondiscriminatory basis) at any time to the extent permitted by law.

Withdrawal Protection for Required Minimum Distributions

If you have a tax-qualified annuity Contract (such as an IRA), you may need to withdraw money from this annuity contract in order to satisfy IRS minimum distributions requirements after you turn 70½.

We will calculate the required minimum distribution with respect to this annuity contract based on the prior calendar year-end fair market value of this annuity Contract only.  We do not take into account your other assets or distributions in making this calculation.

You may take the greater of your LPA or your required minimum distribution from your GLIA Rider without causing a Nonguaranteed Withdrawal.  However, timing of the withdrawals may be restricted.  We will notify you during the year of the amount you may take (Maximum Amount), and when you may take the Maximum Amount so you can satisfy your RMD obligations without inadvertently taking a Nonguaranteed Withdrawal.  If you take withdrawals that exceed your Maximum Amount or if you do not honor the timing restrictions, any withdrawals greater than LPA will be treated as Nonguaranteed Withdrawals.  See “Effect of Withdrawals” section, above.

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You must take your first annual required minimum distribution in the calendar year you turn age 70½.  We reserve the right to make any changes we deem necessary to comply with the tax laws.  You should discuss these matters with your tax advisor prior to electing the GLIA Rider.

Guaranteed Payment Phase

The Guaranteed Payment Phase begins on the date the Account Value decreases to zero, but the Payment Base is more than zero.  During this phase, you will receive automatic payments each Contract Year equal to the LPA on the date of the first payment.

Once the Guaranteed Payment Phase begins, all other rights, benefits, values and charges under the contract, the GLIA Rider and any other Riders, will terminate, except those described in this section and in the “Termination” section below.  We will send you a written notice when the annuity Contract enters the Guaranteed Payment Phase.

The payments will continue for your lifetime (or as long as either you or your spouse is alive).  The Guaranteed Payment Phase will end if the Rider terminates.  See “Cancellation and Termination of Rider” section below.

Contract Structure

While this Rider is in effect:

1.You must be the Owner and Primary Annuitant.  (You may be the beneficial owner through a custodial account.)

2.Joint Owners are not allowed.

3.Contingent Annuitants have no effect.

If the Spousal GLIA Rider is elected, in addition to numbers 1-3 above:

4.You must name your spouse as the Spousal Annuitant.

5.You must name your spouse as the Owner’s Sole Beneficiary and the Annuitant’s Sole Beneficiary.

6.We will only accept a legal spouse as defined under the federal Defense of Marriage Act (1 U.S.C. §7), which means one spouse of the opposite sex.  Where required by state law, the definition of spouse may be expanded to include a civil union partner, however,the surviving partner of a civil union is not afforded the benefits of a surviving spouse beneficiaryunder Internal Revenue Code 72(s) and will incur a taxable event upon the death of his or her partner.

7.If you and your spouse are more than 10 years apart in age, the Spousal GLIA Rider is probably not suitable for you.

You may remove a Spousal Annuitant as a party, but you cannot add or change a Spousal Annuitant. We will not reduce the Rider charge if you remove a spouse.  The Spousal Annuitant is automatically removed upon a divorce or other legal termination of your marriage, therefore lifetime withdrawals are not guaranteed for the lives of both you and your spouse under the Spousal Rider if you are divorced.  You must provide us with notice of the divorce or termination of marriage.  If a spouse is removed, you can name new Owner’s Beneficiaries and Annuitant’s Beneficiaries.

Cancellation and Termination of Rider

You may cancel the Rider after it has been in effect for five Contract Years.  You will have a 45 day window to cancel your Rider each Contract Year after that.

This Rider will terminate automatically on the earliest of the following dates:

1.The date you die (or survivor of you and your spouse dies);

2.The date the Payment Base equals zero;

3.The date a Nonguaranteed Withdrawal reduces the Account Value to zero;

4.The date before the Age 60 Contract Anniversary that the Account Value equals zero;

5.The date that you transfer ownership of the Contract;

6.The date you assign the Contract or any benefits under the Contract or Rider;

7.The date a Death Benefit is elected under the Contract;

8.On the Maximum Retirement Date, unless you elect to receive your LPA under an Annuity Benefit;

9.The date you elect an Annuity Benefit under the contract;

10.The date you cancel this Rider;

11.The date the Contract ends.

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Once cancelled or terminated, this Rider may not be reinstated.

Additional Restrictions

The following additional restrictions apply to your annuity Contract if you elect the GLIA Rider:

·For the Individual Rider, you must be between 50 and 80 years old on the date your elect the Rider.  For the Spousal Rider, the older of you and your spouse must be between 60 and 80 years old on the date you elect the Rider.

·The Guaranteed Rate Options and Systematic Transfer Option are not available.

·Dollar Cost Averaging is not available.

·Systematic contributions are not available.

The addition of the GLIA Rider to your annuity Contract may not always be in your best interest.  For example: (i) if you are purchasing the GLIA to meet income needs, you should consider whether an immediate annuity is better suited to your situation; (ii) if you are primarily seeking long-term asset growth and do not plan to take withdrawals until ten years or more after you purchase the Rider, the benefit of the GLIA Rider may not justify its cost; (iii) if you do not expect to take withdrawals while this Rider is in effect, you do not need the GLIA rider because the benefit is accessed through withdrawals; or (iv) if you are likely to need to take withdrawals prior to the LPA being available or in an amount that is greater than the LPA, you should carefully evaluate whether the GLIA Rider is appropriate, due to the negative effect of Nonguaranteed Withdrawals on your Rider values.  You should consult with your tax and financial advisors and carefully consider your alternatives before deciding if the GLIA Rider is suitable for your needs.

We reserve the right to discontinue offering the GLIA Rider at any time, but this will not affect your GLIA Rider once it is issued.

Examples

Please see Appendix C for hypothetical examples that illustrate how the GLIA Rider works.

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 70, the Death Benefit will be the greater of:

·your highest Account Value on any Contract Anniversary up to and including Annuitant’s age 75, plus any contributions received after that Contract Anniversary, minus proportional adjustments for any withdrawals (including associated charges) after that Contract Anniversary; or

·the standard Death Benefit described in Part 5.

The HADB Rider is not available if the Annuitant is age 71 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.

PART 7 – VOTING RIGHTS

How Portfolio Shares Are Voted

National 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.

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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 shareholder’s 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 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.  National Integrity does not guarantee the tax

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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 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 Tax 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 or any portion of the value of a contract will be treated as a distribution of that portion of the value of the contract.

Your 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, 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 ruled 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 the 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

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beneficiary

·      payment is a result of the taxpayer becoming disabled within the meaning of Tax 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 Tax 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 Tax 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 Tax 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 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 Plan

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 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

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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 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 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

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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.  This program is not available with the GLIA Rider.

Choices Plus Required Minimum Distribution Program

We office a Choices Plus Required Minimum Distribution Program that allows you to pre-authorize withdrawals from your contract after you attain age 70½.  The Tax Code requires that you take minimum distributions from an IRA beginning on or before April 1^st 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, semi-annually, or annually and can specify the day of the month (other than the 29^th, 30^th, or 31^st) 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 or MVAs.  This program is not available with the GLIA Rider.  See Part 6, “Withdrawal Protection for Required Minimum Distributions.”

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.

We offer a Dollar Cost Averaging Program under which we transfer contributions that you have allocated to the Touchstone VST Money Market Fund, Service Class, 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 to transfer to each Investment Option specified, no transfer will be made and your enrollment in the program will end.

This program is not available in connection with the GLIA Investment Options.

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.  You cannot transfer Account Value into an STO.

There is no charge for transfers under this program, and these transfers won’t count towards the twelve free

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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.  This program may not be currently available in some states.  This feature is not available with the GLIA Rider.

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. If you elect the GLIA Rider, a different rebalancing program is used.  See Part 6.   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 you 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.  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.

Contributions to the GLIA Investment Options may not be made via the Systematic Contribution Program.

Legal Proceedings

National 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 National 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:

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Administrative Office

National Integrity Life Insurance Company

15 Matthews Street #200

Goshen, New York 10924

ATTN:  Request for SAI of Separate Account I

PART 10 – PRIOR CONTRACTS

Over time, we have made changes to the AdvantEdge line of variable annuity contracts, which was formerly know as the GrandMaster product line.  You may own a prior version of the AdvantEdge contract sold under the name GrandMaster, GrandMaster II, GrandMaster III, Heritage Asset Builder or GrandMaster flex3.  Material features in prior versions of the AdvantEdge contract that differ from the AdvantEdge contract we are currently offering are described below.  The dates given are the company roll-out dates, but these dates vary state by state.  Please check your contract and the prospectus you received when you purchased your annuity if you are uncertain about whether these features are in your contract.

Contracts issued from May 1, 2002 to February 25, 2008 (GrandMaster flex3)

Annual Administrative Charge

Annual Administrative Charge(11) $ 50

Separate Account Annual Expenses as a percentage of value charged

Mortality and Expense Risk Charge(12) 1.55 %

Total Annual Portfolio Operating Expenses for the Portfolios in which you may purchase a class of shares that is different from the table in Part 1 of this prospectus.  All other portfolios and expenses are the same as in the table in Part 1.

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
Touchstone VST Money Market Fund, Service Class (13), (14)	0.18	%	0.25	%	0.29	%	N/A		0.72	%	0.72	%
Touchstone VST Aggressive ETF Fund, Service Class (13), (14),(15)	0.40	%	0.25	%	0.50	%	0.21	%	1.36	%	0.96	%
Touchstone VST Conservative ETF Fund, Service Class (13), (14), (15)	0.40	%	0.25	%	0.51	%	0.20	%	1.36	%	0.95	%
Touchstone VST Enhanced ETF Fund, Service Class (13), (14), (15)	0.40	%	0.25	%	0.35	%	0.25	%	1.25	%	1.00	%
Touchstone VST Moderate ETF Fund, Service Class (13), (14), (15)	0.40	%	0.25	%	0.37	%	0.21	%	1.23	%	0.96	%

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

(12) Assessed daily on the amount allocated to the Variable Account Options

(13) “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.

(14) 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.

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

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Withdrawal Charge

Contribution  Year	Charge as a percentage of the contribution withdrawn
1	7	%
2	6	%
3	5	%
thereafter	0	%

Commission Allowance and Additional Payments to Distributors

We generally pay a commission to the sales representative equal to a maximum of 4.50% of contributions, plus up to 1.00% trail commission paid on Account Value starting in the second Contract Year.

Standard Death Benefit

For contracts where the Annuitant’s age on the Contract Date is up to and including age 85, the Death Benefit will be the greatest of:

·highest Account Value on any Contract Anniversary before Annuitant’s age 76, plus any contributions received after that Contract Anniversary, minus a proportional adjustment for any withdrawals (and associated charges)received after that Contract Anniversary; or

·total contributions, minus 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 86 or older the Death Benefit is:

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

Optional Benefits

The Guaranteed Lifetime Income Advantage was not available.

Contracts issued until May 1, 2002 (Grand Master I, II and III)

Contract Owner Transaction Expenses

Maximum Deferred Sales Load (Withdrawal Charge) as a percentage of contributions(16)	8		%
Transfer Charge (for each transfer after 12 transfers in one Contract Year)(17)	$	20

Annual Administrative Charge

Annual Administrative Charge(18) $ 30

Separate Account Annual Expenses as a percentage of value charged

Mortality and Expense Risk Charge 1.35 %

Total Annual Portfolio Operating Expenses for the Portfolios in which you may purchase a class of shares that is different from the table in Part 1 of this prospectus.  All other portfolios and expenses are the same as in the

(16) or contracts issued before approximately February 15, 1997, the maximum withdrawal charge was 7%

(17) For contracts issued before approximately May 1, 1996, the transfer a charge is $25 per transfer after your 12 free transfers.

(18) This charge will be waived if the Account Value is at least $50,000 on the last day of the Contract Year

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table in Part 1.

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
Fidelity VIP Asset Manager Portfolio, Initial Class (19)	0.51	%	0.00	%	0.12	%	N/A	0.63	%	0.62	%
Fidelity VIP Contrafund Portfolio, Initial Class (19)	0.56	%	0.00	%	0.09	%	N/A	0.65	%	0.64	%
Fidelity VIP Equity-Income Portfolio, Initial Class (19)	0.46	%	0.00	%	0.09	%	N/A	0.55	%	0.54	%
Fidelity VIP Growth & Income Portfolio, Initial Class (20)	0.46	%	0.00	%	0.12	%	N/A	0.58	%	0.58	%
Fidelity VIP Growth Opportunities Portfolio, Initial Class (20)	0.56	%	0.00	%	0.12	%	N/A	0.68	%	0.68	%
Fidelity VIP High Income Portfolio, Initial Class (20)	0.57	%	0.00	%	0.11	%	N/A	0.68	%	0.68	%

Maximum Number of Investment Options

You may invest in, or have allocations directed to, a total of ten investment options at any time.

Optional Benefits

The Guaranteed Lifetime Income Advantage was not available.

Additional information for contracts issued before February 15, 1997

Disability Waivers aren’t available for contracts issued before February 15, 1997

The systematic transfer option is not available for contracts issued before July 7, 1998.

Death Benefits

For contracts issued before January 1, 1995, the amount of the death benefit is the greatest of:

·your current Account Value on the day we receive due proof of death and beneficiary’s election form in good order,

·the Account Value at the beginning of the seventh Contract Year, plus subsequent contributions and minus a proportional adjustment for subsequent withdrawals (and associated charges), or

·your total contributions less the sum of withdrawals (and associated charges).

For contracts issued on or after January 1, 1995, the amount of the death benefit is the greatest of:

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

·the highest Account Value at the beginning of any Contract Year, plus subsequent contributions and minus a proportional adjustment for subsequent withdrawals (and associated charges), or

·your total contributions less the sum of withdrawals (and associated charges).

All Contracts Issued between May 1, 2002 and November 17, 2003

Separate Account Annual Expenses as a percentage of value charged

(19) A portion of the brokerage commissions that each Fidelity VIP 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.

(20) Not available in Grand Master I.

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Mortality and Expense Risk Charge	1.55	%
Optional AVO Charge (maximum charge 3%)	0.45	%
Highest Possible Total Separate Account Annual Expenses	2.00	%

Additional Features

The Added Value Option (AVO) was available.  The AVO was an optional benefit Rider available for an additional cost, which is shown in the table below.  If you selected the AVO (you would have selected the AVO at the time of application) we credited from 1% up to 3% of all your contributions made during the first Contract Year.  For example, if $50,000 was contributed and the 3% AVO was selected, we would have credited $1500 to your Account Value.

AVO percentage elected		Charge at annual effective rate		Total Separate Account Charges with AVO
1	%	0.15	%	1.70	%
2	%	0.30	%	1.85	%
3	%	0.45	%	2.00	%

The dollar amount of the charge for the AVO is subject to a minimum and maximum amount.  For a 1% credit the minimum amount is .145% multiplied by first-year total contributions and the maximum amount is .182% multiplied by first-year total contributions.  To calculate the minimum and maximum dollar amounts, multiply the first-year total contributions, by the percentages in the following chart, for the AVO you select.  First-Year Total Contributions are all deposits made into the annuity, whether by your contribution or by us, during the first Contract Year.

AVO percentage elected		Minimum Percentage		Maximum Percentage
1	%	0.145	%	0.182	%
2	%	0.290	%	0.364	%
3	%	0.435	%	0.546	%

This fee is assessed quarterly to the Account Value for seven Contract Years.  Therefore, the fee will be assessed against any contributions you make after the first Contract Anniversary, which do not receive any AVO credit.  Over time, the benefit of the AVO may be more than offset by the fees associated with the option.

We use this charge as well as a portion of the withdrawal charge and mortality and expense risk charge to recover the cost of providing the AVO.  We intend to make a profit from these fees and charges.  Under certain circumstances, such as periods of poor market performance, the cost associated with the AVO may exceed the sum of the AVO and any related earnings.  Generally, if the average annual investment performance exceeds the percentages listed below, you will benefit from having the AVO.  Generally, if the average annual investment performance is below the percentages listed below, or you invest substantially in the Fixed Accounts, you will not benefit from the AVO.  The approximate average annual investment performance threshold needed to benefit from the AVO is as follows:

AVO percentage elected		Approximate Average Annual Investment Performance Threshold
1	%	7.70	%
2	%	8.05	%
3	%	8.40	%

Some or all of the AVO will be recaptured by the company if withdrawals in excess of the Free Withdrawal Amount were taken.  The chart below shows what portion of the AVO originally credited was recaptured.  The factors in the chart were applied to a percentage of the AVO amount credited, where the percentage equals the amount subject to a withdrawal charge divided by the Account Value at the time of withdrawal.  The amount recaptured is based upon the year the withdrawal is taken.  The total amount recaptured will never exceed what was credited.  We do not waive the recapture of the Added Value Option for Minimum Required Distributions

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from a tax-qualified annuity under the Code.  Any part of the Added Value Option distributed as part of a minimum required distribution will be subject to the recapture schedule above.

Contract Year	Amount of AVO Recaptured
1	100	%
2	100	%
3	85	%
4	70	%
5	55	%
6	40	%
7	25	%
8	0	%

Death Benefit

For Contracts issued before the Annuitant’s 86th birthday, if the Annuitant dies before age 90 (or the Contract’s 10th anniversary date, if later) before annuity payments have started, the death benefit is the greatest of:

·your highest Account Value on any contract anniversary before age 81, plus subsequent contributions and minus a proportional adjustment for subsequent withdrawals (and associated charges);

·total contributions, minus withdrawals (and associated charges); or

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

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Appendix A

Financial Information for Separate Account I of National Integrity (AdvantEdge)

For the Variable Account Options we currently offer, the table below shows the following data for AdvantEdge contracts with a mortality and expense risk charge of 1.60%, issued after approximately February 25, 2008 (date varies by state):  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

	Inception Date and Value
DWS Small Cap Index VIP, Class B (1351)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Asset Manager, Service Class 2 (1332)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Balanced, Service Class 2 (1337)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Contrafund, Service Class 2 (1335)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Disciplined Small Cap, Service Class 2 (1342)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Dynamic Capital Appreciation, Service Class 2 (1341)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Equity Income, Service Class 2 (1333)
Unit value at beginning of period	$	10.00

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	Inception Date and Value
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Freedom 2010, Service Class 2 (1343)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Freedom 2015, Service Class 2 (1344)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Freedom 2020, Service Class 2 (1345)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Freedom 2025, Service Class 2 (1346)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Freedom 2030, Service Class 2 (1347)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Growth, Service Class 2 (1334)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08

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	Inception Date and Value
Fidelity VIP Growth & Income, Service Class 2 (1338)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Growth Opportunities, Service Class 2 (1339)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP High Income, Service Class 2 (1329)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Index 500, Service Class 2 (1336)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Investment Grade Bond, Service Class 2 (1330)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Mid-Cap, Service Class 2 (1340)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Overseas, Service Class 2 (1331)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Fidelity VIP Value Strategies, Service Class 2 (1375)
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

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	Inception Date and Value
FTVIPT Franklin Growth & Income Securities, Class 2 (1326)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
FTVIPT Franklin Income Securities, Class 2 (1327)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
FTVIPT Franklin Large Cap Growth Securities, Class 2 (1323)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
FTVIPT Franklin Small Cap Value Securities, Class 2 (1328)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
FTVIPT Franklin Mutual Shares Securities, Class 2 (1325)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
FTVIPT Templeton Foreign Securities, Class 2 (1322)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
FTVIPT Templeton Growth Securities, Class 2 (1324)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08

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	Inception Date and Value
PIMCO VIT All Asset Portfolio, Advisor Class (1371)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
PIMCO VIT CommodityRealReturn Strategy Portfolio, Advisor Class (1370)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
PIMCO VIT Low Duration Portfolio, Advisor Class (1368)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
PIMCO VIT Real Return, Advisor Class (1369)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
PIMCO VIT Total Return, Advisor Class (1367)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Rydex VT Absolute Return Strategies Fund (1373)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Rydex VT Hedged Equity Fund (1374)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Rydex VT Sector Rotation Fund (1372)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Baron Small Cap (1361)
Unit value at beginning of period	$	10.00

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	Inception Date and Value
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Core Bond (1353)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST High Yield (1357)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Large Cap Core Equity (1358)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Mid Cap Growth (1354)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Money Market (1359)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Third Avenue Value (1360)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Aggressive ETF (1365)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Conservative ETF (1363)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08

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	Inception Date and Value
Touchstone VST Enhanced ETF (1366)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Touchstone VST Moderate ETF (1364)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Van Kampen LIT Comstock, Class II (1321)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Van Kampen LIT Capital Growth, Class II (1320)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Van Kampen UIF Emerging Markets Debt, Class II (1349)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Van Kampen UIF Emerging Markets Equity, Class II (1350)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08
Van Kampen UIF U.S. Mid Cap Value, Class II (1376)
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 US Real Estate, Class II (1348)
Unit value at beginning of period	$	10.00
Unit value at end of period
Units outstanding at end of period	2-25-08

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Appendix A

Financial Information for Separate Account I of National Integrity (GrandMaster flex3)

For the Variable Account Options we currently offer, the table below shows the following data for GrandMaster flex3 contracts with a mortality and expense risk charge of 1.55%, issued after approximately May 1, 2002:  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		2002		Inception Date and Value
DWS Small Cap Index, Class B (154)
Unit value at beginning of period	$	16.24	$	14.08	$	13.75	$	11.89	$	8.27	—		$	10.00
Unit value at end of period	$	15.65	$	16.24	$	14.08	$	13.75	$	11.89	$	8.27
Number of units outstanding at end of period	12,236		17,655		15,724		15,397		12,478		—		5-1-02
Fidelity VIP Asset Manager, Service Class 2 (172)
Unit value at beginning of period	$	11.16	$	10.58	$	10.36	—		—		—		$	10.00
Unit value at end of period	$	12.65	$	11.16	$	10.58	$	10.36
Number of units outstanding at end of period	8,818		20,969		23,811		18,513						5-1-04
Fidelity VIP Balanced, Service Class 2 (170)
Unit value at beginning of period	$	13.18	$	12.01	$	11.56	$	11.17	—		—		$	10.00
Unit value at end of period	$	14.11	$	13.18	$	12.01	$	11.56	$	11.17
Number of units outstanding at end of period	40,508		29,851		26,465		25,791		2,656				5-1-03
Fidelity VIP Contrafund Fund, Service Class 2 (102)
Unit value at beginning of period	$	16.00	$	14.58	$	12.70	$	11.20	$	8.88	—		$	10.00
Unit value at end of period	$	18.48	$	16.00	$	14.58	$	12.70	$	11.20	$	8.88
Number of units outstanding at end of period	146,150		137,345		119,897		57,352		17,116		860		5-1-02
Fidelity VIP Disciplined Small Cap, Service Class 2 (1304)
Unit value at beginning of period	$	10.00	—		—		—		—		—		$	10.00
Unit value at end of period	$	8.99
Units outstanding at end of period	5,352												4-27-07

AN - 60

	2007		2006		2005		2004		2003		2002		Inception Date and Value
Fidelity VIP Dynamic Capital Appreciation, Service Class 2 (173)
Unit value at beginning of period	$	14.17	$	12.65	$	10.64	—		—		—		$	10.00
Unit value at end of period	$	14.89	$	14.17	$	12.65	$	10.64
Number of units outstanding at end of period	2,931		6,022		2,903		2,817						5-1-04
Fidelity VIP Equity Income Fund, Service Class 2 (104)
Unit value at beginning of period	$	14.82	$	12.55	$	12.07	$	11.02	$	8.61	—		$	10.00
Unit value at end of period	$	14.77	$	14.82	$	12.55	$	12.07	$	11.02	$	8.61
Number of units outstanding at end of period	30,364		33,694		34,719		37,953		7,752		173		5-1-02
Fidelity VIP Freedom 2010, Service Class 2 (1309)
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	3,510												4-30-07
Fidelity VIP Freedom 2015, Service Class 2 (1310)
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	151												4-30-07
Fidelity VIP Freedom 2020, Service Class 2 (1311)
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	0												4-30-07
Fidelity VIP Freedom 2025, Service Class 2 (1312)
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	0												4-30-07
Fidelity VIP Freedom 2030, Service Class 2 (1313)
Unit value at beginning of period	$	10.00	—		—		—		—		—		$	10.00
Unit value at end of period	$	10.26
Number of units outstanding at end of period	0												4-30-07

AN - 61

	2007		2006		2005		2004		2003		2002		Inception Date and Value
Fidelity VIP Growth Fund, Service Class 2 (105)
Unit value at beginning of period	$	11.95	$	11.39	$	10.96	$	10.80	$	8.28	—		$	10.00
Unit value at end of period	$	14.90	$	11.95	$	11.39	$	10.96	$	10.80	$	8.28
Number of units outstanding at end of period	19,501		14,184		14,366		57,737		2,735		—
Fidelity VIP Growth & Income Fund, Service Class 2(106)
Unit value at beginning of period	$	13.69	$	12.32	$	11.65	$	11.21	$	9.23	—		$	10.00
Unit value at end of period	$	15.07	$	13.69	$	12.32	$	11.65	$	11.21	$	9.23
Number of units outstanding at end of period	15,173		16,013		13,924		13,760		2,631		99
Fidelity VIP Growth Opportunities Fund, Service Class 2 (107)
Unit value at beginning of period	$	12.89	$	12.46	$	11.64	$	11.06	$	8.68	—		$	10.00
Unit value at end of period	$	15.60	$	12.89	$	12.46	$	11.64	$	11.06	$	8.68
Number of units outstanding at end of period	8,258		8,593		3,220		7,287		783		—
Fidelity VIP High Income, Service Class 2 (171)
Unit value at beginning of period	$	13.61	$	12.45	$	12.36	$	11.48	—		—		$	10.00
Unit value at end of period	$	13.74	$	13.61	$	12.45	$	12.36	$	11.48
Number of units outstanding at end of period	39,394		172,810		207,903		133,585		56,915
Fidelity VIP Index 500, Service Class 2 (1301)
Unit value at beginning of period	—		—		—		—		—		—		$	10.00
Unit value at end of period	$	9.83
Number of units outstanding at end of period	99,701												4-27-07
Fidelity VIP Investment Grade Bond, Service Class 2 (174)
Unit value at beginning of period	$	10.61	$	10.35	$	10.31	—		—		—		$	10.00
Unit value at end of period	$	10.87	$	10.61	$	10.35	$	10.31
Number of units outstanding at end of period	38,550		39,171		34,653		15,736
Fidelity VIP Mid Cap Fund, Service Class 2 (108)
Unit value at beginning of period	$	19.16	$	17.31	$	14.90	$	12.14	$	8.92	—		$	10.00
Unit value at end of period	$	21.75	$	19.16	$	17.31	$	14.90	$	12.14	$	8.92
Number of units outstanding at end of period	88,459		75,008		63,540		18,641		9,740		612

AN - 62

	2007		2006		2005		2004		2003		2002	Inception Date and Value
Fidelity VIP Overseas, Service Class 2 (175)
Unit value at beginning of period	$	14.99	$	12.93	$	11.05	—		—		—	$	10.00
Unit value at end of period	$	17.27	$	14.99	$	12.93	$	11.05
Number of units outstanding at end of period	47,138		24,592		13,553		2,622
Fidelity VIP Value Strategies, Service Class 2 (1382)
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 & Income Securities, Class 2 (165)
Unit value at beginning of period	$	15.12	$	13.16	$	12.91	$	11.85	$	10.00	—	$	10.00
Unit value at end of period	$	14.34	$	15.12	$	13.16	$	12.91	$	11.85
Number of units outstanding at end of period	37,561		12,831		10,135		6,533		2,620
FTVIPT Franklin Income Securities, Class 2 (164)
Unit value at beginning of period	$	16.44	$	14.12	$	14.12	$	12.60	$	10.00	—	$	10.00
Unit value at end of period	$	16.79	$	16.44	$	14.12	$	14.12	$	12.60
Number of units outstanding at end of period	197,753		158,636		122,243		72,216		19,469
FTVIPT Franklin Large Cap Growth Securities, Class 2 (166)
Unit value at beginning of period	$	13.78	$	12.62	$	12.68	$	11.94	$	10.00	—	$	10.00
Unit value at end of period	$	14.41	$	13.78	$	12.62	$	12.68	$	11.94
Number of units outstanding at end of period	20,097		20,165		30,334		19,288		3,859
FTVIPT Franklin Small Cap Value Securities, Class 2 (1314)
Unit value at beginning of period	$	10.00	—		—		—		—		—	$	10.00
Unit value at end of period	$	8.87
Number of units outstanding at end of period	6,178											4-30-07
FTVIPT Franklin Mutual Shares Securities, Class 2 (168)
Unit value at beginning of period	$	17.07	$	14.64	$	13.45	$	12.13	$	10.00	—	$	10.00
Unit value at end of period	$	17.39	$	17.07	$	14.64	$	13.45	$	12.13
Number of units outstanding at end of period	123,416		85,565		64,568		32,381		7,375

AN - 63

	2007		2006		2005		2004		2003		2002	Inception Date and Value
FTVIPT Templeton Foreign Securities, Class 2 (167)
Unit value at beginning of period	$	19.16	$	16.02	$	14.77	$	12.66	$	10.00	—	$	10.00
Unit value at end of period	$	21.77	$	19.16	$	16.02	$	14.77	$	12.66
Number of units outstanding at end of period	34,409		27,412		38,669		12,282		2,624
FTVIPT Templeton Growth Securities, Class 2 (169)
Unit value at beginning of period	$	18.34	$	15.29	$	14.27	$	12.49	$	10.00	—	$	10.00
Unit value at end of period	$	18.48	$	18.34	$	15.29	$	14.27	$	12.49
Number of units outstanding at end of period	84,406		57,134		43,185		20,192		—
PIMCO VIT All Asset Portfolio, Advisor Class (1317)
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 CommodityRealReturn Strategy Portfolio, Advisor Class (1318)
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 (1319)
Unit value at beginning of period	—		—		—		—		—		—	$	10.00
Unit value at end of period
Units outstanding at end of period												5-1-08

AN - 64

	2007		2006		2005		2004		2003		2002		Inception Date and Value
PIMCO VIT Real Return, Advisor Class (1377)
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 (1378)
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 (1379)
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 (1380)
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 (1381)
Unit value at beginning of period	—		—		—		—		—		—		$	10.00
Unit value at end of period
Units outstanding at end of period													5-1-08
Touchstone VST Baron Small Cap Growth (110)
Unit value at beginning of period	$	16.87	$	14.49	$	13.67	$	10.86	$	8.27	—		$	10.00
Unit value at end of period	$	17.07	$	16.87	$	14.49	$	13.67	$	10.86	$	8.27
Number of units outstanding at end of period	44,595		43,940		38,012		21,787		8,723		236
Touchstone VST Core Bond (141)
Unit value at beginning of period	$	11.07	$	10.81	$	10.80	$	10.62	$	10.42	—		$	10.00
Unit value at end of period	$	11.50	$	11.07	$	10.81	$	10.80	$	10.62	$	10.42
Number of units outstanding at end of period	48,701		51,887		49,865		47,163		32,510		2,169

AN - 65

	2007		2006		2005		2004		2003		2002		Inception Date and Value
Touchstone VST High Yield (147)
Unit value at beginning of period	$	14.08	$	13.25	$	13.04	$	12.09	$	9.90	—		$	10.00
Unit value at end of period	$	14.11	$	14.08	$	13.25	$	13.04	$	12.09	$	9.90
Number of units outstanding at end of period	28,814		31,902		35,181		37,453		28,727		9,106
Touchstone VST Large Cap Core Equity (formerly Enhanced Dividend 30) (143)
Unit value at beginning of period	$	13.27	$	10.65	$	11.16	$	10.77	$	8.30	—		$	10.00
Unit value at end of period	$	13.76	$	13.27	$	10.65	$	11.16	$	10.77	$	8.30
Number of units outstanding at end of period	3,173		4,556		5,226		4,625		817		—
Touchstone VST Mid Cap Growth (142)
Unit value at beginning of period	$	16.89	$	14.76	$	13.01	$	11.79	$	8.13	—		$	10.00
Unit value at end of period	$	19.02	$	16.89	$	14.76	$	13.01	$	11.79	$	8.13
Number of units outstanding at end of period	28,206		15,821		9,402		7,738		1,126		—
Touchstone VST Money Market, Service Class (163)
Unit value at beginning of period	$	10.34	$	10.04	$	9.91	$	9.96	$	10.00	—		$	10.00
Unit value at end of period	$	10.68	$	10.34	$	10.04	$	9.91	$	9.96
Number of units outstanding at end of period	297,490		184,020		74,755		126,776		40,156
Touchstone VST Third Avenue Value (113)
Unit value at beginning of period	$	18.47	$	16.19	$	14.01	$	11.30	$	8.19	—		$	10.00
Unit value at end of period	$	17.86	18.47		$	16.19	$	14.01	$	11.30	$	8.19
Number of units outstanding at end of period	154,618		144,364		120,755		52,295		15,384		2,141
Touchstone VST Aggressive ETF, Service Class (1307)
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	7,058												4-28-07
Touchstone VST Conservative ETF, Service Class (1305)
Unit value at beginning of period	$	10.00	—		—		—		—		—		$	10.00
Unit value at end of period	$	10.08
Number of units outstanding at end of period	69,648												4-28-07

AN - 66

	2007		2006		2005		2004		2003		2002	Inception Date and Value
Touchstone VST Enhanced ETF, Service Class (1308)
Unit value at beginning of period	$	10.00	—		—		—		—		—	$	10.00
Unit value at end of period	$	9.64
Number of units outstanding at end of period	27,125											4-28-07
Touchstone VST Moderate ETF, Service Class (1306)
Unit value at beginning of period	$	10.00	—		—		—		—		—	$	10.00
Unit value at end of period	$	9.92
Number of units outstanding at end of period	42,524											4-28-07
Van Kampen LIT Comstock, Class II (160)
Unit value at beginning of period	$	16.70	$	14.62	$	14.26	$	12.33	$	10.00	—	$	10.00
Unit value at end of period	$	16.06	$	16.70	$	14.62	14.26		$	12.33
Number of units outstanding at end of period	17,194		19,120		19,744		9,664		716
Van Kampen LIT Capital Growth, Class II (161) (formerly LIT Strategic Growth)
Unit value at beginning of period	$	13.45	$	13.31	$	12.56	$	11.95	$	10.00	—	$	10.00
Unit value at end of period	$	15.45	$	13.45	$	13.31	$	12.56	$	11.95
Number of units outstanding at end of period	731		1,743		1,045		1,416		109
Van Kampen UIF Emerging Markets Debt, Class II (1315)
Unit value at beginning of period	$	10.00	—		—		—		—		—	$	10.00
Unit value at end of period	$	10.16
Number of units outstanding at end of period	19,610											4-28-07
Van Kampen UIF Emerging Markets Equity, Class II (162)
Unit value at beginning of period	$	30.93	$	22.90	$	17.39	$	14.36	$	10.00	—	$	10.00
Unit value at end of period	$	42.76	$	30.93	$	22.90	$	17.39	$	14.36
Number of units outstanding at end of period	33,504		16,392		13,989		2,754		—

AN - 67

	2007		2006	2005	2004	2003	2002	Inception Date and Value
Van Kampen UIF U.S. Mid Cap Value, Class II (1383)
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 (1316)
Unit value at beginning of period	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	7.69
Number of units outstanding at end of period	12,110							4-28-07

AN - 68

Financial Information for Separate Account I of National Integrity (Grand Master I, II & III)

For the Variable Account Options we currently offer, the table below shows the following data for Grand Master contracts with a mortality and expense risk charge of 1.35% issued before approximately May 1, 2002: 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		2002		2001		2000		1999		1998		Inception Date and Value
DWS Small Cap Index VIP, Class I B (314)*
Unit value at beginning of period	$	13.73	$	11.87	$	11.57	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	13.25	$	13.73	$	11.87	$	11.57
Number of units outstanding at end of period	1,285		1,795		32,560		19,967
Fidelity VIP Asset Manager, Initial Class (304)*
Unit value at beginning of period	$	33.70	$	31.83	$	31.01	$	29.80	$	25.61	$	28.44	$	30.06	$	31.72	$	28.94	$	25.50	$	10.00
Unit value at end of period	$	38.40	$	33.70	$	31.83	$	31.01	$	29.80	$	25.61	$	28.44	$	30.06	$	31.72	$	28.94
Number of units outstanding at end of period	189,385		238,299		301,745		415,135		380,657		438,163		529,838		703,618		956,725		1,201,119
Fidelity VIP Balanced, Service Class 2 (347)*
Unit value at beginning of period	$	12.02	$	10.93	$	10.50	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	12.90	$	12.02	$	10.93	$	10.50
Number of units outstanding at end of period	41,613		0		0		—														5-1-04
Fidelity VIP Contrafund Fund, Initial Class (330)*
Unit value at beginning of period	$	40.12	$	36.40	$	31.55	$	27.20	$	21.86	$	24.44	$	28.23	$	30.65	$	25.00	$	19.50	$	10.00
Unit value at end of period	$	46.54	$	40.12	$	36.40	$	31.55	$	27.70	$	21.86	$	24.44	$	28.23	$	30.65	$	25.00
Number of units outstanding at end of period	521,093		608,085		695,513		819,427		966,395		1,337,292		1,498,779		2,081,477		2,315,960		2,547,399
Fidelity VIP Disciplined Small Cap, Service Class 2 (601)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	9.01																			4-27-07
Units outstanding at end of period	2,491

AN - 69

	2007		2006		2005		2004		2003		2002		2001		2000		1999		1998		Inception Date and Value
Fidelity VIP Dynamic Capital Appreciation, Service Class 2 (346)*
Unit value at beginning of period	$	14.25	$	12.69	$	10.66	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	15.00	$	14.25	$	12.69	$	10.66
Number of units outstanding at end of period	116,714		81,262		3,081		3,082
Fidelity VIP Equity Income, Initial Class (302)*
Unit value at beginning of period	$	61.13	$	51.56	$	49.36	$	44.87	$	34.90	$	42.59	$	45.43	$	42.47	$	40.49	$	36.77	$	10.00
Unit value at end of period	$	61.23	$	61.13	$	51.56	$	49.36	$	44.87	$	34.90	$	42.59	$	45.43	$	42.47	$	40.49
Number of units outstanding at end of period	353,980		431,962		507,083		599,458		683,179		792,301		1,084,357		1,077,660		1,770,880		2,160,698
Fidelity VIP Freedom 2010, Service Class 2 (354)*																					$	10.00
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—
Unit value at end of period	$	10.23																			4-30-07
Number of units outstanding at end of period	8,536
Fidelity VIP Freedom 2015, Service Class 2 (355)*																					$	10.00
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—
Unit value at end of period	$	10.25																			4-30-07
Units outstanding at end of period	0
Fidelity VIP Freedom 2020, Service Class 2 (356)*																					$	10.00
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—
Unit value at end of period	$	10.26																			4-30-07
Units outstanding at end of period	0
Fidelity VIP Freedom 2025, Service Class 2 (357)*																					$	10.00
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—
Unit value at end of period	$	10.26																			4-30-07
Units outstanding at end of period	0

AN - 70

	2007		2006		2005		2004		2003		2002		2001		2000		1999		1998		Inception Date and Value
Fidelity VIP Freedom 2030, Service Class 2 (358)*																					$	10.00
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—
Unit value at end of period	$	10.27																			4-30-07
Units outstanding at end of period	0
Fidelity VIP Growth Fund, Service Class 2 (033)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	11.71
Number of units outstanding at end of period	62,943
Fidelity VIP Growth & Income, Initial Class (363)*
Unit value at beginning of period	$	17.85	$	15.99	$	15.06	$	14.43	$	11.81	$	14.36	$	15.96	$	16.78	$	15.98	$	12.19	$	10.00
Unit value at end of period	$	19.74	$	17.85	$	15.99	$	15.06	$	14.43	$	11.81	$	14.36	$	15.96	$	16.78	$	15.98	(2)
Number of units outstanding at end of period	162,377		196,191		312,621		418,597		542,988		540,710		594,704		812,189		938,522		812,252
Fidelity VIP Growth & Income, Service Class 2 (329)
Unit value at beginning of period	$	12.50	$	11.23	$	10.60	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	13.79	$	12.50	$	11.23	$	10.60													(3)
Number of units outstanding at end of period	0		0		0		—
Fidelity VIP Growth Opportunities, Initial Class (361)*
Unit value at beginning of period	$	12.22	$	11.75	$	10.94	$	10.34	$	8.07	$	10.47	$	12.40	$	15.16	$	14.74	$	11.99	$	10.00
Unit value at end of period	$	14.85	$	12.22	$	11.75	$	10.94	$	10.34	$	8.07	$	10.47	$	12.40	$	15.16	$	14.74	(2)
Number of units outstanding at end of period	78,304		102,311		137,776		203,148		249,115		293,565		374,819		563,578		770,889		739,632
Fidelity VIP Growth Opportunities, Service Class 2 (328)
Unit value at beginning of period	$	11.99	$	11.56	$	10.78	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	14.53	$	11.99	$	11.56	$	10.78													(3)
Number of units outstanding at end of period	0		0		0		—
Fidelity VIP High Income, Initial Class (360)*
Unit value at beginning of period	$	17.48	$	15.93	$	15.72	$	14.54	$	11.58	$	11.35	$	13.04	$	17.05	$	15.98	$	16.93	$	10.00
Unit value at end of period	$	17.73	$	17.48	$	15.93	$	15.72	$	14.54	$	11.58	$	11.35	$	13.04	$	17.05	$	15.98	(2)
Number of units outstanding at end of period	245,508		340,587		407,644		553,586		767,496		906,875		1,093,661		1,471,012		1,828,869		2,101,650

AN - 71

	2007		2006		2005		2004		2003	2002	2001	2000	1999	1998	Inception Date and Value
Fidelity VIP High Income, Service Class 2 (327)
Unit value at beginning of period	$	11.88	$	10.85	$	10.75	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	12.02	$	11.88	$	10.85	$	10.75							(3)
Number of units outstanding at end of period	0		0		0		—
Fidelity VIP Index 500, Service Class 2 (031)*
Unit value at beginning of period	$	10.00	—		—		—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	9.85													4-30-07
Number of units outstanding at end of period	283,160
Fidelity VIP Investment Grade Bond, Service Class 2 (348)*
Unit value at beginning of period	$	10.00	—		—		—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	10.14													4-30-07
Number of units outstanding at end of period	34,301
Fidelity VIP Mid Cap, Service Class 2 (326)*
Unit value at beginning of period	$	15.81	$	14.26	$	12.25	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	17.99	$	15.81	$	14.26	$	12.25							(3)
Number of units outstanding at end of period	71,275		822		0		—
Fidelity VIP Overseas, Service Class 2 (618)*
Unit value at beginning of period	$	10.00	—		—		—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	10.57													4-30-07
Number of units outstanding at end of period	246,606
Fidelity VIP Value Strategies, Service Class 2 (600)*
Unit value at beginning of period			—		—		—		—	—	—	—	—	—	$	10.00
Unit value at end of period															5-1-08
Number of units outstanding at end of period

AN - 72

	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Inception Date and Value
FTVIPT Franklin Growth & Income Securities, Class 2 (333)*
Unit value at beginning of period	$	15.24	$	13.24	$	12.96	$	11.88	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	14.48	$	15.24	$	13.24	$	12.96	$	11.88
Number of units outstanding at end of period	113,576		25,424		31,808		26,850		36,793
FTVIPT Franklin Income Securities, Class 2 (332)*
Unit value at beginning of period	$	16.57	$	14.21	$	14.17	$	12.62	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	16.96	$	16.57	$	14.21	$	14.17	$	12.62
Number of units outstanding at end of period	203,691		162,850		97,919		77,370		83,241
FTVIPT Franklin Large Cap Growth Securities, Class 2 (334)*
Unit value at beginning of period	$	13.89	$	12.70	$	12.74	$	11.96	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	14.56	$	13.89	$	12.70	$	12.74	$	11.96
Number of units outstanding at end of period	19,025		10,999		11,673		15,581		5,961
FTVIPT Franklin Small Cap Value Securities, Class 2 (359)*																$	10.00
Unit value at beginning of period	—				—		—		—		—	—	—	—	—
Unit value at end of period	$	8.88														4-30-07
Units outstanding at end of period	0
FTVIPT Mutual Shares Securities, Class 2 (336)*
Unit value at beginning of period	$	17.21	$	14.73	$	13.51	$	12.16	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	17.56	$	17.21	$	14.73	$	13.51	$	12.16
Number of units outstanding at end of period	180,262		75,891		72,768		64,279		56,823
FTVIPT Templeton Foreign Securities, Class 2 (335)*
Unit value at beginning of period	$	19.31	$	16.12	$	14.83	$	12.68	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	21.99	$	19.31	$	16.12	$	14.83	$	12.68
Number of units outstanding at end of period	13,285		12,799		20,044		9,934		4,342
FTVIPT Templeton Growth Securities, Class 2 (337)*
Unit value at beginning of period	$	18.49	$	15.38	$	14.32	$	12.51	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	18.66	$	18.49	$	15.38	$	14.32	$	12.51
Number of units outstanding at end of period	22,239		63,037		23,647		22,823		15,778

AN - 73

	2007	2006	2005	2004	2003	2002	2001	2000	1999	1998	Inception Date and Value
PIMCO VIT All Asset Portfolio, Advisor Class (039)*
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 CommodityRealReturn Strategy Portfolio, Advisor Class (060)*
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 (061)*
Unit value at beginning of period		—	—	—	—	—	—	—	—	—	$	10.00
Unit value at end of period
Units outstanding at end of period											5-1-08

AN - 74

	2007		2006		2005		2004		2003	2002	2001	2000	1999	1998	Inception Date and Value
PIMCO VIT Real Return, Advisor Class (300)*
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 (349)*
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 (351)*
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 (352)*
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 (353)*
Unit value at beginning of period			—		—		—		—	—	—	—	—	—	$	10.00
Unit value at end of period
Units outstanding at end of period															5-1-08
Touchstone VST Aggressive ETF, Initial Class (367)
Unit value at beginning of period	$	11.87	$	10.60	$	10.27	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	12.31	$	11.87	$	10.60	$	10.27							(3)
Number of units outstanding at end of period	2,924		185,423		186,491		177,793
Touchstone VST Baron Small Cap Growth (318)*
Unit value at beginning of period	$	14.61	$	12.52	$	11.79	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	14.81	$	14.61	$	12.52	$	11.79
Number of units outstanding at end of period	22,798		28,078		22,706		13,546

AN - 75

	2007		2006		2005		2004		2003	2002	2001	2000	1999	1998	Inception Date and Value
Touchstone VST Conservative ETF, Initial Class (365)*
Unit value at beginning of period	$	11.05	$	10.36	$	10.16	$	10.00	—	—	—	—	—	—	$	10.00
Unit value at end of period	$	11.53	$	11.05	$	10.36	$	10.16
Number of units outstanding at end of period	14,371		13,801		12,331		139
Touchstone VST Core Bond (324)*
Unit value at beginning of period	$	10.58	$	10.31	$	10.28	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	11.01	$	10.58	$	10.31	$	10.28
Number of units outstanding at end of period	4,744		1,515		1,191		3,919
Touchstone VST Enhanced ETF, Initial Class (368)															$	10.00
Unit value at beginning of period	$	12.50	$	10.98	$	10.50	$	10.00	—	—	—	—	—	—	(3)
Unit value at end of period	$	12.83	$	12.50	$	10.98	$	10.50
Number of units outstanding at end of period	180,031		275,208		255,770		26,126
Touchstone VST High Yield (321)*
Unit value at beginning of period	$	11.57	$	10.87	$	10.67	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	11.62	$	11.57	$	10.87	$	10.67
Number of units outstanding at end of period	11,964		22,824		34,108		32,053
Touchstone VST Large Cap Core Equity (formerly Enhanced Dividend 30) (323)*
Unit value at beginning of period	$	12.65	$	10.13	$	10.59	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	13.14	$	12.65	$	10.13	$	10.59
Number of units outstanding at end of period	540		766		832		2,356
Touchstone VST Mid Cap Growth (319)*
Unit value at beginning of period	$	14.01	$	12.22	$	10.74	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	15.81	$	14.01	$	12.22	$	10.74
Number of units outstanding at end of period	15,164		11,324		10,027		11,591
Touchstone VST Moderate ETF, Initial Class (366)
Unit value at beginning of period	$	11.51	$	10.51	$	10.25	$	10.00	—	—	—	—	—	—	$	10.00
Unit value at end of period	$	11.95	$	11.51	$	10.51	$	10.25							(3)
Number of units outstanding at end of period	28,655		32,814		37,725		12,311

AN - 76

	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Inception Date and Value
Touchstone VST Money Market, Initial Class (331)*
Unit value at beginning of period	$	10.50	$	10.14	$	9.97	$	9.97	—		—	—	—	—	—	$	10.00
Unit value at end of period	$	10.90	$	10.50	$	10.14	$	9.97	$	9.97
Number of units outstanding at end of period	533,926		443,038		532,179		557,403		1,391,648
Touchstone VST Third Avenue Value (317)*
Unit value at beginning of period	$	16.10	$	14.09	$	12.16	—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	15.60	$	16.10	$	14.09	$	12.16
Number of units outstanding at end of period	259,418		181,950		149,728		25,169
Van Kampen LIT Comstock Class II (338)*
Unit value at beginning of period	$	16.83	$	14.70	$	14.32	$	12.36	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	16.22	$	16.83	$	14.70	$	14.32	$	12.36
Number of units outstanding at end of period	6,923		10,954		24,557		157,078		7,484
Van Kampen LIT Capital Growth, Class II (339) (formerly LIT Strategic Growth)*
Unit value at beginning of period	$	13.56	$	13.40	$	12.61	$	11.98	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	15.60	$	13.56	$	13.40	$	12.61	$	11.98
Number of units outstanding at end of period	27		477		425		786		366
Van Kampen UIF Emerging Markets Debt, Class II (341)*
Unit value at beginning of period	$	16.32	$	14.93	$	13.50	$	12.43	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	17.13	$	16.32	$	14.93	$	13.50	$	12.43
Number of units outstanding at end of period	1,360		4,693		6,492		3,928		7,625
Van Kampen UIF Emerging Markets Equity, Class II (340)*
Unit value at beginning of period	$	31.18	$	23.04	$	17.46	$	14.39	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	43.20	$	31.18	$	23.04	$	17.46	$	14.39
Number of units outstanding at end of period	17,604		14,914		14,408		14,705		3,626

AN - 77

	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Inception Date and Value
Van Kampen UIF U.S. Mid Cap Value, Class II (369)*																$	10.00
Unit value at beginning of period			—		—		—		—		—	—	—	—	—
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 (342)*
Unit value at beginning of period	$	28.12	$	20.71	$	17.98	$	13.39	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	22.95	$	28.12	$	20.71	$	17.98	$	13.39
Number of units outstanding at end of period	14,769		23,507		25,784		29,674		23,701

* Also contains assets belonging to owners of National Integrity IQ Variable Annuities sold prior to May 1, 1999.

(2) Only available to owners of Grand Master II and III

(3) Only available to owners of Grand Master I

AN - 78

Appendix B

Illustration of a Market Value Adjustment

The following examples illustrate how the MVA and the withdrawal charge may affect the value of a GRO upon a withdrawal.

Assumptions:

·Contribution to a GRO - $50,000

·Guarantee Period – 7 years

·Withdrawal – at the end of year three of the 7 year Guarantee Period

·No prior partial withdrawals or transfers

·Guaranteed Interest Rate – 5% Annual Effective Rate

The GRO Value for this $50,000 contribution is $69,947.92 at the end of the Guarantee Period.  After three years, the GRO Value is $57,723.63.

The MVA will be based on the current rate we are offering (at the time of the withdrawal) on new contributions to GROs for the Guarantee Period equal to the time remaining in your Guarantee Period, rounded to the next lower number of complete months.  If we don’t declare a current rate for the exact time remaining, we’ll use a formula to find a rate using Guarantee Periods closest to (next higher and next lower) the remaining period described above.  Three years after the initial contribution, there would have been four years remaining in your GRO Guarantee Period.  These examples also show the withdrawal charge, which would be calculated separately.

Example of a Downward Market Value Adjustment:

A downward MVA results from a full or partial withdrawal that occurs when interest rates have increased.  Assume interest rates have increased and at the time of the withdrawal, the current rate for four-year Guarantee Period is 6.25%.  Upon a full withdrawal, the MVA would be:

-0.0551589 = [(1 + .05)^48/12 / (1 + .0625 + .0025)^48/12] – 1

The MVA is a reduction of $3,183.97 from the GRO Value: -$3,183.97 = -0.0551589 X $57,723.63

The MVA, which is only applicable to the non-free amount, and which is subject to the 5% withdrawal charge, would be:

$54,539.66 = $57,723.63 - $3,183.97

A withdrawal charge of 5% would be assessed against the $50,000 original contribution:

$2,500.00 = $50,000.00 X .05

Thus, the amount payable on a full withdrawal would be:  $52,039.66 = $57,723.63 - $3,183.97 - $2,500.00

AN - - 79

If instead of a full withdrawal, $20,000 was requested, we would first determine the Free Withdrawal Amount:

$5,772.36 = $57,723.63 X .10

The amount subject to a 5% withdrawal charge (non-free amount) would be:

$14,227.64 = $20,000.00 - $5,772.36

The MVA, which is only applicable to the non-free amount, and which is subject to the 5% withdrawal charge, would be:

-$784.78 = -0.0551589 X $14,227.64

The withdrawal charge would be:  $790.13 = [($14,227.64 (the non-free amount) + $784.78 (the negative MVA)) / (1 - ..05) a factor used to calculate the 5% withdrawal charge and adjust the withdrawal charge to include a withdrawal charge on itself)]  – ($14,227.64 + 784.78)

Thus, the total amount needed to provide $20,000 after the MVA and withdrawal charge would be:

$21,574.91 = $20,000.00 + $784.78 + 790.13

The value remaining in the GRO after the withdrawal would be:  $36,148.72 = $57,723.63 - $21,574.91

Example of an Upward Market Value Adjustment:

An upward MVA results from a full or partial withdrawal that occurs when interest rates have decreased.  Assume interest rates have decreased and at the time of the withdrawal, the current rate for four-year Guarantee Period is 4%.  Upon a full withdrawal, the MVA would be:

.0290890 = [(1 + .05)^48/12 / (1 + .04 + .0025)^48/12] – 1

The MVA is an increase of $1,679.12 to the GRO Value:  $1,679.12 = .0290890 X $57,723.63

The MVA, which is only applicable to the non-free amount, and which is subject to the 5% withdrawal charge, would be:

$59,402.75 = $57,723.63 + $1,679.12

A withdrawal charge of 5% would be assessed against the $50,000 original contribution:

$2,500.00 = $50,000.00 X .05

Thus, the amount payable on a full withdrawal would be:

$56,902.75 = $57,723.63 + $1,679.12 - $2,500.00

If instead of a full withdrawal, $20,000 was requested, the Free Withdrawal Amount and non-free amount (which is subject to a 5% withdrawal charge) would first be determined as above:

AN - - 80

Free Amount = $5,772.36Non-Free Amount = $14,227.64

The MVA, which is only applicable to the non-free amount, and which is subject to the 5% withdrawal charge, would be:

$413.87 = .0290890 X $14,227.64

The withdrawal charge would be:  $727.04 = [($14,227.64 (the non-free amount) - $413.87(the positive MVA)) / (1 - ..05) a factor used to calculate the 5% withdrawal charge and adjust the withdrawal charge to include a withdrawal charge on itself)] – ($14,227.64 - $413.87)

Thus, the total amount needed to provide $20,000 after the MVA and withdrawal charge would be:

$20,313.17 = $20,000.00 - $413.87 + 727.04

The value remaining in the GRO after the withdrawal would be:  $37,410.46 = $57,723.63 - $20,313.17

Actual MVAs will have a greater or lesser impact than shown in the examples, depending on the actual change in current interest rate and the timing of the withdrawal in relation to the time remaining in the Guarantee Period.

The MVA operates in a similar manner for transfers, except withdrawal charges don’t apply to transfers.

The MVA calculation will be adjusted to comply with the applicable state regulation requirements for contracts issued in certain states.

AN - - 81

Appendix C

Illustration of Guaranteed Lifetime Income Advantage

The following examples demonstrate how the Rider works, based on the stated assumptions.  These examples are for illustration only, and do not predict future investment results.

Example #1

This example illustrates the Spousal Rider where withdrawals equal to the Lifetime Payout Amount (LPA) , as well as Nonguaranteed Withdrawals have been taken, additional contributions have been made and Bonuses and Step Ups have been applied.  It also illustrates payments for the life of the Primary and Spousal Annuitant even though the Account Value has been reduced to zero.

Assumptions:

·Primary Annuitant’s age on date GLIA Rider is purchased = 55; Spousal Annuitant’s age on date GLIA Rider is purchased = 52

·Initial contribution = $100,000; additional contribution = $10,000 in Contract Year 10

·Nonguaranteed Withdrawal equal to $5,000 in Contract Years 8; Nonguaranteed Withdrawal of $776 in Contract Year 14

·Withdrawals equal to LPA in Contract Years 9-13, and Contract Years 15+

·No withdrawals were taken that would result in withdrawal charges under the contract.

·The Contract is not a tax qualified contract.

·The Rider remains in effect during the period covered in this example.

Contract Year	Primary Annuitant’s Age on the APD	Spousal Annuitant’s Age on the APD	Contributions		LPA			Annual Withdrawal		Adjusted Nonguaranteed Withdrawal			Hypothetical Account Value on APD (A)		Bonus			Bonus Base			Step-Up Base			Payment Base at the end of the APD (B)
1	55	52	$	100,000	N/A			$	0	$	0		$	105,000	$	5,000	(C)	$	105,000		$	105,000		$	105,000
2	56	53			N/A			$	0	$	0		$	110,250	$	5,000	(C)	$	110,000		$	110,250	(D)	$	110,250
3	57	54			N/A			$	0	$	0		$	114,660	$	5,000	(C)	$	115,000		$	114,660	(D)	$	115,000
4	58	55			N/A			$	0	$	0		$	118,100	$	5,000	(C)	$	120,000		$	118,100	(D)	$	120,000
5	59	56			N/A			$	0	$	0		$	115,738	$	5,000	(C)	$	125,000		$	118,100	(D)	$	125,000
6	60	57			N/A			$	0	$	0		$	115,738	$	5,000	(C)	$	130,000		$	118,100		$	130,000
7	61	58			N/A			$	0	$	0		$	111,108	$	5,000	(C)	$	135,000		$	118,100		$	135,000
8	62	59			N/A			$	5,000	$	5,956	(E)	$	108,330	$	0		$	129,044	(E)	$	112,144	(E)	$	129,044
9	63	60			$	5,807	(F)	$	5,807	$	0		$	102,523	$	0		$	129,044		$	112,144		$	129,044
10	64	61	$	10,000	$	6,257	(G)	$	6,257	$	0		$	104,016	$	0		$	139,044	(G)	$	122,144	(G)	$	139,044
11	65	62			$	6,257		$	6,257	$	0		$	98,799	$	0		$	139,044		$	122,144		$	139,044

AN - 82

12	66	63	$	6,257		$	6,257		$	0		$	88,590	$	0	$	139,044		$	122,144		$	139,044
13	67	64	$	6,257		$	6,257		$	0		$	84,105	$	0	$	139,044		$	122,144		$	139,044
14	68	65	$	6,257		$	7,033	(H)	$	1,371	(H)	$	77,913	$	0	$	137,673	(H)	$	120,773	(H)	$	137,673
15	69	66	$	6,195		$	6,195		$	0		$	72,497	$	0	$	137,673		$	120,773		$	137,673
16	70	67	$	6,195		$	6,195		$	0		$	69,202	$	0	$	137,673		$	120,773		$	137,673
17	71	68	$	6,195		$	6,195		$	0		$	63,698	$	0	$	137,673		$	120,773		$	137,673
18	72	69	$	6,195		$	6,195		$	0		$	56,229	$	0	$	137,673		$	120,773		$	137,673
19	73	70	$	6,195		$	6,195		$	0		$	47,222	$	0	$	137,673		$	120,773		$	137,673
20	74	71	$	6,195		$	6,195		$	0		$	42,916	$	0	$	137,673		$	120,773		$	137,673
21	75	72	$	6,195		$	6,195		$	0		$	36,292	$	0	$	137,673		$	120,773		$	137,673
22	76	73	$	6,195		$	6,195		$	0		$	31,185	$	0	$	137,673		$	120,773		$	137,673
23	77	74	$	6,195		$	6,195		$	0		$	25,925	$	0	$	137,673		$	120,773		$	137,673
24	78	75	$	6,195		$	6,195		$	0		$	18,693	$	0	$	137,673		$	120,773		$	137,673
25	79	76	$	6,195		$	6,195		$	0		$	11,563	$	0	$	137,673		$	120,773		$	137,673
26	80	77	$	6,195	(I)	$	6,195		$	0		$	5,021	$	0	$	137,673		$	120,773		$	137,673
27	81	78	$	6,195		$	6,195		$	0		$	0	$	0	$	137,673		$	120,773		$	137,673
28	82	79	$	6,195		$	6,195		$	0		$	0	$	0	$	137,673		$	120,773		$	137,673
29	83	80	$	6,195		$	6,195		$	0		$	0	$	0	$	137,673		$	120,773		$	137,673
30	84	81	$	6,195		$	6,195		$	0		$	0	$	0	$	137,673		$	120,773		$	137,673
31+	85	82	$	6,195		$	6,195		$	0		$	0	$	0	$	137,673		$	120,773		$	137,673

(A)The hypothetical Account Value includes deduction of all fees.  Rounding of amounts less than $1.00 is used in this example.

(B)The Payment Base is always the greater of the Bonus Base and Step-Up Base.

(C)A Bonus was added to the Bonus Base in Contract Years 1 -7 because no withdrawals were taken during those Contract Years.  The Bonus amount is the Bonus Percentage, which is 5.00% in each of these years, times the total contributions minus total withdrawals, which is $100,000 for each year.

For example, the Bonus in Contract Year 1 is calculated as follows:

·5.00% (Bonus Percentage) X ($100,000 (total contributions) - $0 (total withdrawals)) = $5,000 Bonus amount.  This calculation is the same in each of the 7 years.

The Bonus Base after the Bonus in Contract Year 1 is $100,000+ $5,000 = $105,000; the Bonus Base after the Bonus in Contract Year 2 is $105,000+ $5,000 = $110,000; the Bonus Base after the Bonus in Contract Year 3 is $110,000+ $5,000 = $115,000; the Bonus Base after the Bonus in Contract Year 4 is $115,000+ $5,000 = $120,000; the Bonus Base after the Bonus in Contract Year 5 is $120,000+ $5,000 = $125,000; the Bonus Base after the Bonus in Contract Year 6 is $125,000+ $5,000 = $130,000; the Bonus Base after the Bonus in Contract Year 7 is $130,000+ $5,000 = $135,000.

AN - 83

(D)  In Contract Year 2, the Step-Up Base increases to $110,250 because the hypothetical Account Value ($110,250) is larger than the Step-Up Base in Contract Year 1($105,000).  After the step-up, the Step-Up Base ($110,250) is larger than the Bonus Base ($110,000) and therefore the Payment Base is equal to the Step-Up Base of $110,250.  In Contract Years 3 and 4, the Step-Up Base increases to the Account Value, because the Account Value is larger than the previous years’ Step-Up Base, however the Payment Base is not affected because the Bonus Base is higher than the Step-Up Base in each Contract Year.  In Contract Years 5+, the Step-Up Base is always larger than the Account Value, and thus is not stepped up.

(E)  In Contract Year 8, the younger spouse has not yet reached age 60.  Therefore, the withdrawal in the amount of $5000 is a Nonguaranteed Withdrawal.  The Adjusted Nonguaranteed Withdrawal amount is the Nonguaranteed Withdrawal amount multiplied by the greater of 1 or the ratio of the Payment Base to Account Value, where both values are calculated immediately before the Nonguaranteed Withdrawal.  It is calculated as follows:

·$5,000 (Nonguaranteed Withdrawal amount) x 1.1912 ($135,000 Payment Base divided by $113,330 Account Value [$108,330 + $5,000]) = $5,956 (Adjusted Nonguaranteed Withdrawal amount)

The Bonus Base and the Step-Up Base (and therefore the payment Base) are reduced by the amount of the Adjusted Nonguaranteed Withdrawal:

·$135,000 Bonus Base – $5,956 Adjusted Nonguaranteed Withdrawal amount = $129,044 Bonus Base after the Nonguaranteed Withdrawal

·$118,100 Step-Up Base - $5,956 Adjusted Nonguaranteed Withdrawal amount = $112,144 Step-Up Base after the Nonguaranteed Withdrawal

(F)  In Contract Year 9, the LPA is determined, since this is the first withdrawal on or after the Age 60 Contract Anniversary.  The LPA is the Withdrawal Percentage times the Payment Base:

·4.5% (Withdrawal Percentage) X $129,044 (Payment Base) =$5,807 (LPA)

(G)  The $10,000 additional contribution made at the beginning of Contract Year 10 increases the Bonus Base and Step-Up Base (and therefore the Payment Base) dollar-for-dollar.

·$129,044 Bonus Base + $10,000 additional contribution amount = $139,044 Bonus Base after the additional contribution.

·$112,144 Step-Up Base + $10,000 additional contribution amount = $122,144 Step-Up Base after the additional contribution.

The LPA is recalculated using the Withdrawal Percentage times the Payment Base after the additional contribution:

·4.5% (Withdrawal Percentage) X $139,044 (Payment Base) =$6,257 (LPA)

 (H)  In Contract Year 14, A Nonguaranteed Withdrawal in the amount of $776 ($7,033 amount withdrawn - $6,257 LPA) is taken.  The Adjusted Nonguaranteed Withdrawal amount is the Nonguaranteed Withdrawal amount multiplied by the greater of 1 or the ratio of the Payment Base to Account Value, where both values are calculated immediately before the Nonguaranteed Withdrawal.  It is calculated as follows:

·$776 (Nonguaranteed Withdrawal amount) x  1.767 ($139,044 Payment Base divided by $78,689 Account Value [$77,913+ $776]) = $1,371 (Adjusted Nonguaranteed Withdrawal amount)

AN - 84

The Bonus Base and Step-Up Base (and therefore the Payment Base) are reduced by the Adjusted Nonguaranteed Withdrawal amount:

·$139,044 Bonus Base - $1,371 Adjusted Nonguaranteed Withdrawal amount = $137,673 Bonus Base after the Nonguaranteed Withdrawal.

·$122,144 Step-Up Base - $1371 Adjusted Nonguaranteed Withdrawal amount = $120,773 Step-Up Base after the Nonguaranteed Withdrawal

The LPA is recalculated after the withdrawal as 4.5% of the Payment Base after the withdrawal: $137,673 x 4.5% = $6,195.

(I)  In Contract Year 26, the Account Value is reduced to zero, however the Payment Base is greater than zero; therefore, the Rider enters Guaranteed Payment Phase and payments of the LPA continue.

AN - 85

Example #2

This example illustrates the Individual Rider where withdrawals equal to the LPA, as well as Nonguaranteed Withdrawals have been taken, and Bonuses have been applied.  It also illustrates the termination of the rider is the Account Value is reduced to zero by a Nonguaranteed Withdrawal.

Assumptions:

·Annuitant’s age on date GLIA Rider is purchased = 55

·Initial contribution = $100,000; no additional contributions

·Withdrawals equal to LPA in Contract Years 6-7, 9-13

·Nonguaranteed Withdrawals in Contract Year 8 in the amount of $25,000

·Full Account Value withdrawn in Contract Year 14

·No withdrawals were taken that would result in withdrawal charges under the contract.

·The Contract is not a tax qualified contract.

·The Rider remains in effect during the period covered in this example.

Contract Year	Annuitant’s Age on APD	Contributions		LPA			Annual Withdrawal			Adjusted Nonguaranteed Withdrawal		Hypothetical Account Value on APD (A)		Bonus			Bonus Base		Step-Up Base			Payment Base at the end of the APD (B)
1	55	$	100,000	N/A			$	0		$	0	$	99,000	$	5,000	(C)	$	105,000	$	100,000	(D)	$	105,000
2	56			N/A			$	0		$	0	$	98,010	$	5,000	(C)	$	110,000	$	100,000	(D)	$	110,000
3	57			N/A			$	0		$	0	$	95,070	$	5,000	(C)	$	115,000	$	100,000	(D)	$	115,000
4	58			N/A			$	0		$	0	$	92,218	$	5,000	(C)	$	120,000	$	100,000	(D)	$	120,000
5	59			N/A			$	0		$	0	$	91,295	$	5,000	(C)	$	125,000	$	100,000	(D)	$	125,000
6	60			$	5,625	(E)	$	5,625	(E)	$	0	$	86,583	$	0		$	125,000	$	100,000	(D)	$	125,000
7	61			$	5,625		$	5,625		$	0	$	81,824	$	0		$	125,000	$	100,000	(D)	$	125,000
8	62			$	5,625		$	25,000	(F)	$	31,446	$	57,642	$	0		$	93,554	$	68,554		$	93,554
9	63			$	4,210		$	4,210		$	0	$	52,856	$	0		$	93,554	$	68,554		$	93,554
10	64			$	4,210		$	4,210		$	0	$	48,118	$	0		$	93,554	$	68,554		$	93,554
11	65			$	4,210		$	4,210		$	0	$	41,502	$	0		$	93,554	$	68,554		$	93,554
12	66			$	4,210		$	4,210		$	0	$	37,707	$	0		$	93,554	$	68,554		$	93,554
13	67			$	4,210		$	4,210		$	0	$	33,497	$	0		$	93,554	$	68,554		$	93,554
14	68			$	4,210		$	33,497	(G)	N/A		$	0	$	0		$	0	$	0		$	0
15	69			$	0		$	0		$	0	$	0	$	0		$	0	$	0		$	0

(A)  The hypothetical Account Value includes deduction of all fees.  Rounding of amounts less than $1.00 is used in this example.

AN - 86

(B)  The Payment Base is always the greater of the Bonus Base and Step-Up Base.

(C)  A Bonus was added to the Bonus Base in Contract Years 1 -5 because no withdrawals were taken during those Contract Years.  The Bonus amount is the Bonus Percentage, which is 5.00% in each of these years, times the total contributions minus total withdrawals, which is $100,000 for each year.

For example, the Bonus in Contract Year 1 is calculated as follows:

·5.00% (Bonus Percentage) X ($100,000 (total contributions) - $0 (total withdrawals)) = $5,000 Bonus amount. This calculation is the same in each of the 5 years.

The Bonus Base after the Bonus in Contract Year 1 is $100,000+ $5,000 = $105,000; the Bonus Base after the Bonus in Contract Year 2 is $105,000+ $5,000 = $110,000; the Bonus Base after the Bonus in Contract Year 3 is $110,000+ $5,000 = $115,000; the Bonus Base after the Bonus in Contract Year 4 is $115,000+ $5,000 = $120,000; the Bonus Base after the Bonus in Contract Year 5 is $120,000+ $5,000 = $125,000.

(D)  In Contract Years 1-8, the hypothetical Account Value is less than the Step-Up Base and thus, the Step-Up Base is not stepped up.

(E)  In Contract Year 6, the LPA is determined, since this is the first withdrawal on or after the Age 60 Contract Anniversary.  The LPA is the Withdrawal Percentage times the Payment Base:

·4.5% (Withdrawal Percentage) X $125,000 (Payment Base) =$5,625 (LPA)

(F)  A Nonguaranteed Withdrawal in the amount of $19,375 ($25,000 amount withdrawn - $5,625 LPA) is taken in Contract Year 8.  The Adjusted Nonguaranteed Withdrawal amount is the Nonguaranteed Withdrawal amount multiplied by the greater of 1 or the ratio of the Payment Base to Account Value, where both values are calculated immediately before the Nonguaranteed Withdrawal.  It is calculated as follows:

·$19,375  (Nonguaranteed Withdrawal amount) x 1.6230 ($125,000 Payment Base divided by $77,017 Account Value [$57,642+ $19,375]) = $31,446 (Adjusted Nonguaranteed Withdrawal amount)

The Bonus Base and Step-Up Base (and therefore the Payment Base) are reduced by the Adjusted Nonguaranteed Withdrawal amount.

·$125,000 Bonus Base - $31,446 Adjusted Nonguaranteed Withdrawal amount = $93,554 Bonus Base after the Nonguaranteed Withdrawal

·$100,000 Step-Up Base - $31,446 Adjusted Nonguaranteed Withdrawal amount = $68,554 Step-Up Base after the Nonguaranteed Withdrawal

The LPA is recalculated after the withdrawal as 4.5% of the Payment Base after the withdrawal: $93,554 x 4.5% = $4,210.

(G)  A Nonguaranteed withdrawal reduces the Account Value to zero in Contract Year 14 and the Rider and Annuity Contract terminate.

AN - 87

IQ3The Smart Annuity Variable Annuity

May 1, 2008

National Integrity Life Insurance Company

Separate Account I

This prospectus describes the IQ3 The SmartAnnuity 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 Manager^SM Portfolio

Fidelity VIP Balanced Portfolio

Fidelity VIP Contrafund^â 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 CommodityRealReturn^TMStrategy 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

Touchstone VST Conservative ETF Fund

Touchstone VST Enhanced ETF Fund

Touchstone VST Moderate ETF Fund

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

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.

IQ3N - 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 811-04846 and 033-56658).  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 National Integrity Life Insurance Company (National Integrity) is the licensing of certain trademarks and trade names of BGI.  National Integrity’s variable annuity products are not sponsored, endorsed, sold or promoted by BGI.  BGI makes no representations or warranties to the owners of National 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 National Integrity’s variable annuity products.

To request a copy of the Statement of Additional Information for the National Integrity IQ3 The SmartAnnuity (May 1, 2008) tear off this section and mail it to us at the Administrative Office listed in the Glossary.

Name:

Address:

Phone:

IQ3N - - 2

TABLE OF CONTENTS

	Page IQ3N-
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	11
Your Right to Revoke (Free Look Period)	11
How Your Contract is Taxed	11
Part 2 - National Integrity and the Separate Account	12
National Integrity Life Insurance Company	12
Separate Account I and the Variable Account Options	12
Distribution of Variable Annuity Contracts	12
Changes In How We Operate	12
Part 3 - Your Investment Options	13
The Variable Account Options	13
The Fixed Account	22
Part 4 - Deductions and Charges	23
Mortality and Expense Risk Charge	23
Annual Administrative Charge	23
Reduction of the Mortality and Expense Risk Charge or Annual Administrative Charge	23
Portfolio Charges	23
Commission Allowance and Additional Payments to Distributors	23
Optional Benefit Charges	24
Transfer Charge	24
Tax Reserve	24
State Premium Tax	24
Part 5 - Terms of Your Variable Annuity	24
Your Contributions	24
Units in Our Separate Account	25
How We Determine Unit Value	25
Transfers	25
Excessive Trading	26
Specific Notice Regarding the Use of this Annuity for Market Timing or Frequent Trading	26
Withdrawals	28
Assignments	28
Death Benefit Paid on Death of Annuitant	28
Distribution on Death of Owner	29
Spousal Continuation	30
Death Claims	30
Maximum Retirement Date and Annuity Benefit	31
Annuity Benefit Payments	31
Timing of Payment	32
How You Make Requests and Give Instructions	32
Part 6 - Optional Benefit	32
Highest Anniversary Death Benefit Rider	32

IQ3N - 3

Part 7 - Voting Rights	32
How Portfolio Shares Are Voted	32
How We Determine Your Voting Shares	33
Separate Account Voting Rights	33
Part 8 - Tax Aspects of the Contract	33
Introduction	33
Your Contract is an Annuity	34
Taxation of Annuities Generally	34
Tax-Favored Retirement Programs	35
Federal and State Income Tax Withholding	36
Impact of Taxes on the Company	36
Transfers Among Investment Options	36
Part 9 - Additional Information	36
Systematic Withdrawal Program	36
Income Plus Withdrawal Program	36
Choices Plus Required Minimum Distribution Program	37
Dollar Cost Averaging Program	37
Systematic Transfer Program	37
Customized Asset Rebalancing Program	38
Systematic Contributions Program	38
Legal Proceedings	38
Table of Contents of Statement of Additional Information	38
Part 10 – Prior Contracts	39
IQ (Contracts issued prior to May 1, 1999)	39
IQ2 and IQ3 (Contracts Issued between May 1, 1999 and November 17, 2003)	40
Appendix A	42
Financial Information for Separate Account I of National Integrity	42

IQ3N - 4

GLOSSARY

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

Administrative Office -   National Integrity Life Insurance Company, 15 Matthews Street, #200, Goshen, New York 10924.  You may also call us at 1-800-433-1778.  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.

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.

Fixed Accounts - the Systematic Transfer Option.

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

Highest Anniversary Death Benefit - an optional Death Benefit.

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

Maximum Retirement Date - the last Annuitant’s 90^th birthday or the tenth Contract Anniversary, whichever is later, 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.

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

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

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

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.

IQ3N - 5

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.

IQ3N - 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.(1)

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.(2)

Contract Owner Transaction Expenses

Sales Load on contributions	$	0
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 $ 30

Separate Account Annual Expensesasa percentage of value charged

Mortality and Expense Risk Charge(4)	1.45	%
Optional Highest Anniversary Death Benefit Charge(5)	0.20	%
Highest Possible Total Separate Account Annual Expenses	1.65	%

(1) Expenses for prior versions of the contract, if different, are located in Part 10, Prior Contracts.

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

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

(4) Assessed daily on the amount allocated to the Variable Account Options

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

IQ3N - 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	%
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	%

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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 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, Initial Class (12), (13), (14)	0.40	%	0.25	%	0.50	%	0.21	%	1.36	%	0.96	%
Touchstone VST Conservative ETF Fund, Initial Class (12), (13), (14)	0.40	%	0.25	%	0.51	%	0.20	%	1.36	%	0.95	%
Touchstone VST Enhanced ETF Fund, Initial Class (12), (13), (14)	0.40	%	0.25	%	0.35	%	0.25	%	1.25	%	1.00	%
Touchstone VST Moderate ETF Fund, Initial 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%.

(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.

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(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.  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 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
$	382	$	1,158	$	1,952	$	4,014

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
$	382	$	1,158	$	1,952	$	4,014

If you do not surrender the contract:

1 year		3 years		5 years		10 years
$	382	$	1,158	$	1,952	$	4,014

Accumulation Unit Values

See Appendix A

Summary of Contract

“We,” “our,”  “us,”  “the Company” and “National Integrity” mean National 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.”

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

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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

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 minimum Account Value is $5,000.  If the Account Value goes below $5,000 and we have received no contributions from you for three 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.  In some states, the law requires that we return the 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

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as IRAs; however, it provides no additional tax deferral benefit, as these programs already provide tax-deferral.

Part 2 – National Integrity and the Separate Account

National Integrity Life Insurance Company

National Integrity is a stock life insurance company incorporated under the laws of New York on November 22, 1968.  Our home office is located at 15 Matthews Street, #200, Goshen, New York 10924.  We are authorized to sell life insurance and annuities in 8 states and the District of Columbia.  National 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 National 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 New York.  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 name.  We 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 New York 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.

Distribution of Variable Annuity Contracts

Touchstone Securities, Inc., an affiliate of National 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 Option.  We 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 National Integrity);

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·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 800-433-1778.

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.

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 Manager^SM Portfolio

VIP Asset Manager^SM 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

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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 “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 500^SM 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).

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Fidelity VIP Freedom 2015 Portfolio

VIP Freedom 2015seeks 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 2025seeks 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).

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.

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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 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 .

The 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.

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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.

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  

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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 CommodityRealReturn^TM 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.

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, which is affiliated with

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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 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.

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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.  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

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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.

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

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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 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 Account

Our Fixed Account 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 Account, 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 Account or the General Account.  Disclosures regarding the Fixed Account or the General Account are subject to certain provisions of the federal securities laws relating to the accuracy and completeness of statements made in prospectuses.

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. 

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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

We deduct a daily charge equal to an annual effective rate of 1.45% of your Account Value in each of the Variable Account Options to cover mortality and expense risk and certain administrative expenses.  A portion of the 1.45% 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 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 1.45% 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.

Annual Administrative Charge

We charge an annual administrative charge of $30, which is deducted on the last day of the Contract Year.  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.

Commission Allowance and Additional Payments to Distributors

We generally pay a commission to the sales representative equal to a maximum of 2.00% of contributions, plus up to 1.50% 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.

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

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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 the Rider offered with this contract, which provides an optional benefit for an additional cost.  The additional cost, along with details about the benefit, 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	$ 1,000
·	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 one year 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.

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

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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.

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 1.45%.

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, 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.

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 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 are 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.

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

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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.

·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

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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.

When you make a partial withdrawal, the total amount deducted from your Account Value will be the withdrawal amount requested.  This contract has no withdrawal charge.  The amount you receive will be the amount requested, less any applicable tax withholding.  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 are reduced by withdrawals on a proportional basis.  See Part 5, “Death Benefits Paid on Death of Annuitant” and Part 6.

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 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,

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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.

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 85, the Death Benefit is the greater of:

·total Contributions minus proportional adjustments for any subsequent 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.

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.

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

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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.

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.  If the surviving spouse is under 59½, the 10% federal tax penalty for early withdrawal may apply if withdrawals are taken.  When the surviving spouse dies, the Death Benefit will be paid to the surviving spouse’s beneficiary.

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

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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 90th birthday or the tenth Contract Anniversary, whichever is later.  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, 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.

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 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 don’t receive your election on or before your 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.

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Timing of Payment

We normally apply your 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.  However, we can defer our action as to Account Value allocated to the Variable Account Options 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 Benefit

You may purchase the Rider offered with this contract, which provides an optional benefit for an additional cost.  The Rider may only be elected at the time of application and will replace or supplement the standard contract benefits.  The charge for the optional benefit Rider is 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.

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) 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.

Part 7 - Voting Rights

How Portfolio Shares Are Voted

National Integrity is the legal owner of the shares of the Portfolios held by the Separate Account and, as

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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 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

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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.  National 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, 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:

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·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 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

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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.  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 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 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

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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.

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.

We offer a Dollar Cost Averaging Program under which we transfer contributions that you have allocated to the Touchstone VST Money Market Fund 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 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.

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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 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. 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

National 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 National 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:

Administrative Office

National Integrity Life Insurance Company

15 Matthews Street #200

Goshen, New York 10924

ATTN: Request for Statement of Additional Information of Separate Account I

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Section 10- Prior Contracts

Over time, we have made changes to the IQ variable annuity contract.  You may own a prior version of the IQ contract.  Material features in prior versions of the IQ contract that differ from the IQ contract we are currently offering are described below.  The dates given are the company roll-out dates, but these dates vary state by state.  Please check your contract and the prospectus you received when you purchased your annuity if you are uncertain about whether these features are in your contract.

IQ - Contracts issued prior to May 1, 1999

Separate Account Annual Expenses as a percentage of value charged

Mortality and Expense Risk Charge 1.35 %

Total Annual Portfolio Operating Expenses for the Portfolios in which you may purchase a class of shares that is different from the table in Part 1 of this prospectus.  All other Portfolios and expenses are the same as in the table in Part 1.

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	Other Expenses		Acquired Fund Expenses	Total Annual Expenses
Fidelity VIP Asset Manager Portfolio, Initial Class (6)	0.52	%	N/A	0.13	%	N/A	0.65	%
Fidelity VIP Contrafund Portfolio, Initial Class (7)	0.57	%	N/A	0.09	%	N/A	0.66	%
Fidelity VIP Equity-Income Portfolio, Initial Class (7)	0.47	%	N/A	0.10	%	N/A	0.57	%
Fidelity VIP Growth & Income Portfolio, Initial Class (7)	0.47	%	N/A	0.13	%	N/A	0.60	%
Fidelity VIP Growth Opportunities Portfolio, Initial Class (7), (7)	0.57	%	N/A	0.15	%	N/A	0.72	%
Fidelity VIP High Income Portfolio, Initial Class	0.57	%	N/A	0.14	%	N/A	0.71	%
Touchstone VST Money Market Fund, Initial Class (8)	0.18	%	N/A	0. 50	%	N/A	0.68	%

Maximum Number of Investment Options

You may invest in, or have allocations directed to, a total of ten investment options at any time.

(6) A portion of the brokerage commissions that each Fidelity VIP 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 table in below.  These offsets may be discontinued at any time.

Fidelity VIP Portfolio	Net Total Expenses after Arrangements Described Above
Asset Manager, Initial Class	0.63	%
Contrafund, Initial Class	0.65	%
Growth & Income, Initial Class	0.59	%
Equity-Income, Initial Class	0.56	%

(7) 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 0.67%.  These offsets may be discontinued at any time.

(8) The advisor has contractually agreed until at least December 31, 2007 to waive a portion of its advisory fee and/or reimburse certain fund expenses in order to limit net expenses to 0.28%

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IQ2 and IQ3 - Contracts Issued between May 1, 1999 and November 17, 2003

Separate Account Annual Expenses as a percentage of value charged

Mortality and Expense Risk Charge	1.45	%
Optional Highest Anniversary Death Benefit Charge(9)	0.15	%
Optional AVO Charge (maximum charge 5%)	0.75	%
Highest Possible Total Separate Account Annual Expenses	2.35	%

The Added Value Option (AVO) was available.  The AVO was an optional benefit Rider available for an additional cost, which is shown in the table below.  If you selected the AVO (you would have selected the AVO at the time of application) Integrity credited from 1% up to 5% of all your contributions made during the first Contract Year.  For example, if $50,000 was contributed and the 3% AVO was selected, Integrity would have credited $1500 to your Account Value.

AVO percentage elected	Charge at annual effective rate	Total Separate Account Charges with AVO
1%	0.15%	1.60%
2%	0.30%	1.75%
3%	0.45%	1.90%
4%	0.60%	2.05%
5%	0.75%	2.20%

The dollar amount of the charge for the AVO is subject to a minimum and maximum amount.  For a 1% credit the minimum amount is .145% multiplied by first-year total contributions and the maximum amount is .182% multiplied by first-year total contributions.  To calculate the minimum and maximum dollar amounts, multiply the first-year total contributions, by the percentages in the following chart, for the AVO you select.  First-Year Total Contributions are all deposits made into the annuity, whether by your contribution or by us, during the first Contract Year.

AVO percentage elected	Minimum Percentage	Maximum Percentage
1%	0.145%	0.182%
2%	0.290%	0.364%
3%	0.435%	0.546%
4%	0.580%	0.728%
5%	0.725%	0.910%

This fee is assessed quarterly to the Account Value for seven Contract Years.  Therefore, the fee will be assessed against any contributions you make after the first Contract Anniversary, which do not receive any AVO credit.  Over time, the benefit of the AVO may be more than offset by the fees associated with the option.

Integrity uses this charge as well as a portion of the withdrawal charge and mortality and expense risk charge to recover the cost of providing the AVO.  Integrity intends to make a profit from these fees and charges.  Under certain circumstances, such as periods of poor market performance, the cost associated with the AVO may exceed the sum of the AVO and any related earnings.  Generally, if the average annual investment performance exceeds the percentages listed below, you will benefit from having the AVO.  Generally, if the average annual investment performance is below the percentages listed below, or you invest substantially in the Fixed Accounts, you will not benefit from the AVO.  The approximate average annual investment performance threshold needed to benefit from the AVO is as follows:

AVO percentage elected	Approximate Average Annual Investment Performance Threshold
1%	7.10%
2%	7.45%
3%	7.80%
4%	8.15%
5%	8.50%

(9) This benefit is same optional Highest Anniversary Death Benefit now available, but at a lower cost of 0.15%.

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Some or all of the AVO will be recaptured by the company if withdrawals in excess of the Free Withdrawal Amount were taken.  The chart below shows what portion of the AVO originally credited was recaptured.  The factors in the chart were applied to a percentage of the AVO amount credited, where the percentage equals the amount subject to a withdrawal charge divided by the Account Value at the time of withdrawal.  The amount recaptured is based upon the year the withdrawal is taken.  The total amount recaptured will never exceed what was credited.  The AVO will not be recaptured for withdrawals to meet required minimum distributions, withdrawals based on a Hardship Waiver, election of an Annuity Benefit under the contract, or payment of a Death Benefit.

Contract Year	Amount of AVO Recaptured
1	100%
2	85%
3	65%
4	55%
5	40%
6	25%
7	10%
8	0%

If the Annuitant was age 0-75 on the Contract Date, all five options were available.  If the Annuitant was age 76-79 only the 1%-3% options were available.  At age 80 and above the AVO was not available.

Limitation on Number of Investment Options for Contracts Issued before July 17, 2000

You may not have more than ten Investment Options at any one time, including the Investment Options that are closed to new contribution, and the Investment Options to which you have current allocations

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Appendix A

Financial Information for Separate Account I of National Integrity (IQ3 and IQ2)

For the Variable Account Options we currently offer, the table below shows the following data for IQ The Smart Annuity contracts with a mortality and expense risk charge of 1.45% issued after approximately May 1, 1999:  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		2002		2001		2000	Inception Date and Value
DWS Small Cap Index VIP, Class B (639)
Unit value at beginning of period	$	15.01	$	13.00	$	12.68	$	10.96	$	7.61	—		—		—	$	10.00
Unit value at end of period	$	14.48	$	15.01	$	13.00	$	12.68	$	10.96	$	7.61
Number of units outstanding at end of period	7,089		8,877		10,241		6,837		3,954		11,299
Fidelity VIP Asset Manager, Service Class 2 (623)
Unit value at beginning of period	$	11.45	$	10.84	$	10.60	$	10.23	$	8.82	$	9.84	—		—	$	10.00
Unit value at end of period	$	12.99	$	11.45	$	10.84	$	10.60	$	10.23	$	8.82	$	9.84
Number of units outstanding at end of period	41,162		38,729		47,859		55,882		33,353		25,875		5,661
Fidelity VIP Balanced, Service Class 2 (632)
Unit value at beginning of period	$	11.71	$	10.66	$	10.25	$	9.89	$	8.55	$	9.52	—		—	$	10.00
Unit value at end of period	$	12.55	$	11.71	$	10.66	$	10.25	$	9.89	$	8.55	$	9.52
Number of units outstanding at end of period	37,431		34,365		50,664		60,369		59,163		66,637		30,971
Fidelity VIP Contrafund, Service Class 2 (628)
Unit value at beginning of period	$	14.48	$	13.19	$	11.47	$	10.11	$	8.00	$	8.98	—		—
Unit value at end of period	$	16.74	$	14.48	$	13.19	$	11.47	$	10.11	$	8.00	$	8.98		$	10.00
Number of units outstanding at end of period	176,866		201,398		204,099		184,703		167,177		123,741		46,420
Fidelity VIP Disciplined Small Cap, Service Class 2 (032)
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—	$	10.00
Unit value at end of period	$	9.00
Number of units outstanding at end of period	7,704															4-27-07

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	2007		2006		2005		2004		2003		2002		2001		2000	Inception Date and Value
Fidelity VIP Dynamic Capital Appreciation, Service Class 2 (635)
Unit value at beginning of period	$	18.56	$	16.55	$	13.91	$	13.94	$	11.32	—		—		—	$	10.00
Unit value at end of period	$	19.52	$	18.56	$	16.55	$	13.91	$	13.94
Number of units outstanding at end of period	4,719		5,065		7,648		17,111		25,262
Fidelity VIP Equity Income, Service Class 2 (621)
Unit value at beginning of period	$	13.21	$	11.18	$	10.75	$	9.80	$	7.65	$	9.37	—			$	10.00
Unit value at end of period	$	13.19	$	13.21	$	11.18	$	10.75	$	9.80	$	7.65	$	9.37
Number of units outstanding at end of period	74,806		73,325		85,829		119,393		131,959		130,105		89,149
Fidelity VIP Freedom 2010, Service Class 2 (034)
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	2,532															4-30-07
Fidelity VIP Freedom 2015, Service Class 2 (035)
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	31,842															4-30-07
Fidelity VIP Freedom 2020, Service Class 2 (036)
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—	$	10.00
Unit value at end of period	$	10.25														4-30-07
Number of units outstanding at end of period	3,870
Fidelity VIP Freedom 2025, Service Class 2 (037)
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	0															4-30-07
Fidelity VIP Freedom 2030, Service Class 2 (038)
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—	$	10.00
Unit value at end of period	$	10.26
Number of units outstanding at end of period	0															4-30-07
Fidelity VIP Growth, Service Class 2 (624)
Unit value at beginning of period	$	7.86	$	7.48	$	7.20	$	7.08	$	5.42	$	7.89	—		—	$	10.00
Unit value at end of period	$	9.81	$	7.86	$	7.48	$	7.20	$	7.08	$	5.42	$	7.89
Number of units outstanding at end of period	51,061		45,976		58,261		74,163		143,144		112,293		77,936

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	2007		2006		2005		2004		2003		2002		2001		2000	Inception Date and Value
Fidelity VIP High Income, Service Class 2 (630) Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	12.15 12.27 82,663	$ $	11.10 12.15 301,406	$ $	11.01 11.10 231,391	$ $	10.21 11.01 179,632	$ $	8.18 10.21 69,809	$ $	8.03 8.18 30,026	$	— 8.03 19,758	—	$	10.00
Fidelity VIP Index 500, Service Class 2 (629)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	10.67 11.06 80,256	$ $	9.38 10.67 56,149	$ $	9.10 9.38 69,412	$ $	8.37 9.10 92,639	$ $	6.63 8.37 128,527	$ $	8.68 6.63 86,986	$	— 8.68 43,136	—	$	10.00
Fidelity VIP Investment Grade Bond, Service Class 2 (626)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	12.36 12.68 84,445	$ $	12.05 12.36 98,726	$ $	12.00 12.05 117,128	$ $	11.68 12.00 109,256	$ $	11.30 11.68 100,666	$ $	10.41 11.30 150,000	$	— 10.41 24,700	—	$	10.00
Fidelity VIP Growth & Income, Service Class 2 (633) Unit value at beginning of periodUnit value at end of period Number of units outstanding at end of period	$ $	11.12 12.26 9,953	$ $	10.00 11.12 16,900	$ $	9.45 10.00 27,244	$ $	9.08 9.45 43,179	$ $	7.47 9.08 57,103	$ $	9.11 7.47 66,313	$ $	— 9.11 45,514	—	$	10.00
Fidelity VIP Growth Opportunities, Service Class 2 (631)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	10.57 12.81 12,929	$ $	10.21 10.57 5,633	$ $	9.53 10.21 756	$ $	9.05 9.53 2,374	$ $	7.09 9.05 2,511	$ $	9.23 7.09 913	$	— 9.23 554	—	$	10.00
Fidelity VIP Mid Cap, Service Class 2 (634) Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	19.22 21.85 83,944	$ $	17.35 19.22 100,182	$ $	14.92 17.35 100,863	$ $	12.14 14.92 103,404	$ $	8.91 12.14 102,935	$ $	10.05 8.91 102,213	$	— 10.05 48,120	—	$	10.00
Fidelity VIP Overseas, Service Class 2 (625) Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	12.87 14.85 61,294	$ $	11.09 12.87 27,057	$ $	9.47 11.09 13,404	$ $	8.48 9.47 10,159	$ $	6.02 8.48 14,229	$ $	7.68 6.02 10,601	$	— 7.68 7,557	—	$	10.00
Fidelity VIP Value Strategies, Service Class 2 (070) Unit value at beginning of period	—		—		—		—		—		—			—	—	$	10.00

IQ3N - 44

	2007		2006		2005		2004		2003		2002	2001	2000	Inception Date and Value
Unit value at end of periodNumber of units outstanding at end of period														5-1-08
FTVIPT Franklin Income Securities, Class 2 (602) Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	16.51 16.88 129,986	$ $	14.17 16.51 99,365	$ $	14.15 14.17 75,251	$ $	12.61 14.15 33,222	$ $	10.00 12.61 18,595	—	—	—	$	10.00
FTVIPT Franklin Growth & Income Securities, Class 2 (603) Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	15.18 14.41 112,575	$ $	13.20 15.18 30,279	$ $	12.93 13.20 33,834	$ $	11.87 12.93 31,831	$ $	10.00 11.87 28,835	—	—	—	$	10.00
FTVIPT Franklin Large Cap Growth Securities, Class 2 (604)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	13.84 14.48 29,396	$ $	12.66 13.84 21,701	$ $	12.71 12.66 25,121	$ $	11.95 12.71 11,403	$ $	10.00 11.95 12,141	—	—	—	$	10.00
FTVIPT Franklin Small Cap Value Securities, Class 2 (030)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	10.00 8.88 1,166	—		—		—		—		—	—	—	$	10.00 4-30-07
FTVIPT Mutual Shares Securities, Class 2 (606)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	17.14 17.47 51,761	$ $	14.69 17.14 36,041	$ $	13.48 14.69 20,060	$ $	12.15 13.48 7,905	$ $	10.00 12.15 4,687	—	—	—	$	10.00
FTVIPT Templeton Foreign Securities, Class 2 (605)Unit value at beginning of periodUnit value at end of periodNumber of units outstanding at end of period	$ $	19.23 21.88 24,185	$ $	16.07 19.23 18,618	$ $	14.80 16.07 25,547	$ $	12.67 14.80 14,108	$ $	10.00 12.67 4,648	—	—	—	$	10.00

IQ3N - 45

	2007		2006		2005		2004		2003		2002	2001	2000	Inception Date and Value
FTVIPT Templeton Growth Securities, Class 2 (607)
Unit value at beginning of period	$	18.41	$	15.34	$	14.30	$	12.50	$	10.00	—	—	—	$	10.00
Unit value at end of period	$	18.57	$	18.41	$	15.34	$	14.30	$	12.50
Number of units outstanding at end of period	47,669		86,038		23,068		9,641		4,247
PIMCO VIT All Asset Portfolio, Advisor Class (062)
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 CommodityRealReturn Strategy Portfolio, Advisor Class (063)
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 (064)
Unit value at beginning of period	—		—		—		—		—		—	—	—	$	10.00
Unit value at end of period
Units outstanding at end of period														5-1-08

IQ3N - 46

	2007		2006		2005		2004		2003		2002		2001		2000	Inception Date and Value
PIMCO VIT Real Return, Advisor Class (065)
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 (066)
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 (067)
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 (068)
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 (069)
Unit value at beginning of period	—		—		—		—		—		—		—		—	$	10.00
Unit value at end of period
Units outstanding at end of period																5-1-08
Touchstone VST Aggressive ETF, Initial Class (616)
Unit value at beginning of period	$	11.85	$	10.59	$	10.27	$	10.00	—		—		—		—	$	10.00
Unit value at end of period	$	12.27	$	11.85	$	10.59	$	10.27
Number of units outstanding at end of period	37,527		92,130		88,699		2,441
Touchstone VST Baron Small Cap Growth (675)
Unit value at beginning of period	$	17.31	$	14.85	$	13.99	$	11.11	$	8.44	$	9.97	—		—	$	10.00
Unit value at end of period	$	17.52	$	17.31	$	14.85	$	13.99	11.11		$	8.44	$	9.97
Number of units outstanding at end of period	74,864		72,419		73,459		71,033		71,427		59,960		19,856
Touchstone VST Conservative ETF, Initial Class (614)
Unit value at beginning of period	$	11.03	$	10.34	$	10.16	$	10.00	—		—		—		—	$	10.00
Unit value at end of period	$	11.49	$	11.03	$	10.34	$	10.16
Number of units outstanding at end of period	180,359		128,093		115,331		2,469

IQ3N - 47

	2007		2006		2005		2004		2003		2002		2001		2000	Inception  Date and  Value
Touchstone VST Core Bond (659)
Unit value at beginning of period	$	11.44	$	11.15	$	11.13	$	10.93	$	10.72	$	10.08	—		—	$	10.00
Unit value at end of period	$	11.89	$	11.44	$	11.15	$	11.13	$	10.93	$	10.72	$	10.08
Number of units outstanding at end of period	27,625		40,180		55,369		45,630		44,322		38,270		11,827
Touchstone VST Mid Cap Growth (655)
Unit value at beginning of period	$	17.93	$	15.66	$	13.78	$	12.48	$	8.60	$	11.23			—	$	10.00
Unit value at end of period	$	20.22	$	17.93	$	15.66	$	13.78	$	12.48	$	8.60	$	11.23
Number of units outstanding at end of period	29,298		18,487		21,840		28,032		26,134		23,346		464
Touchstone VST Enhanced ETF, Initial Class (617)
Unit value at beginning of period	$	12.47	$	10.97	$	10.50	$	10.00	—		—		—		—	$	10.00
Unit value at end of period	$	12.79	$	12.47	$	10.97	$	10.50 0
Number of units outstanding at end of period	90,401		116,707		82,939		0
Touchstone VST High Yield (656)
Unit value at beginning of period	$	14.68	$	13.81	$	13.57	$	12.57	$	10.28	$	10.15			—	$	10.00
Unit value at end of period	$	14.73	$	14.68	$	13.81	$	13.57	$	12.57	$	10.28	$	10.15
Number of units outstanding at end of period	20,818		27,123		28,728		26,811		35,567		12,308		4,367
Touchstone VST Large Cap Core Equity (formerly Enhanced Dividend 30) (658)
Unit value at beginning of period	$	12.54	$	10.05	$	10.52	$	10.15	$	7.81	$	10.25	—		—	$	10.00
Unit value at end of period	$	13.01	$	12.54	$	10.05	$	10.52	$	10.15	$	7.81	$	10.25
Number of units outstanding at end of period	8,462		8,130		2,576			53	3,371		1,634		1,467
Touchstone VST Moderate ETF Fund, Initial Class (615)
Unit value at beginning of period	$	11.48	$	10.50	$	10.25	$	10.00	—		—		—		—	$	10.00
Unit value at end of period	$	11.91	$	11.48	$	10.50	$	10.25
Number of units outstanding at end of period	243,963		188,617		178,197		47,582
Touchstone VST Money Market, Service Class (647)
Unit value at beginning of period	$	10.38	$	10.06	$	9.92	$	9.96	$	10.00	—		—		—	$	10.00
Unit value at end of period	$	10.73	$	10.38	$	10.06	$	9.92	$	9.96
Number of units outstanding at end of period	761,236		232,328		408,914		312,531		342,411
Touchstone VST Third Avenue Value (673)
Unit value at beginning of period	$	18.09	$	15.84	$	13.69	$	11.03	$	7.98	$	7.98	—		—	$	10.00
Unit value at end of period	$	17.51	$	18.09	$	15.84	$	13.69	$	11.03	145,421
Number of units outstanding at end of period	213,472		205,529		189,406		185,635		179,297

IQ3N - 48

	2007		2006		2005		2004		2003		2002	2001	2000	Inception Date and Value
Van Kampen LIT Comstock, Class II (608)
Unit value at beginning of period	$	16.77	$	14.66	$	14.29	$	12.35	—		—	—	—	$	10.00
Unit value at end of period	$	16.14	$	16.77	$	14.66	$	14.29	$	12.35
Number of units outstanding at end of period	8,574		8,700		12,700		475		—
Van Kampen LIT Capital Growth, Class II (609) (formerly LIT Strategic Growth)
Unit value at beginning of period	$	13.51	$	13.36	$	12.59	$	11.96	$	10.00	—	—	—
Unit value at end of period	$	15.53	$	13.51	$	13.36	$	12.59	$	11.96				$	10.00
Number of units outstanding at end of period	89		90		91		92		1,148
Van Kampen UIF Emerging Markets Debt, Class II (397)
Unit value at beginning of period	$	16.26	$	14.89	$	13.47	$	12.42			—	—	—	$	10.00
Unit value at end of period	$	17.05	$	16.26	$	14.89	$	13.47
Number of units outstanding at end of period	13,485		0		0		—
Van Kampen UIF Emerging Markets Equity, Class II (610)
Unit value at beginning of period	$	31.05	$	22.97	$	17.42	$	14.37	$	10.00	—	—	—	$	10.00
Unit value at end of period	$	42.98	$	31.05	$	22.97	$	17.42	$	14.37
Number of units outstanding at end of period	10,210		3,640		1,290		945		11,799
Van Kampen UIF U.S. Mid Cap Value, Class II (071)
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 (398)
Unit value at beginning of period	$	28.01	$	20.64	$	17.94	$	13.38	—		—	—	—	$	10.00
Unit value at end of period	$	22.83	$	28.01	$	20.64	$	17.94
Number of units outstanding at end of period	5,067		0		0		357

IQ3N - 49

Financial Information for Separate Account I of National Integrity (IQ1)

For the Variable Account Options we currently offer, the table below shows the following data for IQ The Smart Annuity contracts with a mortality and expense risk charge of 1.35% issued prior to approximately May 1, 1999 (date varies by state): the 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:

																					Inception Date and
	2007		2006		2005		2004		2003		2002		2001		2000		1999		1998		Value
DWS Small Cap Index VIP, Class B (314)*
Unit value at beginning of period	$	13.73	$	11.87	$	11.57	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	13.25	$	13.73	$	11.87	$	11.57
Units outstanding at end of period	1,285		1,795		32,560		19,967
Fidelity VIP Asset Manager, Initial Class (304)*
Unit value at beginning of period	$	33.70	$	31.83	$	31.01	$	29.80	$	25.61	$	28.44	$	30.06	$	31.72	$	28.94	$	25.50	$	10.00
Unit value at end of period	$	38.40	$	33.70	$	31.83	$	31.01	$	29.80	$	25.61	$	28.44	$	30.06	$	31.72	$	28.94
Number of units outstanding at end of period	189,385		238,299		301,745		415,135		380,657		438,163		529,838		703,618		956,725		1,201,119
Fidelity VIP Balanced, Service Class 2 (347)*
Unit value at beginning of period	$	12.02	$	10.93	$	10.50	—		—		—		—		—		—				$	10.00
Unit value at end of period	$	12.90	$	12.02	$	10.93	$	10.50
Number of units outstanding at end of period	41,613		0		0		—														5-1-04
Fidelity VIP Contrafund, Initial Class (330)*
Unit value at beginning of period	$	40.12	$	36.40	$	31.55	$	27.20	$	21.86	$	24.44	$	28.23	$	30.65	$	25.00	$	19.50	$	10.00
Unit value at end of period	$	46.54	$	40.12	$	36.40	$	31.55	$	27.70	$	21.86	$	24.44	$	28.23	$	30.65	$	25.00
Number of units outstanding at end of period	521,093		608,085		695,513		819,427		966,395		1,337,292		1,498,779		2,081,477		2,315,960		2,547,399
Fidelity VIP Disciplined Small Cap, Service Class 2 (601)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	9.01
Number of units outstanding at end of period	2,491																				4-27-07

IQ3N - 50

																					Inception Date and
	2007		2006		2005		2004		2003		2002		2001		2000		1999		1998		Value
Fidelity VIP Dynamic Capital Appreciation, Service Class 2 (346)*
Unit value at beginning of period	$	14.25	$	12.69	$	10.66	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	15.00	$	14.25	$	12.69	$	10.66
Units outstanding at end of period	116,714		81,262		3,081		3,082
Fidelity VIP Equity Income, Initial Class (302)*
Unit value at beginning of period	$	61.13	$	51.56	$	49.36	$	44.87	$	34.90	$	42.59	$	45.43	$	42.47	$	40.49	$	36.77	$	10.00
Unit value at end of period	$	61.23	$	61.13	$	51.56	$	49.36	$	44.87	$	34.90	$	42.59	$	45.43	$	42.47	$	40.49
Number of units outstanding at end of period	353,980		431,962		507,083		599,458		683,179		792,301		1,084,357		1,077,660		1,770,880		2,160,698
Fidelity VIP Freedom 2010, Service Class 2 (354)*
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	8,536																				4-30-07
Fidelity VIP Freedom 2015, Service Class 2 (355)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	10.25
Units outstanding at end of period	0																				4-30-07
Fidelity VIP Freedom 2020, Service Class 2 (356)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	10.26
Units outstanding at end of period	0																				4-30-07
Fidelity VIP Freedom 2025, Service Class 2 (357)*			—		—		—		—		—		—		—		—		—
Unit value at beginning of period	$	10.00																			$	10.00
Unit value at end of period	$	10.26
Units outstanding at end of period	0																				4-30-07
Fidelity VIP Freedom 2030, Service Class 2 (358)*			—		—		—		—		—		—		—		—		—
Unit value at beginning of period	$	10.00																			$	10.00
Unit value at end of period	$	10.27
Units outstanding at end of period	0																				4-30-07

IQ3N - 51

																					Inception Date and
	2007		2006		2005		2004		2003		2002		2001		2000		1999		1998		Value
Fidelity VIP Growth, Service Class 2 (033)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	11.71
Number of units outstanding at end of period	62,943																				4-30-07
Fidelity VIP Growth & Income, Initial Class (363)*
Unit value at beginning of period	$	17.85	$	15.99	$	15.06	$	14.43	$	11.81	$	14.36	$	15.96	$	16.78	$	15.98	$	12.19	$	10.00
Unit value at end of period	$	19.74	$	17.85	$	15.99	$	15.06	$	14.43	$	11.81	$	14.36	$	15.96	$	16.78	$	15.98
Number of units outstanding at end of period	162,377		196,191		312,621		418,597		542,988		540,710		594,704		812,189		938,522		812,252
Fidelity VIP Growth Opportunities, Initial Class (361)*
Unit value at beginning of period	$	12.22	$	11.75	$	10.94	$	10.34	$	8.07	$	10.47	$	12.40	$	15.16	$	14.74	$	11.99	$	10.00
Unit value at end of period	$	14.85	$	12.22	$	11.75	$	10.94	$	10.34	$	8.07	$	10.47	$	12.40	$	15.16	$	14.74
Number of units outstanding at end of period	78,304		102,311		137,776		203,148		249,115		293,565		374,819		563,578		770,889		739,632
Fidelity VIP High Income, Initial Class (360)*
Unit value at beginning of period	$	17.48	$	15.93	$	15.72	$	14.54	$	11.58	$	11.35	$	13.04	$	17.05	$	15.98	$	16.93	$	10.00
Unit value at end of period	$	17.73	$	17.48	$	15.93	$	15.72	$	14.54	$	11.58	$	11.35	$	13.04	$	17.05	$	15.98
Number of units outstanding at end of period	245,508		340,587		407,644		553,586		767,496		906,875		1,093,661		1,471,012		1,828,869		2,101,650
Fidelity VIP Index 500, Service Class 2 (031)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	9.85
Number of units outstanding at end of period	283,160
Fidelity VIP Investment Grade Bond, Service Class 2 (348)*
Unit value at beginning of period	$	10.00	—		—		—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	10.14
Number of units outstanding at end of period	34,301																				4-30-07
Fidelity VIP Mid Cap, Service Class 2 (326)*
Unit value at beginning of period	$	15.81	$	14.26	$	12.25	—		—		—		—		—		—		—		$	10.00
Unit value at end of period	$	17.99	$	15.81	$	14.26	$	12.25
Units outstanding at end of period	71,275		822		0		—

IQ3N - 52

																Inception Date and
	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Value
Fidelity VIP Overseas, Service Class 2 (618)*
Unit value at beginning of period	$	10.00	—		—		—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	10.57
Number of units outstanding at end of period	246,606															4-30-07
Fidelity VIP Value Strategies, Service Class 2 (600)*
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 & Income, Class 2 (333)*
Unit value at beginning of period	$	15.24	$	13.24	$	12.96	$	11.88	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	14.48	$	15.24	$	13.24	$	12.96	$	11.88
Units outstanding at end of period	113,576		25,424		31,808		26,850		36,793
FTVIPT Franklin Income Securities, Class 2 (332)*
Unit value at beginning of period	$	16.57	$	14.21	$	14.17	$	12.62	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	16.96	$	16.57	$	14.21	$	14.17	$	12.62
Units outstanding at end of period	203,691		162,850		97,919		77,370		83,241
FTVIPT Franklin Large Cap Growth, Class 2 (334)*
Unit value at beginning of period	$	13.89	$	12.70	$	12.74	$	11.96	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	14.56	$	13.89	$	12.70	$	12.74	$	11.96
Units outstanding at end of period	19,025		10,999		11,673		15,581		5,961
FTVIPT Mutual Shares, Class 2 (336)*
Unit value at beginning of period	$	17.21	$	14.73	$	13.51	$	12.16	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	17.56	$	17.21	$	14.73	$	13.51	$	12.16
Units outstanding at end of period	180,262		75,891		72,768		64,279		56,823

IQ3N - 53

																Inception Date and
	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Value
FTVIPT Templeton Foreign Securities, Class 2 (335)*
Unit value at beginning of period	$	19.31	$	16.12	$	14.83	$	12.68	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	21.99	$	19.31	$	16.12	$	14.83	$	12.68
Units outstanding at end of period	13,285		12,799		20,044		9,934		4,342
FTVIPT Templeton Growth Securities, Class 2 (337)*
Unit value at beginning of period	$	18.49	$	15.38	$	14.32	$	12.51	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	18.66	$	18.49	$	15.38	$	14.32	$	12.51
Units outstanding at end of period	22,239		63,037		23,647		22,823		15,778
PIMCO VIT All Asset Portfolio, Advisor Class (039)*																$	10.00
Unit value at beginning of period	—		—		—		—		—		—	—	—	—	—
Unit value at end of period																5-1-08
Units outstanding at end of period
PIMCO VIT CommodityRealReturn Strategy Portfolio, Advisor Class (060)*																$	10.00
Unit value at beginning of period	—		—		—		—		—		—	—	—	—	—
Unit value at end of period																5-1-08
Units outstanding at end of period
PIMCO VIT Low Duration Portfolio, Advisor Class (061)*																$	10.00
Unit value at beginning of period	—		—		—		—		—		—	—	—	—	—
Unit value at end of period																5-1-08
Units outstanding at end of period

IQ3N - 54

															Inception Date and
	2007		2006		2005		2004		2003	2002	2001	2000	1999	1998	Value
PIMCO VIT Real Return, Advisor Class (300)*															$	10.00
Unit value at beginning of period	—		—		—		—		—	—	—	—	—	—
Unit value at end of period															5-1-08
Units outstanding at end of period
PIMCO VIT Total Return, Advisor Class (349)*															$	10.00
Unit value at beginning of period	—		—		—		—		—	—	—	—	—	—
Unit value at end of period															5-1-08
Units outstanding at end of period
Rydex VT Absolute Return Strategies Fund (351)*															$	10.00
Unit value at beginning of period	—		—		—		—		—	—	—	—	—	—
Unit value at end of period															5-1-08
Units outstanding at end of period
Rydex VT Hedged Equity Fund (352)*
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 (353)*
Unit value at beginning of period	—		—		—		—		—	—	—	—	—	—	$	10.00
Unit value at end of period
Units outstanding at end of period															5-1-08
Touchstone VST Baron Small Cap Growth (318)*
Unit value at beginning of period	$	14.61	$	12.52	$	11.79	—		—	—	—	—	—	—	$	10.00
Unit value at end of period	$	14.81	$	14.61	$	12.52	$	11.79
Units outstanding at end of period	22,798		28,078		22,706		13,546
Touchstone VST Core Bond (324)*
Unit value at beginning of period	$	10.58	$	10.31	$	10.28	—		—	—	—	—	—	—
Unit value at end of period	$	11.01	$	10.58	$	10.31	$	10.28							$	10.00
Units outstanding at end of period	4,744		1,515		1,191		3,919

IQ3N - 55

																Inception Date and
	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Value
Touchstone VST High Yield (321)*
Unit value at beginning of period	$	11.57	$	10.87	$	10.67	—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	11.62	$	11.57	$	10.87	$	10.67
Units outstanding at end of period	11,964		22,824		34,108		32,053
Touchstone VST Large Cap Core Equity (formerly Enhanced Dividend 30) (323)*
Unit value at beginning of period	$	12.65	$	10.13	$	10.59	—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	13.14	$	12.65	$	10.13	$	10.59
Units outstanding at end of period	540		766		832		2,356
Touchstone VST Mid Cap Growth (319)*
Unit value at beginning of period	$	14.01	$	12.22	$	10.74	—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	15.81	$	14.01	$	12.22	$	10.74
Units outstanding at end of period	15,164		11,324		10,027		11,591
Touchstone VST Money Market, Initial Class (331)*
Unit value at beginning of period	$	10.50	$	10.14	$	9.97	$	9.97	—		—	—	—	—	—
Unit value at end of period	$	10.90	$	10.50	$	10.14	$	9.97	$	9.97						$	10.00
Units outstanding at end of period	533,926		443,038		532,179		557,403		1,391,648
Touchstone VST Third Avenue Value (317)*
Unit value at beginning of period	$	16.10	$	14.09	$	12.16	—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	15.60	$	16.10	$	14.09	$	12.16
Units outstanding at end of period	259,418		181,950		149,728		25,169
Touchstone VST Aggressive ETF, Initial Class (367)*
Unit value at beginning of period	$	11.87	$	10.60	$	10.27	—		—		—	—	—	—	—	$	10.00
Unit value at end of period	$	12.31	$	11.87	$	10.60	$	10.27
Number of units outstanding at end of period	2,924		185,423		186,491		177,793

IQ3N - 56

																Inception Date and
	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Value
Touchstone VST Conservative ETF, Initial Class (365)*
Unit value at beginning of period	$	11.05	$	10.36	$	10.16	$	10.00	—		—	—	—	—	—	$	10.00
Unit value at end of period	$	11.53	$	11.05	$	10.36	$	10.16
Number of units outstanding at end of period	14,371		13,801		12,331		139
Touchstone VST Enhanced ETF, Initial Class (368)*									—		—	—	—	—	—	$	10.00
Unit value at beginning of period	$	12.50	$	10.98	$	10.50	$	10.00
Unit value at end of period	$	12.83	$	12.50	$	10.98	$	10.50
Number of units outstanding at end of period	180,031		275,208		255,770		26,126
Touchstone VST Moderate ETF, Initial Class (366)*
Unit value at beginning of period	$	11.51	$	10.51	$	10.25	$	10.00	—		—	—	—	—	—	$	10.00
Unit value at end of period	$	11.95	$	11.51	$	10.51	$	10.25
Number of units outstanding at end of period	28,655		32,814		37,725		12,311
Van Kampen LIT Comstock, Class II (338)*
Unit value at beginning of period	$	16.83	$	14.70	$	14.32	$	12.36	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	16.22	$	16.83	$	14.70	$	14.32	$	12.36
Units outstanding at end of period	6,923		10,954		24,557		157,078		7,484
Van Kampen LIT Capital Growth, Class II (339)*
Unit value at beginning of period	$	13.56	$	13.40	$	12.61	$	11.98	$	10.00	—	—	—	—	—
Unit value at end of period	$	15.60	$	13.56	$	13.40	$	12.61	$	11.98						$	10.00
Units outstanding at end of period	27		477		425		786		366
Van Kampen UIF Emerging Markets Debt, Class II (341)*
Unit value at beginning of period	$	16.32	$	14.93	$	13.50	$	12.43	$	10.00	—	—	—	—	—
Unit value at end of period	$	17.13	$	16.32	$	14.93	$	13.50	$	12.43						$	10.00
Units outstanding at end of period	1,360		4,693		6,492		3,928		7,625

IQ3N - 57

																Inception Date and
	2007		2006		2005		2004		2003		2002	2001	2000	1999	1998	Value
Van Kampen UIF Emerging Markets Equity, Class II (340)*
Unit value at beginning of period	$	31.18	$	23.04	$	17.46	$	14.39	$	10.00	—	—	—	—	—
Unit value at end of period	$	43.20	$	31.18	$	23.04	$	17.46	$	14.39						$	10.00
Units outstanding at end of period	17,604		14,914		14,408		14,705		3,626
Van Kampen UIF U.S. Mid Cap Value, Class II (369)
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 (342)*
Unit value at beginning of period	$	28.12	$	20.71	$	17.98	$	13.39	$	10.00	—	—	—	—	—	$	10.00
Unit value at end of period	$	22.95	$	28.12	$	20.71	$	17.98	$	13.39
Units outstanding at end of period	14,769		23,507		25,784		29,674		23,701

*Also contains assets belonging to contract owners of the Grand Master I, II, and III variable annuities.

IQ3N - 58

STATEMENT OF ADDITIONAL INFORMATION

May 1, 2008

Deferred Flexible Premium Variable Annuities

Issued By National Integrity Life Insurance Company

Through Separate Account I of National 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 National Integrity Life Insurance Company, 15 Matthews Street, Suite 200, Goshen, NY 10924, or by calling 1-800-433-1778.

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

National Integrity Life Insurance Company (National Integrity) is a New York life insurance company organized on November 22, 1968. The home office is located at 15 Matthews Street, #200, Goshen, New York 10924. National Integrity is authorized to sell life insurance and annuities in 8 states and the District of Columbia. National Integrity, the depositor of Separate Account I, is a wholly owned subsidiary of Integrity Life Insurance Company (Integrity), an Ohio life insurance company, which 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

National Integrity has responsibility for administration of Separate Account I (the Separate Account) and the variable annuity contracts issued through the Separate Account (Contracts). National Integrity has entered into Service Agreements with Integrity, 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 National Integrity, is based on the charges and expenses incurred by the service provider, and will reflect actual costs to the extent reasonably possible.

Custodian

National Integrity is the custodian of the assets of the Separate Account.  The shares are held in book-entry form. National 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 National 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 $27,487,812 in 2007, $28,232,921 in 2006, and $25,314,492 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 National Integrity, and its parent company, Integrity, 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.

2

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.

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

National 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 allowed by law.

3

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 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 National 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 National Integrity from the financial statements of the Separate Account and consider the National Integrity financial statements only as they relate to the ability of National 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 National Integrity policy holders dated March 3, 2000. You should not consider the National 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 National Integrity Life Insurance Company

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

Separate Account I

of

National 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 Period ended December 31, 2007	7
Statements of Changes in Net Assets for the Period ended December 31, 2007	16
Statements of Changes in Net Assets for the Period ended December 31, 2006	22
Notes to Financial Statements	27

Report of Independent Registered Public Accounting Firm

The Contract Holders

Separate Account I of National Integrity Life Insurance Company

and

The Board of Directors

National Integrity Life Insurance Company

We have audited the accompanying statements of assets and liabilities of Separate Account I of National 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 National 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

National Integrity Life Insurance Company

Statements of Assets and Liabilities

December 31, 2007

			Receivable from
			(payable to)
	Investments		the general account
Division	at value		of National Integrity			Net Assets		Unit Value		Units Outstanding
Affiliated:
Touchstone Aggressive ETF (AnnuiChoice™)	$	565,075	$	—		$	565,075	$	12.45	45,396
Touchstone Aggressive ETF (GrandMaster flex3™)	671,925		—			671,925		12.23		54,924
Touchstone Aggressive ETF (Grandmaster™)	36,002		1			36,003		12.31		2,924
Touchstone Aggressive ETF (IQ Annuity™)	460,550		(1		)	460,549		12.27		37,527
Touchstone Aggressive ETF (Pinnacle Plus™)	727,962		—			727,962		12.19		59,731
Touchstone Balanced (AnnuiChoice™)	131,308		(1		)	131,307		14.44		9,096
Touchstone Balanced (GrandMaster flex3™)	370,174		—			370,174		14.54		25,454
Touchstone Balanced (Grandmaster™)	145		1			146		12.96		11
Touchstone Balanced (IQ Annuity™)	227,104		1			227,105		13.71		16,567
Touchstone Balanced (Pinnacle Plus™)	487,452		—			487,452		14.00		34,824
Touchstone Baron Small Cap (AnnuiChoice™)	309,489		—			309,489		18.44		16,786
Touchstone Baron Small Cap (AnnuiChoice II™)	13,011		—			13,011		11.47		1,134
Touchstone Baron Small Cap (GrandMaster flex3™)	761,183		—			761,183		17.07		44,595
Touchstone Baron Small Cap (Grandmaster™)	337,594		—			337,594		14.81		22,798
Touchstone Baron Small Cap (IQ Annuity™)	1,311,888		—			1,311,888		17.52		74,864
Touchstone Baron Small Cap (Pinnacle Plus™)	706,246		—			706,246		17.26		40,916
Touchstone Conservative ETF (AnnuiChoice™)	10,595		—			10,595		11.65		909
Touchstone Conservative ETF (GrandMaster flex3™)	1,200,631		—			1,200,631		11.45		104,820
Touchstone Conservative ETF (Grandmaster™)	165,652		—			165,652		11.53		14,371
Touchstone Conservative ETF (IQ Annuity™)	2,072,391		1			2,072,392		11.49		180,359
Touchstone Conservative ETF (Pinnacle Plus™)	676,004		—			676,004		11.41		59,242
Touchstone Core Bond (AnnuiChoice™)	241,518		1			241,519		12.24		19,731
Touchstone Core Bond (AnnuiChoice II™)	59,962		—			59,962		10.59		5,663
Touchstone Core Bond (GrandMaster flex3™)	559,825		—			559,825		11.50		48,701
Touchstone Core Bond (Grandmaster™)	52,228		1			52,229		11.01		4,744
Touchstone Core Bond (IQ Annuity™)	328,331		—			328,331		11.89		27,625
Touchstone Core Bond (Pinnacle Plus™)	229,724		1			229,725		10.75		21,371
Touchstone Eagle Capital Appreciation (AnnuiChoice™)	181,535		—			181,535		11.80		15,385
Touchstone Eagle Capital Appreciation (GrandMaster™)	40,767		—			40,767		12.92		3,155
Touchstone Eagle Capital Appreciation (GrandMaster flex3™)	182,914		—			182,914		14.03		13,040
Touchstone Eagle Capital Appreciation (IQ Annuity™)	376,527		—			376,527		11.80		31,919
Touchstone Eagle Capital Appreciation (Pinnacle Plus™)	218,462		1			218,463		14.02		15,577
Touchstone Enhanced ETF (AnnuiChoice™)	1,987,906		1			1,987,907		12.97		153,272
Touchstone Enhanced ETF (GrandMaster flex3™)	1,992,737		(1		)	1,992,736		12.75		156,332
Touchstone Enhanced ETF (Grandmaster™)	2,309,358		(1		)	2,309,357		12.83		180,031
Touchstone Enhanced ETF (IQ Annuity™)	1,155,970		(1		)	1,155,969		12.79		90,401
Touchstone Enhanced ETF (Pinnacle Plus™)	866,675		—			866,675		12.70		68,250
Touchstone Growth & Income (AnnuiChoice™)	38,655		—			38,655		13.93		2,775
Touchstone Growth & Income (GrandMaster flex3™)	15,439		—			15,439		13.77		1,121
Touchstone Growth & Income (IQ Annuity™)	53,872		—			53,872		14.02		3,843
Touchstone Growth & Income (Pinnacle Plus™)	107,701		—			107,701		14.11		7,632
Touchstone High Yield (AnnuiChoice™)	403,195		2			403,197		14.84		27,176
Touchstone High Yield (GrandMaster flex3™)	406,507		—			406,507		14.11		28,814
Touchstone High Yield (Grandmaster™)	139,020		—			139,020		11.62		11,964
Touchstone High Yield (IQ Annuity™)	306,598		—			306,598		14.73		20,818
Touchstone High Yield (Pinnacle Plus™)	863,218		—			863,218		12.26		70,411
Touchstone Large Cap Core Equity (AnnuiChoice II™)	323,090		—			323,090		11.42		28,300
Touchstone Large Cap Core Equity (GrandMaster flex3™)	43,651		1			43,652		13.76		3,173
Touchstone Large Cap Core Equity (Grandmaster™)	7,097		—			7,097		13.14		540
Touchstone Large Cap Core Equity (IQ Annuity™)	110,104		—			110,104		13.01		8,462
Touchstone Large Cap Core Equity (Pinnacle Plus™)	119,916		(1		)	119,915		14.15		8,473
Touchstone Mid Cap Growth (AnnuiChoice™)	327,529		(1		)	327,528		19.42		16,862
Touchstone Mid Cap Growth (AnnuiChoice II™)	44,950		—			44,950		12.24		3,671
Touchstone Mid Cap Growth (GrandMaster flex3™)	536,596		1			536,597		19.02		28,206
Touchstone Mid Cap Growth (Grandmaster™)	239,735		—			239,735		15.81		15,164
Touchstone Mid Cap Growth (IQ Annuity™)	592,505		2			592,507		20.22		29,298
Touchstone Mid Cap Growth (Pinnacle Plus™)	1,118,600		—			1,118,600		18.57		60,226
Touchstone Moderate ETF (AnnuiChoice™)	254,163		—			254,163		12.08		21,041
Touchstone Moderate ETF (GrandMaster flex3™)	1,958,584		—			1,958,584		11.87		164,978
Touchstone Moderate ETF (Grandmaster™)	342,345		(1		)	342,344		11.95		28,655
Touchstone Moderate ETF (IQ Annuity™)	2,905,415		—			2,905,415		11.91		243,963
Touchstone Moderate ETF (Pinnacle Plus™)	1,040,064		(1		)	1,040,063		11.83		87,941
See accompanying notes.

2

			Receivable from
			(payable to)
	Investments		the general account
Division	at value		of National Integrity			Net Assets		Unit Value		Units Outstanding
Affiliated (continued):
Touchstone Money Market (AnnuiChoice™)	$	181,515	$	(1	)	$	181,514	$	11.21	16,199
Touchstone Money Market (Grandmaster™)	5,817,179		(3		)	5,817,176		10.90		533,926
Touchstone Money Market (IQ Annuity™)	3,131		(1		)	3,130		10.94		286
Touchstone Third Avenue Value (AnnuiChoice™)	2,339,547		—			2,339,547		18.15		128,870
Touchstone Third Avenue Value (GrandMaster flex3™)	2,761,637		2			2,761,639		17.86		154,618
Touchstone Third Avenue Value (Grandmaster™)	4,046,730		—			4,046,730		15.60		259,418
Touchstone Third Avenue Value (IQ Annuity™)	3,737,015		—			3,737,015		17.51		213,472
Touchstone Third Avenue Value (Pinnacle Plus™)	3,313,729		1			3,313,730		18.83		176,001
Touchstone Third Avenue Value (AnnuiChoice II™)	716,668		(1		)	716,667		10.63		67,427
Touchstone Value Plus (AnnuiChoice™)	125,938		—			125,938		11.55		10,901
Touchstone Value Plus (AnnuiChoice II™)	3,251		—			3,251		10.52		309
Touchstone Value Plus (GrandMaster flex3™)	125,056		—			125,056		12.85		9,734
Touchstone Value Plus (Grandmaster™)	45,372		(1		)	45,371		12.29		3,692
Touchstone Value Plus (IQ Annuity™)	212,502		1			212,503		11.37		18,695
Touchstone Value Plus (Pinnacle Plus™)	294,512		—			294,512		13.44		21,916
Non-Affiliated:
JP Morgan Mid Cap Value (AnnuiChoice™)	328,236		1			328,237		17.98		18,251
JP Morgan Mid Cap Value (GrandMaster flex3™)	194,021		—			194,021		17.79		10,906
JP Morgan Mid Cap Value (Grandmaster™)	88,974		—			88,974		14.43		6,166
JP Morgan Mid Cap Value (IQ3™)	85,377		(1		)	85,376		17.54		4,868
JP Morgan Mid Cap Value (Pinnacle Plus™)	1,031,289		2			1,031,291		16.54		62,342
Non-Affiliated Initial Class:
Fidelity VIP Equity-Income (Grandmaster™)	21,673,366		1			21,673,367		61.23		353,980
Fidelity VIP Growth (Grandmaster™)	11,060,121		1			11,060,122		74.52		148,425
Fidelity VIP High Income (Grandmaster™)	4,352,059		1			4,352,060		17.73		245,508
Fidelity VIP II Asset Manager (Grandmaster™)	7,271,598		1			7,271,599		38.40		189,385
Fidelity VIP II Contrafund (Grandmaster™)	24,249,701		1			24,249,702		46.54		521,093
Fidelity VIP II Index 500 (Grandmaster™)	7,354,014		(1		)	7,354,013		34.65		212,249
Fidelity VIP II Investment Grade Bond (AnnuiChoice™)	596,165		—			596,165		10.19		58,521
Fidelity VIP II Investment Grade Bond (Grandmaster™)	2,631,571		(1		)	2,631,570		27.11		97,071
Fidelity VIP II Investment Grade Bond (GrandmasterFlex3™)	333,355		—			333,355		10.15		32,847
Fidelity VIP II Investment Grade Bond (IQ3™)	163,948		—			163,948		10.16		16,144
Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)	383,348		—			383,348		10.14		37,805
Fidelity VIP III Balanced (Grandmaster™)	2,189,844		—			2,189,844		16.77		130,592
Fidelity VIP III Growth & Income (Grandmaster™)	3,206,034		—			3,206,034		19.74		162,377
Fidelity VIP III Growth Opportunities (Grandmaster™)	1,162,984		—			1,162,984		14.85		78,304
Fidelity VIP Overseas (AnnuiChoice™)	372,938		—			372,938		10.62		35,125
Fidelity VIP Overseas (AnnuiChoice II™)	55,223		—			55,223		10.61		5,207
Fidelity VIP Overseas (Grandmaster™)	4,597,511		2			4,597,513		41.58		110,576
Fidelity VIP Overseas (GrandmasterFlex3™)	351,449		—			351,449		10.58		33,227
Fidelity VIP Overseas (IQ3™)	196,148		—			196,148		10.58		18,532
Fidelity VIP Overseas (Pinnacle Plus™)	786,630		—			786,630		10.57		74,433
Affilated Service Class:
Touchstone Aggressive ETF (AnnuiChoice™)	83,024		—			83,024		11.33		7,330
Touchstone Aggressive ETF (AnnuiChoice II™)	641,600		1			641,601		11.11		57,775
Touchstone Aggressive ETF (GrandmasterFlex3™)	69,337		—			69,337		9.82		7,058
Touchstone Aggressive ETF (Pinnacle Plus™)	100,691		—			100,691		9.82		10,258
Touchstone GMAB Aggressive ETF (AnnuiChoice II™)	309,051		—			309,051		11.02		28,056
Touchstone Conservative ETF (AnnuiChoice II™)	42,701		—			42,701		10.88		3,926
Touchstone Conservative ETF (GrandmasterFlex3™)	701,747		—			701,747		10.08		69,648
Touchstone Conservative ETF (Pinnacle Plus™)	251,488		—			251,488		10.07		24,981
Touchstone Enhanced ETF (AnnuiChoice™)	282,008		(1		)	282,007		11.34		24,857
Touchstone Enhanced ETF (AnnuiChoice II™)	189,433		—			189,433		11.13		17,024
Touchstone Enhanced ETF (GrandmasterFlex3™)	261,454		—			261,454		9.64		27,125
Touchstone Enhanced ETF (Pinnacle Plus™)	423,407		—			423,407		9.63		43,964
Touchstone Moderate ETF (AnnuiChoice™)	462,695		(1		)	462,694		11.17		41,438
Touchstone Moderate ETF (AnnuiChoice II™)	468,526		—			468,526		10.97		42,706
Touchstone Moderate ETF (GrandmasterFlex3™)	421,972		—			421,972		9.92		42,524
Touchstone Moderate ETF (Pinnacle Plus™)	1,967,452		—			1,967,452		9.91		198,433
Touchstone Money Market (AnnuiChoice™)	1,260,870		(2		)	1,260,868		10.95		115,167
Touchstone Money Market (AnnuiChoice II™)	23,867		—			23,867		10.50		2,273
Touchstone Money Market (GrandMaster flex3™)	3,176,996		(1		)	3,176,995		10.68		297,490
Touchstone Money Market (IQ Annuity™)	8,166,341		(3		)	8,166,338		10.73		761,236
Touchstone Money Market (Pinnacle Plus™)	2,988,533		(1		)	2,988,532		10.62		281,382

See accompanying notes.

3

			Receivable from
			(payable to)
	Investments		the general account
Division	at value		of National Integrity			Net Assets		Unit Value		Units Outstanding
Non-Affliated Service Class:
Fidelity VIP III Mid Cap (Grandmaster™)	$	3,911,721	$	—		$	3,911,721	$	35.84	109,138
Non-Affiliated Service Class 2 :
Fidelity VIP Asset Manager (AnnuiChoice™)	270,450		1			270,451		13.80		19,603
Fidelity VIP Asset Manager (AnnuiChoice II™)	7,377		—			7,377		11.90		620
Fidelity VIP Asset Manager (GrandMaster flex3™)	111,587		—			111,587		12.65		8,818
Fidelity VIP Asset Manager (IQ3™)	534,884		—			534,884		12.99		41,162
Fidelity VIP Asset Manager (Pinnacle Plus™)	184,167		—			184,167		13.18		13,977
Fidelity VIP Balanced (AnnuiChoice™)	335,218		(1		)	335,217		13.74		24,404
Fidelity VIP Balanced (AnnuiChoice II™)	8,089		—			8,089		11.37		712
Fidelity VIP Balanced (GrandMaster™)	536,658		—			536,658		12.90		41,613
Fidelity VIP Balanced (GrandMaster flex3™)	571,494		(1		)	571,493		14.11		40,508
Fidelity VIP Balanced (IQ3™)	469,624		1			469,625		12.55		37,431
Fidelity VIP Balanced (Pinnacle Plus™)	567,550		(1		)	567,549		13.10		43,340
Fidelity VIP Contrafund (AnnuiChoice™)	3,027,734		1			3,027,735		19.10		158,506
Fidelity VIP Contrafund (GrandMaster flex3™)	2,700,460		—			2,700,460		18.48		146,150
Fidelity VIP Contrafund (IQ3™)	2,961,305		1			2,961,306		16.74		176,866
Fidelity VIP Contrafund (Pinnacle Plus™)	4,319,298		1			4,319,299		18.50		233,507
Fidelity VIP Contrafund (AnnuiChoice II™)	864,593		—			864,593		12.43		69,553
Fidelity VIP Contrafund Standard (IQ Advisor™)	7,070		—			7,070		16.87		419
Fidelity VIP Disclipined Small Cap (AnnuiChoice™)	66,875		—			66,875		9.03		7,407
Fidelity VIP Disclipined Small Cap (IQ™)	69,341		(1		)	69,340		9.00		7,704
Fidelity VIP Disclipined Small Cap (Grandmaster™)	22,435		1			22,436		9.01		2,491
Fidelity VIP Disclipined Small Cap (GrandmasterFlex3™)	48,137		—			48,137		8.99		5,352
Fidelity VIP Disclipined Small Cap (Pinnacle Plus™)	48,601		—			48,601		8.99		5,408
Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)	93,741		(1		)	93,740		16.22		5,779
Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)	43,648		—			43,648		14.89		2,931
Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)	1,750,840		1			1,750,841		15.00		116,714
Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)	92,132		(1		)	92,131		19.52		4,719
Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)	237,748		1			237,749		14.82		16,039
Fidelity VIP Equity-Income (AnnuiChoice™)	955,844		1			955,845		14.33		66,685
Fidelity VIP Equity-Income (AnnuiChoice II™)	143,124		—			143,124		11.00		13,014
Fidelity VIP Equity-Income (GrandMaster flex3™)	448,528		(1		)	448,527		14.77		30,364
Fidelity VIP Equity-Income (IQ3™)	986,524		1			986,525		13.19		74,806
Fidelity VIP Equity-Income (Pinnacle Plus™)	2,289,241		1			2,289,242		15.15		151,108
Fidelity VIP Freedom 2010 (Grandmaster™)	87,361		—			87,361		10.23		8,536
Fidelity VIP Freedom 2010 (GrandmasterFlex3™)	35,876		—			35,876		10.22		3,510
Fidelity VIP Freedom 2010 (IQ3™)	25,896		—			25,896		10.23		2,532
Fidelity VIP Freedom 2015 (AnnuiChoiceII™)	12,867		—			12,867		10.26		1,254
Fidelity VIP Freedom 2015 (GrandmasterFlex3™)	1,549		—			1,549		10.23		151
Fidelity VIP Freedom 2015 (IQ3™)	326,040		—			326,040		10.24		31,842
Fidelity VIP Freedom 2020 (AnnuiChoiceII™)	33,589		—			33,589		10.27		3,270
Fidelity VIP Freedom 2020 (IQ3™)	39,672		—			39,672		10.25		3,870
Fidelity VIP Freedom 2020 (Pinnacle Plus™)	19,734		—			19,734		10.23		1,928
Fidelity VIP Freedom 2030 (Pinnacle Plus™)	2,014		—			2,014		10.25		197
Fidelity VIP Growth & Income (AnnuiChoice™)	209,441		1			209,442		14.13		14,827
Fidelity VIP Growth & Income (AnnuiChoice II™)	4,297		—			4,297		11.88		362
Fidelity VIP Growth & Income (GrandMaster flex3™)	228,655		—			228,655		15.07		15,173
Fidelity VIP Growth & Income (IQ3™)	121,997		1			121,998		12.26		9,953
Fidelity VIP Growth & Income (Pinnacle Plus™)	350,737		—			350,737		14.15		24,794
Fidelity VIP Growth (AnnuiChoice™)	309,588		—			309,588		12.78		24,217
Fidelity VIP Growth (AnnuiChoice II™)	64,087		(1		)	64,086		13.20		4,854
Fidelity VIP Growth (GrandMaster™)	737,084		—			737,084		11.71		62,943
Fidelity VIP Growth (GrandMaster flex3™)	290,576		1			290,577		14.90		19,501
Fidelity VIP Growth (IQ3™)	500,927		(3		)	500,924		9.81		51,061
Fidelity VIP Growth (Pinnacle Plus™)	591,527		—			591,527		15.13		39,098
Fidelity VIP Growth Opportunities (AnnuiChoice™)	41,295		—			41,295		14.32		2,884
Fidelity VIP Growth Opportunities (GrandMaster flex3™)	128,789		(1		)	128,788		15.60		8,258
Fidelity VIP Growth Opportunities (IQ3™)	165,573		—			165,573		12.81		12,929
Fidelity VIP Growth Opportunities (Pinnacle Plus™)	266,506		—			266,506		15.44		17,265
Fidelity VIP High Income (AnnuiChoice™)	333,292		(2		)	333,290		15.07		22,120
Fidelity VIP High Income (AnnuiChoice II™)	12,238		—			12,238		10.64		1,150
Fidelity VIP High Income (GrandMaster flex3™)	541,185		1			541,186		13.74		39,394
Fidelity VIP High Income (IQ3™)	1,014,687		2			1,014,689		12.27		82,663
Fidelity VIP High Income (Pinnacle Plus™)	285,298		—			285,298		12.73		22,419
Fidelity VIP II Index 500 (AnnuiChoice™)	1,569,490		2			1,569,492		12.42		126,364

See accompanying notes.

4

			Receivable from
			(payable to)
	Investments		the general account
Division	at value		of National Integrity			Net Assets		Unit Value		Units Outstanding
Non-Affiliated Service Class 2 (continued):
Fidelity VIP II Index 500 (AnnuiChoice II™)	$	92,530	$	(2	)	$	92,528	$	9.86	9,383
Fidelity VIP II Index 500 (Grandmaster™)	2,788,433		1			2,788,434		9.85		283,160
Fidelity VIP II Index 500 (GrandmasterFlex3™)	980,458		—			980,458		9.83		99,701
Fidelity VIP Index 500 (IQ3™)	887,889		(1		)	887,888		11.06		80,256
Fidelity VIP Index 500 (Pinnacle Plus™)	2,300,419		1			2,300,420		14.48		158,901
Fidelity VIP Investment Grade Bond (AnnuiChoice™)	881,484		—			881,484		12.83		68,699
Fidelity VIP Investment Grade Bond (GrandMaster ™)	347,894		—			347,894		10.14		34,301
Fidelity VIP Investment Grade Bond (GrandMaster flex3™)	419,024		(1		)	419,023		10.87		38,550
Fidelity VIP Investment Grade Bond (IQ3™)	1,070,819		—			1,070,819		12.68		84,445
Fidelity VIP Investment Grade Bond (Pinnacle Plus™)	452,888		—			452,888		10.77		42,054
Fidelity VIP Investment Grade Bond (AnnuiChoice II™)	277,895		—			277,895		10.45		26,596
Fidelity VIP Mid Cap (AnnuiChoice™)	1,047,763		—			1,047,763		23.17		45,228
Fidelity VIP Mid Cap (GrandMaster flex3™)	1,924,140		—			1,924,140		21.75		88,459
Fidelity VIP Mid Cap (IQ Annuity™)	1,833,988		—			1,833,988		21.85		83,944
Fidelity VIP Mid Cap (Pinnacle Plus™)	2,499,758		—			2,499,758		21.75		114,941
Fidelity VIP Mid Cap (AnnuiChoice II™)	65,112		—			65,112		11.96		5,443
Fidelity VIP Mid Cap (Grandmaster™)	1,282,052		(1		)	1,282,051		17.99		71,275
Fidelity VIP Overseas (AnnuiChoice™)	862,483		—			862,483		18.98		45,432
Fidelity VIP Overseas (GrandMaster™)	2,607,404		—			2,607,404		10.57		246,606
Fidelity VIP Overseas (GrandMaster flex3™)	814,108		—			814,108		17.27		47,138
Fidelity VIP Overseas (IQ3™)	910,193		—			910,193		14.85		61,294
Fidelity VIP Overseas (Pinnacle Plus™)	1,186,818		—			1,186,818		21.29		55,742
Fidelity VIP Overseas (AnnuiChoice II™)	76,198		—			76,198		12.63		6,032
Non-Affiliated Class 1 :
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	241,376		—			241,376		18.12		13,321
Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)	57,881		—			57,881		18.25		3,171
Van Kampen UIF Emerging Markets Debt (IQ3™)	42,257		1			42,258		17.71		2,386
Van Kampen UIF U.S. Real Estate (AnnuiChoice™)	235,520		—			235,520		21.86		10,775
Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)	403,426		—			403,426		21.10		19,119
Van Kampen UIF U.S. Real Estate (IQ3™)	165,366		—			165,366		21.20		7,799
Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)	64,920		—			64,920		9.30		6,978
Non-Affiliated Class 2:
Franklin Foreign Securities (IQ Annuity™)	529,230		—			529,230		21.88		24,185
Franklin Growth and Income Securities (AnnuiChoice™)	827,548		—			827,548		14.74		56,149
Franklin Growth and Income Securities (AnnuiChoice II™)	37,833		—			37,833		10.33		3,664
Franklin Growth and Income Securities (GrandMaster flex3™)	538,444		—			538,444		14.34		37,561
Franklin Growth and Income Securities (Grandmaster™)	1,644,664		(2		)	1,644,662		14.48		113,576
Franklin Growth and Income Securities (IQ Annuity™)	1,621,940		1			1,621,941		14.41		112,575
Franklin Growth and Income Securities (Pinnacle Plus™)	2,002,495		(1		)	2,002,494		13.66		146,608
Franklin Income Securities (AnnuiChoice™)	595,350		—			595,350		17.27		34,482
Franklin Income Securities (AnnuiChoice II™)	132,585		—			132,585		10.91		12,147
Franklin Income Securities (GrandMaster flex3™)	3,320,917		—			3,320,917		16.79		197,753
Franklin Income Securities (Grandmaster™)	3,455,353		—			3,455,353		16.96		203,691
Franklin Income Securities (IQ Annuity™)	2,193,917		2			2,193,919		16.88		129,986
Franklin Income Securities (Pinnacle Plus™)	2,742,662		—			2,742,662		14.84		184,768
Franklin Large Cap Growth Securities (AnnuiChoice™)	61,023		—			61,023		14.82		4,119
Franklin Large Cap Growth Securities (GrandMaster flex3™)	289,609		—			289,609		14.41		20,097
Franklin Large Cap Growth Securities (Grandmaster™)	276,939		—			276,939		14.56		19,025
Franklin Large Cap Growth Securities (IQ Annuity™)	425,760		—			425,760		14.48		29,396
Franklin Large Cap Growth Securities (Pinnacle Plus™)	458,289		(1		)	458,288		13.08		35,040
Franklin Large Cap Growth Securities (AnnuiChoice II™)	99,473		—			99,473		11.36		8,759
Franklin Mutual Shares Securities (AnnuiChoice™)	1,141,622		—			1,141,622		17.88		63,866
Franklin Mutual Shares Securities (AnnuiChoice II™)	257,086		—			257,086		11.05		23,270
Franklin Mutual Shares Securities (GrandMaster flex3™)	2,145,754		—			2,145,754		17.39		123,416
Franklin Mutual Shares Securities (IQ Annuity™)	904,482		—			904,482		17.47		51,761
Franklin Mutual Shares Securities (Pinnacle Plus™)	2,030,841		—			2,030,841		15.90		127,724
Franklin Mutual Shares Securities Standard (IQ Advisor™)	13,496		—			13,496		14.75		915
Franklin Mutual Shares Securities(Grandmaster™)	3,165,924		—			3,165,924		17.56		180,262
Franklin Small Cap Value Securities (AnnuiChoice™)	965		—			965		8.90		108
Franklin Small Cap Value Securities (GrandmasterFlex3™)	54,799		—			54,799		8.87		6,178
Franklin Small Cap Value Securities (IQ3 ™)	10,351		—			10,351		8.88		1,166
Franklin Small Cap Value Securities (Pinnacle Plus ™)	14,436		—			14,436		8.86		1,629
Templeton Foriegn Securities Fund (GrandMaster flex3™)	749,177		—			749,177		21.77		34,409
Templeton Foriegn Securities Fund (Grandmaster™)	292,191		(1		)	292,190		21.99		13,285
Templeton Foriegn Securities Fund (Pinnacle Plus™)	1,032,202		—			1,032,202		20.12		51,291

See accompanying notes.

5

			Receivable from
			(payable to)
	Investments		the general account
Division	at value		of National Integrity			Net Assets		Unit Value		Units Outstanding
Non-Affiliated Class 2 (continued):
Templeton Foreign Securities Fund (AnnuiChoice™)	$	134,200	$	(1	)	$	134,199	$	22.38	5,995
Templeton Foreign Securities Fund (AnnuiChoice II™)	20,790		—			20,790		12.51		1,662
Templeton Growth Securities (AnnuiChoice™)	119,020		—			119,020		19.00		6,265
Templeton Growth Securities (AnnuiChoice II™)	38,971		—			38,971		11.15		3,495
Templeton Growth Securities (GrandMaster flex3™)	1,559,555		—			1,559,555		18.48		84,406
Templeton Growth Securities (Grandmaster™)	415,070		1			415,071		18.66		22,239
Templeton Growth Securities (IQ Annuity™)	885,216		—			885,216		18.57		47,669
Templeton Growth Securities (Pinnacle Plus™)	1,055,965		(1		)	1,055,964		16.99		62,151
Templeton Growth Securities Standard (IQ Advisor™)	6,877		—			6,877		15.04		457
Van Kampen LIT Comstock (AnnuiChoice™)	110,966		—			110,966		16.51		6,722
Van Kampen LIT Comstock (GrandMaster flex3™)	276,071		—			276,071		16.06		17,194
Van Kampen LIT Comstock (Grandmaster™)	112,279		—			112,279		16.22		6,923
Van Kampen LIT Comstock (IQ Annuity™)	138,369		1			138,370		16.14		8,574
Van Kampen LIT Comstock (Pinnacle Plus™)	313,873		1			313,874		14.62		21,469
Van Kampen LIT Strategic Growth (GrandMaster flex3™)	11,289		(3		)	11,286		15.45		731
Van Kampen LIT Strategic Growth (AnnuiChoice™)	8,875		—			8,875		15.88		559
Van Kampen LIT Strategic Growth (Grandmaster™)	428		(2		)	426		15.60		27
Van Kampen LIT Strategic Growth (IQ Annuity™)	1,387		—			1,387		15.53		89
Van Kampen LIT Strategic Growth (Pinnacle Plus™)	309,772		—			309,772		13.62		22,749
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	10,017		—			10,017		10.20		982
Van Kampen UIF Emerging Markets Debt (Grandmaster™)	23,296		(1		)	23,295		17.13		1,360
Van Kampen UIF Emerging Markets Debt (GrandmasterFlex3™)	199,253		—			199,253		10.16		19,610
Van Kampen UIF Emerging Markets Debt (IQ3™)	229,875		—			229,875		17.05		13,485
Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)	326,455		—			326,455		14.88		21,933
Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)	965,645		—			965,645		43.96		21,964
Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)	1,432,726		—			1,432,726		42.76		33,504
Van Kampen UIF Emerging Markets Equity (Grandmaster™)	760,422		(1		)	760,421		43.20		17,604
Van Kampen UIF Emerging Markets Equity (IQ Annuity™)	438,812		(1		)	438,811		42.98		10,210
Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)	1,307,707		1			1,307,708		37.33		35,028
Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)	328,688		—			328,688		16.65		19,747
Van Kampen UIF U. S. Real Estate (AnnuiChoice™)	5,558		—			5,558		7.72		720
Van Kampen UIF U. S. Real Estate (AnnuiChoice II™)	70,088		—			70,088		7.71		9,088
Van Kampen UIF U.S. Real Estate (Grandmaster™)	338,948		(1		)	338,947		22.95		14,769
Van Kampen UIF U.S. Real Estate (GrandmasterFlex3™)	93,133		—			93,133		7.69		12,110
Van Kampen UIF U.S. Real Estate (IQ3™)	115,694		—			115,694		22.83		5,067
Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)	856,409		—			856,409		19.48		43,969
Non-Affiliated Class B:
DWS Small Cap Index VIP (AnnuiChoice™)	137,858		(1		)	137,857		14.98		9,205
DWS Small Cap Index VIP (AnnuiChoice II™)	11,761		—			11,761		10.54		1,115
DWS Small Cap Index VIP (GrandMaster flex3™)	191,441		—			191,441		15.65		12,236
DWS Small Cap Index VIP (Grandmaster™)	17,028		—			17,028		13.25		1,285
DWS Small Cap Index VIP (IQ3™)	102,620		—			102,620		14.48		7,089
DWS Small Cap Index VIP (Pinnacle Plus™)	534,391		—			534,391		15.13		35,310

See accompanying notes.

6

Separate Account I

of

National 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™)	$	11,155	$	6,875	$	4,280		$	35,504		$	14,764	$	85,184		$	62,550		$	(22,634	)	$	27,634		$	31,914
Touchstone Aggressive ETF (GrandMaster flex3™)	13,258		11,059		2,199			11,854			17,567		72,344			63,518			(8,826		)	20,595			22,794
Touchstone Aggressive ETF (Grandmaster™)	711		22,439		(21,728		)	462,556			939		306,889			(1,620		)	(308,509		)	154,986			133,258
Touchstone Aggressive ETF (IQ Annuity™)	9,085		15,047		(5,962		)	166,833			12,019		120,114			(6,512		)	(126,626		)	52,226			46,264
Touchstone Aggressive ETF (Pinnacle Plus™)	14,363		15,307		(944		)	52,393			19,015		55,553			14,332			(41,221		)	30,187			29,243
Touchstone Balanced (AnnuiChoice™)	7,147		1,343		5,804			1,590			5,601		2,738			(4,513		)	(7,251		)	(60		)	5,744
Touchstone Balanced (GrandMaster flex3™)	20,122		6,336		13,786			4,964			15,763		6,396			(12,798		)	(19,194		)	1,533			15,319
Touchstone Balanced (Grandmaster™)	8		2		6			(2		)	6		(1		)	(10		)	(9		)	(5		)	1
Touchstone Balanced (IQ Annuity™)	12,368		3,529		8,839			14,303			9,697		8,045			(12,473		)	(20,518		)	3,482			12,321
Touchstone Balanced (Pinnacle Plus™)	26,283		7,668		18,615			1,172			20,490		4,546			(20,071		)	(24,617		)	(2,955		)	15,660
Touchstone Baron Small Cap (AnnuiChoice™)	—		3,706		(3,706		)	38,082			40,232		89,866			23,955			(65,911		)	12,403			8,697
Touchstone Baron Small Cap (AnnuiChoice II™)(April 09)*	—		113		(113		)	4			1,690		—			(1,849		)	(1,849		)	(155		)	(268		)
Touchstone Baron Small Cap (GrandMaster flex3™)	—		11,025		(11,025		)	58,134			98,717		85,012			(64,108		)	(149,120		)	7,731			(3,294		)
Touchstone Baron Small Cap (Grandmaster™)	—		4,591		(4,591		)	65,575			44,191		55,825			(37,428		)	(93,253		)	16,513			11,922
Touchstone Baron Small Cap (IQ Annuity™)	—		19,429		(19,429		)	106,896			169,546		223,188			(23,338		)	(246,526		)	29,916			10,487
Touchstone Baron Small Cap (Pinnacle Plus™)	—		12,602		(12,602		)	30,195			93,725		89,853			(15,827		)	(105,680		)	18,240			5,638
Touchstone Conservative ETF (AnnuiChoice™)	187		327		(140		)	2,732			24		1,949			972			(977		)	1,779			1,639
Touchstone Conservative ETF (GrandMaster flex3™)	21,254		19,804		1,450			34,337			2,715		92,391			105,257			12,866			49,918			51,368
Touchstone Conservative ETF (Grandmaster™)	2,932		2,176		756			499			375		11,363			16,340			4,977			5,851			6,607
Touchstone Conservative ETF (IQ Annuity™)	36,677		27,261		9,416			54,007			4,656		118,945			122,689			3,744			62,407			71,823
Touchstone Conservative ETF (Pinnacle Plus™)	11,967		13,046		(1,079		)	27,748			1,526		51,814			51,909			95			29,369			28,290
Touchstone Core Bond (AnnuiChoice™)	10,478		2,716		7,762			4,320			—		(1,166		)	(1,920		)	(754		)	3,566			11,328
Touchstone Core Bond (AnnuiChoice II™)(April 09)*	2,600		472		2,128			179			—		—			(390		)	(390		)	(211		)	1,917
Touchstone Core Bond (GrandMaster flex3™)	24,272		8,533		15,739			566			—		63			3,567			3,504			4,070			19,809
Touchstone Core Bond (Grandmaster™)	2,264		745		1,519			4,282			—		(17		)	(1,550		)	(1,533		)	2,749			4,268
Touchstone Core Bond (IQ Annuity™)	14,238		6,000		8,238			7,000			—		(1,027		)	(2,476		)	(1,449		)	5,551			13,789
Touchstone Core Bond (Pinnacle Plus™)	9,961		3,854		6,107			338			—		(1,338		)	428			1,766			2,104			8,211
Touchstone Eagle Capital Appreciation (AnnuiChoice™)	1,188		1,336		(148		)	750			—		915			(8,758		)	(9,673		)	(8,923		)	(9,071		)
Touchstone Eagle Capital Appreciation (GrandMaster™)(April 27)*	266		472		(206		)	9			—		—			(2,011		)	(2,011		)	(2,002		)	(2,208		)
Touchstone Eagle Capital Appreciation (GrandMaster flex3™)	1,195		2,348		(1,153		)	6,450			—		7,378			(8,366		)	(15,744		)	(9,294		)	(10,447		)
Touchstone Eagle Capital Appreciation (IQ Annuity™)	2,488		5,811		(3,323		)	42,859			—		41,956			(17,292		)	(59,248		)	(16,389		)	(19,712		)

See accompanying notes.

* - 2007 inception date of division.

7

	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 (Pinnacle Plus™)	$	1,428	$	3,099	$	(1,671	)	$	13,413		$	—	$	13,253		$	(9,396	)	$	(22,649	)	$	(9,236	)	$	(10,907	)
Touchstone Enhanced ETF (AnnuiChoice™)	40,817		20,512		20,305			10,123			16,190		319,032			330,311			11,279			37,592			57,897
Touchstone Enhanced ETF (GrandMaster flex3™)	40,908		33,071		7,837			39,798			16,231		246,467			234,536			(11,931		)	44,098			51,935
Touchstone Enhanced ETF (Grandmaster™)	47,387		42,452		4,935			259,479			18,792		413,215			241,300			(171,915		)	106,356			111,291
Touchstone Enhanced ETF (IQ Annuity™)	23,618		19,489		4,129			141,003			9,310		186,203			59,090			(127,113		)	23,200			27,329
Touchstone Enhanced ETF (Pinnacle Plus™)	17,848		17,960		(112		)	54,000			7,110		70,337			28,077			(42,260		)	18,850			18,738
Touchstone Growth & Income (AnnuiChoice™)	1,628		411		1,217			97			2,424		418			(2,214		)	(2,632		)	(111		)	1,106
Touchstone Growth & Income (GrandMaster flex3™)	634		240		394			2			924		(120		)	(1,061		)	(941		)	(15		)	379
Touchstone Growth & Income (IQ Annuity™)	2,212		778		1,434			107			3,226		357			(3,485		)	(3,842		)	(509		)	925
Touchstone Growth & Income (Pinnacle Plus™)	4,424		1,699		2,725			376			6,450		615			(6,629		)	(7,244		)	(418		)	2,307
Touchstone High Yield (AnnuiChoice™)	34,902		3,898		31,004			1,969			—		(3,396		)	(35,328		)	(31,932		)	(29,963		)	1,041
Touchstone High Yield (GrandMaster flex3™)	35,168		6,640		28,528			3,216			—		3,923			(26,314		)	(30,237		)	(27,021		)	1,507
Touchstone High Yield (Grandmaster™)	12,027		2,859		9,168			315			—		(5,929		)	(12,339		)	(6,410		)	(6,095		)	3,073
Touchstone High Yield (IQ Annuity™)	26,531		5,633		20,898			7,443			—		9,963			(19,562		)	(29,525		)	(22,082		)	(1,184		)
Touchstone High Yield (Pinnacle Plus™)	74,688		15,211		59,477			(1,958		)	—		5,656			(51,861		)	(57,517		)	(59,475		)	2
Touchstone Large Cap Core Equity (AnnuiChoice II™)(February 26)*	10,005		2,605		7,400			480			—		—			1,528			1,528			2,008			9,408
Touchstone Large Cap Core Equity (GrandMaster flex3™)	1,349		720		629			9,217			—		11,599			3,777			(7,822		)	1,395			2,024
Touchstone Large Cap Core Equity (Grandmaster™)	219		155		64			1,903			—		1,713			201			(1,512		)	391			455
Touchstone Large Cap Core Equity (IQ Annuity™)	3,403		1,628		1,775			1,129			—		7,844			8,880			1,036			2,165			3,940
Touchstone Large Cap Core Equity (Pinnacle Plus™)	3,715		1,862		1,853			1,320			—		5,791			5,184			(607		)	713			2,566
Touchstone Mid Cap Growth (AnnuiChoice™)	10,910		2,832		8,078			(5,344		)	42,901		(11,431		)	(28,302		)	(16,871		)	20,686			28,764
Touchstone Mid Cap Growth (AnnuiChoice II™)(April 09)*	1,493		371		1,122			212			5,873		—			(4,833		)	(4,833		)	1,252			2,374
Touchstone Mid Cap Growth (GrandMaster flex3™)	17,834		6,914		10,920			4,778			70,128		1,787			(47,552		)	(49,339		)	25,567			36,487
Touchstone Mid Cap Growth (Grandmaster™)	7,966		2,950		5,016			5,631			31,325		(1,149		)	(21,834		)	(20,685		)	16,271			21,287
Touchstone Mid Cap Growth (IQ Annuity™)	18,044		6,927		11,117			20,586			70,951		(2,672		)	(64,862		)	(62,190		)	29,347			40,464
Touchstone Mid Cap Growth (Pinnacle Plus™)	37,076		14,695		22,381			33,471			145,794		(50		)	(105,572		)	(105,522		)	73,743			96,124
Touchstone Moderate ETF (AnnuiChoice™)	3,728		2,919		809			9,186			1,244		28,485			29,384			899			11,329			12,138
Touchstone Moderate ETF (GrandMaster flex3™)	28,732		33,242		(4,510		)	76,296			9,590		215,650			218,794			3,144			89,030			84,520
Touchstone Moderate ETF (Grandmaster™)	5,017		4,960		57			11,675			1,672		41,300			42,076			776			14,123			14,180
Touchstone Moderate ETF (IQ Annuity™)	42,442		34,739		7,703			106,775			14,011		200,371			133,929			(66,442		)	54,344			62,047
Touchstone Moderate ETF (Pinnacle Plus™)	15,270		17,782		(2,512		)	19,371			5,123		89,952			102,895			12,943			37,437			34,925
Touchstone Money Market (AnnuiChoice™)	14,852		2,971		11,881			—			—		—			—			—			—			11,881
Touchstone Money Market (Grandmaster™)	258,792		70,016		188,776			—			—		—			—			—			—			188,776
Touchstone Money Market (IQ Annuity™)	156		45		111			—			—		3			3			—			—			111
Touchstone Third Avenue Value (AnnuiChoice™)	18,363		22,467		(4,104		)	179,081			150,132		254,691			(163,617		)	(418,308		)	(89,095		)	(93,199		)
Touchstone Third Avenue Value (GrandMaster flex3™)	21,663		47,933		(26,270		)	191,920			177,509		238,862			(252,806		)	(491,668		)	(122,239		)	(148,509		)
Touchstone Third Avenue Value (Grandmaster™)	31,735		54,778		(23,043		)	181,317			259,605		220,195			(404,745		)	(624,940		)	(184,018		)	(207,061		)

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 Third Avenue Value (IQ Annuity™)	$	29,332	$	59,227	$	(29,895	)	$	641,609		$	238,419	$	1,195,388		$	194,998		$	(1,000,390	)	$	(120,362	)	$	(150,257	)
Touchstone Third Avenue Value (Pinnacle Plus™)	26,001		56,550		(30,549		)	134,094			213,246		220,359			(267,878		)	(488,237		)	(140,897		)	(171,446		)
Touchstone Third Avenue Value (AnnuiChoice II™)	5,614		6,526		(912		)	1,362			44,857		(1,810		)	(79,368		)	(77,558		)	(31,339		)	(32,251		)
Touchstone Value Plus (AnnuiChoice™)	1,898		1,496		402			11,289			—		57,843			38,444			(19,399		)	(8,110		)	(7,708		)
Touchstone Value Plus (AnnuiChoice II™)(November 19)*	49		4		45			—			—		—			(24		)	(24		)	(24		)	21
Touchstone Value Plus (GrandMaster flex3™)	1,878		1,980		(102		)	376			—		19,390			11,782			(7,608		)	(7,232		)	(7,334		)
Touchstone Value Plus (Grandmaster™)	681		616		65			329			—		8,027			4,789			(3,238		)	(2,909		)	(2,844		)
Touchstone Value Plus (IQ Annuity™)	3,192		3,424		(232		)	9,355			—		70,858			49,111			(21,747		)	(12,392		)	(12,624		)
Touchstone Value Plus (Pinnacle Plus™)	4,462		5,977		(1,515		)	25,377			—		61,718			20,835			(40,883		)	(15,506		)	(17,021		)
Non-Affiliated:
JP Morgan Mid Cap Value (AnnuiChoice™)	9,759		4,006		5,753			25,568			12,186		84,530			50,270			(34,260		)	3,494			9,247
JP Morgan Mid Cap Value (GrandMaster flex3™)	4,700		3,203		1,497			15,549			5,868		46,223			25,192			(21,031		)	386			1,883
JP Morgan Mid Cap Value (Grandmaster™)	3,549		1,830		1,719			9,724			4,432		18,446			5,689			(12,757		)	1,399			3,118
JP Morgan Mid Cap Value (IQ3™)	2,071		1,366		705			7,468			2,585		17,746			8,400			(9,346		)	707			1,412
JP Morgan Mid Cap Value (Pinnacle Plus™)	25,395		18,338		7,057			20,664			31,708		186,746			136,872			(49,874		)	2,498			9,555
Non-Affiliated Initial Class:
Fidelity VIP Equity-Income (Grandmaster™)	544,935		341,036		203,899			766,103			1,686,162		4,111,635			1,611,830			(2,499,805		)	(47,540		)	156,359
Fidelity VIP Growth (Grandmaster™)	104,700		150,787		(46,087		)	185,456			—		1,414,682			3,755,924			2,341,242			2,526,698			2,480,611
Fidelity VIP High Income (Grandmaster™)	364,749		68,323		296,426			(33,083		)	—		(150,285		)	(328,799		)	(178,514		)	(211,597		)	84,829
Fidelity VIP II Asset Manager (Grandmaster™)	463,395		102,902		360,493			152,241			225,946		846,975			1,087,647			240,672			618,859			979,352
Fidelity VIP II Contrafund (Grandmaster™)	1,281,904		330,715		951,189			2,055,538			4,787,937		7,297,856			3,089,370			(4,208,486		)	2,634,989			3,586,178
Fidelity VIP II Index 500 (Grandmaster™)	295,800		113,511		182,289			911,634			—		3,047,219			2,316,703			(730,516		)	181,118			363,407
Fidelity VIP II Investment Grade Bond (AnnuiChoice™)(April 27)*	471		4,086		(3,615		)	(506		)	—		—			14,481			14,481			13,975			10,360
Fidelity VIP II Investment Grade Bond (Grandmaster™)	138,786		41,791		96,995			(43,794		)	—		(20,087		)	11,375			31,462			(12,332		)	84,663
Fidelity VIP II Investment Grade Bond (GrandmasterFlex3™)(April 27)*	292		4,013		(3,721		)	(266		)	—		—			8,097			8,097			7,831			4,110
Fidelity VIP II Investment Grade Bond (IQ3™)(April 27)*	165		2,249		(2,084		)	422			—		—			3,982			3,982			4,404			2,320
Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)(April 27)*	309		4,721		(4,412		)	(1,147		)	—		—			9,312			9,312			8,165			3,753
Fidelity VIP III Balanced (Grandmaster™)	156,611		36,180		120,431			149,086			36,917		278,630			177,413			(101,217		)	84,786			205,217
Fidelity VIP III Growth & Income (Grandmaster™)	157,997		45,946		112,051			209,482			46,767		589,377			568,270			(21,107		)	235,142			347,193
Fidelity VIP III Growth Opportunities (Grandmaster™)	—		16,490		(16,490		)	98,682			—		389,120			539,867			150,747			249,429			232,939
Fidelity VIP Overseas (AnnuiChoice™)(April 27)*	6,620		2,929		3,691			4,140			—		—			17,471			17,471			21,611			25,302
Fidelity VIP Overseas (AnnuiChoice II™)(April 27)*	979		423		556			32			—		—			2,586			2,586			2,618			3,174
Fidelity VIP Overseas (Grandmaster™)	162,634		74,655		87,979			1,303,830			354,298		1,898,879			918,259			(980,620		)	677,508			765,487
Fidelity VIP Overseas (GrandmasterFlex3™)(April 27)*	6,233		4,186		2,047			3,959			—		—			16,465			16,465			20,424			22,471
Fidelity VIP Overseas (IQ3™)(April 27)*	3,478		2,568		910			7,328			—		—			9,197			9,197			16,525			17,435
Fidelity VIP Overseas (Pinnacle Plus™)(April 27)*	13,953		8,955		4,998			1,076			—		—			36,852			36,852			37,928			42,926

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 Service Class:
Touchstone Aggressive ETF (AnnuiChoice™)	$	1,608	$	935	$	673		$	7,019		$	2,150	$	1,038	$	(4,130	)	$	(5,168	)	$	4,001		$	4,674
Touchstone Aggressive ETF (AnnuiChoice II™)	12,492		5,608		6,884			445			15,948		7,471		(5,910		)	(13,381		)	3,012			9,896
Touchstone Aggressive ETF (GrandmasterFlex3™)(April 30)*	1,346		532		814			(2		)	1,687		—		(4,776		)	(4,776		)	(3,091		)	(2,277		)
Touchstone Aggressive ETF (Pinnacle Plus™)(April 30)*	1,969		932		1,037			32			2,588		—		(5,197		)	(5,197		)	(2,577		)	(1,540		)
Touchstone GMAB Aggressive ETF (AnnuiChoice II™)(February 12)*	6,062		4,117		1,945			169			8,108		—		(9,216		)	(9,216		)	(939		)	1,006
Touchstone Conservative ETF (AnnuiChoice II ™)(January 12)*	743		380		363			16			91		—		890			890			997			1,360
Touchstone Conservative ETF (GrandmasterFlex3™)(June11)*	12,257		2,487		9,770			195			1,590		—		(12,748		)	(12,748		)	(10,963		)	(1,193		)
Affiliated Service Class (continued):
Touchstone Conservative ETF (Pinnacle Plus™)(May 21)*	4,387		996		3,391			39			554		—		(1,095		)	(1,095		)	(502		)	2,889
Touchstone Enhanced ETF (AnnuiChoice™)	5,416		2,117		3,299			277			2,306		2,008		(3,309		)	(5,317		)	(2,734		)	565
Touchstone Enhanced ETF (AnnuiChoice II™)	3,635		1,128		2,507			126			1,548		344		(7,238		)	(7,582		)	(5,908		)	(3,401		)
Touchstone Enhanced ETF (GrandmasterFlex3™)(April 30)*	4,975		1,448		3,527			517			2,095		—		(16,570		)	(16,570		)	(13,958		)	(10,431		)
Touchstone Enhanced ETF (Pinnacle Plus™)(April30)*	8,160		2,799		5,361			(351		)	3,490		—		(20,926		)	(20,926		)	(17,787		)	(12,426		)
Touchstone Moderate ETF (AnnuiChoice™)	6,386		3,169		3,217			481			2,276		6,478		8,631			2,153			4,910			8,127
Touchstone Moderate ETF (AnnuiChoice II™)	6,456		2,316		4,140			149			2,281		746		(5,327		)	(6,073		)	(3,643		)	497
Touchstone Moderate ETF (GrandmasterFlex3™)(May 3)*	5,844		2,768		3,076			(148		)	2,137		—		(7,460		)	(7,460		)	(5,471		)	(2,395		)
Touchstone Moderate ETF (Pinnacle Plus™)(April 30)*	27,150		5,685		21,465			(82		)	9,668		—		(33,778		)	(33,778		)	(24,192		)	(2,727		)
Touchstone Money Market (AnnuiChoice™)	78,092		16,438		61,654			—			—		—		—			—			—			61,654
Touchstone Money Market (AnnuiChoice II™)(April 9)*	795		192		603			—			—		—		—			—			—			603
Touchstone Money Market (GrandMaster flex3™)	119,004		39,058		79,946			—			—		—		—			—			—			79,946
Touchstone Money Market (IQ Annuity™)	251,112		77,149		173,963			—			—		—		—			—			—			173,963
Touchstone Money Market (Pinnacle Plus™)	123,235		43,697		79,538			—			—		1		1			—			—			79,538
Non-Affiliated Service Class:
Fidelity VIP III Mid Cap (Grandmaster™)	41,106		64,718		(23,612		)	1,107,601			503,438		760,835		(142,776		)	(903,611		)	707,428			683,816
Non-Affiliated Service Class 2:
Fidelity VIP Asset Manager (AnnuiChoice™)	15,180		2,655		12,525			3,535			7,621		19,286		29,968			10,682			21,838			34,363
Fidelity VIP Asset Manager (AnnuiChoice II™)(November 5)*	205		13		192			—			—		—		(211		)	(211		)	(211		)	(19		)
Fidelity VIP Asset Manager (GrandMaster flex3™)	9,910		2,501		7,409			8,228			6,778		14,455		10,187			(4,268		)	10,738			18,147
Fidelity VIP Asset Manager (IQ3™)	27,614		6,717		20,897			17,349			12,683		42,286		47,548			5,262			35,294			56,191
Fidelity VIP Asset Manager (Pinnacle Plus™)	8,371		2,281		6,090			592			3,234		7,472		14,413			6,941			10,767			16,857
Fidelity VIP Balanced (AnnuiChoice™)	19,326		3,405		15,921			12,456			4,577		43,341		35,157			(8,184		)	8,849			24,770
Fidelity VIP Balanced (AnnuiChoice II™)(June 5)*	110		64		46			39			—		—		(200		)	(200		)	(161		)	(115		)
Fidelity VIP Balanced (GrandMaster ™)(April 27)*	7,307		3,271		4,036			29			—		—		(8,926		)	(8,926		)	(8,897		)	(4,861		)
Fidelity VIP Balanced (GrandMaster flex3™)	24,972		7,929		17,043			9,088			5,332		39,624		39,522			(102		)	14,318			31,361
Fidelity VIP Balanced (IQ3™)	23,588		5,240		18,348			13,299			5,351		40,026		22,307			(17,719		)	931			19,279
Fidelity VIP Balanced (Pinnacle Plus™)	24,127		7,974		16,153			5,096			5,085		29,820		30,077			257			10,438			26,591
Fidelity VIP Contrafund (AnnuiChoice™)	156,342		28,283		128,059			107,918			602,504		111,861		(314,697		)	(426,558		)	283,864			411,923

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 Service Class 2 (continued):
Fidelity VIP Contrafund (GrandMaster flex3™)	$	138,332	$	37,594	$	100,738		$	124,315		$	531,850	$	114,961		$	(304,683	)	$	(419,644	)	$	236,521		$	337,259
Fidelity VIP Contrafund (IQ3™)	152,185		42,840		109,345			158,680			590,513		36,850			(403,860		)	(440,710		)	308,483			417,828
Fidelity VIP Contrafund (Pinnacle Plus™)	222,501		60,705		161,796			112,173			846,949		182,234			(427,408		)	(609,642		)	349,480			511,276
Fidelity VIP Contrafund (AnnuiChoice II™)	44,341		6,524		37,817			11,578			163,352		(4,003		)	(115,194		)	(111,191		)	63,739			101,556
Fidelity VIP Contrafund Standard (IQ Advisor™)	364		40		324			4			1,403		(1		)	(725		)	(724		)	683			1,007
Fidelity VIP Disclipined Small Cap (AnnuiChoice™)(April 27)*	226		497		(271		)	(15		)	298		—			(6,945		)	(6,945		)	(6,662		)	(6,933		)
Fidelity VIP Disclipined Small Cap (IQ™)(April 27)*	235		735		(500		)	220			308		—			(5,949		)	(5,949		)	(5,421		)	(5,921		)
Fidelity VIP Disclipined Small Cap (Grandmaster™)(April 27)*	76		223		(147		)	(236		)	100		—			(2,457		)	(2,457		)	(2,593		)	(2,740		)
Fidelity VIP Disclipined Small Cap (GrandmasterFlex3™)(April 27)*	163		499		(336		)	(967		)	214		—			(3,179		)	(3,179		)	(3,932		)	(4,268		)
Fidelity VIP Disclipined Small Cap (Pinnacle Plus™)(April 27)*	165		513		(348		)	(134		)	216		—			(4,441		)	(4,441		)	(4,359		)	(4,707		)
Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)	5,048		966		4,082			64			5,688		(2,666		)	(7,382		)	(4,716		)	1,036			5,118
Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)	2,480		1,165		1,315			15,199			2,801		14,867			(241		)	(15,108		)	2,892			4,207
Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)	91,167		18,798		72,369			6,249			102,548		(35,538		)	(189,685		)	(154,147		)	(45,350		)	27,019
Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)	4,981		1,414		3,567			1,236			5,613		5,753			373			(5,380		)	1,469			5,036
Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)	12,450		4,008		8,442			17,769			14,015		8,472			(19,311		)	(27,783		)	4,001			12,443
Fidelity VIP Equity-Income (AnnuiChoice™)	22,119		10,400		11,719			75,630			75,619		118,352			(40,268		)	(158,620		)	(7,371		)	4,348
Fidelity VIP Equity-Income (AnnuiChoice II™)(May 14)*	3,176		129		3,047			(149		)	11,106		—			(12,164		)	(12,164		)	(1,207		)	1,840
Fidelity VIP Equity-Income (GrandMaster flex3™)	10,369		8,565		1,804			19,436			35,432		36,141			(24,924		)	(61,065		)	(6,197		)	(4,393		)
Fidelity VIP Equity-Income (IQ3™)	22,622		14,593		8,029			68,120			77,587		162,447			4,927			(157,520		)	(11,813		)	(3,784		)
Fidelity VIP Equity-Income (Pinnacle Plus™)	52,391		38,060		14,331			25,895			180,091		144,710			(99,277		)	(243,987		)	(38,001		)	(23,670		)
Fidelity VIP Freedom 2010 (Grandmaster™)(October 30)*	2,793		202		2,591			(20		)	704		—			(5,001		)	(5,001		)	(4,317		)	(1,726		)
Fidelity VIP Freedom 2010 (GrandmasterFlex3™)(November 9)*	49		7		42			—			13		—			(126		)	(126		)	(113		)	(71		)
Fidelity VIP Freedom 2010 (IQ3™)(November 2)*	828		62		766			(12		)	209		—			(1,399		)	(1,399		)	(1,202		)	(436		)
Fidelity VIP Freedom 2015 (AnnuiChoiceII™)(August 28)*	384		39		345			1			109		—			(191		)	(191		)	(81		)	264
Fidelity VIP Freedom 2015 (GrandmasterFlex3™)(November 9)*	51		2		49			—			15		—			(74		)	(74		)	(59		)	(10		)
Fidelity VIP Freedom 2015 (IQ3™)(June 13)*	10,800		1,233		9,567			52			3,056		—			(14,745		)	(14,745		)	(11,637		)	(2,070		)
Fidelity VIP Freedom 2020 (AnnuiChoiceII™)(December 21)*	1,047		11		1,036			—			307		—			(1,308		)	(1,308		)	(1,001		)	35
Fidelity VIP Freedom 2020 (IQ3™)(October 22)*	1,236		111		1,125			(1		)	363		—			(1,998		)	(1,998		)	(1,636		)	(511		)
Fidelity VIP Freedom 2020 (Pinnacle Plus™)(October 19)*	615		67		548			(1		)	180		—			(994		)	(994		)	(815		)	(267		)
Fidelity VIP Freedom 2030 (Pinnacle Plus™)(December 24)*	70		1		69			—			22		—			(105		)	(105		)	(83		)	(14		)
Fidelity VIP Growth & Income (AnnuiChoice™)	8,809		2,078		6,731			9,897			2,861		23,423			24,325			902			13,660			20,391
Fidelity VIP Growth & Income (AnnuiChoice II™)(June 11)*	27		17		10			1			—		—			58			58			59			69
Fidelity VIP Growth & Income (GrandMaster flex3™)	9,369		3,684		5,685			14,969			3,029		28,816			28,473			(343		)	17,655			23,340
Fidelity VIP Growth & Income (IQ3™)	6,811		2,400		4,411			19,922			2,306		29,832			17,691			(12,141		)	10,087			14,498
Fidelity VIP Growth & Income (Pinnacle Plus™)	7,411		2,999		4,412			4,684			1,997		22,288			24,644			2,356			9,037			13,449
Fidelity VIP Growth (AnnuiChoice™)	1,124		2,632		(1,508		)	13,232			—		9,671			55,762			46,091			59,323			57,815
Fidelity VIP Growth (AnnuiChoice II™)(June 11)*	41		59		(18		)	8			—		—			2,314			2,314			2,322			2,304

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
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Growth (GrandMaster™)(April 27)*	$	293	$	2,088	$	(1,795	)	$	11,200		$	—	$	—		$	17,356		$	17,356		$	28,556		$	26,761
Fidelity VIP Growth (GrandMaster flex3™)	906		3,188		(2,282		)	12,957			—		13,841			46,710			32,869			45,826			43,544
Fidelity VIP Growth (IQ3™)	1,703		5,428		(3,725		)	59,660			—		43,751			58,418			14,667			74,327			70,602
Fidelity VIP Growth (Pinnacle Plus™)	1,738		6,786		(5,048		)	71,188			—		34,698			58,963			24,265			95,453			90,405
Fidelity VIP Growth Opportunities (AnnuiChoice™)	—		420		(420		)	3,374			—		4,705			10,042			5,337			8,711			8,291
Fidelity VIP Growth Opportunities (GrandMaster flex3™)	—		1,974		(1,974		)	13,828			—		8,286			13,556			5,270			19,098			17,124
Fidelity VIP Growth Opportunities (IQ3™)	—		1,909		(1,909		)	9,370			—		924			10,111			9,187			18,557			16,648
Fidelity VIP Growth Opportunities (Pinnacle Plus™)	—		1,955		(1,955		)	36,708			—		11,461			5,194			(6,267		)	30,441			28,486
Fidelity VIP High Income (AnnuiChoice™)	27,580		3,609		23,971			(3,420		)	—		(5,051		)	(21,514		)	(16,463		)	(19,883		)	4,088
Fidelity VIP High Income (AnnuiChoice II™)(February 26)*	1,007		103		904			(161		)	—		—			(1,080		)	(1,080		)	(1,241		)	(337		)
Fidelity VIP High Income (GrandMaster flex3™)	44,612		22,973		21,639			39,464			—		(26,184		)	(43,046		)	(16,862		)	22,602			44,241
Fidelity VIP High Income (IQ3™)	83,684		43,452		40,232			83,543			—		(51,558		)	(80,559		)	(29,001		)	54,542			94,774
Fidelity VIP High Income (Pinnacle Plus™)	23,589		5,155		18,434			(482		)	—		(5,908		)	(21,813		)	(15,905		)	(16,387		)	2,047
Fidelity VIP II Index 500 (AnnuiChoice™)	33,715		12,483		21,232			43,053			—		108,496			42,809			(65,687		)	(22,634		)	(1,402		)
Fidelity VIP II Index 500 (AnnuiChoice II™)(April 27)*	1,597		610		987			28			—		—			(2,544		)	(2,544		)	(2,516		)	(1,529		)
Fidelity VIP II Index 500 (Grandmaster™)(April 27)*	48,116		30,897		17,219			(284		)	—		—			(47,383		)	(47,383		)	(47,667		)	(30,448		)
Fidelity VIP II Index 500 (GrandmasterFlex3™)(April 27)*	16,917		10,870		6,047			1,403			—		—			(23,138		)	(23,138		)	(21,735		)	(15,688		)
Fidelity VIP Index 500 (IQ3™)	24,477		12,373		12,104			115,873			—		115,951			(332		)	(116,283		)	(410		)	11,694
Fidelity VIP Index 500 (Pinnacle Plus™)	41,087		26,232		14,855			23,022			—		18,957			(54,344		)	(73,301		)	(50,279		)	(35,424		)
Fidelity VIP Investment Grade Bond (AnnuiChoice™)	38,188		8,997		29,191			(6,679		)	—		(8,106		)	(3,409		)	4,697			(1,982		)	27,209
Fidelity VIP Investment Grade Bond (GrandMaster ™)(April 30)*	336		2,672		(2,336		)	1,662			—		—			9,367			9,367			11,029			8,693
Fidelity VIP Investment Grade Bond (GrandMaster flex3™)	17,129		6,722		10,407			(961		)	—		7,627			8,721			1,094			133			10,540
Fidelity VIP Investment Grade Bond (IQ3™)	48,515		17,279		31,236			(14,708		)	—		8,405			19,931			11,526			(3,182		)	28,054
Fidelity VIP Investment Grade Bond (Pinnacle Plus™)	13,708		6,730		6,978			(1,692		)	—		3,338			8,554			5,216			3,524			10,502
Fidelity VIP Investment Grade Bond (AnnuiChoice II™)	1,058		695		363			(101		)	—		(33		)	1,695			1,728			1,627			1,990
Fidelity VIP Mid Cap (AnnuiChoice™)	6,195		10,077		(3,882		)	86,771			90,572		159,572			106,171			(53,401		)	123,942			120,060
Fidelity VIP Mid Cap (GrandMaster flex3™)	10,224		26,776		(16,552		)	30,517			139,210		93,422			140,767			47,345			217,072			200,520
Fidelity VIP Mid Cap (IQ Annuity™)	11,642		28,920		(17,278		)	255,776			177,683		362,825			200,610			(162,215		)	271,244			253,966
Fidelity VIP Mid Cap (Pinnacle Plus™)	12,749		35,907		(23,158		)	133,370			168,401		188,445			163,673			(24,772		)	276,999			253,841
Fidelity VIP Mid Cap (AnnuiChoice II™)	180		415		(235		)	106			799		(6		)	2,286			2,292			3,197			2,962
Fidelity VIP Mid Cap (Grandmaster™)	2,925		10,234		(7,309		)	4,415			1,232		785			41,800			41,015			46,662			39,353
Fidelity VIP Overseas (AnnuiChoice™)	17,592		5,261		12,331			46,172			20,696		63,152			39,483			(23,669		)	43,199			55,530
Fidelity VIP Overseas (GrandMaster™)(April 27)*	40,682		11,172		29,510			2,378			—		—			38,180			38,180			40,558			70,068
Fidelity VIP Overseas (GrandMaster flex3™)	18,121		10,316		7,805			37,441			28,071		50,919			51,409			490			66,002			73,807
Fidelity VIP Overseas (IQ3™)	19,123		9,261		9,862			54,367			25,004		52,141			40,055			(12,086		)	67,285			77,147
Fidelity VIP Overseas (Pinnacle Plus™)	27,191		14,562		12,629			95,289			43,649		75,800			29,512			(46,288		)	92,650			105,279
Fidelity VIP Overseas (AnnuiChoice II™)	1,491		672		819			56			1,516		531			5,752			5,221			6,793			7,612

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 Class 1:
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	$	18,189	$	2,373	$	15,816		$	37		$	5,915	$	4,111	$	(5,135	)	$	(9,246	)	$	(3,294	)	$	12,522
Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)	5,624		1,127		4,497			789			1,829		4,313		582			(3,731		)	(1,113		)	3,384
Van Kampen UIF Emerging Markets Debt (IQ3™)	8,671		1,506		7,165			(1,544		)	2,820		2,781		(961		)	(3,742		)	(2,466		)	4,699
Van Kampen UIF U.S. Real Estate (AnnuiChoice™)	21,723		7,867		13,856			12,569			76,861		158,823		(57,007		)	(215,830		)	(126,400		)	(112,544		)
Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)	19,047		13,642		5,405			129,160			67,393		219,947		(118,175		)	(338,122		)	(141,569		)	(136,164		)
Van Kampen UIF U.S. Real Estate (IQ3™)	6,415		4,462		1,953			28,864			22,700		53,615		(52,688		)	(106,303		)	(54,739		)	(52,786		)
Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)	12,800		3,722		9,078			(141,240		)	45,291		5,288		(16,058		)	(21,346		)	(117,295		)	(108,217		)
Non-Affiliated Class 2:
Franklin Foreign Securities (IQ Annuity™)	8,880		6,045		2,835			42,153			17,233		48,930		37,573			(11,357		)	48,029			50,864
Franklin Growth and Income Securities (AnnuiChoice™)	26,085		6,601		19,484			(2,553		)	41,756		9,024		(136,053		)	(145,077		)	(105,874		)	(86,390		)
Franklin Growth and Income Securities (AnnuiChoice II™)(April 9)*	1,200		355		845			(530		)	1,921		—		(5,480		)	(5,480		)	(4,089		)	(3,244		)
Franklin Growth and Income Securities (GrandMaster flex3™)	16,714		7,230		9,484			5,317			26,755		16,805		(78,958		)	(95,763		)	(63,691		)	(54,207		)
Franklin Growth and Income Securities (Grandmaster™)	52,994		18,666		34,328			36,737			84,832		48,048		(275,137		)	(323,185		)	(201,616		)	(167,288		)
Franklin Growth and Income Securities (IQ Annuity™)	56,263		21,774		34,489			6,189			90,063		81,155		(236,049		)	(317,204		)	(220,952		)	(186,463		)
Franklin Growth and Income Securities (Pinnacle Plus™)	63,428		27,788		35,640			38,360			101,533		51,666		(332,038		)	(383,704		)	(243,811		)	(208,171		)
Non-Affiliated Class 2 (continued):
Franklin Income Securities (AnnuiChoice™)	22,712		6,077		16,635			17,379			2,683		63,055		39,456			(23,599		)	(3,537		)	13,098
Franklin Income Securities (AnnuiChoice II™)(January 12)*	2,453		769		1,684			15			290		—		(2,939		)	(2,939		)	(2,634		)	(950		)
Franklin Income Securities (GrandMaster flex3™)	111,380		49,404		61,976			82,509			13,155		289,649		182,369			(107,280		)	(11,616		)	50,360
Franklin Income Securities (Grandmaster™)	125,884		44,456		81,428			118,665			14,868		235,390		97,464			(137,926		)	(4,393		)	77,035
Franklin Income Securities (IQ Annuity™)	64,480		27,895		36,585			56,677			7,616		153,161		85,267			(67,894		)	(3,601		)	32,984
Franklin Income Securities (Pinnacle Plus™)	90,787		42,309		48,478			17,680			10,723		248,881		203,187			(45,694		)	(17,291		)	31,187
Franklin Large Cap Growth Securities (AnnuiChoice™)	375		600		(225		)	6,289			369		6,383		2,949			(3,434		)	3,224			2,999
Franklin Large Cap Growth Securities (GrandMaster flex3™)	1,975		4,366		(2,391		)	23,894			1,944		28,982		18,889			(10,093		)	15,745			13,354
Franklin Large Cap Growth Securities (Grandmaster™)	1,106		2,081		(975		)	8,376			1,089		17,968		15,091			(2,877		)	6,588			5,613
Franklin Large Cap Growth Securities (IQ Annuity™)	2,264		4,831		(2,567		)	14,890			2,228		29,008		24,457			(4,551		)	12,567			10,000
Franklin Large Cap Growth Securities (Pinnacle Plus™)	2,662		6,905		(4,243		)	41,948			2,620		36,484		10,602			(25,882		)	18,686			14,443
Franklin Large Cap Growth Securities (AnnuiChoice II™)	680		828		(148		)	128			670		102		305			203			1,001			853
Franklin Mutual Shares Securities (AnnuiChoice™)	20,853		10,938		9,915			76,614			28,909		126,801		42,461			(84,340		)	21,183			31,098
Franklin Mutual Shares Securities (AnnuiChoice II™)(January 12)*	2,422		1,563		859			(27		)	3,358		—		(4,911		)	(4,911		)	(1,580		)	(721		)
Franklin Mutual Shares Securities (GrandMaster flex3™)	37,761		29,337		8,424			42,536			52,347		246,294		154,481			(91,813		)	3,070			11,494
Franklin Mutual Shares Securities (IQ Annuity™)	15,032		11,308		3,724			33,251			20,837		77,010		25,210			(51,800		)	2,288			6,012
Franklin Mutual Shares Securities (Pinnacle Plus™)	42,124		32,599		9,525			66,346			58,396		213,226		93,079			(120,147		)	4,595			14,120
Franklin Mutual Shares Securities Standard (IQ Advisor™)	283		83		200			11			393		1,523		1,294			(229		)	175			375
Franklin Mutual Shares Securities(Grandmaster™)	31,359		24,496		6,863			94,071			43,473		217,349		61,640			(155,709		)	(18,165		)	(11,302		)
Franklin Small Cap Value Securities (AnnuiChoice™)(July 16)*	—		26		(26		)	(651		)	—		—		(48		)	(48		)	(699		)	(725		)

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 Class 2 (continued):
Franklin Small Cap Value Securities (GrandmasterFlex3™)(May 3)*	$	480	$	509	$	(29	)	$	(865	)	$	1,789	$	—		$	(6,173	)	$	(6,173	)	$	(5,249	)	$	(5,278	)
Franklin Small Cap Value Securities (IQ3 ™)(May23)*	141		173		(32		)	(6,772		)	526		—			(623		)	(623		)	(6,869		)	(6,901		)
Franklin Small Cap Value Securities (Pinnacle Plus ™)(July 24)*	—		97		(97		)	(7		)	—		—			(1,488		)	(1,488		)	(1,495		)	(1,592		)
Templeton Foriegn Securities Fund (GrandMaster flex3™)	12,659		9,704		2,955			39,542			24,566		99,914			109,466			9,552			73,660			76,615
Templeton Foriegn Securities Fund (Grandmaster™)	6,484		5,198		1,286			40,730			12,582		18,005			1,154			(16,851		)	36,461			37,747
Templeton Foriegn Securities Fund (Pinnacle Plus™)	15,454		12,473		2,981			70,053			29,990		116,354			105,912			(10,442		)	89,601			92,582
Templeton Foreign Securities Fund (AnnuiChoice™)	2,486		1,288		1,198			9,586			4,823		14,345			14,943			598			15,007			16,205
Templeton Foreign Securities Fund (AnnuiChoice II™)	135		96		39			121			260		152			850			698			1,079			1,118
Templeton Growth Securities (AnnuiChoice™)	2,858		1,493		1,365			7,666			6,669		11,270			(3,870		)	(15,140		)	(805		)	560
Templeton Growth Securities (AnnuiChoice II™)(January 12)*	291		211		80			(52		)	680		—			(920		)	(920		)	(292		)	(212		)
Templeton Growth Securities (GrandMaster flex3™)	21,784		21,056		728			26,693			50,840		157,462			73,685			(83,777		)	(6,244		)	(5,516		)
Templeton Growth Securities (Grandmaster™)	20,358		15,632		4,726			53,042			47,512		83,220			(2,832		)	(86,052		)	14,502			19,228
Templeton Growth Securities (IQ Annuity™)	14,973		15,320		(347		)	152,315			34,946		135,906			(9,091		)	(144,997		)	42,264			41,917
Templeton Growth Securities (Pinnacle Plus™)	17,599		18,003		(404		)	70,844			41,075		143,852			39,552			(104,300		)	7,619			7,215
Templeton Growth Securities Standard (IQ Advisor™)	115		42		73			5			270		940			709			(231		)	44			117
Van Kampen LIT Comstock (AnnuiChoice™)	1,961		1,186		775			271			2,414		5,745			(1,524		)	(7,269		)	(4,584		)	(3,809		)
Van Kampen LIT Comstock (GrandMaster flex3™)	5,588		5,068		520			9,416			6,875		32,538			5,949			(26,589		)	(10,298		)	(9,778		)
Van Kampen LIT Comstock (Grandmaster™)	3,010		2,338		672			8,499			3,702		19,718			1,635			(18,083		)	(5,882		)	(5,210		)
Van Kampen LIT Comstock (IQ Annuity™)	2,491		2,259		232			3,437			3,067		14,719			1,943			(12,776		)	(6,272		)	(6,040		)
Van Kampen LIT Comstock (Pinnacle Plus™)	5,830		5,997		(167		)	13,811			7,175		40,449			6,182			(34,267		)	(13,281		)	(13,448		)
Van Kampen LIT Strategic Growth (GrandMaster flex3™)	—		191		(191		)	101			—		(539		)	1,538			2,077			2,178			1,987
Van Kampen LIT Strategic Growth (AnnuiChoice™)(October 31)*	—		16		(16		)	(79		)	—		—			(552		)	(552		)	(631		)	(647		)
Van Kampen LIT Strategic Growth (Grandmaster™)	—		48		(48		)	329			—		(166		)	50			216			545			497
Van Kampen LIT Strategic Growth (IQ Annuity™)	—		19		(19		)	6			—		222			414			192			198			179
Van Kampen LIT Strategic Growth (Pinnacle Plus™)	—		2,433		(2,433		)	37,236			—		9,206			2,820			(6,386		)	30,850			28,417
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)(November 14)*	—		13		(13		)	—			—		—			35			35			35			22
Van Kampen UIF Emerging Markets Debt (Grandmaster™)	4,620		809		3,811			(1,116		)	1,511		1,296			513			(783		)	(388		)	3,423
Van Kampen UIF Emerging Markets Debt (GrandmasterFlex3™)(May 7)*	762		814		(52		)	(365		)	249		—			1,869			1,869			1,753			1,701
Van Kampen UIF Emerging Markets Debt (IQ3™)(July 20)*	—		582		(582		)	20			—		—			1,506			1,506			1,526			944
Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)	26,511		5,768		20,743			(1,695		)	8,672		8,373			(3,889		)	(12,262		)	(5,285		)	15,458
Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)	6,183		7,010		(827		)	71,031			77,351		81,064			45,492			(35,572		)	112,810			111,983
Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)	5,749		12,302		(6,553		)	27,410			71,919		72,023			218,382			146,359			245,688			239,135
Van Kampen UIF Emerging Markets Equity (Grandmaster™)	3,501		7,257		(3,756		)	96,879			43,796		99,158			123,149			23,991			164,666			160,910
Van Kampen UIF Emerging Markets Equity (IQ Annuity™)	1,074		2,340		(1,266		)	21,940			13,443		13,358			14,452			1,094			36,477			35,211
Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)	7,422		15,165		(7,743		)	118,307			92,850		120,745			217,123			96,378			307,535			299,792
Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)	1,663		2,422		(759		)	957			20,805		5,799			50,727			44,928			66,690			65,931

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 Class 2 (continued):
Van Kampen UIF U. S. Real Estate (AnnuiChoice™)(May 2)*	$	731	$	130	$	601		$	(7,590	)	$	2,815	$	—	$	(512	)	$	(512	)	$	(5,287	)	$	(4,686	)
Van Kampen UIF U. S. Real Estate (AnnuiChoice II™)(May 9)*	750		381		369			(5,083		)	2,892		—		(7,877		)	(7,877		)	(10,068		)	(9,699		)
Van Kampen UIF U.S. Real Estate (Grandmaster™)	10,839		7,408		3,431			67,438			41,763		170,062		(31,900		)	(201,962		)	(92,761		)	(89,330		)
Van Kampen UIF U.S. Real Estate (GrandmasterFlex3™)(April 30)*	1,330		808		522			(4,858		)	5,124		—		(19,116		)	(19,116		)	(18,850		)	(18,328		)
Van Kampen UIF U.S. Real Estate (IQ3 ™)(April 18)*	443		621		(178		)	(2,662		)	1,709		—		(13,574		)	(13,574		)	(14,527		)	(14,705		)
Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)	21,286		18,620		2,666			129,826			82,018		270,923		(156,910		)	(427,833		)	(215,989		)	(213,323		)
Non-Affiliated Class B:
DWS Small Cap Index VIP (AnnuiChoice™)	1,401		1,378		23			1,900			7,694		17,826		3,679			(14,147		)	(4,553		)	(4,530		)
DWS Small Cap Index VIP (AnnuiChoice II™)(January 12)*	93		103		(10		)	(4		)	509		—		(911		)	(911		)	(406		)	(416		)
DWS Small Cap Index VIP (GrandMaster flex3™)	2,263		3,562		(1,299		)	12,216			12,427		24,619		(7,146		)	(31,765		)	(7,122		)	(8,421		)
DWS Small Cap Index VIP (Grandmaster™)	255		802		(547		)	(7,730		)	1,397		2,143		(673		)	(2,816		)	(9,149		)	(9,696		)
DWS Small Cap Index VIP (IQ3™)	1,475		2,210		(735		)	6,237			8,102		12,854		(2,369		)	(15,223		)	(884		)	(1,619		)
DWS Small Cap Index VIP (Pinnacle Plus™)	5,720		9,227		(3,507		)	6,866			31,406		88,799		32,494			(56,305		)	(18,033		)	(21,540		)

See accompanying notes.

* - 2007 inception date of division.

15

Separate Account I

of

National 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Affiliated:
Touchstone Aggressive ETF (AnnuiChoice™)	$	4,280		$	50,268		$	(22,634	)	$	31,914		$	—	$	(8,182	)	$	(158,440	)	$	(2,657	)	$	(169,279	)	$	(137,365	)	$	702,440	$	565,075	—	(872	)	(12,459	)	(13,331	)
Touchstone Aggressive ETF (GrandMaster flex3™)	2,199			29,421			(8,826		)	22,794			26,235		(16,956		)	(38,174		)	(215		)	(29,110		)	(6,316		)	678,241		671,925		2,187	(1,394	)	(3,242	)	(2,449	)
Touchstone Aggressive ETF (Grandmaster™)	(21,728		)	463,495			(308,509		)	133,258			22,648		(342,962		)	(1,977,800		)	(519		)	(2,298,633		)	(2,165,375		)	2,201,378		36,003		1,866	(27,811	)	(156,554	)	(182,499	)
Touchstone Aggressive ETF (IQ Annuity™)	(5,962		)	178,852			(126,626		)	46,264			107,236		(387,845		)	(396,290		)	(257		)	(677,156		)	(630,892		)	1,091,441		460,549		8,679	(32,002	)	(31,280	)	(54,603	)
Touchstone Aggressive ETF (Pinnacle Plus™)	(944		)	71,408			(41,221		)	29,243			8,490		(30,931		)	57,338			(670		)	34,227			63,470			664,492		727,962		716	(2,551	)	5,211		3,376
Touchstone Balanced (AnnuiChoice™)	5,804			7,191			(7,251		)	5,744			—		(4,090		)	53			(560		)	(4,597		)	1,147			130,160		131,307		—	(322	)	3		(319	)
Touchstone Balanced (GrandMaster flex3™)	13,786			20,727			(19,194		)	15,319			—		(40,962		)	2,450			(203		)	(38,715		)	(23,396		)	393,570		370,174		—	(2,817	)	170		(2,647	)
Touchstone Balanced (Grandmaster™)	6			4			(9		)	1			—		—			148			(3		)	145			146			—		146		—	—		11		11
Touchstone Balanced (IQ Annuity™)	8,839			24,000			(20,518		)	12,321			3,600		(47,716		)	13,652			(327		)	(30,791		)	(18,470		)	245,575		227,105		261	(3,445	)	1,130		(2,054	)
Touchstone Balanced (Pinnacle Plus™)	18,615			21,662			(24,617		)	15,660			—		(6,196		)	111,294			(575		)	104,523			120,183			367,269		487,452		—	(486	)	8,100		7,614
Touchstone Baron Small Cap (AnnuiChoice™)	(3,706		)	78,314			(65,911		)	8,697			—		(29,447		)	(79,615		)	(1,642		)	(110,704		)	(102,007		)	411,496		309,489		—	(1,651	)	(4,267	)	(5,918	)
Touchstone Baron Small Cap (AnnuiChoice II™)(April 9)*	(113		)	1,694			(1,849		)	(268		)	13,357		(76		)	(2		)	—			13,279			13,011			—		13,011		1,141	(6	)	(1	)	1,134
Touchstone Baron Small Cap (GrandMaster flex3™)	(11,025		)	156,851			(149,120		)	(3,294		)	128,921		(78,002		)	(27,565		)	(288		)	23,066			19,772			741,411		761,183		7,243	(4,498	)	(2,090	)	655
Touchstone Baron Small Cap (Grandmaster™)	(4,591		)	109,766			(93,253		)	11,922			490		(63,294		)	(21,621		)	(74		)	(84,499		)	(72,577		)	410,171		337,594		33	(4,184	)	(1,129	)	(5,280	)
Touchstone Baron Small Cap (IQ Annuity™)	(19,429		)	276,442			(246,526		)	10,487			55,492		(135,388		)	128,478			(414		)	48,168			58,655			1,253,233		1,311,888		3,079	(7,415	)	6,781		2,445
Touchstone Baron Small Cap (Pinnacle Plus™)	(12,602		)	123,920			(105,680		)	5,638			23,724		(53,973		)	88,850			(944		)	57,657			63,295			642,951		706,246		1,325	(3,123	)	5,079		3,281
Touchstone Conservative ETF (AnnuiChoice™)	(140		)	2,756			(977		)	1,639			—		—			(23,719		)	(14		)	(23,733		)	(22,094		)	32,689		10,595		—	(1	)	(2,026	)	(2,027	)
Touchstone Conservative ETF (GrandMaster flex3™)	1,450			37,052			12,866			51,368			19,894		(33,342		)	(286,235		)	(254		)	(299,937		)	(248,569		)	1,449,200		1,200,631		1,795	(2,982	)	(25,713	)	(26,900	)
Touchstone Conservative ETF (Grandmaster™)	756			874			4,977			6,607			1,680		(2,508		)	7,385			(6		)	6,551			13,158			152,494		165,652		147	(220	)	643		570
Touchstone Conservative ETF (IQ Annuity™)	9,416			58,663			3,744			71,823			685,361		(126,219		)	29,783			(662		)	588,263			660,086			1,412,306		2,072,392		60,354	(11,245	)	3,157		52,266
Touchstone Conservative ETF (Pinnacle Plus™)	(1,079		)	29,274			95			28,290			1,125		(27,719		)	(112,355		)	(339		)	(139,288		)	(110,998		)	787,002		676,004		101	(2,482	)	(10,093	)	(12,474	)
Touchstone Core Bond (AnnuiChoice™)	7,762			4,320			(754		)	11,328			—		(17,954		)	(16,446		)	(980		)	(35,380		)	(24,052		)	265,571		241,519		—	(1,592	)	(1,326	)	(2,918	)
Touchstone Core Bond (AnnuiChoice II™)(April 9)*	2,128			179			(390		)	1,917			60,926		(7,980		)	5,099			—			58,045			59,962			—		59,962		5,944	(767	)	486		5,663
Touchstone Core Bond (GrandMaster flex3™)	15,739			566			3,504			19,809			25,280		(70,919		)	11,266			(179		)	(34,552		)	(14,743		)	574,568		559,825		2,215	(6,349	)	948		(3,186	)
Touchstone Core Bond (Grandmaster™)	1,519			4,282			(1,533		)	4,268			120		(5,218		)	37,052			(21		)	31,933			36,201			16,028		52,229		11	(490	)	3,708		3,229
Touchstone Core Bond (IQ Annuity™)	8,238			7,000			(1,449		)	13,789			1,839		(47,325		)	(98,956		)	(585		)	(145,027		)	(131,238		)	459,569		328,331		156	(4,110	)	(8,601	)	(12,555	)
Touchstone Core Bond (Pinnacle Plus™)	6,107			338			1,766			8,211			5,880		(3,586		)	(1,048		)	(134		)	1,112			9,323			220,402		229,725		563	(352	)	(99	)	112
Touchstone Eagle Capital Appreciation (AnnuiChoice™)	(148		)	750			(9,673		)	(9,071		)	66		(4,700		)	189,115			(740		)	183,741			174,670			6,865		181,535		7	(440	)	15,237		14,804
Touchstone Eagle Capital Appreciation (GrandMaster™)(April 27)*	(206		)	9			(2,011		)	(2,208		)	—		(17,578		)	60,571			(18		)	42,975			40,767			—		40,767		—	(1,296	)	4,451		3,155
Touchstone Eagle Capital Appreciation (GrandMaster flex3™)	(1,153		)	6,450			(15,744		)	(10,447		)	14,569		(39,392		)	183,536			(23		)	158,690			148,243			34,671		182,914		1,031	(2,726	)	12,281		10,586
Touchstone Eagle Capital Appreciation (IQ Annuity™)	(3,323		)	42,859			(59,248		)	(19,712		)	29,161		(12,029		)	230,802			(442		)	247,492			227,780			148,747		376,527		2,369	(1,029	)	18,046		19,386
Touchstone Eagle Capital Appreciation (Pinnacle Plus™)	(1,671		)	13,413			(22,649		)	(10,907		)	—		(22,568		)	186,968			(202		)	164,198			153,291			65,172		218,463		—	(1,586	)	12,555		10,969
Touchstone Enhanced ETF (AnnuiChoice™)	20,305			26,313			11,279			57,897			—		(6,710		)	(15,473		)	(4,912		)	(27,095		)	30,802			1,957,105		1,987,907		—	(891	)	(1,235	)	(2,126	)
Touchstone Enhanced ETF (GrandMaster flex3™)	7,837			56,029			(11,931		)	51,935			100,360		(33,965		)	(87,572		)	(409		)	(21,586		)	30,349			1,962,387		1,992,736		7,958	(2,708	)	(6,576	)	(1,326	)
Touchstone Enhanced ETF (Grandmaster™)	4,935			278,271			(171,915		)	111,291			11,755		(1,083,571		)	(169,785		)	(561		)	(1,242,162		)	(1,130,871		)	3,440,228		2,309,357		904	(83,596	)	(12,485	)	(95,177	)
Touchstone Enhanced ETF (IQ Annuity™)	4,129			150,313			(127,113		)	27,329			197,757		(387,732		)	(136,868		)	(293		)	(327,136		)	(299,807		)	1,455,776		1,155,969		15,511	(30,573	)	(11,244	)	(26,306	)
Touchstone Enhanced ETF (Pinnacle Plus™)	(112		)	61,110			(42,260		)	18,738			1,125		(16,517		)	78,604			(902		)	62,310			81,048			785,627		866,675		88	(1,346	)	6,229		4,971
Touchstone Growth & Income (AnnuiChoice™)	1,217			2,521			(2,632		)	1,106			—		(1,792		)	(2		)	(120		)	(1,914		)	(808		)	39,463		38,655		—	(140	)	—		(140	)
Touchstone Growth & Income (GrandMaster flex3™)	394			926			(941		)	379			1,263		—			—			—			1,263			1,642			13,797		15,439		96	—		—		96
Touchstone Growth & Income (IQ Annuity™)	1,434			3,333			(3,842		)	925			12,600		(1,136		)	(1		)	(75		)	11,388			12,313			41,559		53,872		892	(85	)	—		807
Touchstone Growth & Income (Pinnacle Plus™)	2,725			6,826			(7,244		)	2,307			—		(2,237		)	22,540			(178		)	20,125			22,432			85,269		107,701		—	(168	)	1,625		1,457
Touchstone High Yield (AnnuiChoice™)	31,004			1,969			(31,932		)	1,041			—		(5,205		)	44,041			(1,218		)	37,618			38,659			364,538		403,197		—	(431	)	2,851		2,420
Touchstone High Yield (GrandMaster flex3™)	28,528			3,216			(30,237		)	1,507			—		(49,238		)	5,174			(133		)	(44,197		)	(42,690		)	449,197		406,507		—	(3,461	)	373		(3,088	)
Touchstone High Yield (Grandmaster™)	9,168			315			(6,410		)	3,073			—		(32,055		)	(96,131		)	(19		)	(128,205		)	(125,132		)	264,152		139,020		—	(2,725	)	(8,135	)	(10,860	)
Touchstone High Yield (IQ Annuity™)	20,898			7,443			(29,525		)	(1,184		)	69,980		(12,559		)	(147,250		)	(660		)	(90,489		)	(91,673		)	398,271		306,598		4,688	(896	)	(10,097	)	(6,305	)
Touchstone High Yield (Pinnacle Plus™)	59,477			(1,958		)	(57,517		)	2			23,326		(66,820		)	6,422			(643		)	(37,715		)	(37,713		)	900,931		863,218		1,868	(5,422	)	425		(3,129	)
Touchstone Large Cap Core Equity (AnnuiChoice II™)(February 26)*	7,400			480			1,528			9,408			223,703		—			89,979			—			313,682			323,090			—		323,090		20,441	—		7,859		28,300
Touchstone Large Cap Core Equity (GrandMaster flex3™)	629			9,217			(7,822		)	2,024			12,765		(33,587		)	2,035			(37		)	(18,824		)	(16,800		)	60,452		43,652		887	(2,416	)	146		(1,383	)
Touchstone Large Cap Core Equity (Grandmaster™)	64			1,903			(1,512		)	455			—		(7,810		)	4,764			(3		)	(3,049		)	(2,594		)	9,691		7,097		—	(585	)	359		(226	)
Touchstone Large Cap Core Equity (IQ Annuity™)	1,775			1,129			1,036			3,940			—		(809		)	5,078			(27		)	4,242			8,182			101,922		110,104		—	(61	)	393		332

See accompanying notes.

* - 2007 inception date of division.

16

	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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Affiliated (continued):
Touchstone Large Cap Core Equity (Pinnacle Plus™)	$	1,853		$	1,320		$	(607	)	$	2,566		$	—	$	(3,083	)	$	45,365		$	(156	)	$	42,126		$	44,692		$	75,223	$	119,915	—	(229	)	3,198		2,969
Touchstone Mid Cap Growth (AnnuiChoice™)	8,078			37,557			(16,871		)	28,764			—		(6,546		)	112,629			(985		)	105,098			133,862			193,666		327,528		—	(400	)	5,967		5,567
Touchstone Mid Cap Growth (AnnuiChoice II™)(April 9)*	1,122			6,085			(4,833		)	2,374			29,018		(3,089		)	16,650			(3		)	42,576			44,950			—		44,950		2,516	(255	)	1,410		3,671
Touchstone Mid Cap Growth (GrandMaster flex3™)	10,920			74,906			(49,339		)	36,487			40,212		(23,781		)	216,669			(190		)	232,910			269,397			267,200		536,597		2,175	(1,272	)	11,482		12,385
Touchstone Mid Cap Growth (Grandmaster™)	5,016			36,956			(20,685		)	21,287			13,771		(46,770		)	92,897			(60		)	59,838			81,125			158,610		239,735		887	(2,954	)	5,907		3,840
Touchstone Mid Cap Growth (IQ Annuity™)	11,117			91,537			(62,190		)	40,464			34,866		(144,192		)	330,072			(266		)	220,480			260,944			331,563		592,507		1,693	(7,287	)	16,405		10,811
Touchstone Mid Cap Growth (Pinnacle Plus™)	22,381			179,265			(105,522		)	96,124			163,970		(10,818		)	270,921			(1,496		)	422,577			518,701			599,899		1,118,600		9,435	(683	)	15,135		23,887
Touchstone Moderate ETF (AnnuiChoice™)	809			10,430			899			12,138			—		(11,868		)	(36,097		)	(197		)	(48,162		)	(36,024		)	290,187		254,163		—	(1,021	)	(2,966	)	(3,987	)
Touchstone Moderate ETF (GrandMaster flex3™)	(4,510		)	85,886			3,144			84,520			93,690		(329,795		)	(29,256		)	(578		)	(265,939		)	(181,419		)	2,140,003		1,958,584		7,982	(27,248	)	(2,503	)	(21,769	)
Touchstone Moderate ETF (Grandmaster™)	57			13,347			776			14,180			8,420		(57,761		)	(84		)	(47		)	(49,472		)	(35,292		)	377,636		342,344		703	(4,859	)	(3	)	(4,159	)
Touchstone Moderate ETF (IQ Annuity™)	7,703			120,786			(66,442		)	62,047			651,635		(606,687		)	634,143			(1,772		)	677,319			739,366			2,166,049		2,905,415		54,618	(52,133	)	52,861		55,346
Touchstone Moderate ETF (Pinnacle Plus™)	(2,512		)	24,494			12,943			34,925			13,725		(91,843		)	111,016			(683		)	32,215			67,140			972,923		1,040,063		1,179	(7,881	)	9,522		2,820
Touchstone Money Market (AnnuiChoice™)	11,881			—			—			11,881			—		(4,145		)	(243,006		)	(2,209		)	(249,360		)	(237,479		)	418,993		181,514		—	(578	)	(22,152	)	(22,730	)
Touchstone Money Market (Grandmaster™)	188,776			—			—			188,776			177,645		(1,843,702		)	2,643,125			(1,610		)	975,458			1,164,234			4,652,942		5,817,176		16,565	(172,432	)	246,755		90,888
Touchstone Money Market (IQ Annuity™)	111			—			—			111			—		(68		)	—			(15		)	(83		)	28			3,102		3,130		—	(8	)	—		(8	)
Touchstone Third Avenue Value (AnnuiChoice™)	(4,104		)	329,213			(418,308		)	(93,199		)	6,894		(59,137		)	732,484			(6,121		)	674,120			580,921			1,758,626		2,339,547		371	(3,366	)	37,684		34,689
Touchstone Third Avenue Value (GrandMaster flex3™)	(26,270		)	369,429			(491,668		)	(148,509		)	300,871		(220,535		)	164,143			(1,361		)	243,118			94,609			2,667,030		2,761,639		15,519	(11,732	)	6,467		10,254
Touchstone Third Avenue Value (Grandmaster™)	(23,043		)	440,922			(624,940		)	(207,061		)	27,303		(561,316		)	1,859,149			(1,105		)	1,324,031			1,116,970			2,929,760		4,046,730		1,659	(33,715	)	109,524		77,468
Touchstone Third Avenue Value (IQ Annuity™)	(29,895		)	880,028			(1,000,390		)	(150,257		)	311,528		(561,096		)	421,501			(2,394		)	169,539			19,282			3,717,733		3,737,015		16,667	(29,653	)	20,929		7,943
Touchstone Third Avenue Value (Pinnacle Plus™)	(30,549		)	347,340			(488,237		)	(171,446		)	178,765		(170,607		)	941,173			(2,810		)	946,521			775,075			2,538,655		3,313,730		8,878	(8,725	)	45,649		45,802
Touchstone Third Avenue Value (AnnuiChoice II™)	(912		)	46,219			(77,558		)	(32,251		)	521,940		(817		)	149,911			(52		)	670,982			638,731			77,936		716,667		46,624	(78	)	13,763		60,309
Touchstone Value Plus (AnnuiChoice™)	402			11,289			(19,399		)	(7,708		)	—		(9,242		)	(17,822		)	(608		)	(27,672		)	(35,380		)	161,318		125,938		—	(828	)	(1,532	)	(2,360	)
Touchstone Value Plus (AnnuiChoice II™)(November 19)*	45			—			(24		)	21			—		—			3,230			—			3,230			3,251			—		3,251		—	—		309		309
Touchstone Value Plus (GrandMaster flex3™)	(102		)	376			(7,608		)	(7,334		)	300		—			11,653			(42		)	11,911			4,577			120,479		125,056		22	(3	)	859		878
Touchstone Value Plus (Grandmaster™)	65			329			(3,238		)	(2,844		)	—		(484		)	7,808			(8		)	7,316			4,472			40,899		45,371		—	(38	)	581		543
Touchstone Value Plus (IQ Annuity™)	(232		)	9,355			(21,747		)	(12,624		)	—		(9,440		)	(8,489		)	(117		)	(18,046		)	(30,670		)	243,173		212,503		—	(789	)	(740	)	(1,529	)
Touchstone Value Plus (Pinnacle Plus™)	(1,515		)	25,377			(40,883		)	(17,021		)	28,269		(69,211		)	(11,945		)	(112		)	(52,999		)	(70,020		)	364,532		294,512		2,018	(4,806	)	(883	)	(3,671	)
Non-Affiliated:
JP Morgan Mid Cap Value (AnnuiChoice™)	5,753			37,754			(34,260		)	9,247			—		(6,568		)	(78,240		)	(1,256		)	(86,064		)	(76,817		)	405,054		328,237		—	(424	)	(4,168	)	(4,592	)
JP Morgan Mid Cap Value (GrandMaster flex3™)	1,497			21,417			(21,031		)	1,883			—		(50,601		)	(2		)	(211		)	(50,814		)	(48,931		)	242,952		194,021		—	(2,868	)	—		(2,868	)
JP Morgan Mid Cap Value (Grandmaster™)	1,719			14,156			(12,757		)	3,118			24		(36,288		)	(25,637		)	(42		)	(61,943		)	(58,825		)	147,799		88,974		2	(2,472	)	(1,715	)	(4,185	)
JP Morgan Mid Cap Value (IQ3™)	705			10,053			(9,346		)	1,412			—		(1,059		)	(37,026		)	(105		)	(38,190		)	(36,778		)	122,154		85,376		—	(64	)	(2,101	)	(2,165	)
JP Morgan Mid Cap Value (Pinnacle Plus™)	7,057			52,372			(49,874		)	9,555			—		(50,217		)	(17		)	(930		)	(51,164		)	(41,609		)	1,072,900		1,031,291		—	(2,991	)	(1	)	(2,992	)
Non-Affiliated Initial Class:
Fidelity VIP Equity-Income (Grandmaster™)	203,899			2,452,265			(2,499,805		)	156,359			74,111		(3,173,675		)	(1,784,347		)	(6,541		)	(4,890,452		)	(4,734,093		)	26,407,460		21,673,367		1,176	(50,109	)	(29,049	)	(77,982	)
Fidelity VIP Growth (Grandmaster™)	(46,087		)	185,456			2,341,242			2,480,611			6,051		(1,998,075		)	(809,702		)	(4,207		)	(2,805,933		)	(325,322		)	11,385,444		11,060,122		100	(30,484	)	(12,551	)	(42,935	)
Fidelity VIP High Income (Grandmaster™)	296,426			(33,083		)	(178,514		)	84,829			11,399		(1,315,801		)	(381,144		)	(1,816		)	(1,687,362		)	(1,602,533		)	5,954,593		4,352,060		646	(74,265	)	(21,460	)	(95,079	)
Fidelity VIP II Asset Manager (Grandmaster™)	360,493			378,187			240,672			979,352			26,324		(1,366,741		)	(395,023		)	(2,727		)	(1,738,167		)	(758,815		)	8,030,414		7,271,599		743	(38,656	)	(11,001	)	(48,914	)
Fidelity VIP II Contrafund (Grandmaster™)	951,189			6,843,475			(4,208,486		)	3,586,178			100,980		(3,451,175		)	(374,839		)	(6,725		)	(3,731,759		)	(145,581		)	24,395,283		24,249,702		2,328	(80,885	)	(8,435	)	(86,992	)
Fidelity VIP II Index 500 (Grandmaster™)	182,289			911,634			(730,516		)	363,407			—		(1,967,312		)	(272,418		)	(3,081		)	(2,242,811		)	(1,879,404		)	9,233,417		7,354,013		—	(57,095	)	(7,832	)	(64,927	)
Fidelity VIP II Investment Grade Bond (AnnuiChoice™)(April 27)*	(3,615		)	(506		)	14,481			10,360			—		(6,104		)	593,446			(1,537		)	585,805			596,165			—		596,165		—	(764	)	59,285		58,521
Fidelity VIP II Investment Grade Bond (Grandmaster™)	96,995			(43,794		)	31,462			84,663			9,092		(658,237		)	(110,422		)	(1,009		)	(760,576		)	(675,913		)	3,307,483		2,631,570		342	(24,669	)	(4,183	)	(28,510	)
Fidelity VIP II Investment Grade Bond (GrandmasterFlex3™)(April 27)*	(3,721		)	(266		)	8,097			4,110			—		(51,161		)	380,490			(84		)	329,245			333,355			—		333,355		—	(5,104	)	37,951		32,847
Fidelity VIP II Investment Grade Bond (IQ3™)(April 27)*	(2,084		)	422			3,982			2,320			—		(7,464		)	169,442			(350		)	161,628			163,948			—		163,948		—	(778	)	16,922		16,144
Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)(April 27)*	(4,412		)	(1,147		)	9,312			3,753			—		(4,910		)	384,703			(198		)	379,595			383,348			—		383,348		—	(512	)	38,317		37,805
Fidelity VIP III Balanced (Grandmaster™)	120,431			186,003			(101,217		)	205,217			3,722		(385,807		)	(762,108		)	(844		)	(1,145,037		)	(939,820		)	3,129,664		2,189,844		233	(23,506	)	(46,895	)	(70,168	)
Fidelity VIP III Growth & Income (Grandmaster™)	112,051			256,249			(21,107		)	347,193			1,112		(714,186		)	70,687			(1,048		)	(643,435		)	(296,242		)	3,502,276		3,206,034		58	(37,492	)	3,620		(33,814	)
Fidelity VIP III Growth Opportunities (Grandmaster™)	(16,490		)	98,682			150,747			232,939			4,165		(301,956		)	(22,189		)	(496		)	(320,476		)	(87,537		)	1,250,521		1,162,984		308	(22,765	)	(1,550	)	(24,007	)
Fidelity VIP Overseas (AnnuiChoice™)(April 27)*	3,691			4,140			17,471			25,302			—		(13,704		)	362,575			(1,235		)	347,636			372,938			—		372,938		—	(1,437	)	36,562		35,125
Fidelity VIP Overseas (AnnuiChoice II™)(April27)*	556			32			2,586			3,174			—		(241		)	52,308			(18		)	52,049			55,223			—		55,223		—	(24	)	5,231		5,207
Fidelity VIP Overseas (Grandmaster™)	87,979			1,658,128			(980,620		)	765,487			10,816		(920,936		)	(417,324		)	(1,782		)	(1,329,226		)	(563,739		)	5,161,252		4,597,513		296	(23,806	)	(9,564	)	(33,074	)
Fidelity VIP Overseas (GrandmasterFlex3™)(April27)*	2,047			3,959			16,465			22,471			—		(21,457		)	350,477			(42		)	328,978			351,449			—		351,449		—	(2,100	)	35,327		33,227
Fidelity VIP Overseas (IQ3™)(April 27)*	910			7,328			9,197			17,435			—		(919		)	179,692			(60		)	178,713			196,148			—		196,148		—	(94	)	18,626		18,532
Fidelity VIP Overseas (Pinnacle Plus™)(April 27)*	4,998			1,076			36,852			42,926			—		(10,839		)	754,983			(440		)	743,704			786,630			—		786,630		—	(1,079	)	75,512		74,433

See accompanying notes.

* - 2007 inception date of division.

17

	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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Affiliated Service Class:
Touchstone Aggressive ETF (AnnuiChoice™)	$	673		$	9,169		$	(5,168	)	$	4,674		$	3,373	$	(1,594	)	$	56,954		$	(390	)	$	58,343		$	63,017		$	20,007	$	83,024	294	(174	)	5,378		5,498
Touchstone Aggressive ETF (AnnuiChoice II™)	6,884			16,393			(13,381		)	9,896			72,811		—			252,947			(600		)	325,158			335,054			306,547		641,601		6,556	(54	)	22,681		29,183
Touchstone Aggressive ETF (GrandmasterFlex3™)(April 30)*	814			1,685			(4,776		)	(2,277		)	51,154		—			20,470			(10		)	71,614			69,337			—		69,337		5,046	(1	)	2,013		7,058
Touchstone Aggressive ETF (Pinnacle Plus™)(April 30)*	1,037			2,620			(5,197		)	(1,540		)	2,822		(466		)	99,894			(19		)	102,231			100,691			—		100,691		289	(48	)	10,017		10,258
Touchstone GMAB Aggressive ETF (AnnuiChoice II™)(February 12)*	1,945			8,277			(9,216		)	1,006			308,572		—			(26		)	(501		)	308,045			309,051			—		309,051		28,103	(45	)	(2	)	28,056
Touchstone Conservative ETF (AnnuiChoice II ™)(January 12)*	363			107			890			1,360			31,594		(96		)	9,849			(6		)	41,341			42,701			—		42,701		3,026	(9	)	909		3,926
Touchstone Conservative ETF (GrandmasterFlex3™)(June 11)*	9,770			1,785			(12,748		)	(1,193		)	652,985		(374		)	50,329			—			702,940			701,747			—		701,747		64,593	(37	)	5,092		69,648
Touchstone Conservative ETF (Pinnacle Plus™)(May 21)*	3,391			593			(1,095		)	2,889			109,856		(5,555		)	144,306			(8		)	248,599			251,488			—		251,488		10,859	(554	)	14,676		24,981
Touchstone Enhanced ETF (AnnuiChoice™)	3,299			2,583			(5,317		)	565			51,689		—			174,935			(655		)	225,969			226,534			55,473		282,007		4,687	(56	)	15,204		19,835
Touchstone Enhanced ETF (AnnuiChoice II™)	2,507			1,674			(7,582		)	(3,401		)	140		—			181,360			(15		)	181,485			178,084			11,349		189,433		12	(1	)	15,967		15,978
Touchstone Enhanced ETF (GrandmasterFlex3™)(April 30)*	3,527			2,612			(16,570		)	(10,431		)	163,978		(227		)	108,149			(15		)	271,885			261,454			—		261,454		16,525	(25	)	10,625		27,125
Touchstone Enhanced ETF (Pinnacle Plus™)(April 30)*	5,361			3,139			(20,926		)	(12,426		)	120,671		(8,167		)	323,533			(204		)	435,833			423,407			—		423,407		12,404	(865	)	32,425		43,964
Touchstone Moderate ETF (AnnuiChoice™)	3,217			2,757			2,153			8,127			36,346		(2,142		)	242,398			(417		)	276,185			284,312			178,382		462,694		3,354	(230	)	21,710		24,834
Touchstone Moderate ETF (AnnuiChoice II™)	4,140			2,430			(6,073		)	497			97,087		(3,014		)	349,221			(20		)	443,274			443,771			24,755		468,526		9,019	(269	)	31,614		40,364
Touchstone Moderate ETF (GrandmasterFlex3™)(May 3)*	3,076			1,989			(7,460		)	(2,395		)	179,338		(109		)	245,169			(31		)	424,367			421,972			—		421,972		17,813	(14	)	24,725		42,524
Touchstone Moderate ETF (Pinnacle Plus™)(April 30)*	21,465			9,586			(33,778		)	(2,727		)	1,690,101		(6,625		)	287,582			(879		)	1,970,179			1,967,452			—		1,967,452		170,105	(759	)	29,087		198,433
Touchstone Money Market (AnnuiChoice™)	61,654			—			—			61,654			82,701		(323,280		)	(504,255		)	(11,053		)	(755,887		)	(694,233		)	1,955,101		1,260,868		8,132	(31,448	)	(46,955	)	(70,271	)
Touchstone Money Market (AnnuiChoice II™)(April 9)*	603			—			—			603			13,357		(74		)	9,996			(15		)	23,264			23,867			—		23,867		1,306	(9	)	976		2,273
Touchstone Money Market (GrandMaster flex3™)	79,946			—			—			79,946			335,217		(1,911,263		)	2,770,577			(613		)	1,193,918			1,273,864			1,903,131		3,176,995		31,861	(182,120	)	263,729		113,470
Touchstone Money Market (IQ Annuity™)	173,963			—			—			173,963			3,297,821		(2,243,375		)	4,530,281			(3,518		)	5,581,209			5,755,172			2,411,166		8,166,338		312,385	(212,169	)	428,692		528,908
Touchstone Money Market (Pinnacle Plus™)	79,538			—			—			79,538			1,843,808		(59,106		)	(486,396		)	(619		)	1,297,687			1,377,225			1,611,307		2,988,532		175,238	(5,712	)	(44,612	)	124,914
Non-Affiliated Service Class:
Fidelity VIP III Mid Cap (Grandmaster™)	(23,612		)	1,611,039			(903,611		)	683,816			3,960		(708,095		)	(1,565,720		)	(792		)	(2,270,647		)	(1,586,831		)	5,498,552		3,911,721		123	(20,943	)	(44,809	)	(65,629	)
Non-Affiliated Service Class 2:
Fidelity VIP Asset Manager (AnnuiChoice™)	12,525			11,156			10,682			34,363			23,390		(30,527		)	(1,253		)	(905		)	(9,295		)	25,068			245,383		270,451		1,903	(2,479	)	(100	)	(676	)
Fidelity VIP Asset Manager (AnnuiChoice II™)(November 5)*	192			—			(211		)	(19		)	7,396		—			—			—			7,396			7,377			—		7,377		620	—		—		620
Fidelity VIP Asset Manager (GrandMaster flex3™)	7,409			15,006			(4,268		)	18,147			—		(61,570		)	(78,990		)	(31		)	(140,591		)	(122,444		)	234,031		111,587		—	(4,966	)	(7,185	)	(12,151	)
Fidelity VIP Asset Manager (IQ3™)	20,897			30,032			5,262			56,191			—		(110,801		)	146,397			(325		)	35,271			91,462			443,422		534,884		—	(8,843	)	11,276		2,433
Fidelity VIP Asset Manager (Pinnacle Plus™)	6,090			3,826			6,941			16,857			—		(3,083		)	65,051			(94		)	61,874			78,731			105,436		184,167		—	(256	)	5,172		4,916
Fidelity VIP Balanced (AnnuiChoice™)	15,921			17,033			(8,184		)	24,770			23,464		(54,866		)	6,233			(1,308		)	(26,477		)	(1,707		)	336,924		335,217		1,811	(4,229	)	423		(1,995	)
Fidelity VIP Balanced (AnnuiChoice II™)(June 5)*	46			39			(200		)	(115		)	15,592		(7,376		)	—			(12		)	8,204			8,089			—		8,089		1,365	(653	)	—		712
Fidelity VIP Balanced (GrandMaster ™)(April 27)*	4,036			29			(8,926		)	(4,861		)	13,567		(17,147		)	545,104			(5		)	541,519			536,658			—		536,658		1,058	(1,321	)	41,876		41,613
Fidelity VIP Balanced (GrandMaster flex3™)	17,043			14,420			(102		)	31,361			11,493		(10,831		)	146,152			(169		)	146,645			178,006			393,487		571,493		851	(784	)	10,590		10,657
Fidelity VIP Balanced (IQ3™)	18,348			18,650			(17,719		)	19,279			47,169		(42,593		)	43,629			(306		)	47,899			67,178			402,447		469,625		3,802	(3,499	)	2,763		3,066
Fidelity VIP Balanced (Pinnacle Plus™)	16,153			10,181			257			26,591			10,873		(13,391		)	182,843			(218		)	180,107			206,698			360,851		567,549		887	(1,046	)	14,043		13,884
Fidelity VIP Contrafund (AnnuiChoice™)	128,059			710,422			(426,558		)	411,923			87,542		(139,117		)	97,855			(8,443		)	37,837			449,760			2,577,975		3,027,735		5,332	(8,568	)	5,019		1,783
Fidelity VIP Contrafund (GrandMaster flex3™)	100,738			656,165			(419,644		)	337,259			354,632		(335,793		)	147,665			(945		)	165,559			502,818			2,197,642		2,700,460		20,347	(19,574	)	8,032		8,805
Fidelity VIP Contrafund (IQ3™)	109,345			749,193			(440,710		)	417,828			304,867		(605,275		)	(71,992		)	(1,264		)	(373,664		)	44,164			2,917,142		2,961,306		19,659	(38,031	)	(6,160	)	(24,532	)
Fidelity VIP Contrafund (Pinnacle Plus™)	161,796			959,122			(609,642		)	511,276			85,840		(195,775		)	1,207,455			(2,613		)	1,094,907			1,606,183			2,713,116		4,319,299		5,143	(11,286	)	70,482		64,339
Fidelity VIP Contrafund (AnnuiChoice II™)	37,817			174,930			(111,191		)	101,556			642,194		(17,308		)	69,680			(33		)	694,533			796,089			68,504		864,593		57,907	(1,464	)	6,720		63,163
Fidelity VIP Contrafund Standard (IQ Advisor™)	324			1,407			(724		)	1,007			—		—			(1		)	—			(1		)	1,006			6,064		7,070		—	—		—		—
Fidelity VIP Disclipined Small Cap (AnnuiChoice™)(April 27)*	(271		)	283			(6,945		)	(6,933		)	—		(4,060		)	78,002			(134		)	73,808			66,875			—		66,875		—	(422	)	7,829		7,407
Fidelity VIP Disclipined Small Cap (IQ™)(April 27)*	(500		)	528			(5,949		)	(5,921		)	—		—			75,262			(1		)	75,261			69,340			—		69,340		—	—		7,704		7,704
Fidelity VIP Disclipined Small Cap (Grandmaster™)(April 27)*	(147		)	(136		)	(2,457		)	(2,740		)	—		(426		)	25,607			(5		)	25,176			22,436			—		22,436		—	(45	)	2,536		2,491
Fidelity VIP Disclipined Small Cap (GrandmasterFlex3™)(April 27)*	(336		)	(753		)	(3,179		)	(4,268		)	—		(12,989		)	65,394			—			52,405			48,137			—		48,137		—	(1,310	)	6,662		5,352
Fidelity VIP Disclipined Small Cap (Pinnacle Plus™)(April 27)*	(348		)	82			(4,441		)	(4,707		)	23,203		(287		)	30,412			(20		)	53,308			48,601			—		48,601		2,332	(33	)	3,109		5,408
Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)	4,082			5,752			(4,716		)	5,118			—		(1,106		)	123			(558		)	(1,541		)	3,577			90,163		93,740		—	(101	)	7		(94	)
Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)	1,315			18,000			(15,108		)	4,207			10,092		(1,821		)	(54,132		)	(45		)	(45,906		)	(41,699		)	85,347		43,648		721	(120	)	(3,692	)	(3,091	)
Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)	72,369			108,797			(154,147		)	27,019			19,508		(104,746		)	651,714			(511		)	565,965			592,984			1,157,857		1,750,841		1,294	(6,865	)	41,023		35,452
Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)	3,567			6,849			(5,380		)	5,036			—		(7,879		)	1,001			(42		)	(6,920		)	(1,884		)	94,015		92,131		—	(397	)	51		(346	)
Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)	8,442			31,784			(27,783		)	12,443			129,492		(6,464		)	(68,511		)	(409		)	54,108			66,551			171,198		237,749		8,982	(467	)	(4,596	)	3,919
Fidelity VIP Equity-Income (AnnuiChoice™)	11,719			151,249			(158,620		)	4,348			39,203		(220,109		)	60,916			(4,570		)	(124,560		)	(120,212		)	1,076,057		955,845		2,699	(15,348	)	4,071		(8,578	)
Fidelity VIP Equity-Income (AnnuiChoice II™)(May 14)*	3,047			10,957			(12,164		)	1,840			157,965		(16,500		)	(181		)	—			141,284			143,124			—		143,124		14,451	(1,421	)	(16	)	13,014

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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Equity-Income (GrandMaster flex3™)	$	1,804		$	54,868		$	(61,065	)	$	(4,393	)	$	25,893		$	(67,422	)	$	(4,632	)	$	(159	)	$	(46,320	)	$	(50,713	)	$	499,240	$	448,527	1,628	(4,448	)	(510	)	(3,330	)
Fidelity VIP Equity-Income (IQ3™)	8,029			145,707			(157,520		)	(3,784		)	93,661			(62,028		)	(9,014		)	(1,264		)	21,355			17,571			968,954		986,525		7,061	(4,674	)	(906	)	1,481
Fidelity VIP Equity-Income (Pinnacle Plus™)	14,331			205,986			(243,987		)	(23,670		)	49,031			(93,207		)	410,520			(1,781		)	364,563			340,893			1,948,349		2,289,242		3,152	(6,050	)	25,948		23,050
Fidelity VIP Freedom 2010 (Grandmaster™)(October 30)*	2,591			684			(5,001		)	(1,726		)	—			(1,380		)	90,467			—			89,087			87,361			—		87,361		—	(134	)	8,670		8,536
Fidelity VIP Freedom 2010 (GrandmasterFlex3™)(November 9)*	42			13			(126		)	(71		)	—			—			35,947			—			35,947			35,876			—		35,876		—	—		3,510		3,510
Fidelity VIP Freedom 2010 (IQ3™)(November 2)*	766			197			(1,399		)	(436		)	26,833			(501		)	—			—			26,332			25,896			—		25,896		2,581	(49	)	—		2,532
Fidelity VIP Freedom 2015 (AnnuiChoiceII™)(August 28)*	345			110			(191		)	264			7,500			—			5,103			—			12,603			12,867			—		12,867		761	—		493		1,254
Fidelity VIP Freedom 2015 (GrandmasterFlex3™)(November 9)*	49			15			(74		)	(10		)	—			—			1,559			—			1,559			1,549			—		1,549		—	—		151		151
Fidelity VIP Freedom 2015 (IQ3™)(June 13)*	9,567			3,108			(14,745		)	(2,070		)	318,012			(750		)	10,854			(6		)	328,110			326,040			—		326,040		30,834	(74	)	1,082		31,842
Fidelity VIP Freedom 2020 (AnnuiChoiceII™)(December 12)*	1,036			307			(1,308		)	35			33,554			—			—			—			33,554			33,589			—		33,589		3,270	—		—		3,270
Fidelity VIP Freedom 2020 (IQ3™)(October 22)*	1,125			362			(1,998		)	(511		)	40,184			—			(1		)	—			40,183			39,672			—		39,672		3,870	—		—		3,870
Fidelity VIP Freedom 2020 (Pinnacle Plus™)(October 19)*	548			179			(994		)	(267		)	—			—			20,001			—			20,001			19,734			—		19,734		—	—		1,928		1,928
Fidelity VIP Freedom 2030 (Pinnacle Plus™)(December 24)*	69			22			(105		)	(14		)	2,028			—			—			—			2,028			2,014			—		2,014		197	—		—		197
Fidelity VIP Growth & Income (AnnuiChoice™)	6,731			12,758			902			20,391			—			(22,001		)	2,987			(887		)	(19,901		)	490			208,952		209,442		—	(1,726	)	173		(1,553	)
Fidelity VIP Growth & Income (AnnuiChoice II™)(June 11)*	10			1			58			69			—			—			4,232			(4		)	4,228			4,297			—		4,297		—	—		362		362
Fidelity VIP Growth & Income (GrandMaster flex3™)	5,685			17,998			(343		)	23,340			8,099			(18,539		)	(3,361		)	(28		)	(13,829		)	9,511			219,144		228,655		561	(1,235	)	(166	)	(840	)
Fidelity VIP Growth & Income (IQ3™)	4,411			22,228			(12,141		)	14,498			982			(19,419		)	(61,789		)	(197		)	(80,423		)	(65,925		)	187,923		121,998		90	(1,695	)	(5,342	)	(6,947	)
Fidelity VIP Growth & Income (Pinnacle Plus™)	4,412			6,681			2,356			13,449			3,019			(14,650		)	201,837			(141		)	190,065			203,514			147,223		350,737		224	(1,094	)	14,218		13,348
Fidelity VIP Growth (AnnuiChoice™)	(1,508		)	13,232			46,091			57,815			—			(43,654		)	98,070			(1,201		)	53,215			111,030			198,558		309,588		15	(4,046	)	8,773		4,742
Fidelity VIP Growth (AnnuiChoice II™)(June 11)*	(18		)	8			2,314			2,304			53,851			—			7,939			(8		)	61,782			64,086			—		64,086		4,213	(1	)	642		4,854
Fidelity VIP Growth (GrandMaster™)(April 27)*	(1,795		)	11,200			17,356			26,761			30,016			(35,476		)	715,817			(34		)	710,323			737,084			—		737,084		2,632	(3,319	)	63,630		62,943
Fidelity VIP Growth (GrandMaster flex3™)	(2,282		)	12,957			32,869			43,544			4,876			(47,636		)	120,324			(37		)	77,527			121,071			169,506		290,577		364	(3,664	)	8,617		5,317
Fidelity VIP Growth (IQ3™)	(3,725		)	59,660			14,667			70,602			139,512			(90,506		)	20,231			(279		)	68,958			139,560			361,364		500,924		16,810	(10,915	)	(810	)	5,085
Fidelity VIP Growth (Pinnacle Plus™)	(5,048		)	71,188			24,265			90,405			6,056			(20,776		)	206,618			(422		)	191,476			281,881			309,646		591,527		408	(1,509	)	14,711		13,610
Fidelity VIP Growth Opportunities (AnnuiChoice™)	(420		)	3,374			5,337			8,291			—			(14,154		)	(468		)	(199		)	(14,821		)	(6,530		)	47,825		41,295		—	(1,142	)	(38	)	(1,180	)
Fidelity VIP Growth Opportunities (GrandMaster flex3™)	(1,974		)	13,828			5,270			17,124			4,180			(8,284		)	5,100			(98		)	898			18,022			110,766		128,788		287	(636	)	14		(335	)
Fidelity VIP Growth Opportunities (IQ3™)	(1,909		)	9,370			9,187			16,648			1,350			(54,261		)	142,336			(63		)	89,362			106,010			59,563		165,573		112	(4,286	)	11,470		7,296
Fidelity VIP Growth Opportunities (Pinnacle Plus™)	(1,955		)	36,708			(6,267		)	28,486			15,518			(2,220		)	149,294			(157		)	162,435			190,921			75,585		266,506		1,125	(167	)	10,390		11,348
Fidelity VIP High Income (AnnuiChoice™)	23,971			(3,420		)	(16,463		)	4,088			(335		)	(44,556		)	51,187			(1,097		)	5,199			9,287			324,003		333,290		—	(3,067	)	3,358		291
Fidelity VIP High Income (AnnuiChoice II™)(February 26)*	904			(161		)	(1,080		)	(337		)	6,804			(6,563		)	12,334			—			12,575			12,238			—		12,238		625	(624	)	1,149		1,150
Fidelity VIP High Income (GrandMaster flex3™)	21,639			39,464			(16,862		)	44,241			—			(433,126		)	(1,421,523		)	(205		)	(1,854,854		)	(1,810,613		)	2,351,799		541,186		—	(31,547	)	(101,869	)	(133,416	)
Fidelity VIP High Income (IQ3™)	40,232			83,543			(29,001		)	94,774			139,167			(224,629		)	(2,655,221		)	(762		)	(2,741,445		)	(2,646,671		)	3,661,360		1,014,689		11,112	(18,122	)	(211,733	)	(218,743	)
Fidelity VIP High Income (Pinnacle Plus™)	18,434			(482		)	(15,905		)	2,047			288			(35,541		)	38,098			(140		)	2,705			4,752			280,546		285,298		22	(2,817	)	2,987		192
Fidelity VIP II Index 500 (AnnuiChoice™)	21,232			43,053			(65,687		)	(1,402		)	5,929			(83,844		)	1,223,444			(6,458		)	1,139,071			1,137,669			431,823		1,569,492		477	(7,352	)	97,038		90,163
Fidelity VIP II Index 500 (AnnuiChoice II™)(April 27)*	987			28			(2,544		)	(1,529		)	43,443			(619		)	51,330			(97		)	94,057			92,528			—		92,528		4,319	(70	)	5,134		9,383
Fidelity VIP II Index 500 (Grandmaster™)(April 27)*	17,219			(284		)	(47,383		)	(30,448		)	16,881			(213,679		)	3,016,257			(577		)	2,818,882			2,788,434			—		2,788,434		3,578	(21,290	)	300,872		283,160
Fidelity VIP II Index 500 (GrandmasterFlex3™)(April 27)*	6,047			1,403			(23,138		)	(15,688		)	27,310			(98,065		)	1,067,540			(639		)	996,146			980,458			—		980,458		2,769	(9,741	)	106,673		99,701
Fidelity VIP Index 500 (IQ3™)	12,104			115,873			(116,283		)	11,694			12,577			(212,415		)	477,595			(880		)	276,877			288,571			599,317		887,888		1,089	(19,074	)	42,092		24,107
Fidelity VIP Index 500 (Pinnacle Plus™)	14,855			23,022			(73,301		)	(35,424		)	7,284			(79,151		)	2,314,423			(502		)	2,242,054			2,206,630			93,790		2,300,420		493	(5,403	)	157,111		152,201
Fidelity VIP Investment Grade Bond (AnnuiChoice™)	29,191			(6,679		)	4,697			27,209			—			(86,168		)	(11,492		)	(3,488		)	(101,148		)	(73,939		)	955,423		881,484		4	(7,103	)	(926	)	(8,025	)
Fidelity VIP Investment Grade Bond (GrandMaster ™)(April 30)*	(2,336		)	1,662			9,367			8,693			5,260			(27,731		)	361,740			(68		)	339,201			347,894			—		347,894		530	(2,787	)	36,558		34,301
Fidelity VIP Investment Grade Bond (GrandMaster flex3™)	10,407			(961		)	1,094			10,540			57,542			(58,425		)	(6,056		)	(119		)	(7,058		)	3,482			415,541		419,023		5,329	(5,520	)	(430	)	(621	)
Fidelity VIP Investment Grade Bond (IQ3™)	31,236			(14,708		)	11,526			28,054			147,384			(181,944		)	(141,600		)	(1,647		)	(177,807		)	(149,753		)	1,220,572		1,070,819		11,786	(14,680	)	(11,387	)	(14,281	)
Fidelity VIP Investment Grade Bond (Pinnacle Plus™)	6,978			(1,692		)	5,216			10,502			—			(28,669		)	159,928			(485		)	130,774			141,276			311,612		452,888		—	(2,750	)	15,192		12,442
Fidelity VIP Investment Grade Bond (AnnuiChoice II™)	363			(101		)	1,728			1,990			217,389			(4,227		)	45,992			—			259,154			261,144			16,751		277,895		20,859	(412	)	4,500		24,947
Fidelity VIP Mid Cap (AnnuiChoice™)	(3,882		)	177,343			(53,401		)	120,060			796			(191,802		)	66,648			(4,077		)	(128,435		)	(8,375		)	1,056,138		1,047,763		73	(9,326	)	2,427		(6,826	)
Fidelity VIP Mid Cap (GrandMaster flex3™)	(16,552		)	169,727			47,345			200,520			133,555			(161,843		)	315,493			(544		)	286,661			487,181			1,436,959		1,924,140		6,267	(7,774	)	14,958		13,451
Fidelity VIP Mid Cap (IQ Annuity™)	(17,278		)	433,459			(162,215		)	253,966			66,192			(237,657		)	(173,291		)	(959		)	(345,715		)	(91,749		)	1,925,737		1,833,988		3,263	(10,865	)	(8,636	)	(16,238	)
Fidelity VIP Mid Cap (Pinnacle Plus™)	(23,158		)	301,771			(24,772		)	253,841			174,149			(83,114		)	441,281			(2,650		)	529,666			783,507			1,716,251		2,499,758		8,763	(4,021	)	20,707		25,449
Fidelity VIP Mid Cap (AnnuiChoice II™)	(235		)	905			2,292			2,962			20,526			(3,348		)	39,387			(4		)	56,561			59,523			5,589		65,112		1,757	(285	)	3,438		4,910
Fidelity VIP Mid Cap (Grandmaster™)	(7,309		)	5,647			41,015			39,353			15,267			(65,336		)	1,279,920			(152		)	1,229,699			1,269,052			12,999		1,282,051		853	(3,631	)	73,231		70,453
Fidelity VIP Overseas (AnnuiChoice™)	12,331			66,868			(23,669		)	55,530			368			(60,550		)	572,105			(2,696		)	509,227			564,757			297,726		862,483		38	(3,450	)	30,671		27,259
Fidelity VIP Overseas (GrandMaster™)(April 27)*	29,510			2,378			38,180			70,068			11,162			(84,181		)	2,610,591			(236		)	2,537,336			2,607,404			—		2,607,404		1,076	(7,985	)	253,515		246,606

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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Overseas (GrandMaster flex3™)	$	7,805		$	65,512		$	490		$	73,807			$	115,883	$	(115,928	)	$	371,961		$	(194	)	$	371,722		$	445,529		$	368,579	$	814,108	7,144	(6,893	)	22,295		22,546
Fidelity VIP Overseas (IQ3™)	9,862			79,371			(12,086		)	77,147				168,758		(149,233		)	465,592			(400		)	484,717			561,864			348,329		910,193		11,882	(10,069	)	32,424		34,237
Fidelity VIP Overseas (Pinnacle Plus™)	12,629			138,938			(46,288		)	105,279				137,038		(27,316		)	387,369			(964		)	496,127			601,406			585,412		1,186,818		7,106	(1,375	)	18,367		24,098
Fidelity VIP Overseas (AnnuiChoice II™)	819			1,572			5,221			7,612				20,732		—			33,370			(34		)	54,068			61,680			14,518		76,198		1,732	(3	)	2,973		4,702
Non-Affiliated Class 1:
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	15,816			5,952			(9,246		)	12,522				—		—			—			(763		)	(763		)	11,759			229,617		241,376		—	(43	)	—		(43	)
Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)	4,497			2,618			(3,731		)	3,384				—		(21,749		)	(7,555		)	(26		)	(29,330		)	(25,946		)	83,827		57,881		—	(1,247	)	(398	)	(1,645	)
Van Kampen UIF Emerging Markets Debt (IQ3™)	7,165			1,276			(3,742		)	4,699				—		(1,103		)	(66,432		)	(164		)	(67,699		)	(63,000		)	105,258		42,258		—	(74	)	(3,780	)	(3,854	)
Van Kampen UIF U.S. Real Estate (AnnuiChoice™)	13,856			89,430			(215,830		)	(112,544		)		903		(14,369		)	(714,779		)	(1,357		)	(729,602		)	(842,146		)	1,077,666		235,520		33	(609	)	(29,124	)	(29,700	)
Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)	5,405			196,553			(338,122		)	(136,164		)		49,670		(137,907		)	(391,362		)	(273		)	(479,872		)	(616,036		)	1,019,462		403,426		1,808	(5,260	)	(16,872	)	(20,324	)
Van Kampen UIF U.S. Real Estate (IQ3™)	1,953			51,564			(106,303		)	(52,786		)		2,000		(24,373		)	(22,072		)	(419		)	(44,864		)	(97,650		)	263,016		165,366		74	(934	)	(1,478	)	(2,338	)
Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)	9,078			(95,949		)	(21,346		)	(108,217		)		520,066		(577		)	(466,591		)	(20		)	52,878			(55,339		)	120,259		64,920		43,615	(55	)	(47,178	)	(3,618	)
Non-Affiliated Class 2:
Franklin Foreign Securities (IQ Annuity™)	2,835			59,386			(11,357		)	50,864				56,976		(15,560		)	79,331			(473		)	120,274			171,138			358,092		529,230		2,747	(791	)	3,611		5,567
Franklin Growth and Income Securities (AnnuiChoice™)	19,484			39,203			(145,077		)	(86,390		)		9		(25,909		)	828,188			(2,360		)	799,928			713,538			114,010		827,548		4	(1,756	)	50,527		48,775
Franklin Growth and Income Securities (AnnuiChoice II™)(April 9)*	845			1,391			(5,480		)	(3,244		)		48,668		(7,590		)	—			(1		)	41,077			37,833			—		37,833		4,348	(684	)	—		3,664
Franklin Growth and Income Securities (GrandMaster flex3™)	9,484			32,072			(95,763		)	(54,207		)		40,212		(44,873		)	403,401			(130		)	398,610			344,403			194,041		538,444		2,647	(2,946	)	25,029		24,730
Franklin Growth and Income Securities (Grandmaster™)	34,328			121,569			(323,185		)	(167,288		)		1,285		(200,241		)	1,623,510			(189		)	1,424,365			1,257,077			387,585		1,644,662		79	(12,797	)	100,870		88,152
Franklin Growth and Income Securities (IQ Annuity™)	34,489			96,252			(317,204		)	(186,463		)		29,615		(150,592		)	1,470,735			(1,100		)	1,348,658			1,162,195			459,746		1,621,941		1,911	(9,704	)	90,089		82,296
Franklin Growth and Income Securities (Pinnacle Plus™)	35,640			139,893			(383,704		)	(208,171		)		15,016		(78,739		)	1,767,656			(956		)	1,702,977			1,494,806			507,688		2,002,494		1,041	(5,369	)	115,745		111,417
Franklin Income Securities (AnnuiChoice™)	16,635			20,062			(23,599		)	13,098				791		(38,587		)	90,214			(1,867		)	50,551			63,649			531,701		595,350		55	(2,348	)	5,143		2,850
Franklin Income Securities (AnnuiChoice II™)(January 12)*	1,684			305			(2,939		)	(950		)		82,331		(1,677		)	52,899			(18		)	133,535			132,585			—		132,585		7,501	(155	)	4,801		12,147
Franklin Income Securities (GrandMaster flex3™)	61,976			95,664			(107,280		)	50,360				837,644		(391,394		)	217,749			(1,602		)	662,397			712,757			2,608,160		3,320,917		49,318	(22,989	)	12,788		39,117
Franklin Income Securities (Grandmaster™)	81,428			133,533			(137,926		)	77,035				2,055		(273,669		)	951,521			(708		)	679,199			756,234			2,699,119		3,455,353		121	(15,996	)	56,716		40,841
Franklin Income Securities (IQ Annuity™)	36,585			64,293			(67,894		)	32,984				650,075		(112,325		)	(15,984		)	(1,094		)	520,672			553,656			1,640,263		2,193,919		38,144	(6,633	)	(890	)	30,621
Franklin Income Securities (Pinnacle Plus™)	48,478			28,403			(45,694		)	31,187				99,641		(101,032		)	620,801			(1,673		)	617,737			648,924			2,093,738		2,742,662		6,573	(6,862	)	41,162		40,873
Franklin Large Cap Growth Securities (AnnuiChoice™)	(225		)	6,658			(3,434		)	2,999				—		(9,054		)	8,411			(58		)	(701		)	2,298			58,725		61,023		—	(628	)	579		(49	)
Franklin Large Cap Growth Securities (GrandMaster flex3™)	(2,391		)	25,838			(10,093		)	13,354				6,425		(74,248		)	66,261			(52		)	(1,614		)	11,740			277,869		289,609		438	(5,082	)	4,576		(68	)
Franklin Large Cap Growth Securities (Grandmaster™)	(975		)	9,465			(2,877		)	5,613				72		(30,353		)	148,856			(46		)	118,529			124,142			152,797		276,939		5	(2,049	)	10,070		8,026
Franklin Large Cap Growth Securities (IQ Annuity™)	(2,567		)	17,118			(4,551		)	10,000				45,178		(3,044		)	73,507			(126		)	115,515			125,515			300,245		425,760		3,037	(213	)	4,871		7,695
Franklin Large Cap Growth Securities (Pinnacle Plus™)	(4,243		)	44,568			(25,882		)	14,443				29,152		(36,774		)	115,649			(303		)	107,724			122,167			336,121		458,288		2,265	(2,799	)	8,732		8,198
Franklin Large Cap Growth Securities (AnnuiChoice II™)	(148		)	798			203			853				73,580		(238		)	16,822			(38		)	90,126			90,979			8,494		99,473		6,462	(23	)	1,535		7,974
Franklin Mutual Shares Securities (AnnuiChoice™)	9,915			105,523			(84,340		)	31,098				680		(63,766		)	324,292			(3,444		)	257,762			288,860			852,762		1,141,622		57	(3,711	)	18,650		14,996
Franklin Mutual Shares Securities (AnnuiChoice II™)(January 12)*	859			3,331			(4,911		)	(721		)		145,476		(1,670		)	114,152			(151		)	257,807			257,086			—		257,086		12,980	(164	)	10,454		23,270
Franklin Mutual Shares Securities (GrandMaster flex3™)	8,424			94,883			(91,813		)	11,494				718,287		(156,693		)	112,881			(607		)	673,868			685,362			1,460,392		2,145,754		40,214	(8,701	)	6,338		37,851
Franklin Mutual Shares Securities (IQ Annuity™)	3,724			54,088			(51,800		)	6,012				386,910		(49,125		)	(56,540		)	(383		)	280,862			286,874			617,608		904,482		21,716	(2,813	)	(3,183	)	15,720
Franklin Mutual Shares Securities (Pinnacle Plus™)	9,525			124,742			(120,147		)	14,120				42,719		(83,247		)	611,534			(798		)	570,208			584,328			1,446,513		2,030,841		2,588	(5,172	)	37,747		35,163
Franklin Mutual Shares Securities Standard (IQ Advisor™)	200			404			(229		)	375				—		—			—			—			—			375			13,121		13,496		—	—		—		—
Franklin Mutual Shares Securities(Grandmaster™)	6,863			137,544			(155,709		)	(11,302		)		8,620		(308,485		)	2,171,825			(482		)	1,871,478			1,860,176			1,305,748		3,165,924		486	(17,307	)	121,192		104,371
Franklin Small Cap Value Securities (AnnuiChoice™)(July 16)*	(26		)	(651		)	(48		)	(725		)		—		(96		)	1,787			(1		)	1,690			965			—		965		—	(10	)	118		108
Franklin Small Cap Value Securities (GrandmasterFlex3™)(May 3)*	(29		)	924			(6,173		)	(5,278		)		32,792		—			27,299			(14		)	60,077			54,799			—		54,799		3,422	(1	)	2,757		6,178
Franklin Small Cap Value Securities (IQ3 ™)(May 23)*	(32		)	(6,246		)	(623		)	(6,901		)		2,047		—			15,208			(3		)	17,252			10,351			—		10,351		213	—		953		1,166
Franklin Small Cap Value Securities (Pinnacle Plus ™)(July 24)*	(97		)	(7		)	(1,488		)	(1,592		)		2,028		—			14,000			—			16,028			14,436			—		14,436		221	—		1,408		1,629
Templeton Foriegn Securities Fund (GrandMaster flex3™)	2,955			64,108			9,552			76,615				181,374		(110,137		)	76,381			(165		)	147,453			224,068			525,109		749,177		8,836	(5,334	)	3,495		6,997
Templeton Foriegn Securities Fund (Grandmaster™)	1,286			53,312			(16,851		)	37,747				84		(50,559		)	57,806			(41		)	7,290			45,037			247,153		292,190		4	(2,359	)	2,841		486
Templeton Foriegn Securities Fund (Pinnacle Plus™)	2,981			100,043			(10,442		)	92,582				79,478		(27,297		)	302,872			(784		)	354,269			446,851			585,351		1,032,202		4,156	(1,519	)	15,634		18,271
Templeton Foreign Securities Fund (AnnuiChoice™)	1,198			14,409			598			16,205				—		(28,218		)	59,773			(349		)	31,206			47,411			86,788		134,199		8	(1,288	)	2,844		1,564
Templeton Foreign Securities Fund (AnnuiChoice II™)	39			381			698			1,118				3,668		(660		)	14,890			(3		)	17,895			19,013			1,777		20,790		300	(53	)	1,253		1,500
Templeton Growth Securities (AnnuiChoice™)	1,365			14,335			(15,140		)	560				—		(38,607		)	77,834			(469		)	38,758			39,318			79,702		119,020		—	(2,033	)	4,047		2,014
Templeton Growth Securities (AnnuiChoice II™)(January 12)*	80			628			(920		)	(212		)		32,147		(894		)	7,939			(9		)	39,183			38,971			—		38,971		2,881	(82	)	696		3,495
Templeton Growth Securities (GrandMaster flex3™)	728			77,533			(83,777		)	(5,516		)		515,219		(48,898		)	51,453			(467		)	517,307			511,791			1,047,764		1,559,555		27,244	(2,687	)	2,715		27,272
Templeton Growth Securities (Grandmaster™)	4,726			100,554			(86,052		)	19,228				98		(173,871		)	(595,593		)	(163		)	(769,529		)	(750,301		)	1,165,372		415,071		5	(9,147	)	(31,656	)	(40,798	)
Templeton Growth Securities (IQ Annuity™)	(347		)	187,261			(144,997		)	41,917				291,460		(666,464		)	(364,060		)	(1,821		)	(740,885		)	(698,968		)	1,584,184		885,216		15,498	(34,929	)	(18,938	)	(38,369	)

See accompanying notes.

* - 2007 inception date of division.

20

	Increase (decrease) 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Non-Affiliated Class 2 (continued):
Templeton Growth Securities (Pinnacle Plus™)	$	(404	)	$	111,919		$	(104,300	)	$	7,215		$	33,988	$	(73,419	)	$	40,755		$	(402	)	$	922		$	8,137		$	1,047,827	$	1,055,964	1,904	(4,245	)	2,431		90
Templeton Growth Securities Standard (IQ Advisor™)	73			275			(231		)	117			—		—			—			—			—			117			6,760		6,877		—	—		—		—
Van Kampen LIT Comstock (AnnuiChoice™)	775			2,685			(7,269		)	(3,809		)	121		(148		)	10			(12		)	(29		)	(3,838		)	114,804		110,966		6	(9	)	1		(2	)
Van Kampen LIT Comstock (GrandMaster flex3™)	520			16,291			(26,589		)	(9,778		)	5,400		(42,502		)	3,728			(69		)	(33,443		)	(43,221		)	319,292		276,071		304	(2,447	)	217		(1,926	)
Van Kampen LIT Comstock (Grandmaster™)	672			12,201			(18,083		)	(5,210		)	226		(20,535		)	(46,520		)	(82		)	(66,911		)	(72,121		)	184,400		112,279		13	(1,191	)	(2,853	)	(4,031	)
Van Kampen LIT Comstock (IQ Annuity™)	232			6,504			(12,776		)	(6,040		)	26,880		(949		)	(27,310		)	(73		)	(1,452		)	(7,492		)	145,862		138,370		1,524	(59	)	(1,591	)	(126	)
Van Kampen LIT Comstock (Pinnacle Plus™)	(167		)	20,986			(34,267		)	(13,448		)	—		(62,004		)	47,522			(219		)	(14,701		)	(28,149		)	342,023		313,874		—	(4,058	)	3,061		(997	)
Van Kampen LIT Strategic Growth (GrandMaster flex3™)	(191		)	101			2,077			1,987			—		(14,595		)	445			(5		)	(14,155		)	(12,168		)	23,454		11,286		—	(1,046	)	34		(1,012	)
Van Kampen LIT Strategic Growth (AnnuiChoice™)(October 31)*	(16		)	(79		)	(552		)	(647		)	—		(762		)	10,284			—			9,522			8,875			—		8,875		—	(50	)	609		559
Van Kampen LIT Strategic Growth (Grandmaster™)	(48		)	329			216			497			—		(6,691		)	159			(2		)	(6,534		)	(6,037		)	6,463		426		—	(460	)	10		(450	)
Van Kampen LIT Strategic Growth (IQ Annuity™)	(19		)	6			192			179			—		—			2			(13		)	(11		)	168			1,219		1,387		—	(1	)	—		(1	)
Van Kampen LIT Strategic Growth (Pinnacle Plus™)	(2,433		)	37,236			(6,386		)	28,417			134,510		(104		)	60,221			(46		)	194,581			222,998			86,774		309,772		11,087	(11	)	4,365		15,441
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)(Nov 14)*	(13		)	—			35			22			—		—			10,000			(5		)	9,995			10,017			—		10,017		—	—		982		982
Van Kampen UIF Emerging Markets Debt (Grandmaster™)	3,811			395			(783		)	3,423			—		(18,512		)	(38,164		)	(62		)	(56,738		)	(53,315		)	76,610		23,295		—	(1,110	)	(2,223	)	(3,333	)
Van Kampen UIF Emerging Markets Debt (GrandmasterFlex3™)(May 7)*	(52		)	(116		)	1,869			1,701			—		(3,304		)	200,893			(37		)	197,552			199,253			—		199,253		—	(330	)	19,940		19,610
Van Kampen UIF Emerging Markets Debt (IQ3 ™)(July 20)*	(582		)	20			1,506			944			—		—			228,961			(30		)	228,931			229,875			—		229,875		—	(2	)	13,487		13,485
Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)	20,743			6,977			(12,262		)	15,458			—		(30,849		)	28,510			(655		)	(2,994		)	12,464			313,991		326,455		—	(2,142	)	2,007		(135	)
Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)	(827		)	148,382			(35,572		)	111,983			30,973		(19,466		)	253,527			(887		)	264,147			376,130			589,515		965,645		905	(611	)	3,025		3,319
Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)	(6,553		)	99,329			146,359			239,135			87,757		(34,289		)	633,420			(243		)	686,645			925,780			506,946		1,432,726		2,443	(1,007	)	15,676		17,112
Van Kampen UIF Emerging Markets Equity (Grandmaster™)	(3,756		)	140,675			23,991			160,910			1,993		(141,175		)	273,883			(170		)	134,531			295,441			464,980		760,421		47	(3,677	)	6,320		2,690
Van Kampen UIF Emerging Markets Equity (IQ Annuity™)(July 20)*	(1,266		)	35,383			1,094			35,211			10,074		(8,429		)	289,015			(90		)	290,570			325,781			113,030		438,811		264	(198	)	6,504		6,570
Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)	(7,743		)	211,157			96,378			299,792			9,450		(14,798		)	357,863			(1,211		)	351,304			651,096			656,612		1,307,708		265	(520	)	10,994		10,739
Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)	(759		)	21,762			44,928			65,931			89,742		—			101,521			(50		)	191,213			257,144			71,544		328,688		7,320	(3	)	6,463		13,780
Van Kampen UIF U. S. Real Estate (AnnuiChoice™)(May 2)*	601			(4,775		)	(512		)	(4,686		)	28,556		—			(18,301		)	(11		)	10,244			5,558			—		5,558		2,926	(1	)	(2,205	)	720
Van Kampen UIF U. S. Real Estate (AnnuiChoice II™)(May 9)*	369			(2,191		)	(7,877		)	(9,699		)	25,218		(115		)	54,686			(2		)	79,787			70,088			—		70,088		2,715	(13	)	6,386		9,088
Van Kampen UIF U.S. Real Estate (Grandmaster™)	3,431			109,201			(201,962		)	(89,330		)	2,500		(156,107		)	(79,067		)	(144		)	(232,818		)	(322,148		)	661,095		338,947		84	(5,748	)	(3,074	)	(8,738	)
Van Kampen UIF U.S. Real Estate (GrandmasterFlex3™)(April 30)*	522			266			(19,116		)	(18,328		)	38,453		(607		)	73,635			(20		)	111,461			93,133			—		93,133		4,040	(73	)	8,143		12,110
Van Kampen UIF U.S. Real Estate (IQ3 ™)(April 18)*	(178		)	(953		)	(13,574		)	(14,705		)	21,432		(2,650		)	111,623			(6		)	130,399			115,694			—		115,694		754	(101	)	4,414		5,067
Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)	2,666			211,844			(427,833		)	(213,323		)	157,583		(65,551		)	(96,071		)	(1,726		)	(5,765		)	(219,088		)	1,075,497		856,409		6,419	(3,004	)	(4,359	)	(944	)
Non-Affiliated Class B:
DWS Small Cap Index VIP (AnnuiChoice™)	23			9,594			(14,147		)	(4,530		)	—		(3,174		)	15,122			(794		)	11,154			6,624			131,233		137,857		—	(252	)	970		718
DWS Small Cap Index VIP (AnnuiChoice II™)(January 12)*	(10		)	505			(911		)	(416		)	12,177		—			—			—			12,177			11,761			—		11,761		1,115	—		—		1,115
DWS Small Cap Index VIP (GrandMaster flex3™)	(1,299		)	24,643			(31,765		)	(8,421		)	—		(52,817		)	(34,042		)	(66		)	(86,925		)	(95,346		)	286,787		191,441		—	(3,274	)	(2,145	)	(5,419	)
DWS Small Cap Index VIP (Grandmaster™)	(547		)	(6,333		)	(2,816		)	(9,696		)	20		(13,177		)	15,268			(23		)	2,088			(7,608		)	24,636		17,028		1	(971	)	460		(510	)
DWS Small Cap Index VIP (IQ3™)	(735		)	14,339			(15,223		)	(1,619		)	2,800		(1,478		)	(30,169		)	(196		)	(29,043		)	(30,662		)	133,282		102,620		186	(110	)	(1,864	)	(1,788	)
DWS Small Cap Index VIP (Pinnacle Plus™)	(3,507		)	38,272			(56,305		)	(21,540		)	14,730		(16,356		)	30,581			(397		)	28,558			7,018			527,373		534,391		907	(1,052	)	1,934		1,789

See accompanying notes.

* - - 2007 inception date of division.

21

Separate Account I

of

National Integrity Life Insurance Company

Statements of Changes 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Affiliated:
Touchstone Aggressive ETF (AnnuiChoice™)	$	3,219		$	7,300		$	65,669		$	76,188	$	94,461	$	(46,834	)	$	35,887		$	(2,386	)	$	81,128		$	157,316		$	545,124	$	702,440	8,752	(4,476	)	3,231		7,507
Touchstone Aggressive ETF (GrandMaster flex3™)	(319		)	27,178			45,467			72,326		24,000		(5,804		)	94,439			(120		)	112,515			184,841			493,400		678,241		2,127	(509	)	9,107		10,725
Touchstone Aggressive ETF (Grandmaster™)	2,326			23,891			213,206			239,423		52,034		(143,400		)	77,025			(678		)	(15,019		)	224,404			1,976,974		2,201,378		4,811	(13,329	)	7,450		(1,068	)
Touchstone Aggressive ETF (IQ Annuity™)	(593		)	35,253			78,506			113,166		110,756		(112,465		)	41,414			(338		)	39,367			152,533			938,908		1,091,441		9,920	(10,356	)	3,897		3,461
Touchstone Aggressive ETF (Pinnacle Plus™)	2,502			909			48,360			51,771		90,975		(6,793		)	333,858			(216		)	417,824			469,595			194,897		664,492		8,409	(636	)	30,131		37,904
Touchstone Balanced (AnnuiChoice™)	611			28,892			(16,632		)	12,871		—		(6,263		)	(93,103		)	(695		)	(100,061		)	(87,190		)	217,350		130,160		—	(532	)	(7,315	)	(7,847	)
Touchstone Balanced (GrandMaster flex3™)	707			58,366			(22,661		)	36,412		17,407		(141,599		)	(26,727		)	(247		)	(151,166		)	(114,754		)	508,324		393,570		1,340	(10,826	)	(2,043	)	(11,529	)
Touchstone Balanced (Grandmaster™)	(42		)	278			(5		)	231		—		(3,498		)	—			—			(3,498		)	(3,267		)	3,267		—		—	(287	)	—		(287	)
Touchstone Balanced (IQ Annuity™)	752			27,285			(5,686		)	22,351		33,136		(15,077		)	(50,742		)	(262		)	(32,945		)	(10,594		)	256,169		245,575		2,618	(1,234	)	(3,994	)	(2,610	)
Touchstone Balanced (Pinnacle Plus™)	753			34,972			(5,352		)	30,373		2,633		(9,240		)	15,626			(444		)	8,575			38,948			328,321		367,269		209	(761	)	1,234		682
Touchstone Baron Small Cap (AnnuiChoice™)	(4,428		)	46,805			28,161			70,538		50		(13,258		)	(62,725		)	(1,658		)	(77,591		)	(7,053		)	418,549		411,496		6	(891	)	(3,450	)	(4,335	)
Touchstone Baron Small Cap (GrandMaster flex3™)	(9,540		)	75,568			23,117			89,145		80,210		(23,021		)	44,412			(171		)	101,430			190,575			550,836		741,411		5,244	(1,418	)	2,102		5,928
Touchstone Baron Small Cap (Grandmaster™)	(4,896		)	18,195			41,859			55,158		14,234		(20,191		)	76,882			(201		)	70,724			125,882			284,289		410,171		1,010	(1,463	)	5,826		5,373
Touchstone Baron Small Cap (IQ Annuity™)	(17,868		)	304,614			(110,997		)	175,749		94,929		(132,996		)	25,457			(564		)	(13,174		)	162,575			1,090,658		1,253,233		5,900	(8,401	)	1,461		(1,040	)
Touchstone Baron Small Cap (Pinnacle Plus™)	(9,660		)	56,435			45,476			92,251		49,997		(38,443		)	44,431			(641		)	55,344			147,595			495,356		642,951		3,069	(2,513	)	3,358		3,914
Touchstone Conservative ETF (AnnuiChoice™)	(10		)	14			1,931			1,935		25,989		—			—			(7		)	25,982			27,917			4,772		32,689		2,478	(1	)	—		2,477
Touchstone Conservative ETF (GrandMaster flex3™)	(7,196		)	8,239			73,243			74,286		216,126		(22,089		)	63,263			(103		)	257,197			331,483			1,117,717		1,449,200		20,256	(2,093	)	5,387		23,550
Touchstone Conservative ETF (Grandmaster™)	(606		)	224			9,122			8,740		13,714		(925		)	3,282			(19		)	16,052			24,792			127,702		152,494		1,250	(90	)	310		1,470
Touchstone Conservative ETF (IQ Annuity™)	(7,347		)	8,701			78,924			80,278		51,345		(76,292		)	164,188			(262		)	138,979			219,257			1,193,049		1,412,306		4,819	(7,255	)	15,198		12,762
Touchstone Conservative ETF (Pinnacle Plus™)	(4,026		)	2,794			43,947			42,715		1,181		(9,717		)	420,008			(259		)	411,213			453,928			333,074		787,002		114	(946	)	40,268		39,436
Touchstone Core Bond (AnnuiChoice™)	8,712			144			(973		)	7,883		549		(14,362		)	40,848			(913		)	26,122			34,005			231,566		265,571		51	(1,339	)	3,593		2,305
Touchstone Core Bond (GrandMaster flex3™)	16,067			1,939			(3,890		)	14,116		52,686		(137,632		)	106,586			(179		)	21,461			35,577			538,991		574,568		4,938	(12,897	)	9,981		2,022
Touchstone Core Bond (Grandmaster™)	(461		)	5,402			7			4,948		120		(24,374		)	23,076			(21		)	(1,199		)	3,749			12,279		16,028		12	(2,332	)	2,644		324
Touchstone Core Bond (IQ Annuity™)	12,014			(4,846		)	4,724			11,892		41,826		(158,323		)	(52,582		)	(786		)	(169,865		)	(157,973		)	617,542		459,569		3,886	(14,281	)	(4,794	)	(15,189	)
Touchstone Core Bond (Pinnacle Plus™)	5,943			(120		)	(1,109		)	4,714		3,591		(4,889		)	16,139			(119		)	14,722			19,436			200,966		220,402		352	(491	)	1,564		1,425
Touchstone Eagle Capital Appreciation (AnnuiChoice™)	(23		)	2,002			(74		)	1,905		—		(35,930		)	1			(25		)	(35,954		)	(34,049		)	40,914		6,865		—	(3,422	)	—		(3,422	)
Touchstone Eagle Capital Appreciation (GrandMaster flex3™)	(262		)	1,183			3,974			4,895		—		(2,958		)	(1		)	(7		)	(2,966		)	1,929			32,742		34,671		—	(211	)	—		(211	)
Touchstone Eagle Capital Appreciation (IQ Annuity™)	(893		)	19,443			2,678			21,228		9,956		(2,673		)	(53,384		)	(245		)	(46,346		)	(25,118		)	173,865		148,747		853	(257	)	(4,925	)	(4,329	)
Touchstone Eagle Capital Appreciation (Pinnacle Plus™)	(451		)	1,981			6,701			8,231		13,572		(1,104		)	(358		)	(82		)	12,028			20,259			44,913		65,172		1,051	(93	)	3		961
Touchstone Mid Cap Growth (AnnuiChoice™)	(2,324		)	(2,527		)	38,941			34,090		114		(2,407		)	(125,096		)	(880		)	(128,269		)	(94,179		)	287,845		193,666		7	(204	)	(7,817	)	(8,014	)
Touchstone Mid Cap Growth (GrandMaster flex3™)	(3,024		)	13,236			15,403			25,615		9,150		(16,166		)	109,790			(15		)	102,759			128,374			138,826		267,200		586	(1,015	)	6,848		6,419
Touchstone Mid Cap Growth (Grandmaster™)	(1,976		)	9,466			11,408			18,898		13,955		(751		)	4,042			(62		)	17,184			36,082			122,528		158,610		1,052	(60	)	305		1,297
Touchstone Mid Cap Growth (IQ Annuity™)	(4,867		)	7,489			40,920			43,542		10,069		(58,916		)	(4,960		)	(266		)	(54,073		)	(10,531		)	342,094		331,563		589	(3,604	)	(338	)	(3,353	)
Touchstone Mid Cap Growth (Pinnacle Plus™)	(9,079		)	29,391			51,814			72,126		67,798		(4,977		)	28,140			(877		)	90,084			162,210			437,689		599,899		4,322	(377	)	2,104		6,049
Touchstone Enhanced Dividend 30 (AnnuiChoice™)	7			—			93			100		—		—			—			(4		)	(4		)	96			399		495		—	—		—		—
Touchstone Enhanced Dividend 30 (GrandMaster flex3™)	465			607			11,378			12,450		—		(2,012		)	(5,594		)	(38		)	(7,644		)	4,806			55,646		60,452		—	(179	)	(491	)	(670	)
Touchstone Enhanced Dividend 30 (Grandmaster™)	91			131			1,833			2,055		—		(791		)	1			(3		)	(793		)	1,262			8,429		9,691		—	(66	)	—		(66	)
Touchstone Enhanced Dividend 30 (IQ Annuity™)	1,643			292			7,753			9,688		66,904		—			(543		)	(12		)	66,349			76,037			25,885		101,922		5,595	(1	)	(39	)	5,555
Touchstone Enhanced Dividend 30 (Pinnacle Plus™)	475			10,259			6,287			17,021		—		(6,400		)	14,881			(46		)	8,435			25,456			49,767		75,223		—	(522	)	1,494		972
Touchstone Enhanced ETF (AnnuiChoice™)	(4,745		)	6,351			237,732			239,338		86,860		(1,084		)	25,122			(3,548		)	107,350			346,688			1,610,417		1,957,105		7,456	(396	)	2,265		9,325
Touchstone Enhanced ETF (GrandMaster flex3™)	(12,336		)	6,784			209,759			204,207		387,097		(864		)	155,711			(236		)	541,708			745,915			1,216,472		1,962,387		33,268	(89	)	13,440		46,619
Touchstone Enhanced ETF (Grandmaster™)	(19,823		)	16,209			404,425			400,811		38,292		(73,961		)	267,066			(694		)	230,703			631,514			2,808,714		3,440,228		3,193	(6,392	)	22,613		19,414
Touchstone Enhanced ETF (IQ Annuity™)	(9,716		)	40,921			135,281			166,486		139,233		(232,316		)	472,895			(277		)	379,535			546,021			909,755		1,455,776		12,298	(19,344	)	40,814		33,768
Touchstone Enhanced ETF (Pinnacle Plus™)	(1,711		)	734			62,478			61,501		180,599		(6,061		)	371,953			(111		)	546,380			607,881			177,746		785,627		16,132	(516	)	31,418		47,034
Touchstone Growth & Income (AnnuiChoice™)	486			8,906			(3,848		)	5,544		4,644		(1,504		)	(50,959		)	(134		)	(47,953		)	(42,409		)	81,872		39,463		376	(122	)	(4,145	)	(3,891	)
Touchstone Growth & Income (GrandMaster flex3™)	(16		)	2,572			833			3,389		3,600		(117		)	(77,889		)	—			(74,406		)	(71,017		)	84,814		13,797		296	(10	)	(6,312	)	(6,026	)
Touchstone Growth & Income (IQ Annuity™)	303			3,989			151			4,443		—		(13,234		)	117			(93		)	(13,210		)	(8,767		)	50,326		41,559		—	(1,092	)	9		(1,083	)
Touchstone Growth & Income (Pinnacle Plus™)	641			8,759			(400		)	9,000		—		(5,861		)	(684		)	(141		)	(6,686		)	2,314			82,955		85,269		—	(473	)	(68	)	(541	)

See accompanying notes.

* - - 2006 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Affiliated (continued):
Touchstone High Yield (AnnuiChoice™)	$	24,204		$	(596	)	$	(6,081	)	$	17,527		$	—	$	(3,215	)	$	184,644		$	(435	)	$	180,994		$	198,521		$	166,017	$	364,538	—	(258	)	12,971		12,713
Touchstone High Yield (GrandMaster flex3™)	25,636			615			361			26,612			18,211		(59,079		)	(2,674		)	(182		)	(43,724		)	(17,112		)	466,309		449,197		1,397	(4,462	)	(214	)	(3,279	)
Touchstone High Yield (Grandmaster™)	15,566			11,243			(11,357		)	15,452			—		(119,636		)	(2,495		)	(13		)	(122,144		)	(106,692		)	370,844		264,152		—	(10,666	)	(618	)	(11,284	)
Touchstone High Yield (IQ Annuity™)	23,093			1,987			(353		)	24,727			22,678		(40,285		)	(4,839		)	(697		)	(23,143		)	1,584			396,687		398,271		1,659	(2,935	)	(329	)	(1,605	)
Touchstone High Yield (Pinnacle Plus™)	51,215			4,377			(5,396		)	50,196			25,682		(77,672		)	162,687			(554		)	110,143			160,339			740,592		900,931		2,181	(6,620	)	13,838		9,399
Touchstone Moderate ETF (AnnuiChoice™)	531			1,850			22,877			25,258			97,215		(7,572		)	33,867			(169		)	123,341			148,599			141,588		290,187		9,122	(699	)	3,188		11,611
Touchstone Moderate ETF (GrandMaster flex3™)	(8,177		)	15,448			162,336			169,607			173,476		(44,506		)	242,171			(349		)	370,792			540,399			1,599,604		2,140,003		15,986	(4,010	)	22,246		34,222
Touchstone Moderate ETF (Grandmaster™)	(1,569		)	8,211			28,647			35,289			720		(67,864		)	34,013			(51		)	(33,182		)	2,107			375,529		377,636		66	(6,149	)	3,170		(2,913	)
Touchstone Moderate ETF (IQ Annuity™)	(7,482		)	55,958			143,334			191,810			344,169		(79,675		)	(160,137		)	(1,162		)	103,195			295,005			1,871,044		2,166,049		31,996	(7,581	)	(13,995	)	10,420
Touchstone Moderate ETF (Pinnacle Plus™)	(3,178		)	4,138			68,096			69,056			145,461		(40,665		)	195,893			(450		)	300,239			369,295			603,628		972,923		13,155	(3,801	)	18,135		27,489
Touchstone Money Market (AnnuiChoice™)	16,395			—			—			16,395			—		(11,241		)	(14,010		)	(2,520		)	(27,771		)	(11,376		)	430,369		418,993		—	(1,307	)	(1,305	)	(2,612	)
Touchstone Money Market (Grandmaster™)	176,526			—			—			176,526			65,700		(2,090,691		)	1,104,385			(1,867		)	(922,473		)	(745,947		)	5,398,889		4,652,942		6,430	(203,050	)	107,479		(89,141	)
Touchstone Money Market (IQ Annuity™)	495			—			—			495			—		(8,409		)	(30,031		)	(45		)	(38,485		)	(37,990		)	41,092		3,102		—	(823	)	(2,909	)	(3,732	)
Touchstone Third Avenue Value (AnnuiChoice™)	3,507			308,570			(100,890		)	211,187			741,755		(25,648		)	(141,863		)	(3,836		)	570,408			781,595			977,031		1,758,626		43,764	(1,684	)	(7,925	)	34,155
Touchstone Third Avenue Value (GrandMaster flex3™)	(11,416		)	309,967			(5,037		)	293,514			226,501		(111,845		)	304,337			(913		)	418,080			711,594			1,955,436		2,667,030		13,176	(6,582	)	17,016		23,610
Touchstone Third Avenue Value (Grandmaster™)	(6,162		)	195,963			135,860			325,661			179,352		(218,176		)	534,850			(928		)	495,098			820,759			2,109,001		2,929,760		12,181	(14,910	)	34,951		32,222
Touchstone Third Avenue Value (IQ Annuity™)	(11,060		)	296,542			162,089			447,571			210,731		(206,892		)	268,356			(2,092		)	270,103			717,674			3,000,059		3,717,733		12,721	(12,812	)	16,214		16,123
Touchstone Third Avenue Value (Pinnacle Plus™)	(13,101		)	254,127			50,473			291,499			146,519		(137,627		)	267,267			(1,642		)	274,517			566,016			1,972,639		2,538,655		7,930	(7,606	)	14,595		14,919
Touchstone Third Avenue Value (AnnuiChoice II™)(September 01)*	649			4,044			(1,810		)	2,883			74,195		—			858			—			75,053			77,936			—		77,936		7,039	—		79		7,118
Touchstone Third Avenue Value (IQ Advisor Enhanced™)	(37		)	(272		)	—			(309		)	13,399		(6,557		)	(6,533		)	—			309			—			—		—		913	(464	)	(449	)	—
Touchstone Value Plus (AnnuiChoice™)	(307		)	8,116			18,793			26,602			3,902		(19,111		)	(4,950		)	(581		)	(20,740		)	5,862			155,456		161,318		354	(1,826	)	(414	)	(1,886	)
Touchstone Value Plus (GrandMaster flex3™)	(1,099		)	12,240			10,280			21,421			12,025		—			(36,497		)	(42		)	(24,514		)	(3,093		)	123,572		120,479		1,024	(4	)	(2,871	)	(1,851	)
Touchstone Value Plus (Grandmaster™)	(190		)	145			6,351			6,306			—		(429		)	—			(4		)	(433		)	5,873			35,026		40,899		—	(36	)	(1	)	(37	)
Touchstone Value Plus (IQ Annuity™)	(1,425		)	10,395			29,273			38,243			5,180		(20,184		)	(5,626		)	(137		)	(20,767		)	17,476			225,697		243,173		491	(1,894	)	(521	)	(1,924	)
Touchstone Value Plus (Pinnacle Plus™)	(2,190		)	6,228			45,962			50,000			14,764		(18,100		)	54,508			(17		)	51,155			101,155			263,377		364,532		1,148	(1,415	)	4,090		3,823
Non-Affiliated:
JP Morgan Mid Cap Value (AnnuiChoice™)	2,834			6,640			45,683			55,157			—		(2,322		)	(2,548		)	(1,152		)	(6,022		)	49,135			355,919		405,054		—	(213	)	(163	)	(376	)
JP Morgan Mid Cap Value (GrandMaster flex3™)	512			26,368			7,046			33,926			10,012		(33,811		)	(19,181		)	(312		)	(43,292		)	(9,366		)	252,318		242,952		628	(2,135	)	(1,175	)	(2,682	)
JP Morgan Mid Cap Value (Grandmaster™)	15,212			152,994			(61,783		)	106,423			11,024		(65,484		)	(1,127,690		)	(309		)	(1,182,459		)	(1,076,036		)	1,223,835		147,799		852	(5,027	)	(84,270	)	(88,445	)
JP Morgan Mid Cap Value (IQ3™)	885			13,263			4,187			18,335			3,090		(19,987		)	(40,490		)	(134		)	(57,521		)	(39,186		)	161,340		122,154		193	(1,266	)	(2,590	)	(3,663	)
JP Morgan Mid Cap Value (Pinnacle Plus™)	1,271			48,123			92,024			141,418			26,552		(87,622		)	62,696			(730		)	896			142,314			930,586		1,072,900		1,743	(5,727	)	4,209		225
Non-Affiliated Initial Class:
Fidelity VIP Equity-Income (Grandmaster™)	848,012			3,005,242			544,363			4,397,617			83,616		(3,312,091		)	(896,926		)	(8,036		)	(4,133,437		)	264,180			26,143,280		26,407,460		1,480	(59,618	)	(16,983	)	(75,121	)
Fidelity VIP Growth (Grandmaster™)	(111,382		)	(385,669		)	1,102,496			605,445			79,896		(2,363,459		)	(184,879		)	(5,311		)	(2,473,753		)	(1,868,308		)	13,253,752		11,385,444		1,375	(41,198	)	(3,635	)	(43,458	)
Fidelity VIP High Income (Grandmaster™)	364,561			50,481			171,102			586,144			27,023		(1,222,854		)	72,588			(2,690		)	(1,125,933		)	(539,789		)	6,494,382		5,954,593		1,621	(73,852	)	5,174		(67,057	)
Fidelity VIP II Asset Manager (Grandmaster™)	134,403			(186,890		)	531,272			478,785			57,220		(1,702,929		)	(403,717		)	(3,338		)	(2,052,764		)	(1,573,979		)	9,604,393		8,030,414		1,730	(52,749	)	(12,428	)	(63,447	)
Fidelity VIP II Contrafund (Grandmaster™)	(14,182		)	3,939,770			(1,558,879		)	2,366,709			400,008		(4,103,758		)	423,709			(8,273		)	(3,288,314		)	(921,605		)	25,316,888		24,395,283		10,633	(109,071	)	11,010		(87,428	)
Fidelity VIP II Index 500 (Grandmaster™)	45,060			686,099			496,783			1,227,942			—		(1,747,285		)	(285,287		)	(3,996		)	(2,036,568		)	(808,626		)	10,042,043		9,233,417		—	(57,483	)	(9,513	)	(66,996	)
Fidelity VIP II Investment Grade Bond (Grandmaster™)	103,630			(42,018		)	39,831			101,443			30,880		(648,688		)	(190,679		)	(1,177		)	(809,664		)	(708,221		)	4,015,704		3,307,483		1,198	(25,352	)	(7,227	)	(31,381	)
Fidelity VIP III Balanced (Grandmaster™)	25,408			301,980			(40,392		)	286,996			20,317		(569,884		)	394,467			(1,058		)	(156,158		)	130,838			2,998,826		3,129,664		1,382	(38,859	)	26,239		(11,238	)
Fidelity VIP III Growth & Income (Grandmaster™)	(10,077		)	589,821			(135,798		)	443,946			8,822		(811,814		)	(1,135,431		)	(1,411		)	(1,939,834		)	(1,495,888		)	4,998,164		3,502,276		523	(48,872	)	(68,081	)	(116,430	)
Fidelity VIP III Growth Opportunities (Grandmaster™)	(8,358		)	58,826			(5,933		)	44,535			4,882		(324,971		)	(91,912		)	(690		)	(412,691		)	(368,156		)	1,618,677		1,250,521		425	(28,450	)	(7,441	)	(35,466	)
Fidelity VIP Overseas (Grandmaster™)	17,854			690,128			90,335			798,317			22,460		(1,290,835		)	(250,601		)	(1,944		)	(1,520,920		)	(722,603		)	5,883,855		5,161,252		670	(39,615	)	(8,174	)	(47,119	)
Affiliated Service Class:
Touchstone Aggressive ETF (AnnuiChoice™)(July 31)*	217			5			1,038			1,260			14,874		(127		)	4,002			(2		)	18,747			20,007			—		20,007		1,463	(12	)	381		1,832
Touchstone Aggressive ETF (AnnuiChoice II™)(September 01)*	3,475			20			7,471			10,966			242,491		—			53,127			(37		)	295,581			306,547			—		306,547		23,574	(4	)	5,022		28,592
Touchstone Enhanced ETF (AnnuiChoice™)(July 31)*	222			5			2,008			2,235			7,807		—			45,432			(1		)	53,238			55,473			—		55,473		769	—		4,253		5,022
Touchstone Enhanced ETF (AnnuiChoice II™)(September 01)*	45			1			344			390			2,979		—			7,980			—			10,959			11,349			—		11,349		297	—		749		1,046
Touchstone Moderate ETF (AnnuiChoice™)(July 31)*	1,257			51			6,478			7,786			100,918		(673		)	70,351			—			170,596			178,382			—		178,382		9,944	(65	)	6,725		16,604
Touchstone Moderate ETF (AnnuiChoice II™)(September 01)*	174			3			746			923			21,481		—			2,351			—			23,832			24,755			—		24,755		2,116	—		225		2,341
Touchstone Money Market (AnnuiChoice™)	73,819			—			—			73,819			10,448		(305,863		)	165,886			(10,822		)	(140,351		)	(66,532		)	2,021,633		1,955,101		1,308	(30,837	)	16,272		(13,257	)

See accompanying notes.

* - - 2006 inception date of division.

23

	Increase (decrease) 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Affiliated Service Class (continued):
Touchstone Money Market (GrandMaster flex3™)	$	52,222		$	—		$	—		$	52,222		$	511,524	$	(703,462	)	$	1,292,867		$	(267	)	$	1,100,662		$	1,152,884		$	750,247	$	1,903,131	50,486	(69,025	)	127,804		109,265
Touchstone Money Market (IQ Annuity™)	109,761			—			—			109,761			1,415,602		(1,267,796		)	(1,956,442		)	(4,119		)	(1,812,755		)	(1,702,994		)	4,114,160		2,411,166		139,298	(125,297	)	(190,587	)	(176,586	)
Touchstone Money Market (Pinnacle Plus™)	36,019			—			—			36,019			203,370		(73,660		)	540,685			(362		)	670,033			706,052			905,255		1,611,307		20,056	(7,256	)	53,193		65,993
Non-Affiliated Service Class:
Fidelity VIP III Mid Cap (Grandmaster™)	(4,265		)	1,073,287			(574,055		)	494,967			149,859		(552,098		)	761,095			(1,076		)	357,780			852,747			4,645,805		5,498,552		5,006	(18,321	)	24,065		10,750
Non-Affiliated Service Class 2:
Fidelity VIP Asset Manager (AnnuiChoice™)	6,165			6,749			(509		)	12,405			28,259		(111,211		)	(51,609		)	(1,038		)	(135,599		)	(123,194		)	368,577		245,383		2,404	(9,857	)	(4,577	)	(12,030	)
Fidelity VIP Asset Manager (GrandMaster flex3™)	1,820			5,541			7,009			14,370			39,575		(2,191		)	(69,616		)	(58		)	(32,290		)	(17,920		)	251,951		234,031		3,769	(210	)	(6,402	)	(2,843	)
Fidelity VIP Asset Manager (IQ3™)	5,501			22,487			(2,785		)	25,203			8,473		(65,562		)	(43,374		)	(282		)	(100,745		)	(75,542		)	518,964		443,422		792	(6,009	)	(3,914	)	(9,131	)
Fidelity VIP Asset Manager (Pinnacle Plus™)	522			262			3,960			4,744			—		(3,373		)	26,265			(40		)	22,852			27,596			77,840		105,436		—	(302	)	2,316		2,014
Fidelity VIP Balanced (AnnuiChoice™)	2,075			14,982			14,677			31,734			49,657		(29,038		)	12,460			(1,103		)	31,976			63,710			273,214		336,924		4,222	(2,497	)	1,043		2,768
Fidelity VIP Balanced (GrandMaster flex3™)	129			19,703			18,565			38,397			78,377		(6,423		)	(34,565		)	(94		)	37,295			75,692			317,795		393,487		6,483	(519	)	(2,580	)	3,384
Fidelity VIP Balanced (IQ3™)	2,572			57,605			(16,891		)	43,286			1,600		(84,432		)	(97,658		)	(281		)	(180,771		)	(137,485		)	539,932		402,447		144	(7,593	)	(8,850	)	(16,299	)
Fidelity VIP Balanced (Pinnacle Plus™)	(556		)	11,288			17,059			27,791			44,149		(14,598		)	48,249			(127		)	77,673			105,464			255,387		360,851		3,741	(1,252	)	4,110		6,599
Fidelity VIP Contrafund (AnnuiChoice™)	1,604			452,898			(230,073		)	224,429			774,467		(261,557		)	110,199			(6,538		)	616,571			841,000			1,736,975		2,577,975		50,558	(17,476	)	7,147		40,229
Fidelity VIP Contrafund (GrandMaster flex3™)	(9,306		)	276,135			(84,443		)	182,386			187,595		(281,654		)	361,682			(1,011		)	266,612			448,998			1,748,644		2,197,642		12,666	(18,708	)	23,491		17,449
Fidelity VIP Contrafund (IQ3™)	(13,678		)	673,684			(385,660		)	274,346			300,920		(316,097		)	(32,654		)	(1,246		)	(49,077		)	225,269			2,691,873		2,917,142		22,001	(23,496	)	(1,206	)	(2,701	)
Fidelity VIP Contrafund (Pinnacle Plus™)	(12,409		)	290,939			(70,692		)	207,838			215,982		(95,779		)	543,778			(1,456		)	662,525			870,363			1,842,753		2,713,116		14,105	(6,273	)	35,433		43,265
Fidelity VIP Contrafund (AnnuiChoice II™)(September 01)*	316			4,897			(4,003		)	1,210			66,695		—			599			—			67,294			68,504			—		68,504		6,334	—		56		6,390
Fidelity VIP Contrafund Standard (IQ Advisor™)	25			486			78			589			—		—			1			—			1			590			5,474		6,064		—	—		—		—
Fidelity VIP Contrafund (IQ Advisor Enhanced™)	(38		)	(188		)	—			(226		)	13,399		(6,604		)	(6,569		)	—			226			—			—		—		979	(495	)	(484	)	—
Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)	(338		)	2,306			(2,666		)	(698		)	1,866		(548		)	89,758			(215		)	90,861			90,163			—		90,163		137	(53	)	5,789		5,873
Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)	(765		)	2,639			5,892			7,766			13,047		(275		)	28,100			(8		)	40,864			48,630			36,717		85,347		983	(21	)	2,157		3,119
Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)	(7,297		)	38,837			(44,752		)	(13,212		)	30,697		(59,622		)	1,161,132			(237		)	1,131,970			1,118,758			39,099		1,157,857		2,305	(4,613	)	80,489		78,181
Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)	(2,489		)	64,618			(27,602		)	34,527			—		(23,628		)	(43,365		)	(74		)	(67,067		)	(32,540		)	126,555		94,015		—	(1,368	)	(1,215	)	(2,583	)
Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)	(1,765		)	15,971			933			15,139			28,889		(1,093		)	55,954			(211		)	83,539			98,678			72,520		171,198		2,068	(99	)	4,404		6,373
Fidelity VIP Equity-Income (AnnuiChoice™)	33,127			195,324			(58,020		)	170,431			44,437		(160,624		)	15,494			(3,519		)	(104,212		)	66,219			1,009,838		1,076,057		3,322	(12,887	)	966		(8,599	)
Fidelity VIP Equity-Income (GrandMaster flex3™)	12,366			58,698			7,407			78,471			9,603		(26,267		)	1,908			(149		)	(14,905		)	63,566			435,674		499,240		720	(2,001	)	256		(1,025	)
Fidelity VIP Equity-Income (IQ3™)	27,445			138,592			(11,971		)	154,066			21,063		(102,252		)	(62,441		)	(1,069		)	(144,699		)	9,367			959,587		968,954		1,797	(8,665	)	(5,636	)	(12,504	)
Fidelity VIP Equity-Income (Pinnacle Plus™)	40,646			187,636			49,883			278,165			95,673		(71,351		)	296,609			(1,164		)	319,767			597,932			1,350,417		1,948,349		7,072	(5,137	)	21,447		23,382
Fidelity VIP Growth & Income (AnnuiChoice™)	(599		)	16,004			8,403			23,808			17,866		(25,221		)	(33,722		)	(693		)	(41,770		)	(17,962		)	226,914		208,952		1,484	(2,132	)	(2,847	)	(3,495	)
Fidelity VIP Growth & Income (GrandMaster flex3™)	(1,804		)	5,467			17,931			21,594			—		(2,438		)	28,516			(26		)	26,052			47,646			171,498		219,144		—	(192	)	2,281		2,089
Fidelity VIP Growth & Income (IQ3™)	(1,471		)	29,554			(5,337		)	22,746			975		(74,619		)	(33,369		)	(187		)	(107,200		)	(84,454		)	272,377		187,923		97	(7,206	)	(3,235	)	(10,344	)
Fidelity VIP Growth & Income (Pinnacle Plus™)	(1,306		)	6,431			9,912			15,037			—		(1,101		)	(11,666		)	(106		)	(12,873		)	2,164			145,059		147,223		—	(100	)	(970	)	(1,070	)
Fidelity VIP Growth (AnnuiChoice™)	(1,924		)	18,740			(11,317		)	5,499			55,539		(82,483		)	(82,559		)	(794		)	(110,297		)	(104,798		)	303,356		198,558		5,649	(8,754	)	(8,813	)	(11,918	)
Fidelity VIP Growth (GrandMaster flex3™)	(2,289		)	4,598			6,587			8,896			—		(46,581		)	43,632			(58		)	(3,007		)	5,889			163,617		169,506		—	(3,967	)	3,785		(182	)
Fidelity VIP Growth (IQ3™)	(5,158		)	20,755			1,712			17,309			6,677		(97,669		)	(601		)	(335		)	(91,928		)	(74,619		)	435,983		361,364		870	(13,115	)	(40	)	(12,285	)
Fidelity VIP Growth (Pinnacle Plus™)	(3,672		)	2,505			13,587			12,420			23,136		(9,343		)	71,634			(271		)	85,156			97,576			212,070		309,646		2,017	(786	)	5,963		7,194
Fidelity VIP Growth Opportunities (AnnuiChoice™)	(252		)	2,003			13			1,764			—		(6,147		)	(2		)	(155		)	(6,304		)	(4,540		)	52,365		47,825		—	(567	)	—		(567	)
Fidelity VIP Growth Opportunities (GrandMaster flex3™)	(578		)	671			2,181			2,274			—		(2,636		)	71,071			(44		)	68,391			70,665			40,101		110,766		—	(202	)	5,575		5,373
Fidelity VIP Growth Opportunities (IQ3™)	2			1,485			(174		)	1,313			—		(1,603		)	52,155			(15		)	50,537			51,850			7,713		59,563		—	(148	)	5,026		4,878
Fidelity VIP Growth Opportunities (Pinnacle Plus™)	(879		)	185			3,163			2,469			—		(469		)	—			(107		)	(576		)	1,893			73,692		75,585		—	(46	)	—		(46	)
Fidelity VIP High Income (AnnuiChoice™)	20,657			(1,181		)	11,450			30,926			3,677		(19,755		)	19,213			(802		)	2,333			33,259			290,744		324,003		269	(1,453	)	1,482		298
Fidelity VIP High Income (GrandMaster flex3™)	146,262			(75,808		)	112,891			183,345			—		(242,490		)	(177,189		)	(267		)	(419,946		)	(236,601		)	2,588,400		2,351,799		—	(19,013	)	(16,079	)	(35,092	)
Fidelity VIP High Income (IQ3™)	230,438			(39,009		)	83,109			274,538			155,441		(484,733		)	1,148,098			(837		)	817,969			1,092,507			2,568,853		3,661,360		13,412	(42,014	)	98,616		70,014
Fidelity VIP High Income (Pinnacle Plus™)	16,206			(441		)	8,082			23,847			294		(16,965		)	9,717			(109		)	(7,063		)	16,784			263,762		280,546		25	(1,435	)	822		(588	)
Fidelity VIP Index 500 (AnnuiChoice™)	3,008			24,898			30,386			58,292			—		(26,330		)	(87,220		)	(2,256		)	(115,806		)	(57,514		)	489,337		431,823		—	(2,559	)	(8,124	)	(10,683	)
Fidelity VIP Index 500 (IQ3™)	1,287			27,177			49,733			78,197			—		(94,299		)	(35,343		)	(456		)	(130,098		)	(51,901		)	651,218		599,317		—	(9,586	)	(3,677	)	(13,263	)
Fidelity VIP Index 500 (Pinnacle Plus™)	(173		)	1,953			9,751			11,531			—		(2,142		)	(15,373		)	(46		)	(17,561		)	(6,030		)	99,820		93,790		—	(170	)	(1,224	)	(1,394	)
Fidelity VIP Investment Grade Bond (AnnuiChoice™)	27,743			(13,469		)	15,321			29,595			3,123		(13,389		)	(115,382		)	(3,529		)	(129,177		)	(99,582		)	1,055,005		955,423		255	(1,394	)	(9,483	)	(10,622	)
Fidelity VIP Investment Grade Bond (GrandMaster flex3™)	6,787			(1,536		)	6,470			11,721			81,346		(2,534		)	(33,498		)	(42		)	45,272			56,993			358,548		415,541		7,932	(248	)	(3,166	)	4,518
Fidelity VIP Investment Grade Bond (IQ3™)	32,902			(44,669		)	41,141			29,374			129,185		(355,125		)	7,776			(1,593		)	(219,757		)	(190,383		)	1,410,955		1,220,572		10,907	(29,738	)	429		(18,402	)

See accompanying notes.

* - - 2006 inception date of division.

24

	Increase (decrease) 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Investment Grade Bond (Pinnacle Plus™)	$	5,834		$	(685	)	$	2,565		$	7,714		$	25,640	$	(13,257	)	$	6,925		$	(239	)	$	19,069		$	26,783		$	284,829	$	311,612	2,513	(1,304	)	685		1,894
Fidelity VIP Investment Grade Bond (AnnuiChoice II™)(September 01)*	(18		)	—			(33		)	(51		)	—		—			16,802			—			16,802			16,751			—		16,751		—	—		1,649		1,649
Fidelity VIP Mid Cap (AnnuiChoice™)	2,525			163,828			(64,078		)	102,275			55,149		(42,724		)	880			(3,587		)	9,718			111,993			944,145		1,056,138		2,817	(2,345	)	(203	)	269
Fidelity VIP Mid Cap (GrandMaster flex3™)	(4,727		)	180,069			(61,015		)	114,327			39,123		(35,762		)	219,769			(433		)	222,697			337,024			1,099,935		1,436,959		2,089	(1,922	)	11,301		11,468
Fidelity VIP Mid Cap (IQ Annuity™)	(4,356		)	378,215			(187,823		)	186,036			68,141		(211,218		)	133,640			(1,048		)	(10,485		)	175,551			1,750,186		1,925,737		3,657	(11,594	)	7,256		(681	)
Fidelity VIP Mid Cap (Pinnacle Plus™)	(7,429		)	205,867			(42,865		)	155,573			111,054		(65,808		)	103,106			(1,782		)	146,570			302,143			1,414,108		1,716,251		6,065	(3,680	)	5,603		7,988
Fidelity VIP Mid Cap (AnnuiChoice II™)(September 01)*	(6		)	—			(6		)	(12		)	—		—			5,601			—			5,601			5,589			—		5,589		—	—		533		533
Fidelity VIP Mid Cap (Grandmaster™)	(139		)	4			785			650			—		—			12,349			—			12,349			12,999			—		12,999		—	—		822		822
Fidelity VIP Overseas (AnnuiChoice™)	1,752			76,018			(25,639		)	52,131			10,187		(87,192		)	(10,505		)	(1,409		)	(88,919		)	(36,788		)	334,514		297,726		674	(6,064	)	(245	)	(5,635	)
Fidelity VIP Overseas (GrandMaster flex3™)	(1,207		)	12,675			32,040			43,508			6,703		(10,175		)	153,463			(107		)	149,884			193,392			175,187		368,579		510	(768	)	11,296		11,038
Fidelity VIP Overseas (IQ3™)	(1,906		)	4,506			38,030			40,630			48,269		(28,482		)	139,380			(133		)	159,034			199,664			148,665		348,329		4,134	(2,458	)	11,977		13,653
Fidelity VIP Overseas (Pinnacle Plus™)	(3,493		)	22,967			41,720			61,194			176,935		(13,700		)	191,281			(387		)	354,129			415,323			170,089		585,412		10,273	(821	)	11,544		20,996
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Overseas (AnnuiChoice II™)(September 01)*	(15		)	—			531			516			—		—			14,002			—			14,002			14,518			—		14,518		—	—		1,330		1,330
Non-Affiliated Class 1:
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	18,769			1,701			(154		)	20,316			—		—			(4		)	(577		)	(581		)	19,735			209,882		229,617		—	(36	)	—		(36	)
Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)	6,238			430			1,377			8,045			722		(8,366		)	4,817			(32		)	(2,859		)	5,186			78,641		83,827		47	(522	)	362		(113	)
Van Kampen UIF Emerging Markets Debt (IQ3™)	3,309			(258		)	1,850			4,901			1,245		(1,481		)	62,244			(52		)	61,956			66,857			38,401		105,258		79	(96	)	3,771		3,754
Van Kampen UIF U.S. Real Estate (AnnuiChoice™)	2,920			154,630			51,291			208,841			366,260		(28,998		)	188,835			(1,208		)	524,889			733,730			343,936		1,077,666		16,463	(1,285	)	7,642		22,820
Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)	(1,225		)	71,644			167,355			237,774			95,467		(24,333		)	156,375			(307		)	227,202			464,976			554,486		1,019,462		4,326	(1,027	)	6,986		10,285
Van Kampen UIF U.S. Real Estate (IQ3™)	(192		)	31,888			28,543			60,239			9,103		(35,536		)	68,320			(303		)	41,584			101,823			161,193		263,016		437	(1,700	)	2,948		1,685
Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)(September01)*	(190		)	1,182			5,288			6,280			174,945		—			(60,966		)	—			113,979			120,259			—		120,259		16,236	—		(5,641	)	10,595
Non-Affiliated Class 2:
Franklin Growth and Income Securities (AnnuiChoice™)	1,309			7,541			6,393			15,243			—		(48,910		)	19,926			(322		)	(29,306		)	(14,063		)	128,073		114,010		—	(3,571	)	1,370		(2,201	)
Franklin Growth and Income Securities (GrandMaster flex3™)	1,261			8,069			11,783			21,113			49,647		(763		)	(9,221		)	(60		)	39,603			60,716			133,325		194,041		3,436	(58	)	(682	)	2,696
Franklin Growth and Income Securities (Grandmaster™)	5,083			49,550			1,114			55,747			3,366		(54,866		)	(37,557		)	(84		)	(89,141		)	(33,394		)	420,979		387,585		241	(3,904	)	(2,720	)	(6,383	)
Franklin Growth and Income Securities (IQ Annuity™)	5,067			36,932			19,917			61,916			245		(18,672		)	(29,889		)	(313		)	(48,629		)	13,287			446,459		459,746		17	(1,395	)	(2,178	)	(3,556	)
Franklin Growth and Income Securities (Pinnacle Plus™)	4,288			22,948			36,292			63,528			3,440		(11,169		)	41,403			(345		)	33,329			96,857			410,831		507,688		263	(867	)	3,100		2,496
Franklin Income Securities (AnnuiChoice™)	13,648			23,565			42,573			79,786			8,267		(95,721		)	26,253			(1,481		)	(62,682		)	17,104			514,597		531,701		545	(6,576	)	1,826		(4,205	)
Franklin Income Securities (GrandMaster flex3™)	43,686			45,281			247,091			336,058			429,810		(49,603		)	166,622			(1,156		)	545,673			881,731			1,726,429		2,608,160		28,605	(3,363	)	11,151		36,393
Franklin Income Securities (Grandmaster™)	52,107			71,928			180,286			304,321			2,303		(236,289		)	1,238,043			(536		)	1,003,521			1,307,842			1,391,277		2,699,119		155	(15,236	)	80,012		64,931
Franklin Income Securities (IQ Annuity™)	21,227			29,819			137,332			188,378			205,100		(210,110		)	391,598			(675		)	385,913			574,291			1,065,972		1,640,263		13,411	(14,390	)	25,093		24,114
Franklin Income Securities (Pinnacle Plus™)	37,558			27,810			214,495			279,863			38,976		(127,692		)	250,804			(1,176		)	160,912			440,775			1,652,963		2,093,738		2,968	(9,536	)	18,374		11,806
Franklin Large Cap Growth Securities (AnnuiChoice™)	(298		)	4,529			3,179			7,410			8,024		(9,625		)	(96,368		)	(49		)	(98,018		)	(90,608		)	149,333		58,725		609	(727	)	(7,352	)	(7,470	)
Franklin Large Cap Growth Securities (GrandMaster flex3™)	(2,458		)	13,484			14,491			25,517			32,687		(35,166		)	(127,917		)	(96		)	(130,492		)	(104,975		)	382,844		277,869		2,618	(2,807	)	(9,981	)	(10,170	)
Franklin Large Cap Growth Securities (Grandmaster™)	(792		)	2,558			11,206			12,972			72		(29,845		)	21,412			(36		)	(8,397		)	4,575			148,222		152,797		6	(2,297	)	1,617		(674	)
Franklin Large Cap Growth Securities (IQ Annuity™)	(1,903		)	10,243			17,443			25,783			92,935		(42,847		)	(93,508		)	(117		)	(43,537		)	(17,754		)	317,999		300,245		7,269	(3,427	)	(7,262	)	(3,420	)
Franklin Large Cap Growth Securities (Pinnacle Plus™)	(2,837		)	5,278			23,766			26,207			15,005		(15,470		)	5,183			(136		)	4,582			30,789			305,332		336,121		1,286	(1,342	)	308		252
Franklin Large Cap Growth Securities (AnnuiChoice II™)(Sept 01)*	(9		)	—			102			93			—		—			8,401			—			8,401			8,494			—		8,494		—	—		785		785
Franklin Mutual Shares Securities (AnnuiChoice™)	5,650			53,146			44,520			103,316			18,628		(27,641		)	347,014			(1,480		)	336,521			439,837			412,925		852,762		1,223	(1,771	)	21,684		21,136
Franklin Mutual Shares Securities (GrandMaster flex3™)	5,091			41,126			145,055			191,272			288,188		(14,450		)	50,294			(428		)	323,604			514,876			945,516		1,460,392		18,761	(930	)	3,166		20,997
Franklin Mutual Shares Securities (IQ Annuity™)	1,191			12,683			55,899			69,773			128,368		(12,231		)	137,311			(249		)	253,199			322,972			294,636		617,608		8,133	(779	)	8,627		15,981
Franklin Mutual Shares Securities (Pinnacle Plus™)	6,024			56,272			120,478			182,774			55,850		(63,840		)	404,379			(397		)	395,992			578,766			867,747		1,446,513		3,898	(4,345	)	28,370		27,923
Franklin Mutual Shares Securities Standard (IQ Advisor™)	177			308			1,486			1,971			—		—			(1		)	—			(1		)	1,970			11,151		13,121		—	—		—		—
Franklin Mutual Shares Securities(Grandmaster™)	8,945			122,407			44,184			175,536			2,213		(186,974		)	243,192			(269		)	58,162			233,698			1,072,050		1,305,748		141	(12,015	)	14,997		3,123
Templeton Foreign Securities (IQ Annuity™)	(182		)	46,740			17,911			64,469			83,998		(102,726		)	(97,796		)	(373		)	(116,897		)	(52,428		)	410,520		358,092		4,859	(6,072	)	(5,716	)	(6,929	)
Templeton Foriegn Securities Fund (GrandMaster flex3™)	(1,739		)	49,720			44,012			91,993			41,985		(151,704		)	(76,504		)	(165		)	(186,388		)	(94,395		)	619,504		525,109		2,512	(9,178	)	(4,591	)	(11,257	)
Templeton Foriegn Securities Fund (Grandmaster™)	(1,487		)	54,309			595			53,417			1,263		(48,499		)	(82,052		)	(42		)	(129,330		)	(75,913		)	323,066		247,153		74	(2,773	)	(4,547	)	(7,246	)
Templeton Foriegn Securities Fund (Pinnacle Plus™)	(2,114		)	24,073			63,127			85,086			109,633		(11,126		)	50,951			(480		)	148,978			234,064			351,287		585,351		6,739	(721	)	3,337		9,355
Templeton Foreign Securities Fund (AnnuiChoice™)	87			21,135			(3,217		)	18,005			30,128		(706		)	(114,593		)	(231		)	(85,402		)	(67,397		)	154,185		86,788		1,786	(55	)	(6,766	)	(5,035	)
Templeton Foreign Securities Fund (AnnuiChoice II™)(Sept 01)*	(5		)	—			152			147			1,296		—			334			—			1,630			1,777			—		1,777		130	—		32		162
Templeton Growth Securities (AnnuiChoice™)	84			19,211			(3,975		)	15,320			19,030		(1,992		)	(91,257		)	(277		)	(74,496		)	(59,176		)	138,878		79,702		1,186	(137	)	(5,731	)	(4,682	)

See accompanying notes.

* - - 2006 inception date of division.

25

	Increase (decrease) 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 year		Net assets, end of year		Units purchased	Units redeemed		Units transferred		Increase (decrease) in units
Non-Affiliated Class 2 (continued):
Templeton Growth Securities (GrandMaster flex3™)	$	(2,788	)	$	73,497		$	92,063		$	162,772		$	275,562	$	(23,592	)	$	(27,059	)	$	(277	)	$	224,634		$	387,406		$	660,358	$	1,047,764	16,932	(1,449	)	(1,534	)	13,949
Templeton Growth Securities (Grandmaster™)	1,936			87,335			41,045			130,316			90		(105,295		)	776,613			(133		)	671,275			801,591			363,781		1,165,372		5	(6,369	)	45,754		39,390
Templeton Growth Securities (IQ Annuity™)	(3,845		)	45,968			101,034			143,157			148,174		(55,070		)	994,420			(312		)	1,087,212			1,230,369			353,815		1,584,184		9,086	(3,263	)	57,147		62,970
Templeton Growth Securities (Pinnacle Plus™)	(3,557		)	57,370			93,902			147,715			13,523		(63,453		)	351,575			(246		)	301,399			449,114			598,713		1,047,827		905	(4,075	)	22,755		19,585
Templeton Growth Securities Standard (IQ Advisor™)	44			226			908			1,178			—		—			(1		)	—			(1		)	1,177			5,583		6,760		—	—		—		—
Van Kampen LIT Comstock (AnnuiChoice™)	4,637			24,983			(2,976		)	26,644			13,268		(148		)	(170,250		)	(554		)	(157,684		)	(131,040		)	245,844		114,804		884	(46	)	(10,658	)	(9,820	)
Van Kampen LIT Comstock (GrandMaster flex3™)	2,956			19,557			18,567			41,080			33,728		(7,492		)	(36,549		)	(53		)	(10,366		)	30,714			288,578		319,292		2,266	(468	)	(2,422	)	(624	)
Van Kampen LIT Comstock (Grandmaster™)	5,890			31,111			416			37,417			3,926		(26,219		)	(191,649		)	(174		)	(214,116		)	(176,699		)	361,099		184,400		263	(1,632	)	(12,234	)	(13,603	)
Van Kampen LIT Comstock (IQ Annuity™)	2,461			11,923			6,115			20,499			45,691		(56,611		)	(49,845		)	(54		)	(60,819		)	(40,320		)	186,182		145,862		2,994	(3,732	)	(3,262	)	(4,000	)
Van Kampen LIT Comstock (Pinnacle Plus™)	2,397			20,150			18,629			41,176			30,536		(17,387		)	2,388			(193		)	15,344			56,520			285,503		342,023		2,220	(1,268	)	113		1,065
Van Kampen LIT Strategic Growth (GrandMaster flex3™)	(352		)	2,094			(2,194		)	(452		)	—		(157		)	10,144			—			9,987			9,535			13,919		23,454		—	(11	)	709		698
Van Kampen LIT Strategic Growth (Grandmaster™)	(90		)	631			(622		)	(81		)	—		(37		)	886			(2		)	847			766			5,697		6,463		—	(3	)	55		52
Van Kampen LIT Strategic Growth (IQ Annuity™)	(18		)	3			27			12			—		—			2			(12		)	(10		)	2			1,217		1,219		—	(1	)	—		(1	)
Van Kampen LIT Strategic Growth (Pinnacle Plus™)	(1,306		)	749			1,647			1,090			50		—			9,024			(21		)	9,053			10,143			76,631		86,774		4	(2	)	793		795
Van Kampen UIF Emerging Markets Debt (Grandmaster™)	7,875			353			(1,057		)	7,171			375		(35,060		)	7,251			(74		)	(27,508		)	(20,337		)	96,947		76,610		25	(2,303	)	479		(1,799	)
Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)	25,251			2,239			(1,269		)	26,221			—		(41,084		)	38,903			(505		)	(2,686		)	23,535			290,456		313,991		—	(3,107	)	2,932		(175	)
Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)	(1,329		)	35,098			47,139			80,908			142,374		(7,652		)	256,056			(474		)	390,304			471,212			118,303		589,515		5,349	(291	)	8,506		13,564
Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)	(3,154		)	76,058			22,117			95,021			33,747		(51,115		)	109,183			(247		)	91,568			186,589			320,357		506,946		1,342	(2,020	)	3,081		2,403
Van Kampen UIF Emerging Markets Equity (Grandmaster™)	(2,320		)	29,748			85,984			113,412			—		(30,121		)	49,823			(85		)	19,617			133,029			331,951		464,980		—	(1,135	)	1,641		506
Van Kampen UIF Emerging Markets Equity (IQ Annuity™)	(360		)	(21,587		)	10,518			(11,429		)	11,993		(3,258		)	86,125			(22		)	94,838			83,409			29,621		113,030		493	(131	)	1,989		2,351
Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)	(5,018		)	76,184			78,066			149,232			168,000		(18,807		)	(20,603		)	(506		)	128,084			277,316			379,296		656,612		7,005	(859	)	(783	)	5,363
Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)(Sept01)*	(89		)	3			5,799			5,713			4,532		—			61,299			—			65,831			71,544			—		71,544		396	—		5,571		5,967
Van Kampen UIF Emerging Markets Equity (IQ Advisor Enhanced™)	(15		)	257			983			1,225			—		—			10,543			—			10,543			11,768			—		11,768		—	—		549		549
Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)	(3,851		)	142,118			144,022			282,289			64,257		(63,727		)	18,515			(1,210		)	17,835			300,124			775,373		1,075,497		3,229	(3,180	)	1,029		1,078
Van Kampen UIF U.S. Real Estate (Grandmaster™)	(533		)	60,143			120,415			180,025			4,000		(64,984		)	8,278			(110		)	(52,816		)	127,209			533,886		661,095		180	(2,789	)	332		(2,277	)
Van Kampen UIF U.S. Real Estate (IQ Advisor Enhanced™)	117			1,523			627			2,267			13,605		(7,094		)	2,561			—			9,072			11,339			—		11,339		788	(387	)	131		532
Non-Affiliated Class B:
DWS Small Cap Index VIP (AnnuiChoice™)	(539		)	16,198			5,154			20,813			—		(41,100		)	(17,340		)	(687		)	(59,127		)	(38,314		)	169,547		131,233		—	(2,977	)	(1,258	)	(4,235	)
DWS Small Cap Index VIP (GrandMaster flex3™)	(2,480		)	29,107			5,831			32,458			22,413		(8,544		)	19,130			(53		)	32,946			65,404			221,383		286,787		1,425	(574	)	1,079		1,930
DWS Small Cap Index VIP (Grandmaster™)	(2,060		)	47,418			2,647			48,005			—		(5,978		)	(403,918		)	(19		)	(409,915		)	(361,910		)	386,546		24,636		—	(461	)	(30,304	)	(30,765	)
DWS Small Cap Index VIP (IQ3™)	(1,221		)	10,203			12,082			21,064			3,487		(2,567		)	(21,653		)	(180		)	(20,913		)	151			133,131		133,282		253	(192	)	(1,426	)	(1,365	)
DWS Small Cap Index VIP (Pinnacle Plus™)	(5,500		)	34,692			42,168			71,360			48,255		(13,172		)	(51,984		)	(319		)	(17,220		)	54,140			473,233		527,373		3,202	(907	)	(3,439	)	(1,144	)

See accompanying notes.

* - - 2006 inception date of division.

26

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements

December 31, 2007

1. Organization and Significant Accounting Policies

Organization and Nature of Operations

National Integrity Life Insurance Company (“National Integrity”) established Separate Account I (the “Separate Account”) on May 19, 1986, under the insurance laws of the State of New York, 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 National Integrity.

National Integrity is a wholly owned subsidiary of Integrity Life Insurance Company (“Integrity”), which is a wholly owned subsidiary of The Western and Southern Life Insurance Company (“W&S”).

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 guarantee rate options of National 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”). In addition, certain contract holders may also allocate or transfer their account values to options held in National Integrity’s general account. Such options include a guaranteed interest division, a quarterly rate option or a Systematic Transfer Option (“STO”). 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.

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

27

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

1. Organization and Significant Accounting Policies (continued)

LIT Funds”). The Fidelity VIP Funds are “series” type mutual funds managed by Fidelity Management and Research Company. The investment adviser of the Franklin Templeton Funds are various affiliates of Franklin Resources, Inc., doing business as Franklin Templeton Investments, including Franklin Advisers, Inc., Franklin Mutual Advisers, LLC, Templeton Investment Counsel, LLC, and Templeton Global Advisors Limited. J.P. Morgan Investment Management Inc. is the investment adviser to the JPMorgan Funds. 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 holders 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 the underlying fund. The Separate Account currently has 412 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 National 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 National 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.

28

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

1. Organization and Significant Accounting Policies (continued)

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 of the Funds are determined based on the identified cost basis.

Capital gain distributions are included in the realized gain distributions line on the Statements of Operations. Dividends are included in the dividends line on the Statements of Operations. Dividends and capital gain distributions are recorded on the ex-dividend 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 certain administrative charges.

Taxes

 Operations of the Separate Account are included in the income tax return of National 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, National 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, National Integrity pays no tax on investment income and capital gains reflected in variable life insurance policy reserves. However, National Integrity retains the right to charge for any federal income tax incurred, which is attributable to the Separate

29

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

1. Organization and Significant Accounting Policies (continued)

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.

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.

30

Separate Account I

of

National 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™)	$	26,109	$	176,344	$	502,525
Touchstone Aggressive ETF (GrandMaster flex3™)	59,606		68,950		608,407
Touchstone Aggressive ETF (Grandmaster™)	60,933		2,380,355		37,622
Touchstone Aggressive ETF (IQ Annuity™)	442,779		1,113,877		467,062
Touchstone Aggressive ETF (Pinnacle Plus™)	388,886		336,588		713,630
Touchstone Balanced (AnnuiChoice™)	16,370		9,562		135,821
Touchstone Balanced (GrandMaster flex3™)	38,210		47,375		382,972
Touchstone Balanced (Grandmaster™)	162		5		155
Touchstone Balanced (IQ Annuity™)	106,436		118,691		239,577
Touchstone Balanced (Pinnacle Plus™)	156,494		12,866		507,523
Touchstone Baron Small Cap (AnnuiChoice™)	43,932		118,110		285,534
Touchstone Baron Small Cap (AnnuiChoice II™)	15,121		265		14,860
Touchstone Baron Small Cap (GrandMaster flex3™)	401,412		290,654		825,291
Touchstone Baron Small Cap (Grandmaster™)	303,689		348,588		375,022
Touchstone Baron Small Cap (IQ Annuity™)	461,529		263,242		1,335,226
Touchstone Baron Small Cap (Pinnacle Plus™)	278,673		139,894		722,073
Touchstone Conservative ETF (AnnuiChoice™)	214		24,060		9,623
Touchstone Conservative ETF (GrandMaster flex3™)	44,841		340,613		1,095,374
Touchstone Conservative ETF (Grandmaster™)	11,761		4,079		149,312
Touchstone Conservative ETF (IQ Annuity™)	962,654		360,320		1,949,702
Touchstone Conservative ETF (Pinnacle Plus™)	103,104		241,945		624,095
Touchstone Core Bond (AnnuiChoice™)	291,020		318,639		243,438
Touchstone Core Bond (AnnuiChoice II™)	68,911		8,738		60,352
Touchstone Core Bond (GrandMaster flex3™)	77,192		96,005		556,258
Touchstone Core Bond (Grandmaster™)	240,814		207,363		53,778
Touchstone Core Bond (IQ Annuity™)	413,535		550,318		330,807
Touchstone Core Bond (Pinnacle Plus™)	68,783		61,564		229,296
Touchstone Eagle Capital Appreciation (AnnuiChoice™)	201,741		18,148		190,293
Touchstone Eagle Capital Appreciation (GrandMaster™)	61,283		18,514		42,778
Touchstone Eagle Capital Appreciation (GrandMaster flex3™)	241,929		84,392		191,280
Touchstone Eagle Capital Appreciation (IQ Annuity™)	528,913		284,744		393,819
Touchstone Eagle Capital Appreciation (Pinnacle Plus™)	244,817		82,290		227,858
Touchstone Enhanced ETF (AnnuiChoice™)	57,007		47,608		1,657,595
Touchstone Enhanced ETF (GrandMaster flex3™)	176,564		174,081		1,758,201
Touchstone Enhanced ETF (Grandmaster™)	216,711		1,435,144		2,068,058
Touchstone Enhanced ETF (IQ Annuity™)	419,721		733,417		1,096,880
Touchstone Enhanced ETF (Pinnacle Plus™)	392,766		323,458		838,598
Touchstone Growth & Income (AnnuiChoice™)	4,051		2,324		40,869
Touchstone Growth & Income (GrandMaster flex3™)	2,821		240		16,500
Touchstone Growth & Income (IQ Annuity™)	17,915		1,867		57,357
Touchstone Growth & Income (Pinnacle Plus™)	33,010		3,710		114,330

31

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

2. Investments (continued)

Division	Purchases		Sales		Cost
Affiliated (continued):
Touchstone High Yield (AnnuiChoice™)	$	137,340	$	68,718	$	438,523
Touchstone High Yield (GrandMaster flex3™)	59,202		74,871		432,821
Touchstone High Yield (Grandmaster™)	114,389		233,426		151,359
Touchstone High Yield (IQ Annuity™)	100,968		170,556		326,160
Touchstone High Yield (Pinnacle Plus™)	148,931		127,169		915,079
Touchstone Large Cap Core Equity (AnnuiChoice II™)	336,231		15,149		321,562
Touchstone Large Cap Core Equity (GrandMaster flex3™)	18,961		37,157		39,874
Touchstone Large Cap Core Equity (Grandmaster™)	5,203		8,188		6,896
Touchstone Large Cap Core Equity (IQ Annuity™)	10,977		4,960		101,224
Touchstone Large Cap Core Equity (Pinnacle Plus™)	51,903		7,923		114,732
Touchstone Mid Cap Growth (AnnuiChoice™)	194,756		38,679		355,831
Touchstone Mid Cap Growth (AnnuiChoice II™)	53,252		3,681		49,783
Touchstone Mid Cap Growth (GrandMaster flex3™)	394,595		80,637		584,148
Touchstone Mid Cap Growth (Grandmaster™)	156,870		60,692		261,569
Touchstone Mid Cap Growth (IQ Annuity™)	578,245		275,698		657,367
Touchstone Mid Cap Growth (Pinnacle Plus™)	961,460		370,708		1,224,172
Touchstone Moderate ETF (AnnuiChoice™)	8,134		54,243		224,779
Touchstone Moderate ETF (GrandMaster flex3™)	166,668		427,527		1,739,790
Touchstone Moderate ETF (Grandmaster™)	25,382		73,124		300,269
Touchstone Moderate ETF (IQ Annuity™)	1,484,472		785,438		2,771,486
Touchstone Moderate ETF (Pinnacle Plus™)	155,678		120,851		937,169
Touchstone Money Market (AnnuiChoice™)	14,852		252,333		181,515
Touchstone Money Market (Grandmaster™)	5,414,360		4,250,141		5,817,179
Touchstone Money Market (IQ Annuity™)	155		127		3,128
Touchstone Third Avenue Value (AnnuiChoice™)	1,197,308		377,159		2,503,164
Touchstone Third Avenue Value (GrandMaster flex3™)	1,399,258		1,004,902		3,014,443
Touchstone Third Avenue Value (Grandmaster™)	2,702,177		1,141,581		4,451,475
Touchstone Third Avenue Value (IQ Annuity™)	1,533,283		1,155,221		3,542,017
Touchstone Third Avenue Value (Pinnacle Plus™)	1,817,262		688,045		3,581,607
Touchstone Third Avenue Value (AnnuiChoice II™)	795,358		80,430		796,036
Touchstone Value Plus (AnnuiChoice™)	1,898		29,169		87,494
Touchstone Value Plus (AnnuiChoice II™)	3,279		4		3,275
Touchstone Value Plus (GrandMaster flex3™)	13,756		1,947		113,274
Touchstone Value Plus (Grandmaster™)	8,800		1,418		40,583
Touchstone Value Plus (IQ Annuity™)	5,062		23,340		163,391
Touchstone Value Plus (Pinnacle Plus™)	48,258		102,772		273,677
Non-Affiliated:
JP Morgan Mid Cap Value (AnnuiChoice™)	21,960		90,084		277,966
JP Morgan Mid Cap Value (GrandMaster flex3™)	10,567		54,017		168,829
JP Morgan Mid Cap Value (Grandmaster™)	7,982		63,775		83,285
JP Morgan Mid Cap Value (IQ3™)	4,657		39,556		76,977
JP Morgan Mid Cap Value (Pinnacle Plus™)	57,980		70,380		894,417
Non-Affiliated Initial Class:
Fidelity VIP Equity-Income (Grandmaster™)	2,598,812		5,599,204		20,061,536
Fidelity VIP Growth (Grandmaster™)	279,822		3,131,843		7,304,197
Fidelity VIP High Income (Grandmaster™)	584,672		1,975,606		4,680,858
Fidelity VIP II Asset Manager (Grandmaster™)	768,491		1,920,212		6,183,951
Fidelity VIP II Contrafund (Grandmaster™)	6,692,708		4,685,343		21,160,331

32

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

2.  Investments (continued)

Division	Purchases		Sales		Cost
Non-Affiliated Initial Class (continued):
Fidelity VIP II Index 500 (Grandmaster™)	$	296,260	$	2,356,778	$	5,037,311
Fidelity VIP II Investment Grade Bond (AnnuiChoice™)	634,898		52,708		581,684
Fidelity VIP II Investment Grade Bond (Grandmaster™)	339,894		1,003,476		2,620,196
Fidelity VIP II Investment Grade Bond (GrandmasterFlex3™)	449,112		123,588		325,258
Fidelity VIP II Investment Grade Bond (IQ3™)	266,680		107,136		159,966
Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)	511,607		136,424		374,036
Fidelity VIP III Balanced (Grandmaster™)	194,665		1,182,352		2,012,431
Fidelity VIP III Growth & Income (Grandmaster™)	435,275		919,888		2,637,764
Fidelity VIP III Growth Opportunities (Grandmaster™)	40,243		377,201		623,117
Fidelity VIP Overseas (AnnuiChoice™)	504,548		153,221		355,467
Fidelity VIP Overseas (AnnuiChoice II™)	53,517		912		52,637
Fidelity VIP Overseas (Grandmaster™)	1,859,999		2,746,948		3,679,252
Fidelity VIP Overseas (GrandmasterFlex3™)	520,103		189,078		334,984
Fidelity VIP Overseas (IQ3™)	279,501		99,878		186,951
Fidelity VIP Overseas (Pinnacle Plus™)	789,254		40,552		749,778
Affiliated Service Class:
Touchstone Aggressive ETF (AnnuiChoice™)	178,491		117,325		87,154
Touchstone Aggressive ETF (AnnuiChoice II™)	353,111		5,122		647,510
Touchstone Aggressive ETF (GrandmasterFlex3™)	74,718		603		74,113
Touchstone Aggressive ETF (Pinnacle Plus™)	112,177		6,321		105,888
Touchstone GMAB Aggressive ETF (AnnuiChoice II™)	322,669		4,571		318,267
Touchstone Conservative ETF (AnnuiChoice II ™)	42,258		463		41,811
Touchstone Conservative ETF (GrandmasterFlex3™)	721,898		7,598		714,495
Touchstone Conservative ETF (Pinnacle Plus™)	258,986		6,442		252,583
Touchstone Enhanced ETF (AnnuiChoice™)	233,719		2,144		285,317
Touchstone Enhanced ETF (AnnuiChoice II™)	186,591		1,051		196,671
Touchstone Enhanced ETF (GrandmasterFlex3™)	303,770		26,263		278,024
Touchstone Enhanced ETF (Pinnacle Plus™)	457,614		12,930		444,333
Touchstone Moderate ETF (AnnuiChoice™)	286,644		4,965		454,064
Touchstone Moderate ETF (AnnuiChoice II™)	451,403		1,708		473,853
Touchstone Moderate ETF (GrandmasterFlex3™)	463,039		33,459		429,432
Touchstone Moderate ETF (Pinnacle Plus™)	2,010,254		8,942		2,001,230
Touchstone Money Market (AnnuiChoice™)	797,961		1,492,197		1,260,870
Touchstone Money Market (AnnuiChoice II™)	24,223		356		23,867
Touchstone Money Market (GrandMaster flex3™)	4,901,328		3,627,470		3,176,996
Touchstone Money Market (IQ Annuity™)	16,722,430		10,967,263		8,166,341
Touchstone Money Market (Pinnacle Plus™)	7,207,769		5,830,550		2,988,532
Non-Affiliated Service Class:
Fidelity VIP III Mid Cap (Grandmaster™)	742,141		2,532,963		4,054,497
Non-Affiliated Service Class 2:
Fidelity VIP Asset Manager (AnnuiChoice™)	46,165		35,314		240,482
Fidelity VIP Asset Manager (AnnuiChoice II™)	7,601		13		7,588
Fidelity VIP Asset Manager (GrandMaster flex3™)	31,693		158,097		101,400
Fidelity VIP Asset Manager (IQ3™)	195,019		126,169		487,336
Fidelity VIP Asset Manager (Pinnacle Plus™)	76,047		4,849		169,754
Fidelity VIP Balanced (AnnuiChoice™)	59,971		65,950		300,061
Fidelity VIP Balanced (AnnuiChoice II™)	15,702		7,452		8,289
Fidelity VIP Balanced (GrandMaster ™)	591,722		46,167		545,584

33

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

2.  Investments (continued)

Division	Purchases			Sales		Cost
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Balanced (GrandMaster flex3™)	$	238,924		$	69,903	$	531,972
Fidelity VIP Balanced (IQ3™)	220,129			148,531		447,317
Fidelity VIP Balanced (Pinnacle Plus™)	254,879			53,534		537,473
Fidelity VIP Contrafund (AnnuiChoice™)	1,229,738			461,339		3,342,431
Fidelity VIP Contrafund (GrandMaster flex3™)	1,427,715			629,567		3,005,143
Fidelity VIP Contrafund (IQ3™)	1,325,581			999,386		3,365,165
Fidelity VIP Contrafund (Pinnacle Plus™)	2,499,705			396,053		4,746,706
Fidelity VIP Contrafund (AnnuiChoice II™)	1,018,283			122,581		979,787
Fidelity VIP Contrafund Standard (IQ Advisor™)	1,767			40		7,795
Fidelity VIP Disclipined Small Cap (AnnuiChoice™)	78,513			4,678		73,820
Fidelity VIP Disclipined Small Cap (IQ™)	90,495			15,425		75,290
Fidelity VIP Disclipined Small Cap (Grandmaster™)	47,214			22,086		24,892
Fidelity VIP Disclipined Small Cap (GrandmasterFlex3™)	77,709			25,426		51,316
Fidelity VIP Disclipined Small Cap (Pinnacle Plus™)	227,969			174,793		53,042
Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)	10,872			2,643		101,123
Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)	15,362			57,152		43,889
Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)	905,921			165,039		1,940,525
Fidelity VIP Dynamic Capital Appreciation (IQ Annuity™)	11,583			9,322		91,759
Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)	346,303			269,739		257,059
Fidelity VIP Equity-Income (AnnuiChoice™)	231,751			268,973		996,112
Fidelity VIP Equity-Income (AnnuiChoice II™)	172,246			16,809		155,288
Fidelity VIP Equity-Income (GrandMaster flex3™)	167,927			177,010		473,452
Fidelity VIP Equity-Income (IQ3™)	340,810			233,840		981,597
Fidelity VIP Equity-Income (Pinnacle Plus™)	770,412			211,428		2,388,518
Fidelity VIP Freedom 2010 (Grandmaster™)	93,964			1,582		92,362
Fidelity VIP Freedom 2010 (GrandmasterFlex3™)	36,009			7		36,002
Fidelity VIP Freedom 2010 (IQ3™)	27,870			563		27,295
Fidelity VIP Freedom 2015 (AnnuiChoiceII™)	13,094			37		13,058
Fidelity VIP Freedom 2015 (GrandmasterFlex3™)	1,625			2		1,623
Fidelity VIP Freedom 2015 (IQ3™)	342,843			2,110		340,785
Fidelity VIP Freedom 2020 (AnnuiChoiceII™)	34,908			11		34,897
Fidelity VIP Freedom 2020 (IQ3™)	41,782			111		41,670
Fidelity VIP Freedom 2020 (Pinnacle Plus™)	20,796			67		20,728
Fidelity VIP Freedom 2030 (Pinnacle Plus™)	2,120			1		2,119
Fidelity VIP Growth & Income (AnnuiChoice™)	46,030			56,339		185,116
Fidelity VIP Growth & Income (AnnuiChoice II™)	4,258			20		4,239
Fidelity VIP Growth & Income (GrandMaster flex3™)	81,908			87,023		200,182
Fidelity VIP Growth & Income (IQ3™)	44,167			117,873		104,306
Fidelity VIP Growth & Income (Pinnacle Plus™)	223,636			27,162		326,093
Fidelity VIP Growth (AnnuiChoice™)	132,868			81,160		253,826
Fidelity VIP Growth (AnnuiChoice II™)	61,829			64		61,773
Fidelity VIP Growth (GrandMaster™)	793,373			84,845		719,728
Fidelity VIP Growth (GrandMaster flex3™)	144,146			68,902		243,866
Fidelity VIP Growth (IQ3™)	385,466			320,233		442,509
Fidelity VIP Growth (Pinnacle Plus™)	430,421			243,993		532,564
Fidelity VIP Growth Opportunities (AnnuiChoice™)	(1		)	15,240		31,253
Fidelity VIP Growth Opportunities (GrandMaster flex3™)	116,529			117,604		115,233
Fidelity VIP Growth Opportunities (IQ3™)	188,106			100,653		155,462

34

Separate Account I

of

National 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 (Pinnacle Plus™)	$	501,495	$	341,015	$	261,312
Fidelity VIP High Income (AnnuiChoice™)	115,979		86,809		354,806
Fidelity VIP High Income (AnnuiChoice II™)	20,146		6,667		13,318
Fidelity VIP High Income (GrandMaster flex3™)	1,327,535		3,160,751		584,231
Fidelity VIP High Income (IQ3™)	3,897,125		6,598,340		1,095,246
Fidelity VIP High Income (Pinnacle Plus™)	67,625		46,485		307,111
Fidelity VIP II Index 500 (AnnuiChoice™)	1,307,037		146,734		1,526,681
Fidelity VIP II Index 500 (AnnuiChoice II™)	96,343		1,297		95,074
Fidelity VIP II Index 500 (Grandmaster™)	3,797,870		961,770		2,835,816
Fidelity VIP II Index 500 (GrandmasterFlex3™)	1,155,759		153,566		1,003,596
Fidelity VIP Index 500 (IQ3™)	799,126		510,143		888,221
Fidelity VIP Index 500 (Pinnacle Plus™)	2,358,443		101,534		2,354,763
Fidelity VIP Investment Grade Bond (AnnuiChoice™)	69,537		141,495		884,893
Fidelity VIP Investment Grade Bond (GrandMaster ™)	484,253		147,388		338,527
Fidelity VIP Investment Grade Bond (GrandMaster flex3™)	155,246		151,896		410,303
Fidelity VIP Investment Grade Bond (IQ3™)	303,854		450,426		1,050,888
Fidelity VIP Investment Grade Bond (Pinnacle Plus™)	195,267		57,515		444,334
Fidelity VIP Investment Grade Bond (AnnuiChoice II™)	264,385		4,868		276,200
Fidelity VIP Mid Cap (AnnuiChoice™)	300,243		341,987		941,592
Fidelity VIP Mid Cap (GrandMaster flex3™)	638,386		229,067		1,783,373
Fidelity VIP Mid Cap (IQ Annuity™)	540,212		725,522		1,633,378
Fidelity VIP Mid Cap (Pinnacle Plus™)	1,369,221		694,312		2,336,085
Fidelity VIP Mid Cap (AnnuiChoice II™)	60,847		3,722		62,826
Fidelity VIP Mid Cap (Grandmaster™)	1,379,419		155,797		1,240,252
Fidelity VIP Overseas (AnnuiChoice™)	692,034		149,780		823,000
Fidelity VIP Overseas (GrandMaster™)	2,716,871		150,025		2,569,224
Fidelity VIP Overseas (GrandMaster flex3™)	609,415		201,817		762,699
Fidelity VIP Overseas (IQ3™)	787,740		268,157		870,138
Fidelity VIP Overseas (Pinnacle Plus™)	1,380,451		828,046		1,157,306
Fidelity VIP Overseas (AnnuiChoice II™)	57,070		666		70,446
Non-Affiliated Class 1:
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	24,104		3,136		246,511
Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)	16,460		39,464		57,299
Van Kampen UIF Emerging Markets Debt (IQ3™)	16,487		74,201		43,218
Van Kampen UIF U.S. Real Estate (AnnuiChoice™)	108,912		747,796		292,527
Van Kampen UIF U.S. Real Estate (GrandMaster flex3™)	338,744		745,818		521,601
Van Kampen UIF U.S. Real Estate (IQ3™)	142,447		162,659		218,054
Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)	589,807		482,560		80,978
Non-Affiliated Class 2:
Franklin Foreign Securities (IQ Annuity™)	357,488		217,146		491,657
Franklin Growth and Income Securities (AnnuiChoice™)	1,007,638		146,470		963,601
Franklin Growth and Income Securities (AnnuiChoice II™)	52,021		8,178		43,313
Franklin Growth and Income Securities (GrandMaster flex3™)	571,061		136,212		617,402
Franklin Growth and Income Securities (Grandmaster™)	1,849,897		306,372		1,919,801
Franklin Growth and Income Securities (IQ Annuity™)	2,243,442		770,226		1,857,989
Franklin Growth and Income Securities (Pinnacle Plus™)	2,244,589		404,438		2,334,533
Franklin Income Securities (AnnuiChoice™)	175,050		105,181		555,894
Franklin Income Securities (AnnuiChoice II™)	137,716		2,207		135,524

35

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

2.  Investments (continued)

Division	Purchases		Sales		Cost
Non-Affiliated Class 2 (continued):
Franklin Income Securities (GrandMaster flex3™)	$	1,172,140	$	434,610	$	3,138,548
Franklin Income Securities (Grandmaster™)	1,547,790		772,291		3,357,889
Franklin Income Securities (IQ Annuity™)	967,432		402,560		2,108,650
Franklin Income Securities (Pinnacle Plus™)	769,252		92,315		2,539,475
Franklin Large Cap Growth Securities (AnnuiChoice™)	37,438		37,995		58,074
Franklin Large Cap Growth Securities (GrandMaster flex3™)	136,669		138,730		270,720
Franklin Large Cap Growth Securities (Grandmaster™)	166,017		47,373		261,848
Franklin Large Cap Growth Securities (IQ Annuity™)	207,773		92,597		401,303
Franklin Large Cap Growth Securities (Pinnacle Plus™)	332,505		226,403		447,687
Franklin Large Cap Growth Securities (AnnuiChoice II™)	91,966		1,318		99,168
Franklin Mutual Shares Securities (AnnuiChoice™)	565,183		268,597		1,099,161
Franklin Mutual Shares Securities (AnnuiChoice II™)	265,210		3,186		261,997
Franklin Mutual Shares Securities (GrandMaster flex3™)	879,904		145,265		1,991,273
Franklin Mutual Shares Securities (IQ Annuity™)	454,095		148,672		879,272
Franklin Mutual Shares Securities (Pinnacle Plus™)	908,130		270,001		1,937,762
Franklin Mutual Shares Securities Standard (IQ Advisor™)	676		83		12,202
Franklin Mutual Shares Securities(Grandmaster™)	2,261,885		340,071		3,104,284
Franklin Small Cap Value Securities (AnnuiChoice™)	11,020		9,356		1,013
Franklin Small Cap Value Securities (GrandmasterFlex3™)	71,549		9,712		60,972
Franklin Small Cap Value Securities (IQ3 ™)	117,019		99,273		10,974
Franklin Small Cap Value Securities (Pinnacle Plus ™)	16,026		95		15,924
Templeton Foriegn Securities Fund (GrandMaster flex3™)	323,373		148,398		639,711
Templeton Foriegn Securities Fund (Grandmaster™)	1,528,955		1,507,796		291,037
Templeton Foriegn Securities Fund (Pinnacle Plus™)	580,806		193,566		926,290
Templeton Foreign Securities Fund (AnnuiChoice™)	74,514		37,286		119,257
Templeton Foreign Securities Fund (AnnuiChoice II™)	18,946		752		19,940
Templeton Growth Securities (AnnuiChoice™)	101,314		54,522		122,890
Templeton Growth Securities (AnnuiChoice II™)	41,047		1,104		39,891
Templeton Growth Securities (GrandMaster flex3™)	683,093		114,217		1,485,870
Templeton Growth Securities (Grandmaster™)	213,819		931,111		417,902
Templeton Growth Securities (IQ Annuity™)	3,221,623		3,927,908		894,307
Templeton Growth Securities (Pinnacle Plus™)	376,766		335,172		1,016,413
Templeton Growth Securities Standard (IQ Advisor™)	385		42		6,168
Van Kampen LIT Comstock (AnnuiChoice™)	7,661		4,501		112,490
Van Kampen LIT Comstock (GrandMaster flex3™)	41,346		67,394		270,122
Van Kampen LIT Comstock (Grandmaster™)	24,889		87,425		110,644
Van Kampen LIT Comstock (IQ Annuity™)	32,818		30,972		136,426
Van Kampen LIT Comstock (Pinnacle Plus™)	64,105		71,799		307,691
Van Kampen LIT Strategic Growth (GrandMaster flex3™)	443		14,790		9,751
Van Kampen LIT Strategic Growth (AnnuiChoice™)	10,283		777		9,427
Van Kampen LIT Strategic Growth (Grandmaster™)	158		6,741		378
Van Kampen LIT Strategic Growth (IQ Annuity™)	5		32		973
Van Kampen LIT Strategic Growth (Pinnacle Plus™)	509,523		317,375		306,952
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)	10,000		18		9,982
Van Kampen UIF Emerging Markets Debt (Grandmaster™)	8,184		59,599		22,783
Van Kampen UIF Emerging Markets Debt (GrandmasterFlex3™)	201,892		4,143		197,384
Van Kampen UIF Emerging Markets Debt (IQ3™)	229,283		934		228,369
Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)	65,388		38,968		330,344

36

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

2.  Investments (continued)

Division	Purchases		Sales		Cost
Non-Affiliated Class 2 (continued):
Van Kampen UIF Emerging Markets Equity (AnnuiChoice™)	$	1,087,080	$	746,409	$	920,153
Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)	925,026		173,015		1,214,344
Van Kampen UIF Emerging Markets Equity (Grandmaster™)	461,268		286,696		637,273
Van Kampen UIF Emerging Markets Equity (IQ Annuity™)	406,573		103,825		424,360
Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)	778,205		341,794		1,090,584
Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)	220,221		8,962		277,961
Van Kampen UIF U. S. Real Estate (AnnuiChoice™)	61,343		47,683		6,070
Van Kampen UIF U. S. Real Estate (AnnuiChoice II™)	109,873		26,825		77,965
Van Kampen UIF U.S. Real Estate (Grandmaster™)	114,981		302,604		370,848
Van Kampen UIF U.S. Real Estate (GrandmasterFlex3™)	145,748		28,641		112,249
Van Kampen UIF U.S. Real Estate (IQ3™)	236,020		104,090		129,268
Van Kampen UIF U. S. Real Estate (Pinnacle Plus™)	498,487		419,568		1,013,319
Non-Affiliated Class B:
DWS Small Cap Index VIP (AnnuiChoice™)	32,403		13,531		134,179
DWS Small Cap Index VIP (AnnuiChoice II™)	12,778		102		12,672
DWS Small Cap Index VIP (GrandMaster flex3™)	54,003		129,800		198,587
DWS Small Cap Index VIP (Grandmaster™)	226,301		223,363		17,701
DWS Small Cap Index VIP (IQ3™)	164,162		185,838		104,989
DWS Small Cap Index VIP (Pinnacle Plus™)	101,700		45,236		501,897

37

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (continued)

3.  Expenses

National 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 Smart Annuity (“IQ Annuity”), IQ3 the Smart Annuity (“IQ3”), IQ Advisor (Standard or Enhanced), AnnuiChoice, AnnuiChoice II, Pinnacle Plus and ETF easyAnnuity.  Grandmasterflex3, 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 charges 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 Easy Annuity 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  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.

National 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.

38

Separate Account I

of

National 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	45	$	12.45	$	565	1.64	%	1.00	%	4.07	%
	2006	59	11.96		702		1.50	%	1.00	%	12.39	%
	2005	51	10.64		545		0.00	%	1.00	%	3.63	%
	2004	35	10.27		362		13.94	%	1.00	%	2.70	%
Touchstone Aggressive ETF (GrandMaster flex3™)
	2007	55	12.23		672		1.88	%	1.55	%	3.49	%
	2006	57	11.82		678		1.51	%	1.55	%	11.77	%
	2005	47	10.58		493		0.00	%	1.55	%	2.99	%
	2004	14	10.27		148		88.01	%	1.55	%	2.70	%
Touchstone Aggressive ETF (Grandmaster™)
	2007	3	12.31		36		0.04	%	1.35	%	3.70	%
	2006	185	11.87		2,201		1.47	%	1.35	%	11.99	%
	2005	186	10.60		1,977		0.00	%	1.35	%	3.22	%
	2004	178	10.27		1,826		13.31	%	1.35	%	2.70	%
Touchstone Aggressive ETF (IQ Annuity™)
	2007	38	12.27		461		0.89	%	1.45	%	3.59	%
	2006	92	11.85		1,091		1.40	%	1.45	%	11.88	%
	2005	89	10.59		939		0.00	%	1.45	%	3.11	%
	2004	2	10.27		25		20.85	%	1.45	%	2.70	%
Touchstone Aggressive ETF (Pinnacle Plus™)
	2007	60	12.19		728		1.58	%	1.67	%	3.36	%
	2006	56	11.79		664		2.30	%	1.67	%	11.63	%
	2005	18	10.56		195		0.00	%	1.67	%	2.85	%
	2004	3	10.27		31		12.01	%	1.67	%	2.70	%

(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.

39

Separate Account I

of

National 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 Balanced (AnnuiChoice™)
	2007	9		$	14.44	$	131		5.36	%	1.00	%	4.42	%
	2006	9		13.82		130			1.37	%	1.00	%	9.80	%
	2005	17		12.59		217			1.44	%	1.00	%	5.54	%
	2004	18		11.93		217			1.16	%	1.00	%	8.55	%
	2003	14		10.99		150			1.33	%	1.00	%	20.37	%
Touchstone Balanced (GrandMaster flex3™)
	2007	25		14.54		370			4.97	%	1.55	%	3.83	%
	2006	28		14.01		394			1.74	%	1.55	%	9.19	%
	2005	40		12.83		508			1.56	%	1.55	%	4.97	%
	2004	34		12.22		416			1.29	%	1.55	%	7.95	%
	2003	15		11.32		168			3.09	%	1.55	%	19.66	%
Touchstone Balanced (Grandmaster™)
	2007	—	*	12.96		—		*	7.33	%	1.35	%	0.00	%
	2006	—	*	—		—		*	0.00	%	1.35	%	0.00	%
	2005	—	*	11.38		3			1.48	%	1.35	%	5.18	%
	2004	—	*	10.82		3			18.02	%	1.35	%	8.20	%
Touchstone Balanced (IQ Annuity™)
	2007	17		13.71		227			5.13	%	1.45	%	3.94	%
	2006	19		13.19		246			1.77	%	1.45	%	9.30	%
	2005	21		12.07		256			1.28	%	1.45	%	5.10	%
	2004	28		11.48		321			0.91	%	1.45	%	8.00	%
	2003	22		10.63		234			0.65	%	1.45	%	19.84	%
Touchstone Balanced (Pinnacle Plus™)
	2007	35		14.00		487			5.76	%	1.67	%	3.71	%
	2006	27		13.50		367			1.90	%	1.67	%	9.06	%
	2005	27		12.38		328			1.47	%	1.67	%	4.88	%
	2004	26		11.80		304			2.45	%	1.67	%	7.76	%
	2003	2		10.95		21			5.96	%	1.67	%	9.50	%
Touchstone Baron Small Cap (AnnuiChoice™)
	2007	17		18.44		309			0.00	%	1.00	%	1.73	%
	2006	23		18.12		411			0.00	%	1.00	%	17.09	%
	2005	27		15.48		419			0.00	%	1.00	%	6.61	%
	2004	25		14.52		363			0.00	%	1.00	%	26.59	%
	2003	11		11.47		127			0.00	%	1.00	%	31.99	%
Touchstone Baron Small Cap (AnnuiChoice II™)
	2007	1		11.47		13			0.00	%	1.15	%	1.57	%
Touchstone Baron Small Cap (GrandMaster flex3™)
	2007	45		17.07		761			0.00	%	1.55	%	1.16	%
	2006	44		16.87		741			0.00	%	1.55	%	16.44	%
	2005	38		14.49		551			0.00	%	1.55	%	6.01	%
	2004	22		13.67		298			0.00	%	1.55	%	25.87	%
	2003	9		10.86		95			0.00	%	1.55	%	31.32	%
Touchstone Baron Small Cap (Grandmaster™)
	2007	23		14.81		338			0.00	%	1.35	%	1.37	%
	2006	28		14.61		410			0.00	%	1.35	%	16.67	%
	2005	23		12.52		284			0.00	%	1.35	%	6.20	%
	2004	14		11.79		160			0.00	%	1.35	%	17.90	%

(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.

40

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements(continued)

4.  Financial Higlights (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 (IQ Annuity™)
	2007	75		$	17.52	$	1,312	0.00	%	1.45	%	1.26	%
	2006	72		17.31		1,253		0.00	%	1.45	%	16.56	%
	2005	73		14.85		1,091		0.00	%	1.45	%	6.13	%
	2004	71		13.99		994		0.00	%	1.45	%	25.92	%
	2003	71		11.11		794		0.00	%	1.45	%	31.64	%
Touchstone Baron Small Cap (Pinnacle Plus™)
	2007	41		17.26		706		0.00	%	1.67	%	1.04	%
	2006	38		17.08		643		0.00	%	1.67	%	16.30	%
	2005	34		14.69		495		0.00	%	1.67	%	5.91	%
	2004	18		13.87		247		0.00	%	1.67	%	25.63	%
	2003	2		11.04		23		0.00	%	1.67	%	10.40	%
Touchstone Conservative ETF (AnnuiChoice™)
	2007	1		11.65		11		0.58	%	1.00	%	4.69	%
	2006	3		11.13		33		0.96	%	1.00	%	7.07	%
	2005	—	*	10.40		5		0.00	%	1.00	%	2.33	%
Touchstone Conservative ETF (GrandMaster flex3™)
	2007	105		11.45		1,201		1.68	%	1.55	%	4.11	%
	2006	132		11.00		1,449		0.96	%	1.55	%	6.48	%
	2005	108		10.33		1,118		0.00	%	1.55	%	1.70	%
Touchstone Conservative ETF (Grandmaster™)
	2007	14		11.53		166		1.83	%	1.35	%	4.32	%
	2006	14		11.05		152		0.90	%	1.35	%	6.69	%
	2005	12		10.36		128		0.00	%	1.35	%	1.93	%
	2004	—	*	10.16		1		32.93	%	1.35	%	1.60	%
Touchstone Conservative ETF (IQ Annuity™)
	2007	180		11.49		2,072		1.96	%	1.45	%	4.22	%
	2006	128		11.03		1,412		0.88	%	1.45	%	6.58	%
	2005	115		10.34		1,193		0.00	%	1.45	%	1.82	%
	2004	2		10.16		25		27.40	%	1.45	%	1.60	%
Touchstone Conservative ETF (Pinnacle Plus™)
	2007	59		11.41		676		1.55	%	1.67	%	3.98	%
	2006	72		10.97		787		1.02	%	1.67	%	6.35	%
	2005	32		10.32		333		0.00	%	1.67	%	1.56	%
	2004	3		10.16		32		28.12	%	1.67	%	1.60	%
Touchstone Core Bond (AnnuiChoice™)
	2007	20		12.24		242		3.89	%	1.00	%	4.39	%
	2006	23		11.73		266		4.33	%	1.00	%	3.02	%
	2005	20		11.38		232		0.00	%	1.00	%	0.64	%
	2004	30		11.31		342		3.36	%	1.00	%	2.26	%
	2003	36		11.06		403		4.54	%	1.00	%	2.50	%
Touchstone Core Bond (AnnuiChoice II™)
	2007	6		10.59		60		6.27	%	1.15	%	4.23	%
Touchstone Core Bond (GrandMaster flex3™)
	2007	49		11.50		560		4.45	%	1.55	%	3.81	%
	2006	52		11.07		575		4.52	%	1.55	%	2.45	%
	2005	50		10.81		539		0.00	%	1.55	%	0.08	%
	2004	47		10.80		509		4.34	%	1.55	%	1.69	%
	2003	33		10.62		345		5.59	%	1.55	%	1.92	%

(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.

41

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements(continued)

4.  Financial Higlights (continued)

								Investment
		Units		Unit		Net Assets		Income		Expense		Total
Division	Year	(000s)		Value		(000s)		Ratio (1)		Ratio		Return (2)
Affiliated (continued):
Touchstone Core Bond (Grandmaster™)
	2007	5		$	11.01	$	52	4.10	%	1.35	%	4.02	%
	2006	2		10.58		16		0.81	%	1.35	%	2.65	%
	2005	1		10.31		12		0.00	%	1.35	%	0.29	%
	2004	4		10.28		40		33.13	%	1.35	%	2.80	%
Touchstone Core Bond (IQ Annuity™)
	2007	28		11.89		328		3.49	%	1.45	%	3.91	%
	2006	40		11.44		460		3.77	%	1.45	%	2.55	%
	2005	55		11.15		618		0.00	%	1.45	%	0.21	%
	2004	46		11.13		508		4.08	%	1.45	%	1.83	%
	2003	44		10.93		484		3.59	%	1.45	%	1.96	%
Touchstone Core Bond (Pinnacle Plus™)
	2007	21		10.75		230		4.36	%	1.67	%	3.68	%
	2006	21		10.37		220		4.56	%	1.67	%	2.32	%
	2005	20		10.13		201		0.00	%	1.67	%	0.02	%
	2004	12		10.13		125		11.91	%	1.67	%	1.50	%
	2003	2		9.98		18		14.10	%	1.67	%	-0.20	%
Touchstone Eagle Capital Appreciation (AnnuiChoice™)
	2007	15		11.80		182		0.88	%	1.00	%	-0.16	%
	2006	—	*	11.82		7		0.72	%	1.00	%	15.62	%
	2005	4		10.22		41		0.08	%	1.00	%	-0.87	%
	2004	4		10.31		40		1.01	%	1.00	%	13.67	%
	2003	4		9.07		35		0.18	%	1.00	%	31.07	%
Touchstone Eagle Capital Appreciation (AnnuiChoice II™)
	2007	3		12.92		41		0.76	%	1.35	%	-0.51	%
Touchstone Eagle Capital Appreciation (GrandMaster flex3™)
	2007	13		14.03		183		0.79	%	1.55	%	-0.71	%
	2006	2		14.13		35		0.80	%	1.55	%	14.98	%
	2005	3		12.29		33		0.09	%	1.55	%	-1.47	%
	2004	2		12.47		28		1.18	%	1.55	%	13.16	%
	2003	1		11.02		11		0.26	%	1.55	%	30.26	%
Touchstone Eagle Capital Appreciation (IQ Annuity™)
	2007	32		11.80		377		0.62	%	1.45	%	-0.61	%
	2006	13		11.87		149		0.83	%	1.45	%	15.10	%
	2005	17		10.31		174		0.07	%	1.45	%	-1.32	%
	2004	22		10.45		234		1.02	%	1.45	%	13.22	%
	2003	24		9.23		218		0.14	%	1.45	%	30.37	%
Touchstone Eagle Capital Appreciation (Pinnacle Plus™)
	2007	16		14.02		218		0.77	%	1.67	%	-0.83	%
	2006	5		14.14		65		0.90	%	1.67	%	14.84	%
	2005	4		12.31		45		0.09	%	1.67	%	-1.56	%
	2004	4		12.51		46		1.54	%	1.67	%	13.01	%
	2003	2		11.07		18		0.30	%	1.67	%	10.70	%

(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.

42

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements(continued)

4.  Financial Higlights (continued)

								Investment
		Units		Unit		Net Assets		Income		Expense		Total
Division	Year	(000s)		Value		(000s)		Ratio (1)		Ratio		Return (2)
Affiliated (continued):
Touchstone Enhanced ETF (AnnuiChoice™)
	2007	153		$	12.97	$	1,988	2.00	%	1.00	%	2.98	%
	2006	155		12.59		1,957		0.74	%	1.00	%	14.24	%
	2005	146		11.02		1,610		0.00	%	1.00	%	5.00	%
Touchstone Enhanced ETF (GrandMaster flex3™)
	2007	156		12.75		1,993		1.94	%	1.55	%	2.41	%
	2006	158		12.45		1,962		0.80	%	1.55	%	13.60	%
	2005	111		10.96		1,216		0.00	%	1.55	%	4.35	%
	2004	—	*	10.50		3		6.70	%	1.55	%	5.00	%
Touchstone Enhanced ETF (Grandmaster™)
	2007	180		12.83		2,309		1.53	%	1.35	%	2.62	%
	2006	275		12.50		3,440		0.73	%	1.35	%	13.83	%
	2005	256		10.98		2,809		0.00	%	1.35	%	4.58	%
	2004	26		10.50		274		7.77	%	1.35	%	5.00	%
Touchstone Enhanced ETF (IQ Annuity™)
	2007	90		12.79		1,156		1.78	%	1.45	%	2.51	%
	2006	117		12.47		1,456		0.73	%	1.45	%	13.72	%
	2005	83		10.97		910		0.00	%	1.45	%	4.47	%
Touchstone Enhanced ETF (Pinnacle Plus™)
	2007	68		12.70		867		1.67	%	1.67	%	2.28	%
	2006	63		12.42		786		1.25	%	1.67	%	13.47	%
	2005	16		10.94		178		0.00	%	1.67	%	4.21	%
	2004	2		10.50		19		7.25	%	1.67	%	5.00	%
Touchstone Growth & Income (AnnuiChoice™)
	2007	3		13.93		39		3.98	%	1.00	%	2.88	%
	2006	3		13.54		39		2.15	%	1.00	%	12.54	%
	2005	7		12.03		82		0.03	%	1.00	%	0.84	%
	2004	8		11.93		92		1.81	%	1.00	%	9.05	%
	2003	8		10.94		88		9.79	%	1.00	%	31.49	%
Touchstone Growth & Income (GrandMaster flex3™)
	2007	1		13.77		15		4.12	%	1.55	%	2.31	%
	2006	1		13.46		14		1.52	%	1.55	%	11.92	%
	2005	7		12.03		85		0.04	%	1.55	%	0.32	%
	2004	11		11.99		130		1.86	%	1.55	%	8.31	%
	2003	11		11.07		120		28.49	%	1.55	%	30.85	%
Touchstone Growth & Income (IQ Annuity™)
	2007	4		14.02		54		4.15	%	1.45	%	2.41	%
	2006	3		13.69		42		2.14	%	1.45	%	12.03	%
	2005	4		12.22		50		0.01	%	1.45	%	0.41	%
	2004	22		12.17		273		1.76	%	1.45	%	8.47	%
	2003	18		11.22		198		4.38	%	1.45	%	30.92	%
Touchstone Growth & Income (Pinnacle Plus™)
	2007	8		14.11		108		4.38	%	1.67	%	2.18	%
	2006	6		13.81		85		2.50	%	1.67	%	11.78	%
	2005	7		12.35		83		0.03	%	1.67	%	0.20	%
	2004	6		12.33		80		2.87	%	1.67	%	8.25	%
	2003	1		11.39		14		32.79	%	1.67	%	13.90	%

(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.

43

Separate Account I

of

National Integrity Life Insurance Compan

Notes to Financial Statements(continued)

4.  Financial Higlights (continued)

								Investment
		Units		Unit		Net Assets		Income		Expense		Total
Division	Year	(000s)		Value		(000s)		Ratio (1)		Ratio		Return (2)
Affiliated (continued):
Touchstone High Yield (AnnuiChoice™)
	2007	27		$	14.84	$	403	9.01	%	1.00	%	0.76	%
	2006	25		14.72		365		12.60	%	1.00	%	6.82	%
	2005	12		13.78		166		0.00	%	1.00	%	2.26	%
	2004	18		13.48		247		7.05	%	1.00	%	8.45	%
	2003	22		12.43		279		13.00	%	1.00	%	22.70	%
Touchstone High Yield (GrandMaster flex3™)
	2007	29		14.11		407		8.30	%	1.55	%	0.19	%
	2006	32		14.08		449		7.48	%	1.55	%	6.23	%
	2005	35		13.25		466		0.00	%	1.55	%	1.65	%
	2004	37		13.04		488		8.38	%	1.55	%	7.86	%
	2003	29		12.09		347		16.05	%	1.55	%	22.12	%
Touchstone High Yield (Grandmaster™)
	2007	12		11.62		139		5.77	%	1.35	%	0.40	%
	2006	23		11.57		264		7.44	%	1.35	%	6.45	%
	2005	34		10.87		371		0.00	%	1.35	%	1.90	%
	2004	32		10.67		342		40.88	%	1.35	%	6.70	%
Touchstone High Yield (IQ Annuity™)
	2007	21		14.73		307		6.91	%	1.45	%	0.30	%
	2006	27		14.68		398		7.43	%	1.45	%	6.34	%
	2005	29		13.81		397		0.00	%	1.45	%	1.76	%
	2004	27		13.57		364		6.60	%	1.45	%	7.96	%
	2003	36		12.57		447		8.98	%	1.45	%	22.28	%
Touchstone High Yield (Pinnacle Plus™)
	2007	70		12.26		863		8.29	%	1.67	%	0.07	%
	2006	74		12.25		901		7.96	%	1.67	%	6.10	%
	2005	64		11.55		741		0.00	%	1.67	%	1.55	%
	2004	28		11.37		322		16.97	%	1.67	%	7.77	%
	2003	2		10.55		25		28.17	%	1.67	%	5.50	%
Touchstone Large Cap Core Equity (AnnuiChoice II™)
	2007	28		11.42		323		4.37	%	1.15	%	4.10	%
Touchstone Large Cap Core Equity (GrandMaster flex3™)
	2007	3		13.76		44		2.95	%	1.55	%	3.68	%
	2006	5		13.27		60		2.39	%	1.55	%	24.62	%
	2005	5		10.65		56		0.00	%	1.55	%	-4.59	%
	2004	5		11.16		52		3.19	%	1.55	%	3.62	%
	2003	1		10.77		9		3.36	%	1.55	%	29.76	%
Touchstone Large Cap Core Equity (Grandmaster™)
	2007	1		13.14		7		1.93	%	1.35	%	3.89	%
	2006	—	*	12.65		10		2.35	%	1.35	%	24.87	%
	2005	—	*	10.13		8		0.00	%	1.35	%	-4.35	%
	2004	2		10.59		25		14.55	%	1.35	%	5.90	%
Touchstone Large Cap Core Equity (IQ Annuity™)
	2007	8		13.01		110		3.06	%	1.45	%	3.78	%
	2006	8		12.54		102		5.26	%	1.45	%	24.75	%
	2005	3		10.05		26		0.00	%	1.45	%	-4.47	%
	2004	—	*	10.52		1		0.05	%	1.45	%	3.65	%
	2003	3		10.15		34		1.93	%	1.45	%	29.96	%

(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

National 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 Large Cap Core Equity (Pinnacle Plus™)
	2007	8	$	14.15	$	120	3.35	%	1.67	%	3.55	%
	2006	6	13.67		75		2.35	%	1.67	%	24.47	%
	2005	5	10.98		50		0.00	%	1.67	%	-4.68	%
	2004	3	11.52		39		2.80	%	1.67	%	3.41	%
Touchstone Mid Cap Growth (AnnuiChoice™)
	2007	17	19.42		328		3.86	%	1.00	%	13.28	%
	2006	11	17.15		194		0.00	%	1.00	%	15.02	%
	2005	19	14.91		288		6.09	%	1.00	%	14.15	%
	2004	27	13.06		357		2.03	%	1.00	%	10.96	%
	2003	23	11.77		276		0.00	%	1.00	%	45.85	%
Touchstone Mid Cap Growth (AnnuiChoice II™)
	2007	4	12.24		45		4.58	%	1.15	%	13.11	%
Touchstone Mid Cap Growth (GrandMaster flex3™)
	2007	28	19.02		537		4.01	%	1.55	%	12.65	%
	2006	16	16.89		267		0.00	%	1.55	%	14.38	%
	2005	9	14.76		139		5.15	%	1.55	%	13.49	%
	2004	8	13.01		101		3.21	%	1.55	%	10.35	%
	2003	1	11.79		13		0.00	%	1.55	%	45.02	%
Touchstone Mid Cap Growth (Grandmaster™)
	2007	15	15.81		240		3.66	%	1.35	%	12.88	%
	2006	11	14.01		159		0.00	%	1.35	%	14.61	%
	2005	10	12.22		123		5.37	%	1.35	%	13.78	%
	2004	12	10.74		124		5.30	%	1.35	%	7.40	%
Touchstone Mid Cap Growth (IQ Annuity™)
	2007	29	20.22		593		3.79	%	1.45	%	12.76	%
	2006	18	17.93		332		0.00	%	1.45	%	14.50	%
	2005	22	15.66		342		4.33	%	1.45	%	13.67	%
	2004	28	13.78		386		1.85	%	1.45	%	10.42	%
	2003	26	12.48		326		0.00	%	1.45	%	45.12	%
Touchstone Mid Cap Growth (Pinnacle Plus™)
	2007	60	18.57		1,119		4.23	%	1.67	%	12.51	%
	2006	36	16.51		600		0.00	%	1.67	%	14.24	%
	2005	30	14.45		438		5.97	%	1.67	%	13.33	%
	2004	19	12.75		238		2.65	%	1.67	%	10.20	%
	2003	4	11.57		48		0.00	%	1.67	%	15.70	%
Touchstone Moderate ETF (AnnuiChoice™)
	2007	21	12.08		254		1.29	%	1.00	%	4.18	%
	2006	25	11.59		290		1.23	%	1.00	%	9.87	%
	2005	13	10.55		142		0.00	%	1.00	%	2.86	%
	2004	1	10.26		8		9.06	%	1.00	%	2.60	%
Touchstone Moderate ETF (GrandMaster flex3™)
	2007	165	11.87		1,959		1.35	%	1.55	%	3.60	%
	2006	187	11.46		2,140		1.12	%	1.55	%	9.26	%
	2005	153	10.49		1,600		0.00	%	1.55	%	2.32	%
	2004	30	10.25		303		22.15	%	1.55	%	2.50	%
Touchstone Moderate ETF (Grandmaster™)
	2007	29	11.95		342		1.38	%	1.35	%	3.81	%
	2006	33	11.51		378		0.95	%	1.35	%	9.48	%
	2005	36	10.51		376		0.00	%	1.35	%	2.55	%
	2004	12	10.25		126		9.14	%	1.35	%	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.

45

Separate Account I

of

National 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 (IQ Annuity™)
	2007	244		$	11.91	$	2,905	1.78	%	1.45	%	3.70	%
	2006	189		11.48		2,166		1.07	%	1.45	%	9.37	%
	2005	178		10.50		1,871		0.00	%	1.45	%	2.44	%
	2004	48		10.25		488		9.77	%	1.45	%	2.50	%
Touchstone Moderate ETF (Pinnacle Plus™)
	2007	88		11.83		1,040		1.45	%	1.67	%	3.47	%
	2006	85		11.43		973		1.25	%	1.67	%	9.13	%
	2005	58		10.47		604		0.00	%	1.67	%	2.18	%
	2004	35		10.25		360		7.01	%	1.67	%	2.50	%
Touchstone Money Market (AnnuiChoice™)
	2007	16		11.21		182		5.08	%	1.00	%	4.11	%
	2006	39		10.76		419		4.84	%	1.00	%	3.89	%
	2005	42		10.36		430		3.13	%	1.00	%	2.17	%
	2004	42		10.14		423		1.33	%	1.00	%	0.30	%
	2003	45		10.11		459		0.99	%	1.00	%	0.00	%
Touchstone Money Market (Grandmaster™)
	2007	534		10.90		5,817		5.02	%	1.35	%	3.74	%
	2006	443		10.50		4,653		4.84	%	1.35	%	3.52	%
	2005	532		10.14		5,399		3.11	%	1.35	%	1.75	%
	2004	557		9.97		5,557		1.28	%	1.35	%	0.00	%
	2003	1,392		9.97		13,875		0.92	%	1.35	%	-0.30	%
Touchstone Money Market (IQ Annuity™)
	2007	—	*	10.94		3		5.04	%	1.45	%	3.63	%
	2006	—	*	10.56		3		4.47	%	1.45	%	3.42	%
	2005	4		10.21		41		3.03	%	1.45	%	1.66	%
	2004	6		10.04		60		1.32	%	1.45	%	-0.10	%
	2003	7		10.05		71		0.99	%	1.45	%	-0.50	%
Touchstone Third Avenue Value (AnnuiChoice™)
	2007	129		18.15		2,340		0.82	%	1.00	%	-2.78	%
	2006	94		18.67		1,759		1.25	%	1.00	%	14.72	%
	2005	60		16.28		977		0.79	%	1.00	%	16.26	%
	2004	68		14.00		954		0.22	%	1.00	%	24.67	%
	2003	82		11.23		917		0.33	%	1.00	%	38.81	%
Touchstone Third Avenue Value (GrandMaster flex3™)
	2007	155		17.86		2,762		0.71	%	1.55	%	-3.32	%
	2006	144		18.47		2,667		1.09	%	1.55	%	14.09	%
	2005	121		16.19		1,955		1.13	%	1.55	%	15.58	%
	2004	52		14.01		733		0.44	%	1.55	%	23.98	%
	2003	15		11.30		174		0.20	%	1.55	%	37.97	%
Touchstone Third Avenue Value (Grandmaster™)
	2007	259		15.60		4,047		0.79	%	1.35	%	-3.12	%
	2006	182		16.10		2,930		1.12	%	1.35	%	14.32	%
	2005	150		14.09		2,109		1.32	%	1.35	%	15.83	%
	2004	25		12.16		306		0.91	%	1.35	%	21.60	%
Touchstone Third Avenue Value (IQ Annuity™)
	2007	213		17.51		3,737		0.72	%	1.45	%	-3.22	%
	2006	206		18.09		3,718		1.12	%	1.45	%	14.20	%
	2005	189		15.84		3,000		0.80	%	1.45	%	15.70	%
	2004	186		13.69		2,541		0.26	%	1.45	%	24.12	%
	2003	179		11.03		1,978		0.34	%	1.45	%	38.22	%

(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

National 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 (Pinnacle Plus™)
	2007	176		$	18.83	$	3,314	0.77	%	1.67	%	-3.44	%
	2006	130		19.50		2,539		1.11	%	1.67	%	13.95	%
	2005	115		17.11		1,973		1.08	%	1.67	%	15.46	%
	2004	50		14.82		748		0.47	%	1.67	%	23.81	%
	2003	1		11.97		18		0.00	%	1.67	%	19.70	%
Touchstone Third Avenue Value (AnnuiChoice II™)
	2007	67		10.63		717		0.98	%	1.15	%	-2.93	%
	2006	7		10.95		78		6.57	%	1.15	%	9.49	%
Touchstone Value Plus (AnnuiChoice™)
	2007	11		11.55		126		1.28	%	1.00	%	-5.03	%
	2006	13		12.17		161		0.80	%	1.00	%	18.53	%
	2005	15		10.26		155		0.00	%	1.00	%	1.12	%
	2004	20		10.15		208		0.78	%	1.00	%	9.49	%
	2003	21		9.27		199		1.03	%	1.00	%	28.39	%
Touchstone Value Plus (AnnuiChoice II™)
	2007	—	*	10.52		3		11.86	%	1.15	%	-5.18	%
Touchstone Value Plus (GrandMaster flex3™)
	2007	10		12.85		125		1.48	%	1.55	%	-5.56	%
	2006	9		13.60		120		0.71	%	1.55	%	17.87	%
	2005	11		11.54		124		0.00	%	1.55	%	0.62	%
	2004	9		11.47		101		0.82	%	1.55	%	8.82	%
	2003	11		10.54		116		1.66	%	1.55	%	27.60	%
Touchstone Value Plus (Grandmaster™)
	2007	4		12.29		45		1.50	%	1.35	%	-5.37	%
	2006	3		12.99		41		0.85	%	1.35	%	18.11	%
	2005	3		10.99		35		0.00	%	1.35	%	0.78	%
	2004	4		10.91		42		2.27	%	1.35	%	9.10	%
Touchstone Value Plus (IQ Annuity™)
	2007	19		11.37		213		1.37	%	1.45	%	-5.47	%
	2006	20		12.02		243		0.83	%	1.45	%	17.99	%
	2005	22		10.19		226		0.00	%	1.45	%	0.70	%
	2004	21		10.12		216		0.74	%	1.45	%	8.93	%
	2003	25		9.29		234		0.99	%	1.45	%	27.79	%
Touchstone Value Plus (Pinnacle Plus™)
	2007	22		13.44		295		1.26	%	1.67	%	-5.68	%
	2006	26		14.25		365		0.94	%	1.67	%	17.73	%
	2005	22		12.10		263		0.00	%	1.67	%	0.43	%
	2004	16		12.05		187		1.21	%	1.67	%	8.75	%
	2003	2		11.08		27		19.95	%	1.67	%	10.80	%
Non-Affiliated:
JP Morgan Mid Cap Value (AnnuiChoice™)
	2007	18		17.98		328		2.46	%	1.00	%	1.42	%
	2006	23		17.73		405		1.76	%	1.00	%	15.68	%
	2005	23		15.33		356		0.57	%	1.00	%	8.10	%
	2004	10		14.18		137		0.10	%	1.00	%	19.86	%
	2003	1		11.83		8		0.19	%	1.00	%	28.31	%

(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

National 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 (GrandMaster flex3™)
	2007	11	$	17.79	$	194	2.30	%	1.55	%	0.86	%
	2006	14	17.64		243		1.78	%	1.55	%	15.04	%
	2005	16	15.33		252		0.83	%	1.55	%	7.53	%
	2004	10	14.26		141		0.55	%	1.55	%	19.13	%
	2003	5	11.97		59		0.33	%	1.55	%	27.61	%
JP Morgan Mid Cap Value (Grandmaster™)
	2007	6	14.43		89		2.65	%	1.35	%	1.06	%
	2006	10	14.28		148		4.16	%	1.35	%	15.27	%
	2005	99	12.39		1,224		0.19	%	1.35	%	7.72	%
	2004	5	11.50		54		0.00	%	1.35	%	15.00	%
JP Morgan Mid Cap Value (IQ3™)
	2007	5	17.54		85		2.23	%	1.45	%	0.96	%
	2006	7	17.37		122		2.08	%	1.45	%	15.15	%
	2005	11	15.08		161		0.96	%	1.45	%	7.67	%
	2004	7	14.01		101		0.36	%	1.45	%	19.23	%
	2003	2	11.75		24		0.24	%	1.45	%	27.72	%
JP Morgan Mid Cap Value (Pinnacle Plus™)
	2007	62	16.54		1,031		2.34	%	1.67	%	0.73	%
	2006	65	16.42		1,073		1.81	%	1.67	%	14.90	%
	2005	65	14.29		931		0.91	%	1.67	%	7.38	%
	2004	31	13.31		407		0.64	%	1.67	%	19.05	%
	2003	8	11.18		93		0.00	%	1.67	%	11.80	%
Non-Affiliated Initial Class:
Fidelity VIP Equity-Income (Grandmaster™)
	2007	354	61.23		21,673		2.18	%	1.35	%	0.15	%
	2006	432	61.13		26,407		4.68	%	1.35	%	18.58	%
	2005	507	51.56		26,143		2.15	%	1.35	%	4.45	%
	2004	599	49.36		29,589		1.58	%	1.35	%	10.01	%
	2003	683	44.87		30,654		1.90	%	1.35	%	28.57	%
Fidelity VIP Growth (Grandmaster™)
	2007	148	74.52		11,060		0.95	%	1.35	%	25.24	%
	2006	191	59.50		11,385		0.43	%	1.35	%	5.41	%
	2005	235	56.44		13,254		0.55	%	1.35	%	4.37	%
	2004	310	54.08		16,748		0.28	%	1.35	%	1.98	%
	2003	447	53.03		23,679		0.28	%	1.35	%	31.07	%
Fidelity VIP High Income (Grandmaster™)
	2007	246	17.73		4,352		7.30	%	1.35	%	1.39	%
	2006	341	17.48		5,955		7.16	%	1.35	%	9.74	%
	2005	408	15.93		6,494		14.76	%	1.35	%	1.35	%
	2004	554	15.72		8,702		9.44	%	1.35	%	8.12	%
	2003	767	14.54		11,159		7.54	%	1.35	%	25.56	%
Fidelity VIP II Asset Manager (Grandmaster™)
	2007	189	38.40		7,272		6.14	%	1.35	%	13.94	%
	2006	238	33.70		8,030		2.91	%	1.35	%	5.87	%
	2005	302	31.83		9,604		3.05	%	1.35	%	2.64	%
	2004	415	31.01		12,873		2.38	%	1.35	%	4.06	%
	2003	381	29.80		11,344		3.73	%	1.35	%	16.36	%

(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

National 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 Contrafund (Grandmaster™)
	2007	521	$	46.54	$	24,250	5.28	%	1.35	%	16.00	%
	2006	608	40.12		24,395		1.30	%	1.35	%	10.21	%
	2005	696	36.40		25,317		0.32	%	1.35	%	15.37	%
	2004	819	31.55		25,853		0.35	%	1.35	%	13.90	%
	2003	966	27.70		26,769		0.56	%	1.35	%	26.72	%
Fidelity VIP II Index 500 (Grandmaster™)
	2007	212	34.65		7,354		3.56	%	1.35	%	4.01	%
	2006	277	33.31		9,233		1.84	%	1.35	%	14.17	%
	2005	344	29.18		10,042		1.92	%	1.35	%	3.43	%
	2004	452	28.21		12,748		1.44	%	1.35	%	9.09	%
	2003	689	25.86		17,815		2.33	%	1.35	%	26.70	%
Fidelity VIP II Investment Grade Bond (AnnuiChoice™)
	2007	59	10.19		596		0.11	%	1.00	%	1.87	%
Fidelity VIP II Investment Grade Bond (Grandmaster™)
	2007	97	27.11		2,632		4.53	%	1.35	%	2.93	%
	2006	126	26.34		3,307		4.18	%	1.35	%	2.95	%
	2005	157	25.58		4,016		4.84	%	1.35	%	0.80	%
	2004	198	25.38		5,028		7.62	%	1.35	%	3.05	%
	2003	400	24.63		9,862		5.29	%	1.35	%	3.79	%
Fidelity VIP II Investment Grade Bond (GrandmasterFlex3™)
	2007	33	10.15		333		0.11	%	1.55	%	1.49	%
Fidelity VIP II Investment Grade Bond (IQ™)
	2007	16	10.16		164		0.11	%	1.45	%	1.56	%
Fidelity VIP II Investment Grade Bond (Pinnacle Plus™)
	2007	38	10.14		383		0.11	%	1.67	%	1.40	%
Fidelity VIP III Balanced (Grandmaster™)
	2007	131	16.77		2,190		5.92	%	1.35	%	7.57	%
	2006	201	15.59		3,130		2.19	%	1.35	%	10.20	%
	2005	212	14.15		2,999		2.91	%	1.35	%	4.32	%
	2004	282	13.56		3,820		2.11	%	1.35	%	4.07	%
	2003	293	13.03		3,814		3.03	%	1.35	%	16.13	%
Fidelity VIP III Growth & Income (Grandmaster™)
	2007	162	19.74		3,206		4.69	%	1.35	%	10.60	%
	2006	196	17.85		3,502		1.11	%	1.35	%	11.65	%
	2005	313	15.99		4,998		1.65	%	1.35	%	6.16	%
	2004	419	15.06		6,304		0.95	%	1.35	%	4.37	%
	2003	543	14.43		7,835		1.18	%	1.35	%	22.18	%
Fidelity VIP III Growth Opportunities (Grandmaster™)
	2007	78	14.85		1,163		0.00	%	1.35	%	21.51	%
	2006	102	12.22		1,251		0.76	%	1.35	%	4.04	%
	2005	138	11.75		1,619		1.04	%	1.35	%	7.39	%
	2004	203	10.94		2,222		0.57	%	1.35	%	5.80	%
	2003	249	10.34		2,576		0.82	%	1.35	%	28.13	%
Fidelity VIP Overseas (AnnuiChoice™)
	2007	35	10.62		373		2.24	%	1.00	%	6.17	%
Fidelity VIP Overseas (AnnuiChoice II™)
	2007	5	10.61		55		2.63	%	1.15	%	6.06	%

(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

National 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 (Grandmaster™)
	2007	111	$	41.58	$	4,598	2.97	%	1.35	%	15.72	%
	2006	144	35.93		5,161		1.70	%	1.35	%	16.49	%
	2005	191	30.84		5,884		1.23	%	1.35	%	17.45	%
	2004	226	26.26		5,939		1.20	%	1.35	%	12.08	%
	2003	268	23.43		6,269		0.87	%	1.35	%	41.49	%
Fidelity VIP Overseas (GrandmasterFlex3™)
	2007	33	10.58		351		2.29	%	1.55	%	5.77	%
Fidelity VIP Overseas (IQ™)
	2007	19	10.58		196		1.95	%	1.45	%	5.84	%
Fidelity VIP Overseas (Pinnacle Plus™)
	2007	74	10.57		787		2.58	%	1.67	%	5.68	%
Affiliated Service Class:
Touchstone Aggressive ETF (AnnuiChoice™)
	2007	7	11.33		83		1.72	%	1.00	%	3.74	%
	2006	2	10.92		20		4.55	%	1.00	%	9.18	%
Touchstone Aggressive ETF (AnnuiChoice II™)
	2007	58	11.11		642		2.56	%	1.15	%	3.58	%
	2006	29	10.72		307		6.80	%	1.15	%	7.21	%
Touchstone Aggressive ETF (GrandmasterFlex3™)
	2007	7	9.82		69		3.87	%	1.55	%	-1.76	%
Touchstone Aggressive ETF (Pinnacle Plus™)
	2007	10	9.82		101		3.48	%	1.67	%	-1.84	%
Touchstone GMAB Aggressive ETF (AnnuiChoice II™)
	2007	28	11.02		309		2.56	%	1.15	%	2.95	%
Touchstone Conservative ETF (AnnuiChoice II ™)
	2007	4	10.88		43		2.23	%	1.15	%	4.25	%
Touchstone Conservative ETF (GrandmasterFlex3™)
	2007	70	10.08		702		7.34	%	1.55	%	0.76	%
Touchstone Conservative ETF (Pinnacle Plus™)
	2007	25	10.07		251		7.08	%	1.67	%	0.67	%
Touchstone Enhanced ETF (AnnuiChoice™)
	2007	25	11.34		282		2.54	%	1.00	%	2.70	%
	2006	5	11.05		55		3.16	%	1.00	%	10.47	%
Touchstone Enhanced ETF (AnnuiChoice II™)
	2007	17	11.13		189		3.65	%	1.15	%	2.54	%
	2006	1	10.85		11		3.66	%	1.15	%	8.51	%
Touchstone Enhanced ETF (GrandmasterFlex3™)
	2007	27	9.64		261		5.20	%	1.55	%	-3.61	%
Touchstone Enhanced ETF (Pinnacle Plus™)
	2007	44	9.63		423		4.77	%	1.67	%	-3.69	%
Touchstone Moderate ETF (AnnuiChoice™)
	2007	41	11.17		463		2.01	%	1.00	%	3.93	%
	2006	17	10.74		178		3.64	%	1.00	%	7.43	%
Touchstone Moderate ETF (AnnuiChoice II™)
	2007	43	10.97		469		3.15	%	1.15	%	3.77	%
	2006	2	10.57		25		4.14	%	1.15	%	5.72	%
Touchstone Moderate ETF (GrandmasterFlex3™)
	2007	43	9.92		422		3.21	%	1.55	%	-0.77	%
Touchstone Moderate ETF (Pinnacle Plus™)
	2007	198	9.91		1,967		7.55	%	1.67	%	-0.85	%

(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

National 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 Money Market (AnnuiChoice™)
	2007	115	$	10.95	$	1,261	4.81	%	1.00	%	3.84	%
	2006	185	10.54		1,955		4.61	%	1.00	%	3.62	%
	2005	199	10.17		2,022		2.88	%	1.00	%	1.85	%
	2004	195	9.99		1,943		1.03	%	1.00	%	0.10	%
	2003	273	9.98		2,723		0.64	%	1.00	%	-0.20	%
Touchstone Money Market (AnnuiChoice II™)
	2007	2	10.50		24		4.69	%	1.15	%	3.68	%
Touchstone Money Market (GrandMaster flex3™)
	2007	297	10.68		3,177		4.74	%	1.55	%	3.26	%
	2006	184	10.34		1,903		4.73	%	1.55	%	3.05	%
	2005	75	10.04		750		2.88	%	1.55	%	1.27	%
	2004	127	9.91		1,256		1.14	%	1.55	%	-0.50	%
	2003	40	9.96		400		0.67	%	1.55	%	-0.40	%
Touchstone Money Market (IQ Annuity™)
	2007	761	10.73		8,166		4.70	%	1.45	%	3.37	%
	2006	232	10.38		2,411		4.60	%	1.45	%	3.15	%
	2005	409	10.06		4,114		2.97	%	1.45	%	1.42	%
	2004	313	9.92		3,100		1.07	%	1.45	%	-0.40	%
	2003	342	9.96		3,410		0.63	%	1.45	%	-0.40	%
Touchstone Money Market (Pinnacle Plus™)
	2007	281	10.62		2,989		4.73	%	1.67	%	3.14	%
	2006	156	10.30		1,611		4.65	%	1.67	%	2.92	%
	2005	90	10.01		905		2.94	%	1.67	%	1.17	%
	2004	64	9.89		636		1.20	%	1.67	%	-0.60	%
	2003	21	9.95		209		0.75	%	1.67	%	-0.50	%
Non-Affiliated Service Class:
Fidelity VIP III Mid Cap (Grandmaster™)
	2007	109	35.84		3,912		0.87	%	1.35	%	13.92	%
	2006	175	31.46		5,499		1.28	%	1.35	%	11.08	%
	2005	164	28.33		4,646		0.00	%	1.35	%	16.61	%
	2004	204	24.29		4,946		0.00	%	1.35	%	23.11	%
	2003	244	19.73		4,807		0.36	%	1.35	%	36.63	%
Non-Affiliated Service Class 2:
Fidelity VIP Asset Manager (AnnuiChoice™)
	2007	20	13.80		270		5.75	%	1.00	%	14.02	%
	2006	20	12.10		245		3.01	%	1.00	%	6.07	%
	2005	32	11.41		369		2.82	%	1.00	%	2.78	%
	2004	40	11.10		443		1.63	%	1.00	%	4.13	%
	2003	21	10.66		228		2.72	%	1.00	%	16.50	%
Fidelity VIP Asset Manager (AnnuiChoice II™)
	2007	1	11.90		7		17.13	%	1.15	%	13.84	%
Fidelity VIP Asset Manager (GrandMaster flex3™)
	2007	9	12.65		112		6.26	%	1.55	%	13.38	%
	2006	21	11.16		234		2.30	%	1.55	%	5.48	%
	2005	24	10.58		252		2.27	%	1.55	%	2.13	%
	2004	19	10.36		192		0.00	%	1.55	%	3.60	%

(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.

51

Separate Account I
of

National 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):
Non-Affiliated Service Class 2 (continued):
Fidelity VIP Asset Manager (IQ3™)
	2007	41	$	12.99	$	535	6.00	%	1.45	%	13.50	%
	2006	39	11.45		443		2.63	%	1.45	%	5.59	%
	2005	48	10.84		519		2.72	%	1.45	%	2.30	%
	2004	56	10.60		592		1.86	%	1.45	%	3.62	%
	2003	33	10.23		341		3.17	%	1.45	%	15.99	%
Fidelity VIP Asset Manager (Pinnacle Plus™)
	2007	14	13.18		184		6.15	%	1.67	%	13.24	%
	2006	9	11.64		105		2.29	%	1.67	%	5.35	%
	2005	7	11.04		78		2.22	%	1.67	%	2.08	%
	2004	5	10.82		54		2.23	%	1.67	%	3.44	%
	2003	4	10.46		45		0.00	%	1.67	%	4.60	%
Fidelity VIP Balanced (AnnuiChoice™)
	2007	24	13.74		335		5.72	%	1.00	%	7.63	%
	2006	26	12.76		337		1.71	%	1.00	%	10.39	%
	2005	24	11.56		273		2.57	%	1.00	%	4.44	%
	2004	25	11.07		279		1.70	%	1.00	%	4.14	%
	2003	24	10.63		256		1.50	%	1.00	%	16.17	%
Fidelity VIP Balanced (AnnuiChoice II™)
	2007	1	11.37		8		1.96	%	1.15	%	7.46	%
Fidelity VIP Balanced (GrandMaster ™)
	2007	42	12.90		537		2.96	%	1.35	%	7.25	%
Fidelity VIP Balanced (GrandMaster flex3™)
	2007	41	14.11		571		4.91	%	1.55	%	7.03	%
	2006	30	13.18		393		1.59	%	1.55	%	9.78	%
	2005	26	12.01		318		2.44	%	1.55	%	3.87	%
	2004	26	11.56		298		0.39	%	1.55	%	3.49	%
	2003	3	11.17		30		0.00	%	1.55	%	11.70	%
Fidelity VIP Balanced (IQ3™)
	2007	37	12.55		470		6.58	%	1.45	%	7.14	%
	2006	34	11.71		402		2.00	%	1.45	%	9.89	%
	2005	51	10.66		540		2.62	%	1.45	%	3.97	%
	2004	60	10.25		619		1.72	%	1.45	%	3.64	%
	2003	59	9.89		585		2.84	%	1.45	%	15.67	%
Fidelity VIP Balanced (Pinnacle Plus™)
	2007	43	13.10		568		5.08	%	1.67	%	6.90	%
	2006	29	12.25		361		1.51	%	1.67	%	9.64	%
	2005	23	11.17		255		1.93	%	1.67	%	3.74	%
	2004	12	10.77		124		1.07	%	1.67	%	3.46	%
	2003	1	10.41		11		0.00	%	1.67	%	4.10	%
Fidelity VIP Contrafund (AnnuiChoice™)
	2007	159	19.10		3,028		5.55	%	1.00	%	16.12	%
	2006	157	16.45		2,578		1.08	%	1.00	%	10.32	%
	2005	116	14.91		1,737		0.12	%	1.00	%	15.49	%
	2004	78	12.91		1,010		0.19	%	1.00	%	14.05	%
	2003	53	11.32		602		0.19	%	1.00	%	26.91	%

(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

National 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 (GrandMaster flex3™)
	2007	146		$	18.48	$	2,700		5.74	%	1.55	%	15.48	%
	2006	137		16.00		2,198			1.07	%	1.55	%	9.71	%
	2005	120		14.58		1,749			0.09	%	1.55	%	14.84	%
	2004	57		12.70		728			0.13	%	1.55	%	13.39	%
	2003	17		11.20		192			0.10	%	1.55	%	26.13	%
Fidelity VIP Contrafund (IQ3™)
	2007	177		16.74		2,961			5.20	%	1.45	%	15.59	%
	2006	201		14.48		2,917			1.00	%	1.45	%	9.82	%
	2005	204		13.19		2,692			0.14	%	1.45	%	14.99	%
	2004	185		11.47		2,119			0.20	%	1.45	%	13.45	%
	2003	167		10.11		1,690			0.27	%	1.45	%	26.38	%
Fidelity VIP Contrafund (Pinnacle Plus™)
	2007	234		18.50		4,319			6.15	%	1.67	%	15.34	%
	2006	169		16.04		2,713			1.11	%	1.67	%	9.58	%
	2005	126		14.64		1,843			0.10	%	1.67	%	14.70	%
	2004	63		12.76		799			0.05	%	1.67	%	13.22	%
	2003	3		11.27		37			0.00	%	1.67	%	12.70	%
Fidelity VIP Contrafund (AnnuiChoice II™)
	2007	70		12.43		865			7.74	%	1.15	%	15.95	%
	2006	6		10.72		69			4.26	%	1.15	%	7.21	%
Fidelity VIP Contrafund Standard (IQ Advisor™)
	2007	—	*	16.87		7			5.50	%	0.60	%	16.60	%
	2006	—	*	14.47		6			1.03	%	0.60	%	10.77	%
	2005	—	*	13.07		5			0.00	%	0.60	%	15.93	%
Fidelity VIP Disclipined Small Cap (AnnuiChoice™)
	2007	7		9.03		67			0.45	%	1.00	%	-9.71	%
Fidelity VIP Disclipined Small Cap (IQ™)
	2007	8		9.00		69			0.46	%	1.45	%	-9.99	%
Fidelity VIP Disclipined Small Cap (Grandmaster™)
	2007	2		9.01		22			0.46	%	1.35	%	-9.93	%
Fidelity VIP Disclipined Small Cap (GrandmasterFlex3™)
	2007	5		8.99		48			0.50	%	1.55	%	-10.05	%
Fidelity VIP Disclipined Small Cap (Pinnacle Plus™)
	2007	5		8.99		49			0.53	%	1.67	%	-10.13	%
Fidelity VIP Dynamic Capital Appreciation (AnnuiChoice™)
	2007	6		16.22		94			5.26	%	1.00	%	5.66	%
	2006	6		15.35		90			0.37	%	1.00	%	12.68	%
	2005	—	*	13.62		—		*	0.00	%	1.00	%	19.51	%
	2004	3		11.40		32			0.00	%	1.00	%	0.26	%
	2003	3		11.37		32			0.00	%	1.00	%	23.59	%
Fidelity VIP Dynamic Capital Appreciation (GrandMaster flex3™)
	2007	3		14.89		44			3.35	%	1.55	%	5.07	%
	2006	6		14.17		85			0.31	%	1.55	%	12.06	%
	2005	3		12.65		37			0.00	%	1.55	%	18.86	%
	2004	3		10.64		30			0.00	%	1.55	%	6.40	%
Fidelity VIP Dynamic Capital Appreciation (Grandmaster™)
	2007	117		15.00		1,751			6.57	%	1.35	%	5.28	%
	2006	81		14.25		1,158			0.35	%	1.35	%	12.28	%
	2005	3		12.69		39			0.00	%	1.35	%	19.04	%
	2004	3		10.66		33			0.00	%	1.35	%	6.60	%

(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.

53

Separate Account I
of

National 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 Dynamic Capital Appreciation (IQ Annuity™)
	2007	5		$	19.52	$	92	5.16	%	1.45	%	5.17	%
	2006	5		18.56		94		0.11	%	1.45	%	12.17	%
	2005	8		16.55		127		0.00	%	1.45	%	18.96	%
	2004	17		13.91		238		0.00	%	1.45	%	-0.22	%
	2003	25		13.94		352		0.00	%	1.45	%	23.14	%
Fidelity VIP Dynamic Capital Appreciation (Pinnacle Plus™)
	2007	16		14.82		238		5.22	%	1.67	%	4.94	%
	2006	12		14.13		171		0.26	%	1.67	%	11.92	%
	2005	6		12.62		73		0.00	%	1.67	%	18.62	%
Fidelity VIP Equity-Income (AnnuiChoice™)
	2007	67		14.33		956		2.14	%	1.00	%	0.26	%
	2006	75		14.30		1,076		4.28	%	1.00	%	18.73	%
	2005	84		12.04		1,010		1.67	%	1.00	%	4.53	%
	2004	68		11.52		778		1.42	%	1.00	%	10.13	%
	2003	73		10.46		766		0.99	%	1.00	%	28.66	%
Fidelity VIP Equity-Income (AnnuiChoice II™)
	2007	13		11.00		143		25.01	%	1.15	%	0.10	%
Fidelity VIP Equity-Income (GrandMaster flex3™)
	2007	30		14.77		449		1.90	%	1.55	%	-0.30	%
	2006	34		14.82		499		4.25	%	1.55	%	18.08	%
	2005	35		12.55		436		2.22	%	1.55	%	3.96	%
	2004	38		12.07		458		0.55	%	1.55	%	9.53	%
	2003	8		11.02		85		0.48	%	1.55	%	27.99	%
Fidelity VIP Equity-Income (IQ3™)
	2007	75		13.19		987		2.27	%	1.45	%	-0.20	%
	2006	73		13.21		969		4.50	%	1.45	%	18.20	%
	2005	86		11.18		960		2.11	%	1.45	%	4.00	%
	2004	119		10.75		1,283		1.48	%	1.45	%	9.69	%
	2003	132		9.80		1,293		1.70	%	1.45	%	28.10	%
Fidelity VIP Equity-Income (Pinnacle Plus™)
	2007	151		15.15		2,289		2.32	%	1.67	%	-0.43	%
	2006	128		15.21		1,948		4.19	%	1.67	%	17.93	%
	2005	105		12.90		1,350		1.51	%	1.67	%	3.79	%
	2004	71		12.43		878		0.48	%	1.67	%	9.42	%
	2003	12		11.36		133		0.00	%	1.67	%	13.60	%
Fidelity VIP Freedom 2010 (Grandmaster™)
	2007	9		10.23		87		17.61	%	1.35	%	2.34	%
Fidelity VIP Freedom 2010 (GrandmasterFlex3™)
	2007	4		10.22		36		5.90	%	1.55	%	2.20	%
Fidelity VIP Freedom 2010 (IQ3™)
	2007	3		10.23		26		18.34	%	1.45	%	2.27	%
Fidelity VIP Freedom 2015 (AnnuiChoiceII™)
	2007	1		10.26		13		11.02	%	1.15	%	2.61	%
Fidelity VIP Freedom 2015 (GrandmasterFlex3™)
	2007	—	*	10.23		2		29.66	%	1.55	%	2.32	%
Fidelity VIP Freedom 2015 (IQ3™)
	2007	32		10.24		326		12.26	%	1.45	%	2.39	%
Fidelity VIP Freedom 2020 (AnnuiChoiceII™)
	2007	3		10.27		34		81.18	%	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.

54

Separate Account I
of

National 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 Freedom 2020 (IQ3™)
	2007	4		$	10.25	$	40	15.32	%	1.45	%	2.51	%
Fidelity VIP Freedom 2020 (Pinnacle Plus™)
	2007	2		10.23		20		14.72	%	1.67	%	2.35	%
Fidelity VIP Freedom 2030 (Pinnacle Plus™)
	2007	—	*	10.25		2		114.95	%	1.67	%	2.48	%
Fidelity VIP Growth & Income (AnnuiChoice™)
	2007	15		14.13		209		4.27	%	1.00	%	10.73	%
	2006	16		12.76		209		0.73	%	1.00	%	11.73	%
	2005	20		11.42		227		1.46	%	1.00	%	6.30	%
	2004	33		10.74		359		0.57	%	1.00	%	4.47	%
	2003	11		10.28		112		0.76	%	1.00	%	22.24	%
Fidelity VIP Growth & Income (AnnuiChoice II™)
	2007	—	*	11.88		4		1.74	%	1.15	%	10.57	%
Fidelity VIP Growth & Income (GrandMaster flex3™)
	2007	15		15.07		229		3.98	%	1.55	%	10.12	%
	2006	16		13.69		219		0.63	%	1.55	%	11.11	%
	2005	14		12.32		171		1.33	%	1.55	%	5.72	%
	2004	14		11.65		160		0.26	%	1.55	%	3.93	%
	2003	3		11.21		29		0.24	%	1.55	%	21.45	%
Fidelity VIP Growth & Income (IQ3™)
	2007	10		12.26		122		4.17	%	1.45	%	10.23	%
	2006	17		11.12		188		0.80	%	1.45	%	11.22	%
	2005	27		10.00		272		1.55	%	1.45	%	5.80	%
	2004	43		9.45		408		0.90	%	1.45	%	4.07	%
	2003	57		9.08		518		1.12	%	1.45	%	21.55	%
Fidelity VIP Growth & Income (Pinnacle Plus™)
	2007	25		14.15		351		4.12	%	1.67	%	9.98	%
	2006	11		12.86		147		0.75	%	1.67	%	10.98	%
	2005	13		11.59		145		1.22	%	1.67	%	5.65	%
	2004	9		10.97		97		0.72	%	1.67	%	3.69	%
	2003	5		10.58		51		0.00	%	1.67	%	5.80	%
Fidelity VIP Growth (AnnuiChoice™)
	2007	24		12.78		310		0.43	%	1.00	%	25.39	%
	2006	19		10.20		199		0.21	%	1.00	%	5.51	%
	2005	31		9.66		303		0.26	%	1.00	%	4.47	%
	2004	36		9.25		334		0.12	%	1.00	%	2.10	%
	2003	55		9.06		494		0.07	%	1.00	%	31.11	%
Fidelity VIP Growth (AnnuiChoice II™)
	2007	5		13.20		64		0.71	%	1.15	%	25.20	%
Fidelity VIP Growth (GrandMaster™)
	2007	63		11.71		737		0.18	%	1.35	%	17.10	%
Fidelity VIP Growth (GrandMaster flex3™)
	2007	20		14.90		291		0.44	%	1.55	%	24.69	%
	2006	14		11.95		170		0.16	%	1.55	%	4.93	%
	2005	14		11.39		164		0.39	%	1.55	%	3.92	%
	2004	58		10.96		633		0.01	%	1.55	%	1.48	%
	2003	3		10.80		30		0.00	%	1.55	%	30.43	%

(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

National 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 (IQ3™)
	2007	51		$	9.81	$	501	0.46	%	1.45	%	24.81	%
	2006	46		7.86		361		0.20	%	1.45	%	5.03	%
	2005	58		7.48		436		0.30	%	1.45	%	3.93	%
	2004	74		7.20		534		0.08	%	1.45	%	1.69	%
	2003	143		7.08		1,013		0.07	%	1.45	%	30.63	%
Fidelity VIP Growth (Pinnacle Plus™)
	2007	39		15.13		592		0.43	%	1.67	%	24.54	%
	2006	25		12.15		310		0.15	%	1.67	%	4.80	%
	2005	18		11.59		212		0.27	%	1.67	%	3.78	%
	2004	17		11.17		195		0.02	%	1.67	%	1.36	%
	2003	—	*	11.02		2		0.00	%	1.67	%	10.20	%
Fidelity VIP Growth Opportunities (AnnuiChoice™)
	2007	3		14.32		41		0.00	%	1.00	%	21.67	%
	2006	4		11.77		48		0.48	%	1.00	%	4.07	%
	2005	5		11.31		52		0.58	%	1.00	%	7.58	%
	2004	6		10.51		61		0.35	%	1.00	%	5.84	%
	2003	6		9.93		64		0.39	%	1.00	%	28.13	%
Fidelity VIP Growth Opportunities (GrandMaster flex3™)
	2007	8		15.60		129		0.00	%	1.55	%	20.99	%
	2006	9		12.89		111		0.37	%	1.55	%	3.49	%
	2005	3		12.46		40		0.65	%	1.55	%	7.00	%
	2004	7		11.64		85		0.09	%	1.55	%	5.24	%
	2003	1		11.06		9		0.00	%	1.55	%	27.42	%
Fidelity VIP Growth Opportunities (IQ3™)
	2007	13		12.81		166		0.00	%	1.45	%	21.12	%
	2006	6		10.57		60		1.45	%	1.45	%	3.60	%
	2005	1		10.21		8		0.89	%	1.45	%	7.09	%
	2004	2		9.53		23		0.31	%	1.45	%	5.30	%
	2003	3		9.05		23		0.25	%	1.45	%	27.64	%
Fidelity VIP Growth Opportunities (Pinnacle Plus™)
	2007	17		15.44		267		0.00	%	1.67	%	20.84	%
	2006	6		12.77		76		0.46	%	1.67	%	3.37	%
	2005	6		12.36		74		0.64	%	1.67	%	6.90	%
	2004	6		11.56		65		0.10	%	1.67	%	5.09	%
	2003	1		11.00		9		0.00	%	1.67	%	10.00	%
Fidelity VIP High Income (AnnuiChoice™)
	2007	22		15.07		333		7.69	%	1.00	%	1.51	%
	2006	22		14.84		324		7.13	%	1.00	%	9.92	%
	2005	22		13.50		291		16.22	%	1.00	%	1.30	%
	2004	34		13.33		448		9.39	%	1.00	%	8.29	%
	2003	39		12.31		484		1.72	%	1.00	%	25.48	%
Fidelity VIP High Income (AnnuiChoice II™)
	2007	1		10.64		12		11.13	%	1.15	%	1.36	%
Fidelity VIP High Income (GrandMaster flex3™)
	2007	39		13.74		541		3.09	%	1.55	%	0.95	%
	2006	173		13.61		2,352		9.60	%	1.55	%	9.31	%
	2005	208		12.45		2,588		19.14	%	1.55	%	0.73	%
	2004	134		12.36		1,651		12.05	%	1.55	%	7.67	%
	2003	57		11.48		653		0.00	%	1.55	%	14.80	%

(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

National 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 (IQ3™)
	2007	83	$	12.27	$	1,015	2.85	%	1.45	%	1.05	%
	2006	301	12.15		3,661		9.84	%	1.45	%	9.42	%
	2005	231	11.10		2,569		20.22	%	1.45	%	0.83	%
	2004	180	11.01		1,978		8.20	%	1.45	%	7.84	%
	2003	70	10.21		713		4.64	%	1.45	%	24.82	%
Fidelity VIP High Income (Pinnacle Plus™)
	2007	22	12.73		285		7.72	%	1.67	%	0.82	%
	2006	22	12.62		281		7.64	%	1.67	%	9.18	%
	2005	23	11.56		264		15.06	%	1.67	%	0.62	%
	2004	18	11.49		208		1.45	%	1.67	%	7.58	%
	2003	3	10.68		31		0.00	%	1.67	%	6.80	%
Fidelity VIP Index 500 (AnnuiChoice™)
	2007	126	12.42		1,569		2.69	%	1.00	%	4.12	%
	2006	36	11.93		432		1.66	%	1.00	%	14.29	%
	2005	47	10.44		489		1.61	%	1.00	%	3.54	%
	2004	52	10.08		529		1.24	%	1.00	%	9.21	%
	2003	81	9.23		743		0.65	%	1.00	%	26.79	%
Fidelity VIP II Index 500 (AnnuiChoice II™)
	2007	9	9.86		93		2.97	%	1.15	%	-1.39	%
Fidelity VIP II Index 500 (Grandmaster™)
	2007	283	9.85		2,788		2.09	%	1.35	%	-1.52	%
Fidelity VIP II Index 500 (GrandmasterFlex3™)
	2007	100	9.83		980		2.39	%	1.55	%	-1.66	%
Fidelity VIP Index 500 (IQ3™)
	2007	80	11.06		888		2.88	%	1.45	%	3.65	%
	2006	56	10.67		599		1.67	%	1.45	%	13.77	%
	2005	69	9.38		651		1.83	%	1.45	%	3.10	%
	2004	93	9.10		843		1.31	%	1.45	%	8.72	%
	2003	129	8.37		1,076		0.97	%	1.45	%	26.24	%
Fidelity VIP Index 500 (Pinnacle Plus™)
	2007	159	14.48		2,300		2.60	%	1.67	%	3.42	%
	2006	7	14.00		94		1.49	%	1.67	%	13.52	%
	2005	8	12.33		100		1.60	%	1.67	%	2.85	%
	2004	8	11.99		99		0.82	%	1.67	%	8.51	%
Fidelity VIP Investment Grade Bond (AnnuiChoice™)
	2007	69	12.83		881		4.28	%	1.00	%	3.04	%
	2006	77	12.45		955		3.89	%	1.00	%	3.10	%
	2005	87	12.08		1,055		3.63	%	1.00	%	0.91	%
	2004	78	11.97		929		2.44	%	1.00	%	3.10	%
	2003	87	11.61		1,006		4.14	%	1.00	%	3.94	%
Fidelity VIP Investment Grade Bond (GrandMaster ™)
	2007	34	10.14		348		0.17	%	1.35	%	1.42	%
Fidelity VIP Investment Grade Bond (GrandMaster flex3™)
	2007	39	10.87		419		3.99	%	1.55	%	2.46	%
	2006	39	10.61		416		3.29	%	1.55	%	2.53	%
	2005	35	10.35		359		2.44	%	1.55	%	0.36	%
	2004	16	10.31		162		0.00	%	1.55	%	3.10	%

(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.

57

Separate Account I

of

National 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 Investment Grade Bond (IQ3™)
	2007	84		$	12.68	$	1,071	4.12	%	1.45	%	2.57	%
	2006	99		12.36		1,221		4.18	%	1.45	%	2.63	%
	2005	117		12.05		1,411		4.14	%	1.45	%	0.39	%
	2004	109		12.00		1,311		5.71	%	1.45	%	2.74	%
	2003	101		11.68		1,176		4.32	%	1.45	%	3.36	%
Fidelity VIP Investment Grade Bond (Pinnacle Plus™)
	2007	42		10.77		453		3.42	%	1.67	%	2.34	%
	2006	30		10.52		312		3.63	%	1.67	%	2.40	%
	2005	28		10.28		285		2.16	%	1.67	%	0.16	%
	2004	9		10.26		90		4.71	%	1.67	%	2.50	%
	2003	5		10.01		52		0.00	%	1.67	%	0.10	%
Fidelity VIP Investment Grade Bond (AnnuiChoice II™)
	2007	27		10.45		278		1.68	%	1.15	%	2.88	%
	2006	2		10.16		17		0.00	%	1.15	%	1.56	%
Fidelity VIP Mid Cap (AnnuiChoice™)
	2007	45		23.17		1,048		0.62	%	1.00	%	14.18	%
	2006	52		20.29		1,056		1.25	%	1.00	%	11.28	%
	2005	52		18.23		944		0.00	%	1.00	%	16.87	%
	2004	48		15.60		744		0.00	%	1.00	%	23.42	%
	2003	36		12.64		460		0.22	%	1.00	%	36.80	%
Fidelity VIP Mid Cap (GrandMaster flex3™)
	2007	88		21.75		1,924		0.60	%	1.55	%	13.54	%
	2006	75		19.16		1,437		1.21	%	1.55	%	10.67	%
	2005	64		17.31		1,100		0.00	%	1.55	%	16.18	%
	2004	19		14.90		278		0.00	%	1.55	%	22.73	%
	2003	10		12.14		118		0.04	%	1.55	%	36.10	%
Fidelity VIP Mid Cap (IQ Annuity™)
	2007	84		21.85		1,834		0.59	%	1.45	%	13.66	%
	2006	100		19.22		1,926		1.23	%	1.45	%	10.78	%
	2005	101		17.35		1,750		0.00	%	1.45	%	16.30	%
	2004	103		14.92		1,543		0.00	%	1.45	%	22.90	%
	2003	103		12.14		1,250		0.24	%	1.45	%	36.25	%
Fidelity VIP Mid Cap (Pinnacle Plus™)
	2007	115		21.75		2,500		0.60	%	1.67	%	13.40	%
	2006	89		19.18		1,716		1.21	%	1.67	%	10.53	%
	2005	82		17.35		1,414		0.00	%	1.67	%	16.06	%
	2004	46		14.95		686		0.00	%	1.67	%	22.54	%
	2003	4		12.20		50		0.00	%	1.67	%	22.00	%
Fidelity VIP Mid Cap (AnnuiChoice II™)
	2007	5		11.96		65		0.49	%	1.15	%	14.01	%
	2006	—	*	10.49		6		0.00	%	1.15	%	4.92	%
Fidelity VIP Mid Cap (Grandmaster™)
	2007	71		17.99		1,282		0.38	%	1.35	%	13.77	%
	2006	—	*	15.81		13		0.00	%	1.35	%	10.89	%
Fidelity VIP Overseas (AnnuiChoice™)
	2007	45		18.98		862		3.32	%	1.00	%	15.88	%
	2006	18		16.38		298		1.43	%	1.00	%	16.60	%
	2005	24		14.05		335		0.87	%	1.00	%	17.58	%
	2004	20		11.95		242		1.02	%	1.00	%	12.21	%
	2003	26		10.65		272		0.26	%	1.00	%	41.62	%

(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

National 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 (GrandMaster™)
	2007	247		$	10.57	$	2,607	4.78	%	1.35	%	5.73	%
Fidelity VIP Overseas (GrandMaster flex3™)
	2007	47		17.27		814		2.73	%	1.55	%	15.23	%
	2006	25		14.99		369		1.15	%	1.55	%	15.95	%
	2005	14		12.93		175		0.42	%	1.55	%	16.98	%
	2004	3		11.05		29		0.00	%	1.55	%	10.50	%
Fidelity VIP Overseas (IQ3™)
	2007	61		14.85		910		2.99	%	1.45	%	15.35	%
	2006	27		12.87		348		0.76	%	1.45	%	16.07	%
	2005	13		11.09		149		0.98	%	1.45	%	17.12	%
	2004	10		9.47		96		1.47	%	1.45	%	11.67	%
	2003	14		8.48		121		0.39	%	1.45	%	40.86	%
Fidelity VIP Overseas (Pinnacle Plus™)
	2007	56		21.29		1,187		3.12	%	1.67	%	15.09	%
	2006	32		18.50		585		0.73	%	1.67	%	15.81	%
	2005	11		15.97		170		0.79	%	1.67	%	16.77	%
	2004	6		13.68		81		0.00	%	1.67	%	11.49	%
	2003	1		12.27		7		0.00	%	1.67	%	22.70	%
Fidelity VIP Overseas (AnnuiChoice II™)
	2007	6		12.63		76		2.54	%	1.15	%	15.70	%
	2006	1		10.92		15		0.00	%	1.15	%	9.18	%
Non-Affiliated Class 1:
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)
	2007	13		18.12		241		7.71	%	1.00	%	5.46	%
	2006	13		17.18		230		9.74	%	1.00	%	9.70	%
	2005	13		15.66		210		10.63	%	1.00	%	11.16	%
	2004	3		14.09		48		10.78	%	1.00	%	8.97	%
	2003	1		12.93		18		0.00	%	1.00	%	26.52	%
Van Kampen UIF Emerging Markets Debt (GrandMaster flex3™)
	2007	3		18.25		58		7.85	%	1.55	%	4.87	%
	2006	5		17.41		84		9.28	%	1.55	%	9.10	%
	2005	5		15.96		79		9.87	%	1.55	%	10.49	%
	2004	5		14.44		70		9.72	%	1.55	%	8.41	%
	2003	—	*	13.32		5		0.00	%	1.55	%	25.90	%
Van Kampen UIF Emerging Markets Debt (IQ3™)
	2007	2		17.71		42		8.49	%	1.45	%	4.98	%
	2006	6		16.87		105		8.36	%	1.45	%	9.21	%
	2005	2		15.45		38		9.96	%	1.45	%	10.64	%
	2004	2		13.96		33		6.77	%	1.45	%	8.47	%
	2003	6		12.87		81		0.00	%	1.45	%	26.05	%
Van Kampen UIF U.S. Real Estate (AnnuiChoice™)
	2007	11		21.86		236		2.82	%	1.00	%	-17.90	%
	2006	40		26.63		1,078		1.44	%	1.00	%	36.67	%
	2005	18		19.48		344		1.49	%	1.00	%	15.89	%
	2004	19		16.81		313		1.65	%	1.00	%	35.02	%
	2003	20		12.45		251		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.

59

Separate Account I

of

National Integrity Life Insurance Company

Notes to Financial Statements (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 (GrandMaster flex3™)
	2007	19	$	21.10	$	403	2.20	%	1.55	%	-18.36	%
	2006	39	25.85		1,019		1.39	%	1.55	%	35.92	%
	2005	29	19.02		554		1.43	%	1.55	%	15.25	%
	2004	18	16.50		305		1.89	%	1.55	%	34.26	%
	2003	6	12.29		77		0.00	%	1.55	%	35.35	%
Van Kampen UIF U.S. Real Estate (IQ3™)
	2007	8	21.20		165		2.11	%	1.45	%	-18.28	%
	2006	10	25.95		263		1.36	%	1.45	%	36.05	%
	2005	8	19.07		161		1.64	%	1.45	%	15.38	%
	2004	7	16.53		111		1.73	%	1.45	%	34.39	%
	2003	9	12.30		114		0.00	%	1.45	%	35.46	%
Van Kampen UIF U.S. Real Estate (AnnuiChoice II™)
	2007	7	9.30		65		3.99	%	1.15	%	-18.03	%
	2006	11	11.35		120		0.00	%	1.15	%	13.50	%
Non-Affiliated Class 2:
Franklin Foreign Securities (IQ Annuity™)
	2007	24	21.88		529		2.14	%	1.45	%	13.78	%
	2006	19	19.23		358		1.41	%	1.45	%	19.69	%
	2005	26	16.07		411		1.07	%	1.45	%	8.58	%
	2004	14	14.80		209		0.88	%	1.45	%	16.81	%
	2003	5	12.67		59		0.52	%	1.45	%	26.70	%
Franklin Growth and Income Securities (AnnuiChoice™)
	2007	56	14.74		828		3.92	%	1.00	%	-4.67	%
	2006	7	15.46		114		2.39	%	1.00	%	15.59	%
	2005	10	13.38		128		2.43	%	1.00	%	2.49	%
	2004	8	13.05		107		1.25	%	1.00	%	9.48	%
	2003	4	11.92		49		3.74	%	1.00	%	19.20	%
Franklin Growth and Income Securities (AnnuiChoice II™)
	2007	4	10.33		38		3.85	%	1.15	%	-4.82	%
Franklin Growth and Income Securities (GrandMaster flex3™)
	2007	38	14.34		538		3.58	%	1.55	%	-5.21	%
	2006	13	15.12		194		2.42	%	1.55	%	14.95	%
	2005	10	13.16		133		2.43	%	1.55	%	1.90	%
	2004	7	12.91		84		1.48	%	1.55	%	8.95	%
	2003	3	11.85		31		0.00	%	1.55	%	18.50	%
Franklin Growth and Income Securities (Grandmaster™)
	2007	114	14.48		1,645		3.82	%	1.35	%	-5.01	%
	2006	25	15.24		388		2.62	%	1.35	%	15.18	%
	2005	32	13.24		421		3.04	%	1.35	%	2.12	%
	2004	27	12.96		348		2.55	%	1.35	%	9.09	%
	2003	37	11.88		437		3.34	%	1.35	%	18.80	%
Franklin Growth and Income Securities (IQ Annuity™)
	2007	113	14.41		1,622		3.74	%	1.45	%	-5.11	%
	2006	30	15.18		460		2.64	%	1.45	%	15.07	%
	2005	34	13.20		446		2.54	%	1.45	%	2.05	%
	2004	32	12.93		412		2.47	%	1.45	%	8.93	%
	2003	29	11.87		342		3.48	%	1.45	%	18.70	%

(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.

60

Separate Account I

of

National 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	147		$	13.66	$	2,002	3.81	%	1.67	%	-5.32	%
	2006	35		14.43		508		2.64	%	1.67	%	14.81	%
	2005	33		12.57		411		2.62	%	1.67	%	1.83	%
	2004	22		12.34		270		2.66	%	1.67	%	8.72	%
	2003	8		11.35		88		0.00	%	1.67	%	13.50	%
Franklin Income Securities (AnnuiChoice™)
	2007	34		17.27		595		3.76	%	1.00	%	2.71	%
	2006	32		16.81		532		3.76	%	1.00	%	17.06	%
	2005	36		14.36		515		3.72	%	1.00	%	0.63	%
	2004	42		14.27		595		2.98	%	1.00	%	12.72	%
	2003	31		12.66		395		4.10	%	1.00	%	26.60	%
Franklin Income Securities (AnnuiChoice II™)
	2007	12		10.91		133		3.61	%	1.15	%	2.56	%
Franklin Income Securities (GrandMaster flex3™)
	2007	198		16.79		3,321		3.52	%	1.55	%	2.14	%
	2006	159		16.44		2,608		3.61	%	1.55	%	16.41	%
	2005	122		14.12		1,726		3.84	%	1.55	%	0.02	%
	2004	72		14.12		1,020		2.20	%	1.55	%	12.06	%
	2003	19		12.60		245		3.05	%	1.55	%	26.00	%
Franklin Income Securities (Grandmaster™)
	2007	204		16.96		3,455		3.84	%	1.35	%	2.35	%
	2006	163		16.57		2,699		4.02	%	1.35	%	16.65	%
	2005	98		14.21		1,391		3.65	%	1.35	%	0.27	%
	2004	77		14.17		1,096		3.01	%	1.35	%	12.28	%
	2003	83		12.62		1,051		5.64	%	1.35	%	26.20	%
Franklin Income Securities (IQ Annuity™)
	2007	130		16.88		2,194		3.37	%	1.45	%	2.25	%
	2006	99		16.51		1,640		3.24	%	1.45	%	16.53	%
	2005	75		14.17		1,066		3.40	%	1.45	%	0.11	%
	2004	33		14.15		470		3.07	%	1.45	%	12.21	%
	2003	19		12.61		234		3.52	%	1.45	%	26.10	%
Franklin Income Securities (Pinnacle Plus™)
	2007	185		14.84		2,743		3.61	%	1.67	%	2.02	%
	2006	144		14.55		2,094		3.74	%	1.67	%	16.27	%
	2005	132		12.51		1,653		3.79	%	1.67	%	-0.05	%
	2004	82		12.52		1,032		3.04	%	1.67	%	11.89	%
	2003	28		11.19		315		0.00	%	1.67	%	11.90	%
Franklin Large Cap Growth Securities (AnnuiChoice™)
	2007	4		14.82		61		0.63	%	1.00	%	5.16	%
	2006	4		14.09		59		0.61	%	1.00	%	9.79	%
	2005	12		12.83		149		0.68	%	1.00	%	0.01	%
	2004	20		12.83		258		0.41	%	1.00	%	6.92	%
	2003	—	*	12.00		6		0.00	%	1.00	%	20.00	%
Franklin Large Cap Growth Securities (GrandMaster flex3™)
	2007	20		14.41		290		0.71	%	1.55	%	4.58	%
	2006	20		13.78		278		0.71	%	1.55	%	9.18	%
	2005	30		12.62		383		0.60	%	1.55	%	-0.47	%
	2004	19		12.68		245		0.40	%	1.55	%	6.20	%
	2003	4		11.94		46		0.00	%	1.55	%	19.40	%

(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.

61

Separate Account I

of

National 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 (Grandmaster™)
	2007	19		$	14.56	$	277	0.72	%	1.35	%	4.79	%
	2006	11		13.89		153		0.77	%	1.35	%	9.40	%
	2005	12		12.70		148		0.63	%	1.35	%	-0.34	%
	2004	16		12.74		199		0.60	%	1.35	%	6.52	%
	2003	6		11.96		71		0.13	%	1.35	%	19.60	%
Franklin Large Cap Growth Securities (IQ Annuity™)
	2007	29		14.48		426		0.68	%	1.45	%	4.68	%
	2006	22		13.84		300		0.87	%	1.45	%	9.29	%
	2005	25		12.66		318		0.54	%	1.45	%	-0.40	%
	2004	11		12.71		145		0.43	%	1.45	%	6.36	%
	2003	12		11.95		145		0.00	%	1.45	%	19.50	%
Franklin Large Cap Growth Securities (Pinnacle Plus™)
	2007	35		13.08		458		0.65	%	1.67	%	4.45	%
	2006	27		12.52		336		0.78	%	1.67	%	9.05	%
	2005	27		11.48		305		0.52	%	1.67	%	-0.58	%
	2004	29		11.55		333		0.47	%	1.67	%	6.06	%
Franklin Large Cap Growth Securities (AnnuiChoice II™)
	2007	9		11.36		99		0.94	%	1.15	%	5.00	%
	2006	—	*	10.82		8		0.00	%	1.15	%	8.16	%
Franklin Mutual Shares Securities (AnnuiChoice™)
	2007	64		17.88		1,142		1.91	%	1.00	%	2.44	%
	2006	49		17.45		853		1.97	%	1.00	%	17.20	%
	2005	28		14.89		413		0.99	%	1.00	%	9.48	%
	2004	23		13.60		313		0.53	%	1.00	%	11.48	%
	2003	11		12.20		138		1.06	%	1.00	%	22.00	%
Franklin Mutual Shares Securities (AnnuiChoice II™)
	2007	23		11.05		257		1.75	%	1.15	%	2.28	%
Franklin Mutual Shares Securities (GrandMaster flex3™)
	2007	123		17.39		2,146		2.01	%	1.55	%	1.87	%
	2006	86		17.07		1,460		1.99	%	1.55	%	16.55	%
	2005	65		14.64		946		0.95	%	1.55	%	8.88	%
	2004	32		13.45		436		0.37	%	1.55	%	10.88	%
	2003	7		12.13		89		0.92	%	1.55	%	21.30	%
Franklin Mutual Shares Securities (IQ Annuity™)
	2007	52		17.47		904		1.94	%	1.45	%	1.97	%
	2006	36		17.14		618		1.74	%	1.45	%	16.67	%
	2005	20		14.69		295		0.92	%	1.45	%	8.96	%
	2004	8		13.48		107		0.88	%	1.45	%	10.95	%
	2003	5		12.15		57		1.11	%	1.45	%	21.50	%
Franklin Mutual Shares Securities (Pinnacle Plus™)
	2007	128		15.90		2,031		2.17	%	1.67	%	1.74	%
	2006	93		15.63		1,447		2.20	%	1.67	%	16.41	%
	2005	65		13.42		868		0.95	%	1.67	%	8.70	%
	2004	30		12.35		375		0.78	%	1.67	%	10.76	%
	2003	8		11.15		86		0.00	%	1.67	%	11.50	%
Franklin Mutual Shares Securities Standard (IQ Advisor™)
	2007	1		14.75		13		2.05	%	0.60	%	2.86	%
	2006	—	*	14.34		13		2.08	%	0.60	%	17.67	%
	2005	—	*	12.18		11		0.00	%	0.60	%	9.86	%

(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

National 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 (Grandmaster™)
	2007	180		$	17.56	$	3,166	1.72	%	1.35	%	2.08	%
	2006	76		17.21		1,306		2.13	%	1.35	%	16.79	%
	2005	73		14.73		1,072		0.89	%	1.35	%	9.05	%
	2004	64		13.51		868		0.81	%	1.35	%	11.10	%
	2003	57		12.16		691		0.82	%	1.35	%	21.60	%
Franklin Small Cap Value Securities (AnnuiChoice™)
	2007	—	*	8.90		1		0.00	%	1.00	%	-10.96	%
Franklin Small Cap Value Securities (GrandmasterFlex3™)
	2007	6		8.87		55		1.45	%	1.55	%	-11.30	%
Franklin Small Cap Value Securities (IQ3 ™)
	2007	1		8.88		10		1.18	%	1.45	%	-11.24	%
Franklin Small Cap Value Securities (Pinnacle Plus ™)
	2007	2		8.86		14		0.00	%	1.67	%	-11.37	%
Templeton Foreign Securities Fund (GrandMaster flex3™)
	2007	34		21.77		749		2.03	%	1.55	%	13.66	%
	2006	27		19.16		525		1.19	%	1.55	%	19.57	%
	2005	39		16.02		620		1.09	%	1.55	%	8.47	%
	2004	12		14.77		181		0.68	%	1.55	%	16.67	%
	2003	3		12.66		33		1.74	%	1.55	%	26.60	%
Templeton Foreign Securities Fund (Grandmaster™)
	2007	13		21.99		292		1.69	%	1.35	%	13.89	%
	2006	13		19.31		247		0.89	%	1.35	%	19.81	%
	2005	20		16.12		323		1.53	%	1.35	%	8.68	%
	2004	10		14.83		147		0.98	%	1.35	%	16.96	%
	2003	4		12.68		55		0.00	%	1.35	%	26.80	%
Templeton Foreign Securities Fund (Pinnacle Plus™)
	2007	51		20.12		1,032		2.08	%	1.67	%	13.52	%
	2006	33		17.73		585		1.23	%	1.67	%	19.42	%
	2005	24		14.84		351		1.12	%	1.67	%	8.35	%
	2004	17		13.70		237		1.16	%	1.67	%	16.50	%
	2003	3		11.76		32		0.00	%	1.67	%	17.60	%
Templeton Foreign Securities Fund (AnnuiChoice™)
	2007	6		22.38		134		1.93	%	1.00	%	14.30	%
	2006	4		19.58		87		1.11	%	1.00	%	20.24	%
	2005	9		16.29		154		0.93	%	1.00	%	9.10	%
	2004	4		14.93		61		0.67	%	1.00	%	17.28	%
Templeton Foreign Securities Fund (AnnuiChoice II™)
	2007	2		12.51		21		1.58	%	1.15	%	14.12	%
	2006	—	*	10.96		2		0.00	%	1.15	%	9.64	%
Templeton Growth Securities (AnnuiChoice™)
	2007	6		19.00		119		1.92	%	1.00	%	1.32	%
	2006	4		18.75		80		1.12	%	1.00	%	20.59	%
	2005	9		15.55		139		1.01	%	1.00	%	7.74	%
	2004	5		14.43		77		0.39	%	1.00	%	14.89	%
	2003	—	*	12.56		5		0.00	%	1.00	%	25.60	%
Templeton Growth Securities (AnnuiChoice II™)
	2007	3		11.15		39		1.56	%	1.15	%	1.16	%

(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

National 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 (GrandMaster flex3™)
	2007	84		$	18.48	$	1,560	1.61	%	1.55	%	0.75	%
	2006	57		18.34		1,048		1.21	%	1.55	%	19.93	%
	2005	43		15.29		660		1.07	%	1.55	%	7.16	%
	2004	20		14.27		288		0.58	%	1.55	%	14.25	%
Templeton Growth Securities (Grandmaster™)
	2007	22		18.66		415		1.79	%	1.35	%	0.96	%
	2006	63		18.49		1,165		1.58	%	1.35	%	20.17	%
	2005	24		15.38		364		1.11	%	1.35	%	7.43	%
	2004	23		14.32		327		1.11	%	1.35	%	14.47	%
	2003	16		12.51		197		1.18	%	1.35	%	25.10	%
Templeton Growth Securities (IQ Annuity™)
	2007	48		18.57		885		1.44	%	1.45	%	0.86	%
	2006	86		18.41		1,584		0.85	%	1.45	%	20.05	%
	2005	23		15.34		354		1.08	%	1.45	%	7.26	%
	2004	10		14.30		138		1.25	%	1.45	%	14.40	%
	2003	4		12.50		53		0.72	%	1.45	%	25.00	%
Templeton Growth Securities (Pinnacle Plus™)
	2007	62		16.99		1,056		1.65	%	1.67	%	0.63	%
	2006	62		16.88		1,048		1.21	%	1.67	%	19.78	%
	2005	42		14.10		599		1.25	%	1.67	%	7.03	%
	2004	8		13.17		105		1.34	%	1.67	%	14.12	%
Templeton Growth Securities Standard (IQ Advisor™)
	2007	—	*	15.04		7		1.65	%	0.60	%	1.73	%
	2006	—	*	14.78		7		1.32	%	0.60	%	21.08	%
	2005	—	*	12.21		6		0.00	%	0.60	%	8.25	%
Van Kampen LIT Comstock (AnnuiChoice™)
	2007	7		16.51		111		1.67	%	1.00	%	-3.31	%
	2006	7		17.07		115		3.20	%	1.00	%	14.89	%
	2005	17		14.86		246		1.12	%	1.00	%	3.05	%
	2004	25		14.42		355		0.28	%	1.00	%	16.29	%
	2003	2		12.40		30		0.00	%	1.00	%	24.00	%
Van Kampen LIT Comstock (GrandMaster flex3™)
	2007	17		16.06		276		1.73	%	1.55	%	-3.85	%
	2006	19		16.70		319		2.55	%	1.55	%	14.25	%
	2005	20		14.62		289		0.82	%	1.55	%	2.50	%
	2004	10		14.26		138		0.36	%	1.55	%	15.65	%
	2003	1		12.33		9		0.00	%	1.55	%	23.30	%
Van Kampen LIT Comstock (Grandmaster™)
	2007	7		16.22		112		1.76	%	1.35	%	-3.65	%
	2006	11		16.83		184		3.63	%	1.35	%	14.48	%
	2005	25		14.70		361		1.49	%	1.35	%	2.68	%
	2004	157		14.32		2,249		0.12	%	1.35	%	15.86	%
	2003	7		12.36		93		0.00	%	1.35	%	23.60	%
Van Kampen LIT Comstock (IQ Annuity™)
	2007	9		16.14		138		1.61	%	1.45	%	-3.75	%
	2006	9		16.77		146		2.92	%	1.45	%	14.37	%
	2005	13		14.66		186		0.11	%	1.45	%	2.59	%
	2004	—	*	14.29		7		0.00	%	1.45	%	15.71	%

(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

National 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 Comstock (Pinnacle Plus™)
	2007	21		$	14.62	$	314		1.64	%	1.67	%	-3.97	%
	2006	22		15.22		342			2.46	%	1.67	%	14.11	%
	2005	21		13.34		286			0.92	%	1.67	%	2.39	%
	2004	15		13.03		190			0.65	%	1.67	%	15.41	%
	2003	9		11.29		100			0.00	%	1.67	%	12.90	%
Van Kampen LIT Strategic Growth (GrandMaster flex3™)
	2007	1		15.45		11			0.00	%	1.55	%	14.83	%
	2006	2		13.45		23			0.00	%	1.55	%	1.04	%
	2005	1		13.31		14			0.01	%	1.55	%	6.01	%
	2004	1		12.56		18			0.00	%	1.55	%	5.10	%
	2003	—	*	11.95		1			0.00	%	1.55	%	19.50	%
Van Kampen LIT Strategic Growth (AnnuiChoice™)
	2007	1		15.88		9			0.00	%	1.00	%	15.47	%
Van Kampen LIT Strategic Growth (Grandmaster™)
	2007	—	*	15.60		—		*	0.00	%	1.35	%	15.06	%
	2006	—	*	13.56		6			0.00	%	1.35	%	1.24	%
	2005	—	*	13.40		6			0.01	%	1.35	%	6.23	%
	2004	1		12.61		10			0.00	%	1.35	%	5.26	%
	2003	—	*	11.98		4			0.00	%	1.35	%	19.80	%
Van Kampen LIT Strategic Growth (IQ Annuity™)
	2007	—	*	15.53		1			0.00	%	1.45	%	14.94	%
	2006	—	*	13.51		1			0.00	%	1.45	%	1.14	%
	2005	—	*	13.36		1			0.00	%	1.45	%	6.08	%
	2004	—	*	12.59		1			0.00	%	1.45	%	5.27	%
	2003	1		11.96		14			0.00	%	1.45	%	19.60	%
Van Kampen LIT Strategic Growth (Pinnacle Plus™)
	2007	23		13.62		310			0.00	%	1.67	%	14.69	%
	2006	7		11.87		87			0.00	%	1.67	%	0.92	%
	2005	7		11.77		77			0.01	%	1.67	%	5.80	%
	2004	6		11.12		69			0.00	%	1.67	%	5.00	%
	2003	2		10.59		22			0.00	%	1.67	%	5.90	%
Van Kampen UIF Emerging Markets Debt (AnnuiChoice™)
	2007	1		10.20		10			0.00	%	1.00	%	2.00	%
Van Kampen UIF Emerging Markets Debt (Grandmaster™)
	2007	1		17.13		23			7.86	%	1.35	%	4.95	%
	2006	5		16.32		77			10.33	%	1.35	%	9.31	%
	2005	6		14.93		97			7.27	%	1.35	%	10.62	%
	2004	4		13.50		53			10.66	%	1.35	%	8.61	%
	2003	8		12.43		95			0.00	%	1.35	%	24.30	%
Van Kampen UIF Emerging Markets Debt (GrandmasterFlex3™)
	2007	20		10.16		199			1.40	%	1.55	%	1.61	%
Van Kampen UIF Emerging Markets Debt (IQ3™)
	2007	13		17.05		230			0.00	%	1.45	%	4.84	%
Van Kampen UIF Emerging Markets Debt (Pinnacle Plus™)
	2007	22		14.88		326			7.75	%	1.67	%	4.61	%
	2006	22		14.23		314			10.06	%	1.67	%	8.96	%
	2005	22		13.06		290			8.71	%	1.67	%	10.29	%
	2004	5		11.84		63			7.92	%	1.67	%	8.23	%
	2003	2		10.94		19			0.00	%	1.67	%	9.40	%

(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.

65

Separate Account I

of

National 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	22		$	43.96	$	966	0.88	%	1.00	%	39.05	%
	2006	19		31.62		590		0.27	%	1.00	%	35.80	%
	2005	5		23.28		118		0.33	%	1.00	%	32.44	%
	2004	4		17.58		62		0.72	%	1.00	%	21.75	%
	2003	4		14.44		62		0.00	%	1.00	%	44.40	%
Van Kampen UIF Emerging Markets Equity (GrandMaster flex3™)
	2007	34		42.76		1,433		0.72	%	1.55	%	38.27	%
	2006	16		30.93		507		0.80	%	1.55	%	35.05	%
	2005	14		22.90		320		0.24	%	1.55	%	31.68	%
	2004	3		17.39		48		1.13	%	1.55	%	21.10	%
Van Kampen UIF Emerging Markets Equity (Grandmaster™)
	2007	18		43.20		760		0.65	%	1.35	%	38.56	%
	2006	15		31.18		465		0.74	%	1.35	%	35.32	%
	2005	14		23.04		332		0.27	%	1.35	%	31.95	%
	2004	15		17.46		257		0.58	%	1.35	%	21.33	%
	2003	4		14.39		52		0.00	%	1.35	%	43.90	%
Van Kampen UIF Emerging Markets Equity (IQ Annuity™)
	2007	10		42.98		439		0.66	%	1.45	%	38.41	%
	2006	4		31.05		113		1.22	%	1.45	%	35.19	%
	2005	1		22.97		30		0.04	%	1.45	%	31.85	%
	2004	1		17.42		16		0.18	%	1.45	%	21.22	%
	2003	12		14.37		170		0.00	%	1.45	%	43.70	%
Van Kampen UIF Emerging Markets Equity (Pinnacle Plus™)
	2007	35		37.33		1,308		0.82	%	1.67	%	38.10	%
	2006	24		27.03		657		0.72	%	1.67	%	34.89	%
	2005	19		20.04		379		0.23	%	1.67	%	31.50	%
	2004	3		15.24		44		0.97	%	1.67	%	20.95	%
	2003	—	*	12.60		1		0.00	%	1.67	%	26.00	%
Van Kampen UIF Emerging Markets Equity (AnnuiChoice II™)
	2007	20		16.65		329		0.78	%	1.15	%	38.84	%
	2006	6		11.99		72		0.00	%	1.15	%	19.89	%
Van Kampen UIF U. S. Real Estate (AnnuiChoice™)
	2007	1		7.72		6		5.60	%	1.00	%	-22.80	%
Van Kampen UIF U. S. Real Estate (AnnuiChoice II™)
	2007	9		7.71		70		2.22	%	1.15	%	-22.88	%
Van Kampen UIF U.S. Real Estate (Grandmaster™)
	2007	15		22.95		339		2.01	%	1.35	%	-18.40	%
	2006	24		28.12		661		1.27	%	1.35	%	35.82	%
	2005	26		20.71		534		1.47	%	1.35	%	15.16	%
	2004	30		17.98		534		2.09	%	1.35	%	34.28	%
	2003	24		13.39		317		0.00	%	1.35	%	33.90	%
Van Kampen UIF U.S. Real Estate (GrandmasterFlex3™)
	2007	12		7.69		93		2.52	%	1.55	%	-23.09	%
Van Kampen UIF U.S. Real Estate (IQ3 ™)
	2007	5		22.83		116		1.01	%	1.45	%	-18.48	%

(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

National 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 (Pinnacle Plus™)
	2007	44	$	19.48	$	856	1.93	%	1.67	%	-18.66	%
	2006	45	23.95		1,075		1.27	%	1.67	%	35.38	%
	2005	44	17.69		775		1.40	%	1.67	%	14.79	%
	2004	21	15.41		318		2.20	%	1.67	%	33.77	%
	2003	6	11.52		74		0.00	%	1.67	%	15.20	%
Non-Affiliated Class B:
DWS Small Cap Index VIP (AnnuiChoice™)
	2007	9	14.98		138		1.02	%	1.00	%	-3.14	%
	2006	8	15.46		131		0.60	%	1.00	%	16.02	%
	2005	13	13.33		170		0.52	%	1.00	%	2.99	%
	2004	15	12.94		191		0.22	%	1.00	%	16.26	%
	2003	28	11.13		317		0.00	%	1.00	%	44.55	%
DWS Small Cap Index VIP (AnnuiChoice II™)
	2007	1	10.54		12		1.03	%	1.15	%	-3.29	%
DWS Small Cap Index VIP (GrandMaster flex3™)
	2007	12	15.65		191		1.00	%	1.55	%	-3.68	%
	2006	18	16.24		287		0.54	%	1.55	%	15.38	%
	2005	16	14.08		221		0.71	%	1.55	%	2.39	%
	2004	15	13.75		212		0.21	%	1.55	%	15.64	%
	2003	12	11.89		148		0.00	%	1.55	%	43.77	%
DWS Small Cap Index VIP (Grandmaster™)
	2007	1	13.25		17		0.43	%	1.35	%	-3.49	%
	2006	2	13.73		25		0.09	%	1.35	%	15.61	%
	2005	33	11.87		387		0.18	%	1.35	%	2.61	%
	2004	20	11.57		231		0.00	%	1.35	%	15.70	%
DWS Small Cap Index VIP (IQ3™)
	2007	7	14.48		103		0.98	%	1.45	%	-3.59	%
	2006	9	15.01		133		0.45	%	1.45	%	15.50	%
	2005	10	13.00		133		0.77	%	1.45	%	2.52	%
	2004	7	12.68		87		0.19	%	1.45	%	15.69	%
	2003	4	10.96		43		0.73	%	1.45	%	44.02	%
DWS Small Cap Index VIP (Pinnacle Plus™)
	2007	35	15.13		534		1.05	%	1.67	%	-3.80	%
	2006	34	15.73		527		0.60	%	1.67	%	15.24	%
	2005	35	13.65		473		0.61	%	1.67	%	2.26	%
	2004	29	13.35		390		0.20	%	1.67	%	15.48	%
	2003	3	11.56		32		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.

67

STATUTORY-BASIS FINANCIAL STATEMENTS

AND SCHEDULES

National Integrity Life Insurance Company

Years Ended December 31, 2007, 2006 and 2005

National 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	33
Schedule III – Supplementary Insurance Information	34
Schedule IV – Reinsurance	35

Report of Independent Registered Public Accounting Firm

The Board of Directors

National Integrity Life Insurance Company

We have audited the accompanying statutory-basis balance sheets of National 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 New York 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 National 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 National 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 New York 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 2007 the Company changed the valuation basis of its statutory reserves for certain annuity products.

/s/ Ernst & Young LLP

Cincinnati, Ohio

April 7, 2008

1

National Integrity Life Insurance Company

Balance Sheets (Statutory-Basis)

	December 31
	2007			2006
	(in thousands)
Admitted Assets
Cash and invested assets:
Debt securities	$	993,174		$	869,781
Preferred stock	38,230			46,866
Mortgage loans	2,754			3,480
Policy loans	42,357			40,044
Cash, cash equivalents and short-term investments	12,455			13,581
Receivable for securities	344			584
Total cash and invested assets	1,089,314			974,336
Investment income due and accrued	10,403			9,566
Net deferred income tax asset	13,748			11,159
Other Admitted Assets	926			—
Separate account assets	2,563,118			2,488,106
Total admitted assets	$	3,677,509		$	3,483,167
Liabilities and Capital and Surplus
Liabilities:
Policy and contract liabilities:
Life and annuity reserves	$	968,111		$	877,478
Liability for deposit-type contracts	20,862			16,356
Policy and contract claims	51			38
Deposits on policies to be issued	5,220			2,873
Total policy and contract liabilities	994,244			896,745
General expense due and accrued	238			192
Transfer to (from) separate accounts due and accrued, net	(48,625		)	(85,492		)
Asset valuation reserve	17,162			21,798
Other liabilities	2,313			9,934
Borrowed money and interest	6,924			22,810
Separate account liabilities	2,563,118			2,488,106
Total liabilities	3,535,374			3,354,093
Capital and surplus:
Common stock, $10 par value, 200 shares authorized, issued and outstanding	2,000			2,000
Paid-in surplus	206,371			206,371
Accumulated deficit	(66,236		)	(79,297		)
Total capital and surplus	142,135			129,074
Total liabilities and capital and surplus	$	3,677,509		$	3,483,167

See accompanying notes.

2

National 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	$	523,228		$	528,350		$	486,498
Net investment income	55,251			51,555			42,224
Considerations for supplementary contracts with life contingencies	5,685			3,166			1,593
Amortization of interest maintenance reserve	(933		)	(466		)	17
Fees from management of separate account mutual funds	8,588			7,614			8,069
Other revenues	1,579			1,363			3,430
Total premiums and other revenues	593,398			591,582			541,831
Benefits paid or provided:
Death benefits	3,921			2,750			6,859
Annuity benefits	62,998			55,844			48,060
Surrender benefits	402,034			256,327			198,466
Payments on supplementary contracts	1,427			1,093			860
Other benefits	875			604			591
Increase (decrease) in policy reserves and other policyholders’ funds	92,810			53,026			183,666
Total benefits paid or provided	564,065			369,644			438,502
Insurance expenses and other deductions:
Commissions	26,065			25,489			26,219
Commissions and expenses on reinsurance assumed	1,736			2,439			4,200
General expenses	12,623			11,142			12,742
Net transfers to (from) separate accounts	(20,361		)	171,850			59,284
Other deductions	(1,132		)	(1,308		)	(766		)
Total insurance expenses and other deductions	18,931			209,612			101,679
Gain (loss) from operations before federal income tax expense and net realized capital gains (losses)	10,402			12,326			1,650
Federal income tax expense (benefit), excluding tax on capital gains	1,016			(22,086		)	—
Gain (loss) from operations before net realized capital gains (losses)	9,386			34,412			1,650
Net realized capital gains or (losses) (excluding gains (losses) transferred to IMR and capital gains tax)	(4,271		)	3,480			5,467
Net income (loss)	$	5,115		$	37,892		$	7,117

See accompanying notes.

3

National 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	$	2,000	$	206,371	$	(110,234	)	$	98,137
Net income	—		—		7,117			7,117
Change in net deferred income tax asset	—		—		647			647
Net change in unrealized gains on investments (net of deferred tax expense (benefit) of $845)	—		—		845			845
Net change in nonadmitted assets and related items	—		—		(1,709		)	(1,709		)
Change in reserve on account of change in valuation basis	—		—		(1,778		)	(1,778		)
Other	—		—		694			694
Change in surplus in separate accounts	—		—		(5,626		)	(5,626		)
Balance, December 31, 2005	2,000		206,371		(110,044		)	98,327
Net income	—		—		37,892			37,892
Change in net deferred income tax asset	—		—		(27,490		)	(27,490		)
Net change in nonadmitted assets and related items	—		—		21,015			21,015
Change in asset valuation reserve	—		—		(2,458		)	(2,458		)
Change in surplus in separate accounts	—		—		1,788			1,788
Balance, December 31, 2006	2,000		206,371		(79,297		)	129,074
Net income	—		—		5,115			5,115
Change in deferred income tax asset	—		—		4,365			4,365
Net change in unrealized gains on investments (net of deferred taxes of $0)	—		—		—			—
Net change in nonadmitted assets and related items	—		—		(4,787		)	(4,787		)
Change in reserve on account of change in valuation basis	—		—		9,335			9,335
Change in asset valuation reserve	—		—		4,636			4,636
Change in surplus in separate accounts	—		—		(5,603		)	(5,603		)
Balance, December 31, 2007	$	2,000	$	206,371	$	(66,236	)	$	142,135

See accompanying notes.

4

National 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	$	528,913		$	531,516		$	488,091
Net investment income received	53,790			50,933			41,538
Benefits paid	(476,428		)	(315,691		)	(257,404		)
Net transfers from (to) separate accounts	57,229			(198,766		)	(70,025		)
Commissions and expense paid	(39,179		)	(37,781		)	(42,236		)
Other, net	7,776			36,619			11,500
Net cash from (for) operations	132,101			66,830			171,464
Cash from Investments:
Proceeds from investments sold, matured or repaid:
Debt securities	517,025			541,820			354,884
Preferred stocks	28,682			23,232			22,162
Mortgage loans	3,480			414			279
Miscellaneous proceeds	—			863			428
Net proceeds from investments sold, matured or repaid	549,187			566,329			377,753
Cost of investments acquired:
Debt securities	647,353			677,362			510,400
Preferred stocks	18,991			44,455			19,116
Mortgage loans	2,754			3,504			—
Miscellaneous applications	358			—			23,734
Total cost of investments acquired	672,555			725,321			553,250
Net change in policy and other loans	2,312			1,732			(156		)
Net cash from (for) investments	(125,680		)	(160,724		)	(175,341		)
Cash from Financing and Miscellaneous Sources:
Borrowed money	(15,886		)	9,561			13,248
Net deposits on deposit-type contract funds and other insurance liabilities	4,506			2,401			—
Other cash provided (applied)	3,833			(3,588		)	5,714
Net cash from (for) financing and miscellaneous sources	(7,547		)	8,374			18,962
Net change in cash, cash equivalents and short-term investments	(1,126		)	(85,520		)	15,085
Cash, cash equivalents and short-term investments:
Beginning of year	13,581			99,101			84,016
End of year	$	12,455		$	13,581		$	99,101

See accompanying notes.

5

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis)

December 31, 2007

1. Nature of Operations and Significant Accounting Policies

National Integrity Life Insurance Company (the Company) is a wholly-owned subsidiary of Integrity Life Insurance Company (Integrity), which is a wholly-owned subsidiary of The Western and Southern Life Insurance Company (Western and Southern).  The Company, domiciled in the state of New York and currently licensed in eight states and the District of Columbia, specializes in the asset accumulation business with particular emphasis on retirement savings and investment products.  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 New York 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

6

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

1. Nature of Operations and Significant Accounting Policies (continued)

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.

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 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.

7

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

1. Nature of Operations and Significant Accounting Policies (continued)

Nonadmitted Assets

Certain assets designated as “nonadmitted” (principally a portion of deferred tax assets, negative IMR on the separate account that is not offset by positive IMR on the general account), and other assets not specifically identified as an admitted asset within the NAIC’s 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

National Integrity Life Insurance Company

Notes to the 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.

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	$	142,135		$	129,074
Adjustments to customer deposits	(38,544		)	(30,560		)
Adjustments to invested asset carrying values	1,270			(952		)
Federal income taxes	(40,505		)	(41,610		)
Asset valuation reserve	17,162			21,798
Value of insurance in force	14,315			21,274
Goodwill	—			14,548
Deferred policy acquisition costs	123,016			118,725
Deferred sales inducements	16,047			12,511
Commissions and prepaids	11			415
Shareholder’s equity, GAAP basis	$	234,907		$	245,223

9

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

1. Nature of Operations and Significant Accounting Policies (continued)

	Year Ended December 31
	2007			2006			2005
	(in thousands)
Net income (loss) as reported in the accompanying statutory-basis financial statements	$	5,115		$	37,892		$	7,117
Deferred policy acquisition costs, net of amortization	7,276			12,112			16,276
Deferred sales inducements, net of amortization	3,536			6,663			3,087
Adjustments to customer deposits	(5,853		)	(9,145		)	(4,658		)
Adjustments to invested asset carrying values at acquisition date	3,092			1,143			928
Amortization of value of insurance in force	(4,503		)	(5,006		)	(5,885		)
Amortization of interest maintenance reserve	933			466			17
Adjustments for realized investment gains/losses	(1,462		)	(11,110		)	2,704
Adjustments for federal income tax expense	1,142			(25,831		)	(5,919		)
Other	556			(1,113		)	(557		)
Net income, GAAP basis	$	9,832		$	6,071		$	13,110

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

10

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

1. Nature of Operations and Significant Accounting Policies (continued)

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.

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 investee 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.

11

National Integrity Life Insurance Company

Notes to the 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 insured 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.

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^st 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 reserves 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 conditions.  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.

12

National Integrity Life Insurance Company

Notes to the 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 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 $6.9 million and $22.8 million of mortgage-backed securities that were subject to the reverse repurchase agreements at December 31, 2007 and 2006, respectively.

Securities Lending

The Company loaned $13.0 million and $50.0 million of various U.S. Treasury and corporate debt securities 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 sheet.  Restricted collateral is not reflected on the balance sheets as an asset or a liability.  All of the collateral was restricted and held in the Bank of New York Cash Reserves as of December 31, 2007 and 2006.

Separate Accounts

Separate account assets and liabilities reported in the accompanying balance sheets represent funds that are separately administered, principally for market value adjusted annuity contracts and variable 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.

13

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

1. Nature of Operations and Significant Accounting Policies (continued)

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.

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 $9.3 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.

14

National Integrity Life Insurance Company

Notes to the 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	$	3,837	$	232	$	(16	)	$	4,053
Debt securities issued by states of the U.S. and political subdivisions of the states	46,716		16		(98		)	46,634
Corporate securities/asset-backed securities	566,553		10,907		(10,996		)	566,464
Mortgage-backed securities	376,068		2,908		(3,611		)	375,365
Total	$	993,174	$	14,063	$	(14,721	)	$	992,516

15

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

2.  Investments (continued)

	Book/ Adjusted Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in thousands)
At December 31, 2006:
U.S. Treasury securities and obligations of U.S. government corporation and agencies	$	23,653	$	152	$	(158	)	$	23,647
Debt securities issued by states of the U.S. and political subdivisions of the states	21,328		9		(37		)	21,300
Corporate securities/asset-backed securities	509,297		8,126		(8,582		)	508,841
Mortgage-backed securities	315,503		1,592		(2,992		)	314,103
Total	$	869,781	$	9,879	$	(11,769	)	$	867,891

At December 31, 2007 and 2006, the Company held unrated or less-than-investment grade corporate debt securities with a book value of $21.1 million and $19.2 million, respectively, and an aggregate fair value of $24.0 million and $21.6, respectively.  Such holdings amount to 2.1% and 2.2%, respectively, of the Company’s investment in debt securities and 0.6% and 0.6%, 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.

16

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

2.  Investments (continued)

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	$	(16	)	$	765	$	—		$	101
Debt securities issued by states of the U.S. and political subdivisions of the states	(98		)	7,317		—			—
Corporate securities/asset-backed securities	(4,195		)	180,618		(6,801		)	103,681
Mortgage-backed securities	(2,644		)	120,858		(967		)	63,490
Total	(6,953		)	309,558		(7,768		)	167,272
Preferred stocks	$	(1,903	)	$	22,502	$	(244	)	$	4,416

	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	$	(154	)	$	20,535	$	(4	)	$	239
Debt securities issued by states of the U.S. and political subdivisions of the states	(24		)	4,602		(13		)	687
Corporate securities/asset-backed securities	(2,016		)	150,472		(6,566		)	122,344
Mortgage-backed securities	(1,427		)	139,690		(1,565		)	89,897
Total	$	(3,621	)	$	315,299	$	(8,148	)	$	213,167
Preferred stocks	$	(207	)	$	12,289	$	(120	)	$	3,589

17

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

2.  Investments (continued)

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 temporary due to the assigned rating and the typical fluctuations of these particular securities in the marketplace. The aggregated unrealized loss is approximately 3.3% and 2.2% of the carrying value of these securities at December 31, 2007 and 2006, respectively. At December 31, 2007, there were a total of 225 securities held that are considered temporarily impaired, 83 of which have been impaired for 12 months or longer.  At December 31, 2006, there were a total of 216 securities held that were considered temporarily impaired, 89 of which had been impaired for 12 months or longer.  The Company recorded other-than-temporary impairments on securities of $4.8 million, $0.0 million and $0.0 million for the years ended December 31, 2007, 2006 and 2005, respectively.

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	$	24,877	$	24,889
After one through five	171,330		171,187
After five through ten	203,972		199,667
After ten	216,927		221,407
Mortgage-backed securities	376,068		375,366
Total	$	993,174	$	992,516

The expected maturities in the foregoing table may differ from the 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 $246.8 million, $215.6 million, and $106.2 million; gross gains of $0.2 million, $1.5 million, and $5.8 million, and gross losses of $2.5 million, $2.9 million, and $1.7 million were realized on these sales in 2007, 2006, and 2005, respectively.

18

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

2.  Investments (continued)

Realized capital gains (losses) are reported net of federal income taxes and amounts transferred to the IMR as follows for the years ended December 31:

	2007			2006			2005
	(in thousands)
Realized capital gains (losses)	$	(6,502	)	$	(2,185	)	$	4,956
Less amount transferred to IMR	(962		)	(3,507		)	(426		)
Less federal income taxes of realized capital gains	(1,269		)	(2,158		)	(85		)
Net realized capital gains (losses)	$	(4,271	)	$	3,480		$	5,467

The unrealized gains and unrealized losses on, and the cost and fair value of preferred stocks are as follows:

			Gross		Gross
			Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
	(in thousands)
At December 31, 2007:
Preferred stocks	$	38,230	$	974	$	(2,147	)	$	37,057
At December 31, 2006:
Preferred stocks	$	46,866	$	1,245	$	(327	)	$	47,784

Proceeds from the sales of investments in equity securities during 2007, 2006 and 2005 were $20.0 million, $20.7 million, and $6.6 million; gross gains of $0.0 million, $0.1 million, and $0.7 million and gross losses of $0.0 million, $0.0 million, and $0.1 million were realized on these sales in 2007, 2006, and 2005, respectively.

19

National Integrity Life Insurance Company

Notes to the 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	$	49,217		$	42,678	$	35,369
Equity securities	2,708			3,152		2,232
Mortgage loans	130			186		38
Policy loans	3,244			3,108		3,030
Cash, cash equivalents and short-term investments	1,385			3,779		2,574
Other	(69		)	124		145
Gross investment income	56,615			53,027		43,388
Investment expenses	1,364			1,472		1,164
Net investment income	$	55,251		$	51,555	$	42,224

The Company’s investments in mortgage loans principally involve commercial loans. At December 31, 2007, 100% of such mortgages involved properties located in Ohio.  Such investments consist of first mortgage liens on completed income producing properties.  The aggregate mortgage outstanding to any one borrower does not exceed $2.8 million.  During 2007, the respective maximum and minimum lending rates for mortgage loans were 6.25% and 6.25%.  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.

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.

20

National Integrity Life Insurance Company

Notes to the 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	$	993,174	$	992,516	$	869,781	$	867,891
Preferred stocks	38,230		37,057		46,866		47,784
Mortgage loans	2,754		2,754		3,480		3,500
Cash, cash equivalents and short-term investments	12,455		12,455		13,581		13,581
Separate account assets	2,563,118		2,563,118		2,488,106		2,488,106
Liabilities:
Life and annuity reserves for investment-type contracts and deposit fund liabilities	$	903,837	$	900,365	$	810,700	$	810,900
Separate account liabilities	2,563,118		2,479,395		2,488,106		2,361,400

21

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

4. Related Party Transactions

Western and Southern, Fort Washington and IFS Financial Services 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, and investment functions. During 2007, the Company paid $6.9 million, $1.2 million and $4.7 million to Western and Southern, Fort Washington, and IFS, respectively.  During 2006, the Company paid $5.9 million, $1.1 million and $3.9 million to Western and Southern, Fort Washington, and IFS Financial Services, respectively.  During 2005, the Company paid $0.03 million, $1.0 million and $10.8 million to Western and Southern, Fort Washington and Integrity, respectively.  The charges for services are considered reasonable and in accordance with the requirements of applicable insurance law and regulations.

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 effects of reinsurance on premiums, annuity considerations and deposit-type funds are as follows for the years ended December 31:

	2007			2006			2005
	(in thousands)
Direct premiums	$	517,678		$	522,714		$	457,845
Assumed premiums:
Affiliates	—			—			—
Non-affiliates	5,774			6,238			29,388
Ceded premiums:
Affiliates	—			—			—
Non-affiliates	(224		)	(602		)	(735		)
Net premiums	$	523,228		$	528,350		$	486,498

22

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

5. Reinsurance (continued)

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	$	—	$	—		$	—
Non-affiliates	298		(12		)	534
Policy and contract liabilities:
Affiliates	—		—			—
Non-affiliates	299		142			565

In 2007 and 2006, 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.

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.

23

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

6. Federal Income Taxes

The Company is included in the consolidated federal income tax return of Western and Southern. The method of allocation between the companies is subject to a written agreement, approved by the Board of Directors. Allocation is based on separate return calculations with current credit for net losses. Intercompany tax balances are settled annually.  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 $2.2 million, $0 million, and $0 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	$	17,520		$	16,425		$	1,095
Total deferred tax liabilities	(1,996		)	(5,266		)	3,270
Net deferred tax asset (liability)	$	15,524		$	11,159		$	4,365
Less tax (expense) benefit from unrealized gains or losses							—
Change in net deferred income taxes							$	4,365

Nonadmitted deferred tax assets increased (decreased) by $1.8 million, $(30.2) million and $1.3 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 income	$	3,452		$	6,871		$	(3,121	)
Federal income tax expense on capital gains	(491		)	(938		)	(1,246		)
Capital loss carryforward adjustment	(778		)	(1,220		)	1,161
NOL carryforward adjustment	—			(28,957		)	3,242
Prior year under (over) accrual	(2,436		)	—			(121		)
Current income taxes incurred	$	(253	)	$	(24,244	)	$	(85	)

24

National Integrity Life Insurance Company

Notes to the 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	$	7,217	$	7,013
Deferred acquisition costs	7,182		6,552
Stocks/debt securities	3,121		2,082
Capital loss carryover	—		778
Total deferred tax assets	17,520		16,425
Nonadmitted deferred tax assets	1,776		—
Admitted deferred tax assets	15,744		16,425
Deferred tax liabilities:
Stocks /debt securities	6		18
Reserve strengthening	955		1,024
Separate account adjustment	1,035		4,224
Total deferred tax liabilities	1,996		5,266
Net admitted deferred income tax assets	$	13,748	$	11,159

25

National Integrity Life Insurance Company

Notes to the 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	$	3,640		35.00	%	$	4,314		35.00	%	$	576		35.00	%
Dividends received deduction	(4,350		)	-41.82		(1,095		)	-8.89		(801		)	-48.64
Separate account adjustment	(1,961		)	-18.86		625			5.08		(1,969		)	-119.66
Other	329			3.17		167			1.35		(273		)	-16.58
Total	$	(2,342	)	-22.51	%	$	4,011		32.54	%	$	(2,467	)	-149.88	%
Federal income taxes incurred	$	1,016		9.77	%	$	(22,086	)	-179.18	%	$	—		—	%
Change in net deferred income taxes*	(3,358		)	-32.28		26,097			211.72		(2,467		)	-149.88
Total statutory income taxes	$	(2,342	)	-22.51	%	$	4,011		32.54	%	$	(2,467	)	-149.88	%

*Excludes change in net deferred income taxes on realized gains/losses of $(1,007), $1,394 and $1,820 for the years ended December 31, 2007, 2006 and 2005, respectively.

26

National Integrity Life Insurance Company

Notes to the 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.

Under New York insurance laws, the Company may pay dividends only out of its earnings and surplus, subject to at least thirty days prior notice to the New York Insurance Superintendent and no disapproval from the Superintendent prior to the date of such dividend. The Superintendent may disapprove a proposed dividend if the Superintendent finds that the financial condition of the Company does not warrant such distribution. 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.

27

National Integrity Life Insurance Company

Notes to the 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	$	1,941,260	56.8	%
At book value less current surrender charge of 5% or more	391,167		11.4
At fair value	573,807		16.8
Total with adjustment or at market value	2,906,234		85.0
Subject to discretionary withdrawal (without adjustment) at book value with minimal or no charge or adjustment	319,656		9.4
Not subject to discretionary withdrawal	192,322		5.6
Total annuity reserves and deposit fund liabilities (before reinsurance)	3,418,212		100.0	%
Less reinsurance ceded	—
Net annuity reserves and deposit fund liabilities	$	3,418,212

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.

28

National Integrity Life Insurance Company

Notes to the Financial Statements (Statutory-Basis) (continued)

10. Separate Accounts

The Company’s guaranteed separate accounts include non-indexed products and guaranteed rate options.  The guaranteed rate options are sold as a fixed annuity product or as an investment option within the Company’s variable annuity products.  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.  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 nonguaranteed separate accounts 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, and a death benefit that is adjusted periodically to the current account value.  Assets held in separate accounts are carried at estimated fair values.

29

National Integrity Life Insurance Company

Notes to the 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	$	—	$	7,932	$	187,243	$	55,000	$	250,175
Reserves for separate accounts with assets at fair value	$	—	$	534,294	$	1,406,274	$	573,807	$	2,514,375
Reserves for separate accounts by withdrawal characteristics:
Subject to discretionary withdrawal (with adjustment):
With market value adjustment	$	—	$	534,294	$	1,406,274	$	—	$	1,940,568
At book value without market value adjustment and with current surrender charge of 5% or more
At fair value	—		—		—		573,807		573,807
Subtotal	—		534,294		1,406,274		573,807		2,514,375
Not subject to discretionary withdrawal	—		—		—		—		—
Total separate accounts liabilities	$	—	$	534,294	$	1,406,274	$	573,807	$	2,514,375

30

National Integrity Life Insurance Company

Notes to the 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	$	353,881
Transfers from Separate Accounts	356,766
Net transfers to Separate Accounts	(2,885		)
Reconciling adjustments:
Policy deductions and other expenses reported elsewhere in the statement of operations	(11,873		)
Other changes in surplus in separate account statement	(5,603		)
Transfers as reported in the summary of operations of the Company	$	(20,361	)

31

Financial Statement Schedules (Statutory-Basis)

32

National 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	$	3,850	$	4,068	$	3,850
States, municipalities and political subdivisions	85,621		85,416		85,621
Foreign governments	—		—		—
Public utilities	70,865		72,421		70,865
All other corporate bonds	832,838		830,611		832,838
Preferred stocks	38,230		37,057		38,230
Total fixed maturities	1,031,404		1,029,573		1,031,404
Equity securities
Common stocks:
Public utilities	—		—		—
Banks, trust and insurance	—		—		—
Industrial, miscellaneous and all other	—		—		—
Total equity securities	—		—		—
Mortgage loans on real estate	2,754				2,754
Real estate	—				—
Policy loans	42,357				42,357
Other long-term investments	—				—
Cash, cash equivalents and short-term investments	12,455				12,455
Total investments	$	1,088,970			$	1,088,970

(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.

33

National 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	$	100,786	$	—	$	1	$	11,429	$	7,674	$	17,826	$	274
Individual health	—		—		—		—		—		—		—		—
Group life and health	—		—		—		—		—		—		—		—
Annuity	867,325		—		50		517,484		47,577		546,240		12,349
	$	968,111	$	—	$	51	$	528,913	$	55,251	$	564,066	$	12,623
Year ended December 31, 2006
Individual life	$	93,868	$	—	$	1	$	9,027	$	6,894	$	15,119	$	217
Individual health	—		—		—		—		—		—		—		—
Group life and health	—		—		—		—		—		—		—		—
Annuity	783,610		—		37		522,489		44,661		354,525		10,925
	$	877,478	$	—	$	38	$	531,516	$	51,555	$	369,644	$	11,142
Year ended December 31, 2005
Individual life	$	90,918	$	—	$	1	$	30,516	$	8,305	$	34,503	$	631
Individual health	—		—		—		—		—		—		—		—
Group life and health	—		—		—		—		—		—		—		—
Annuity	733,020		—		26		457,575		33,919		403,999		12,111
	$	823,938	$	—	$	27	$	488,091	$	42,224	$	438,502	$	12,742

*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.

34

National Integrity Life Insurance Company

Reinsurance

(in thousands)

Schedule IV

									Percentage of
					Assumed From				Amount
			Ceded to Other		Other				Assumed to
	Gross Amount		Companies		Companies		Net Amount		Net
Year ended December 31, 2007
Life insurance in force	$	128,357	$	11,084	$	228,402	$	345,675	66	%
Premiums:
Individual life	$	5,702	$	47	$	5,774	$	11,429	51	%
Individual health	—		—		—		—		—
Group life and health	—		—		—		—		—
Annuity	517,661		177		—		517,484		—
	$	523,363	$	224	$	5,774	$	528,913	1	%
Year ended December 31, 2006
Life insurance in force	$	129,231	$	11,998	$	233,700	$	350,933	67	%
Premiums:
Individual life	$	3,182	$	393	$	6,238	$	9,027	69	%
Individual health	—		—		—		—		—
Group life and health	—		—		—		—		—
Annuity	522,698		209		—		522,489		—
	$	525,880	$	602	$	6,238	$	531,516	1	%
Year ended December 31, 2005
Life insurance in force	$	142,084	$	59,000	$	1,060,912	$	1,143,996	93	%
Premiums:
Individual life	$	1,606	$	478	$	29,388	$	30,516	96	%
Individual health	—		—		—		—		—
Group life and health	—		—		—		—		—
Annuity	457,832		257		—		457,575		—
	$	459,438	$	735	$	29,388	$	488,091	6	%

35

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

NAT Sep Acct I April 2008

PART C - Other Information

Item 24.Financial Statements and Exhibits

(a)Financial Statements:

Financial Statements included in Part A:  Condensed Financial Information for the Portfolios

Financial Statements included in Part B:

National Integrity Life Insurance Company Separate Account I:

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

National 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:

1.Resolutions of the Board of Directors of National Integrity Life Insurance Company (National Integrity) authorizing the establishment of Separate Account I, the Registrant.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 9 to registration statement on Form N-4 (File No. 333-44892), filed on July 19, 2006.

2.Not applicable.

3.

a.Form of Selling/General Agent Agreement among National Integrity, Touchstone Securities, Inc. and broker dealers.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 9 to registration statement on Form N-4 (File No. 333-44892) filed on July 19, 2006.

b.Form of Variable Contract Principal Underwriter Agreement with Touchstone Securities, Inc. dated May 1, 2006.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 9 to registration statement on Form N-4 (File No. 333-44892) filed on July 19, 2006.

4.

a.Form of variable annuity contract.   Incorporated by reference to Registrant’s Post-Effective Amendment No. 9 to registration statement on Form N-4 (File No. 333-44892) filed on July 19, 2006.

b.Form of Guaranteed Minimum Accumulation Benefit Rider.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 22 to registration statement on Form N-4 (File No. 033-51126) filed April 20, 2007.

c.Form of Guaranteed Minimum Withdrawal Benefit Rider.  Incorporated by reference to Registrant’s Post-

1

Effective Amendment No. 22 to registration statement on Form N-4 (File No. 033-51126) filed April 20, 2007.

d.Form of Individual Guaranteed Minimum Lifetime Withdrawal Benefit and Schedule Page. Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

e.Form of Spousal Guaranteed Minimum Lifetime Withdrawal Benefit and Schedule Page.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

5.Form of application.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 9 to registration statement on Form N-4 (File No. 333-44892) filed on July 19, 2006.

6.

a.Certificate of Incorporation of National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 9 to registration statement on Form N-4 (File No. 333-44892) filed on July 19, 2006.

b.By-Laws of National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No.9 to registration statement on Form N-4 (File No. 333-44892) filed on July 19, 2006.

7.Reinsurance Agreement between National 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. 033-56658), filed on May 1, 1996.

8.

a.Form of Amended and Restated Participation Agreement among Variable Insurance Products Funds, Fidelity Distributors Corporation and National Integrity, dated August 10, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed 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 to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

c.Form of Service Agreement between Fidelity Investments Institutional Operations Company, Inc. and National Integrity dated May 1, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

d.Form of Rule 22C-2 Agreement between Fidelity Distributors Corporation and National Integrity dated March 26, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

e.Form of Participation Agreement among Franklin Templeton Variable Insurance Products Trust, Franklin Templeton Distributor, Inc., Touchstone Securities, Inc. and National Integrity dated January 6, 2003, amended May 4, 2004.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 7 to registration statement on Form N-4 (File No. 333-44892), filed April 21, 2006.

f.Form of Amendment #3 to Participation Agreement among Franklin Templeton Variable Insurance Products Trust, Franklin Templeton Distributors, Inc., Touchstone Securities, Inc. and National Integrity dated May 1, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed 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 National Integrity dated November 29, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

h.Form of Participation Agreement between JPM Series Trust II and National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 11 to registration statement on Form N-4 (File No. 033-51126), filed on April 26, 1999.

i.Form of Rule 22C-2 Agreement between JPM Series Trust II and National Integrity dated April 17, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

j.Form of Participation Agreement among PIMCO Variable Insurance Trust, Allianz Global Investors LLC and National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

k.Form of Selling Agreement between Allianz Global Investors Distributors LLC and National Integrity. 

2

Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

l.Form of Services Agreement between Pacific Investment Management Company LLC and National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

m.Form of Participation Agreement among Rydex Variable Trust, Rydex Distributors, Inc. and National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

n.Form of Services Agreement between Rydex Distributors, Inc. and National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

o.Form of Administrative Services Agreement between PADCO Advisors II and National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 12 to registration statement on Form N-4 (File No. 333-44892) filed February 5, 2008.

p.Form of Participation Agreement among Touchstone Variable Series Trust, Touchstone Securities, Inc. and National Integrity, incorporated by reference to Registrant’s Post Effective Amendment no. 17 to registration statement on Form N-4 (File No. 033-56658) filed October 15, 2001.

q.Form of 22c-2 Agreement between Touchstone Variable Series Trust and National Integrity dated February 14, 2008.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

r.Form of Shareholder Services Agreement between Touchstone Advisors, Inc. and National Integrity dated January 1, 2008.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed 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 National Integrity dated October 2, 1997.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 7 to registration statement on Form N-4 (File No. 333-44892), filed April 21, 2006.

t.Form of 22c-2 Agreement between DWS Scudder Distributors and National Integrity dated February 16, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

u.Form of Participation Agreement among The Universal Institutional Funds, Inc., Morgan Stanley & Co., Inc., Morgan Stanley Investment Management, Incorporated and National Integrity, dated January 2, 2003 .  Incorporated by reference to Registrant’s Post-Effective Amendment No. 7 to registration statement on Form N-4 (File No. 333-44892) filed April 21, 2006.

v.Form of 22c-2 Agreement among The Universal Institutional Funds, Inc., Morgan Stanley & Co., Incorporated, Morgan Stanley Investment Management, Inc. and National Integrity dated February 16, 2007  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

w.Form of Administrative Service Agreement between Morgan Stanley Distribution, Inc. (successor to Morgan Stanley & Co. Incorporated) and National Integrity dated May 1, 2008.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

x.Form of administrative services agreement between Morgan Stanley Investment Management Inc. and National Integrity dated May 1, 2008.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed April 23, 2008.

y.Form of Participation Agreement among Van Kampen Investments Trust, Van Kampen Funds, Inc., Van Kampen Asset Management, Inc. and National Integrity dated January 2, 2003.  Incorporated by reference from Registrant’s Post-Effective Amendment No. 7 to registration statement on Form N-4 (File No. 333-44892), filed April 21, 2006.

z.Form of 22c-2 Agreement between Van Kampen Investments Trust, Van Kampen Funds, Inc., Van Kampen Asset Management, Inc. and National Integrity dated February 16, 2007.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 24 to registration statement on Form N-4 (File No. 033-51126) filed 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.

3

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. 22 to registration statement on Form N-4 (File No. 033-51126) filed April 20, 2007.

14.Guarantee from WSLIC to the policy holders of National Integrity.  Incorporated by reference to Registrant’s Post-Effective Amendment No. 22 to registration statement on Form N-4 (File No. 033-51126) filed April 20, 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
Daniel J. Downing(4)	Director, Vice President
Dale Patrick Hennie(5)	Director
Eric C. Fast(6)	Director
Cameron F. MacRae III(7)	Director
Newton Phelps Stokes Merrill(8)	Director
George R. Bunn Jr.(9)	Director
Officers:
John F. Barrett	Director, Chairman of the Board
Jill T. McGruder(1)	Director, President and Chief Executive Officer
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
John P. Ciprio(4)	Vice President
Daniel J. Downing(4)	Vice President
Maureen 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 Controller
Phillip E. King	Vice President and Auditor
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(1)	Vice President and Treasurer
Patricia 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
Michael W. Collier	Manager, Financial Services
Marvin J. Cox, Jr.	Manager, New Business

4

David L. DiMartino	Managing Actuary
Edward J. Babbitt	Secretary
Thomas M. Barth	Assistant Treasurer
Douglas B. Perry(1)	Assistant Treasurer
Cheryl J. Stotts	Assistant Treasurer
Timothy D. Speed	Assistant Treasurer
Sharon Cummings(1)	Licensing Officer
Brenda L. Feige(1)	Manager, Licensing
Cynthia A. Lyons	Manager, Annuity Operations
Dawn M. Baca-Travis(4)	Assistant Manager

*The principal business address for the above is 400 Broadway, Cincinnati, Ohio 45202, unless otherwise noted.

(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

(4) Principal Business Address: 15 Matthews Street, Goshen, New York 10924

(5) Principal Business Address: 990 Hickoryview Drive, Cincinnati, OH 45233

(6) Principal Business Address: 100 First Stamford Place, Stamford, Connecticut 06902

(7) Principal Business Address: 125 West 55^th Street, New York, NY 10019

(8) Principal Business Address: 262 Central Park West, Apt. 12B, New York, NY 10024

(9) Principal Business Address: 126 East 56th Street, 12th Floor, New York, NY 10022-3584

Item 26.Persons Controlled by or Under Common Control with National 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

5

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
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

6

	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.	Integrity Life Insurance Company; Ohio corporation; 100% owned by WSLIC
53.	IR Mall Associates, Ltd.; Florida limited partnership; 49.50% owned by WSLIC; ownership and operation of real estate
54.	IR Mall Company, L.C.; Florida Limited Liability Company; 50% owned by ERI; ownership and operation of real estate
55.	Kentucky Co-Investment Partners , L.P.; Delaware Limited Partnership; general partner is FWCP; private equity fund
56.	The Lafayette Life Insurance Company; Indiana Corporation; 100% owned by Western & Southern Financial Group, Inc. (WSFG)
57.	LaFrontera Hotel LLC; Texas Limited Liability Company; 75% owned by ERI; ownership and operation of real estate
58.	LaFrontera Lodging Partners LP; Texas limited Partnership; 74.25% owned by W&S Real Estate Holdings, LLC; ownership and operation of real estate
59.	Lookout Corporate Center, Ohio Joint Venture; 50% owned by WS Lookout GP, LLC; ownership and operation of real estate
60.	Mission Club Apartments General Partnership; Florida General Partnership; 95.5% owned by WSLIC, 4.5% owned by ERI; ownership and operation of real estate
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

7

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
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

8

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
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 4,643 contract owners of Separate Account I of National Integrity.

Item 28.Indemnification

National Integrity’s By-Laws provide, in Article VII, Section 7.1 provides:

To the extent permitted by the laws of the State of New York, subject to all applicable requirements thereof:

(a)  any person made or threatened to be made a party to any action or proceeding, whether civil or criminal, by reason of the fact that he, his testator, or intestate, is or was a director, officer, employee or incorporator of the Company shall be indemnified by the Company;

(b)  any person made or threatened to be made a party to any action or proceeding, whether civil or criminal, by reason of the fact that he, his testator or intestate serves or served any other organization on any capacity at the request of the Company may be indemnified by the Company; and

(c)  the related expenses of any such person in any other of said categories may be advanced by the Company.

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

9

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.

Item 29.Principal Underwriters

(a)Touchstone Securities, Inc. (Touchstone Securities) is the principal underwriter for Separate Account I of National Integrity Life Insurance Company.  Touchstone Securities also serves as an underwriter for Separate Accounts II of National Integrity Life Insurance Company, Separate Accounts I, II and VUL of Integrity Life Insurance Company, Western-Southern Life Assurance Company’s Separate Accounts 1 and 2, Columbus Life Insurance Company Separate Account I and for 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	Assistant Treasurer
Timothy D. Speed(1)	Assistant Treasurer
Cheryl J. Stotts	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 National Integrity at 400 Broadway, Cincinnati, Ohio 45202 or 15 Matthews Street, Suite 200, Goshen, New York 10924.

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

10

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 National 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, National Integrity hereby undertakes to provide notice to contract owners promptly 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.

National 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 National Integrity.

National 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.

11

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
NATIONAL INTEGRITY LIFE INSURANCE COMPANY
(Registrant)
By: National Integrity Life Insurance Company
(Depositor)
By:		/s/ Jill T. McGruder
Jill T. McGruder, President and CEO
NATIONAL 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.

NATIONAL 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/ John R. Lindholm	/s/ Donald J. Wuebbling
John R. Lindholm	Donald J. Wuebbling
April 18, 2008	April 18, 2008
/s/ Jill T. McGruder
Jill T. McGruder
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

EX-99.9

Exhibit 99.9

April 23, 2008

National Integrity Life Insurance Company

400 Broadway

Cincinnati, Ohio 45202

RE:	Opinion of Counsel
	Separate Account I of National Integrity Life Insurance Company
	File Nos. 033-56658 and 811- 04846
	AdvantEdge and IQ3

Ladies and Gentlemen:

This Opinion of Counsel is in connection with a filing of Post-Effective Amendment No. 33 to a registration statement filed on form N-4 for the AdvantEdge and IQ3 flexible premium variable annuities to be issued by National Integrity Life Insurance Company and its Separate Account I and filed pursuant to the Securities Act of 1933, as amended.

I have made such examination of the law and have examined such records and documents as in my judgment are necessary and appropriate to enable me to render the opinions expressed.  I am of the following opinions:

1.National Integrity Life Insurance Company is duly organized and validly existing under the laws of the State of New York and has been duly authorized to issue individual variable annuity contracts by the Department of Insurance of the State of New York.

2.Separate Account I is a Unit Investment Trust as that term is defined in Section 4(2) of the Investment Company Act of 1940 (the “Act”) and is currently registered with the Securities and Exchange Commission, pursuant to Section 8(a) of the Act.

3.Upon the acceptance of contributions paid by an owner pursuant to a contract issued in accordance with a prospectus contained in this registration statement and upon compliance with applicable law, such an owner will have a legally issued contractual interest binding upon the National Integrity Life Insurance Company.

You may use this opinion letter, or a copy thereof, as an exhibit to the Registration Statement.

Sincerely,

/s/ Rhonda S. Malone

Rhonda S. Malone

Associate Counsel - Securities

Western & Southern Financial Group, Inc.

EX-99.10

Exhibit 99.10

National Integrity Separate Account I	Combo
	Exhibit 10

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the reference to our firm under the caption “Financial Statements” and to the use of our reports (a) dated April 7, 2008, with respect to the statutory-basis financial statements of  The Western and Southern Life Insurance Company, (b) dated April 7, 2008, with respect to the statutory-basis financial statements of  National Integrity Life Insurance Company, and (c) dated April 7, 2008, with respect to the financial statements of Separate Account I of National Integrity Life Insurance Company, in Post-Effective Amendment No. 33 to the Registration Statement (Form N-4 No. 033-56658) and Amendment No. 59 to the Registration Statement (Form N-4 No. 811-04846) and related Prospectus and Statement of Additional Information of Separate Account I of National Integrity Life Insurance Company for the registration of the “AdvantEdge” and the “IQ³ The SmartAnnuity” flexible premium variable annuities.

/s/ Ernst & Young LLP

Cincinnati, Ohio

April 22, 2008