N-Q 1 variableinsur146.htm VANGUARD VARIABLE INSURANCE FUND 146

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED MANAGEMENT COMPANY


Investment Company Act file number: 811-5962

Name of Registrant: VANGUARD VARIABLE INSURANCE FUND

Address of Registrant: P.O. Box 2600
Valley Forge, PA 19482

Name and address of agent for service: R. Gregory Barton, Esquire
P.O. Box 876
Valley Forge, PA 19482

Registrant’s telephone number, including area code: (610) 669-1000


Date of fiscal year end: December 31

Date of reporting period: September 30, 2004

Item 1: Schedule of Investments

September 30, 2004

Vanguard Variable Insurance Fund - High Yield Bond Portfolio
 Coupon
 Maturity
Date
 Face
Amount
(000)
 Market
Value
(000)
CORPORATE BONDS (91.4)%
Finance (1.7%)        
Banking (0.6%)
Chevy Chase Savings Bank 6.875% 12/1/2013  $720  $731 
Western Financial Bank 9.625% 5/15/2012  915  1,034 
Finance Companies (0.4%)
E*TRADE FINANCIAL Corp. 8.00% 6/15/2011 (2)  570  593 
REFCO Finance Holdings 9.00% 8/1/2012 (2)  475  500 
Insurance (0.1%)
Fairfax Financial Holdings, Inc. 6.875% 4/15/2008  175  171 
Real Estate Investment Trusts (0.8%)
CBRE Escrow Inc. 9.75% 5/15/2010  577  658 
iStar Financial Inc. 8.75% 8/15/2008  267  304 
iStar Financial Inc. 4.875% 1/15/2009  255  256 
iStar Financial Inc. 6.00% 12/15/2010  265  274 
Thornburg Mortgage 8.00% 5/15/2013  660  685 
  4,521
Industrial (80.9%)
Basic Industry (16.3%)
AK Steel Corp. 7.875% 2/15/2009  380  376 
AK Steel Corp. 7.75% 6/15/2012  385  376 
ARCO Chemical Co. 9.80% 2/1/2020  1,065  1,097 
Abitibi-Consolidated Inc. 8.55% 8/1/2010  2,435  2,651 
Acetex Corp. 10.875% 8/1/2009  310  341 
Airgas, Inc. 9.125% 10/1/2011  785  883 
Arch Western Finance 7.50% 7/1/2013 (2)(3)  735  792 
BCP Caylux Holdings 9.625% 6/15/2014 (2)  1,725  1,863 
Borden U.S. Financial/Nova Scotia 9.00% 7/15/2014 (2)  460  486 
Bowater Canada Finance 7.95% 11/15/2011  1,250  1,342 
Bowater Inc. 6.50% 6/15/2013  80  78 
CONSOL Energy Inc. 7.875% 3/1/2012  650  726 
Compass Minerals Group 10.00% 8/15/2011  1,000  1,120 
Crompton Corp. 9.875% 8/1/2012 (2)  255  269 
Equistar Chemicals LP 10.125% 9/1/2008  165  185 
Equistar Chemicals LP 10.625% 5/1/2011  605  690 
Fluor Corp. 6.95% 3/1/2007  500  525 
Georgia-Pacific Corp. 8.875% 2/1/2010  1,455  1,702 
Georgia-Pacific Corp. 9.375% 2/1/2013  1,890  2,225 
Graphic Packaging Inc. 8.50% 8/15/2011  640  717 
Hercules Inc. 11.125% 11/15/2007  130  154 
Huntsman Advanced Materials 11.00% 7/15/2010 (2)  170  197 
Huntsman LLC 11.625% 10/15/2010  345  398 
IMC Global, Inc. 10.875% 6/1/2008  1,155  1,392 
IMC Global, Inc. 11.25% 6/1/2011  530  621 
IMC Global, Inc. 11.25% 6/1/2011  400  469 
iSpat Inland ULC 9.75% 4/1/2014  610  673 
JohnsonDiversey Inc. 9.625% 5/15/2012  885  989 
Koppers Inc. 9.875% 10/15/2013  670  740 
Longview Fibre Co. 10.00% 1/15/2009  1,000  1,095 
Lubrizol Corp. 5.50% 10/1/2014  225  224 
Lyondell Chemical Co. 9.625% 5/1/2007  1,045  1,134 
Lyondell Chemical Co. 9.50% 12/15/2008  655  715 
MDP Acquisitions 9.625% 10/1/2012  810  915 
Massey Energy Co. 6.625% 11/15/2010  640  666 
Methanex Corp. 8.75% 8/15/2012  855  991 
Millennium America Inc. 9.25% 6/15/2008  840  922 
Nalco Co. 7.75% 11/15/2011  1,195  1,268 
Norske Skog Canada 8.625% 6/15/2011  1,255  1,359 
Nova Chemicals Corp. 6.50% 1/15/2012  495  506 
Omnova Solutions Inc. 11.25% 6/1/2010  690  745 
Peabody Energy Corp. 6.875% 3/15/2013  1,135  1,229 
Resolution Performance Products LLC 9.50% 4/15/2010  905  932 
Russel Metals Inc. 6.375% 3/1/2014  130  130 
Ryerson Tull, Inc. 9.125% 7/15/2006  500  529 
Steel Dynamics, Inc. 9.50% 3/15/2009  720  808 
Stone Container Corp. 9.25% 2/1/2008  855  951 
Stone Container Corp. 9.75% 2/1/2011  1,575  1,744 
Tembec Industries Inc. 8.50% 2/1/2011  1,160  1,218 
U.S. Steel LLC 10.75% 8/1/2008  800  941 
Union Carbide Corp. 6.79% 6/1/2025  580  587 
Capital Goods (8.4%)
AEP Industries Inc. 9.875% 11/15/2007  95  97 
Ainsworth Lumber Co. Ltd. 7.25% 10/1/2012 (2)  295  296 
Alliant Techsystems Inc. 8.50% 5/15/2011  315  343 
Allied Waste North America Inc. 8.875% 4/1/2008  1,520  1,649 
Allied Waste North America Inc. 8.50% 12/1/2008  205  222 
American Rock Salt Co. LLC 9.50% 3/15/2014 (2)  100  103 
American Standard Cos. Inc. 7.375% 2/1/2008  1,105  1,218 
Anchor Glass Container 11.00% 2/15/2013  1,075  1,225 
Argo Tech Corp. 9.25% 6/1/2011 (2)  290  313 
Building Materials Corp. 7.75% 8/1/2014 (2)  640  640 
Case New Holland Inc. 9.25% 8/1/2011 (2)  1,005  1,128 
Case New Holland Inc. 9.25% 8/1/2011 (2)  1,180  1,325 
Crown Euro Holdings SA 9.50% 3/1/2011  375  418 
Crown Euro Holdings SA 10.875% 3/1/2013  1,120  1,305 
Invensys PLC 9.875% 3/15/2011 (2)  1,225  1,277 
K & F Industries, Inc. 9.625% 12/15/2010  575  641 
Kennametal Inc. 7.20% 6/15/2012  255  278 
L-3 Communications Corp. 7.625% 6/15/2012  950  1,047 
NMHG Holding Co. 10.00% 5/15/2009  770  847 
Owens-Brockway Glass Container, Inc. 8.875% 2/15/2009  705  767 
Owens-Brockway Glass Conainter, Inc. 7.75% 5/15/2011  890  950 
Owens-Brockway Glass Container, Inc. 8.75% 11/15/2012  265  295 
Owens-Illinois, Inc. 8.10% 5/15/2007  330  347 
Pliant Corp. 11.125% 9/1/2009  550  575 
Portola Packaging 8.25% 2/1/2012  95  75 
SPX Corp. 7.50% 1/1/2013  545  555 
Sequa Corp. 9.00% 8/1/2009  1,145  1,257 
Texas Industries Inc. 10.25% 6/15/2011  665  765 
Trinity Industries 6.50% 3/15/2014  670  660 
Tyco International Group SA 6.75% 2/15/2011  460  516 
United Rental North America 6.50% 2/15/2012  1,425  1,372 
Communication (19.0%)
ACC Escrow Group 10.00% 8/1/2011  1,610  1,312 
AT&T Corp. 8.05% 11/15/2011 (3)  2,490  2,788 
Advanstar Communications 10.75% 8/15/2010  340  376 
Alaska Communications System Holdings 9.875% 8/15/2011  1,010  980 
American Media Operation 8.875% 1/15/2011  160  165 
CSC Holdings, Inc. 7.875% 12/15/2007  980  1,046 
CSC Holdings, Inc. 8.125% 7/15/2009  240  257 
CSC Holdings, Inc. 8.125% 8/15/2009  1,170  1,246 
CSC Holdings, Inc. 7.625% 4/1/2011  1,455  1,528 
CSC Holdings, Inc. 6.75% 4/15/2012 (2)  585  588 
Canwest Media 10.625% 5/15/2011  880  999 
Charter Communications OPT LLC 8.00% 4/30/2012 (2)  1,200  1,195 
Charter Communications OPT LLC 8.375% 4/30/2014 (2)  105  104 
Citizens Communications 9.25% 5/15/2011  2,400  2,632 
Corus Entertainment, Inc. 8.75% 3/1/2012  1,410  1,555 
Dex Media East LLC 9.875% 11/15/2009  980  1,127 
Dex Media West LLC 8.50% 8/15/2010  255  289 
DirecTV Holdings 8.375% 3/15/2013  885  1,009 
EchoStar DBS Corp. 9.125% 1/15/2009  186  206 
EchoStar DBS Corp. 6.375% 10/1/2011  1,075  1,086 
Fairpoint Communications 11.875% 3/1/2010  140  161 
GCI Inc. 7.25% 2/15/2014  1,355  1,328 
Houghton Mifflin Co. 8.25% 2/1/2011  1,550  1,620 
Insight Midwest LP 9.75% 10/1/2009  470  494 
Insight Midwest LP 10.50% 11/1/2010  2,235  2,453 
Intelsat Ltd 5.25% 11/1/2008  505  461 
Intelsat Ltd. 7.625% 4/15/2012  195  176 
LBI Media, Inc. 10.125% 7/15/2012  20  22 
Lamar Media Corp. 7.25% 1/1/2013  400  431 
MCI Inc. 6.688% 5/1/2009  700  674 
Mail-Well Corp. 9.625% 3/15/2012  970  1,069 
Mediacom Broadband LLC 11.00% 7/15/2013  1,135  1,212 
Mediacom LLC/Mediacom Capital Corp. 9.50% 1/15/2013  435  420 
Medianews Group Inc. 6.875% 10/1/2013  700  719 
Nextel Communications 9.50% 2/1/2011  3,000  3,398 
Nextel Communications 6.875% 10/31/2013  945  978 
Quebecor Media Inc. 11.125% 7/15/2011  2,260  2,610 
Qwest Communications International Inc. 7.25% 2/15/2011 (2)  370  352 
Qwest Communications International Inc. 9.125% 3/15/2012 (2)(3)  2,745  3,026 
R.H. Donnelley Finance Corp. 8.875% 12/15/2010 (2)  1,160  1,311 
Rogers Cable Inc. 7.875% 5/1/2012  90  98 
Rogers Cable Inc. 6.25% 6/15/2013  895  875 
Rogers Wireless Inc. 9.625% 5/1/2011  1,495  1,674 
Rogers Wireless Inc. 6.375% 3/1/2014  1,040  957 
Rural Cellular 8.25% 3/15/2012 (2)  275  283 
Shaw Communications Inc. 8.25% 4/11/2010  845  957 
Shaw Communications Inc. 7.25% 4/6/2011  55  60 
Sinclair Broadcast Group 8.75% 12/15/2011  475  518 
Sinclair Broadcast Group 8.00% 3/15/2012  125  131 
Triton PCS Inc. 8.50% 6/1/2013  715  651 
Vertis Inc. 9.75% 4/1/2009  415  446 
Vertis Inc. 10.875% 6/15/2009  245  263 
Videotron Telecom Ltd. 6.875% 1/15/2014  135  138 
Von Hoffmann Corp. 10.25% 3/15/2009  455  504 
Consumer Cyclical (14.6%)
Argosy Gaming Co. 9.00% 9/1/2011  110  124 
Argosy Gaming Co. 7.00% 1/15/2014  375  388 
Arvinmeritor Inc. 8.75% 3/1/2012  1,220  1,357 
Aztar Corp 9.00% 8/15/2011  1,245  1,373 
Beazer Homes USA, Inc. 8.625% 5/15/2011  860  946 
Beazer Homes USA, Inc. 8.375% 4/15/2012  195  214 
Boyd Gaming Corp. 7.75% 12/15/2012  500  535 
Boyd Gaming Corp. 6.75% 4/15/2014  145  148 
Cummins Inc. 9.50% 12/1/2010  235  270 
D.R. Horton, Inc. 9.75% 9/15/2010  220  263 
D.R. Horton, Inc. 9.375% 3/15/2011  955  1,067 
D.R. Horton, Inc. 7.875% 8/15/2011  35  40 
Dana Corp. 9.00% 8/15/2011  645  777 
Dura Operating Corp. 8.625% 4/15/2012  850  844 
Felcor Lodging LP 9.00% 6/1/2011 (3)  215  236 
Hilton Hotels Corp. 7.50% 12/15/2017  145  164 
Host Marriott LP 9.50% 1/15/2007  1,459  1,612 
Host Marriott LP 7.125% 11/1/2013  1,740  1,823 
ITT Corp. 7.375% 11/15/2015  85  93 
Isle of Capri Casinos 7.00% 3/1/2014  680  683 
J.B. Poindexter Co. 8.75% 3/15/2014 (2)  565  600 
John Q. Hammons Hotel 8.875% 5/15/2012  375  418 
KB Home 8.625% 12/15/2008  585  660 
KB Home 7.75% 2/1/2010  50  54 
La Quinta Properties 7.00% 8/15/2012 (2)  155  164 
Lodgenet Entertainment Corp. 9.50% 6/15/2013  275  300 
MGM Mirage, Inc. 8.50% 9/15/2010  2,270  2,591 
Mandalay Resort Group 10.25% 8/1/2007  1,009  1,145 
Mandalay Resort Group 9.375% 2/15/2010  1,185  1,357 
Marquee Inc. 8.625% 8/15/2012 (2)  695  737 
Mastec, Inc. 7.75% 2/1/2008  435  394 
Meritage Corp. 9.75% 6/1/2011  265  295 
Meritage Corp. 7.00% 5/1/2014  415  424 
Navistar International Corp. 9.375% 6/1/2006  230  246 
Navistar International Corp. 7.50% 6/15/2011  185  195 
Park Place Entertainment Corp. 8.875% 9/15/2008  600  683 
Park Place Entertainment Corp. 7.00% 4/15/2013  1,190  1,324 
R.J. Tower Corp. 12.00% 6/1/2013  650  514 
Rite Aid Corp. 8.125% 5/1/2010  80  84 
Rite Aid Corp. 9.50% 2/15/2011  1,580  1,730 
Riviera Holdings Corp. 11.00% 6/15/2010  550  605 
Ryland Group, Inc. 9.125% 6/15/2011  640  718 
Seneca Gaming Corp. 7.25% 5/1/2012  630  650 
Speedway Motorsports Inc. 6.75% 6/1/2013  355  370 
Standard Pacific Corp. 6.50% 10/1/2008  550  573 
Standard Pacific Corp. 9.50% 9/15/2010  15  16 
Standard Pacific Corp. 6.875% 5/15/2011  360  378 
Standard Pacific Corp. 7.75% 3/15/2013  210  227 
Starwood Hotel Resorts 7.875% 5/1/2012 (3)  1,525  1,733 
Station Casinos 6.00% 4/1/2012  290  297 
Station Casinos 6.50% 2/1/2014  720  738 
TRW Automotive Inc. 9.375% 2/15/2013  1,292  1,479 
Tenneco Automotive Inc. 10.25% 7/15/2013  565  638 
The Gap Inc. 10.30% 12/15/2008 (3)  525  644 
Toll Corp. 8.25% 12/1/2011  235  260 
Visteon Corp. 8.25% 8/1/2010  745  784 
Visteon Corp. 7.00% 3/10/2014  1,835  1,748 
Warner Music Group 7.375% 4/15/2014 (2)  440  454 
Consumer Noncyclical (8.2%)
AmerisourceBergen Corp. 8.125% 9/1/2008  850  939 
AmerisourceBergen Corp. 7.25% 11/15/2012  968  1,048 
Armkel Finance, Inc. 9.50% 8/15/2009  635  691 
Bio-Rad Laboratories Inc. 7.50% 8/15/2013  195  209 
Biovail Corp. 7.875% 4/1/2010  1,270  1,295 
Bombardier Recreational 8.375% 12/15/2013 (2)  755  795 
Columbia/HCA Healthcare Corp. 7.25% 5/20/2008  990  1,082 
Constellation Brands Inc. 8.125% 1/15/2012  865  954 
Coventry Health Care Inc. 8.125% 2/15/2012  565  627 
Dimon Inc. 9.625% 10/15/2011  445  469 
Dole Foods Co. 7.25% 6/15/2010  65  67 
Dole Foods Co. 8.875% 3/15/2011  1,165  1,273 
Fisher Scientific International 8.125% 5/1/2012  1,264  1,413 
HCA Inc. 8.75% 9/1/2010  1,200  1,406 
Iasis Healthcare LLC 8.75% 6/15/2014 (2)  560  587 
NDC Health Corp. 10.50% 12/1/2012  1,135  1,226 
Neighborcare Inc. 6.875% 11/15/2013  695  721 
Omnicare, Inc. 8.125% 3/15/2011  1,250  1,359 
Omnicare, Inc. 6.125% 6/1/2013  70  70 
Owens & Minor, Inc. 8.50% 7/15/2011  485  534 
Pathmark Stores, Inc. 8.75% 2/1/2012  300  279 
Playtex Products, Inc. 8.00% 3/1/2011  700  742 
Radiologix, Inc. 10.50% 12/15/2008  700  728 
Standard Commercial Corp. 8.00% 4/15/2012 (2)  205  209 
Triad Hospitals Inc. 7.00% 5/15/2012  1,500  1,577 
United Agricultural Products 8.25% 12/15/2011 (2)  185  200 
VWR International Inc. 6.875% 4/15/2012 (2)  155  162 
VWR International Inc. 8.00% 4/15/2014 (2)  255  269 
Valeant Pharmaceuticals International 7.00% 12/15/2011  380  385 
Winn-Dixie Stores, Inc. 8.875% 4/1/2008  670  543 
Energy (5.4%)
Chesapeake Energy Corp. 8.125% 4/1/2011  1,415  1,549 
Chesapeake Energy Corp. 9.00% 8/15/2012  210  240 
Chesapeake Energy Corp. 7.50% 9/15/2013  215  235 
Chesapeake Energy Corp. 7.75% 1/15/2015  105  114 
Chesapeake Energy Corp. 6.875% 1/15/2016  415  432 
Encore Acquisition Co. 8.375% 6/15/2012  230  255 
Encore Acquisition Co. 6.25% 4/15/2014  150  150 
Evergreen Resources 5.875% 3/15/2012  160  164 
Exco Resources Inc. 7.250% 1/15/2011  650  686 
Forest Oil Corp. 8.00% 12/15/2011  640  720 
Forest Oil Corp. 7.75% 5/1/2014  400  432 
Giant Industries 11.00% 5/15/2012  503  576 
Giant Industries 8.00% 5/15/2014  75  77 
Key Energy Services Inc. 6.375% 5/1/2013  155  155 
Magnum Hunter Resources Inc. 9.60% 3/15/2012  852  959 
Newfield Exploration Co. 7.45% 10/15/2007  580  631 
Newfield Exploration Co. 8.375% 8/15/2012  665  750 
Parker Drilling Co. 9.625% 10/1/2013  675  749 
Petroleum Geo-Services 10.00% 11/5/2010  1,175  1,331 
Plains Exploration & Production Co. 8.75% 7/1/2012  130  146 
Plains Exploration & Production Co. 7.125% 6/15/2014  280  301 
Premcor Refining Group 6.75% 2/1/2011  85  91 
Premcor Refining Group 9.50% 2/1/2013  1,265  1,486 
Pride International Inc. 7.375% 7/15/2014 (2)  1,255  1,374 
Tesoro Petroleum Corp. 8.00% 4/15/2008  350  378 
Whiting Petroleum Corp. 7.25% 5/1/2012  520  529 
Technology (5.3%)
Amkor Technology Inc. 9.25% 2/15/2008  1,755  1,621 
Avaya Inc. 11.125% 4/1/2009  983  1,135 
Iron Mountain, Inc. 8.625% 4/1/2013  960  1,044 
Iron Mountain, Inc. 7.75% 1/15/2015  185  198 
Nortel Networks Ltd. 6.125% 2/15/2006  1,265  1,290 
Sanmina-SCI Corp. 10.375% 1/15/2010  1,595  1,826 
Solectron Corp. 9.625% 2/15/2009  2,335  2,586 
UGS Corp. 10.00% 6/1/2012 (2)  955  1,039 
Xerox Corp. 9.75% 1/15/2009  2,750  3,204 
Xerox Corp. 7.125% 6/15/2010  250  266 
Transportation (1.4%)
American Airlines, Inc. Pass-Through Certificates 7.024% 10/15/2009  410  403 
Continental Airlines Enhanced Equipment Trust Certificates 7.056% 9/15/2009  554  552 
Continental Airlines Enhanced Equipment Trust Certificates 6.90% 1/2/2018 (1)  285  275 
Delta Air Lines Enhanced Equipment Trust Certificates 7.111% 9/18/2011  745  670 
Kansas City Southern Industries, Inc. 9.50% 10/1/2008  600  654 
Kansas City Southern Industries, Inc. 7.50% 6/15/2009  655  666 
Northwest Airlines, Inc. Pass-Through Certificates 6.841% 4/1/2011  250  246 
Petro Stopping Centers 9.00% 2/15/2012  125  133 
Other (2.3%)
Adesa Corp. 7.625% 6/15/2012  585  603 
Eagle-Picher Inc. 9.75% 9/1/2013  110  113 
FastenTech Inc. 11.50% 5/1/2011 (2)  370  415 
General Cable Corp. 9.50% 11/15/2010  615  689 
Itron Inc. 7.75% 5/15/2012 (2)  90  90 
Jostens IH Corp. 7.625% 10/1/2012 (2)  200  200 
National Waterworks Inc. 10.50% 12/1/2012  290  327 
Thomas & Betts Corp. 6.39% 2/10/2009  40  42 
Thomas & Betts Corp. 7.25% 6/1/2013  185  200 
Timken Co. 5.75% 2/15/2010  664  688 
UCAR Finance, Inc. 10.25% 2/15/2012  1,630  1,866 
Valmont Industries Inc. 6.875% 5/1/2014 (2)  115  118 
Wesco Distribution Inc. 9.125% 6/1/2008  800  824 
  216,686
Utilities (8.6%)
Electric (5.1%)
AES Corp. 9.50% 6/1/2009  50  56 
AES Corp. 9.375% 9/15/2010  80  90 
AES Corp. 8.75% 5/15/2013 (2)  1,565  1,765 
AES Corp. 9.00% 5/15/2015 (2)  1,810  2,054 
Aquila Inc. 9.95% 2/1/2011  610  671 
Avista Corp. 9.75% 6/1/2008  570  676 
CMS Energy Corp. 7.50% 1/15/2009  535  562 
CMS Energy Corp. 8.50% 4/15/2011  845  921 
DPL Inc. 6.875% 9/1/2011  855  903 
Dynegy Inc. 10.125% 7/15/2013 (2)  580  665 
Midwest Generation LLC 8.75% 5/1/2034  880  957 
NRG Energy Inc. 8.00% 12/15/2013 (2)  1,085  1,161 
Nevada Power Co. 10.875% 10/15/2009  725  843 
Nevada Power Co. 6.50% 4/15/2012  70  72 
Nevada Power Co. 9.00% 8/15/2013  510  588 
Sierra Pacific Resources 8.625% 3/15/2014  405  437 
TECO Energy Inc. 7.20% 5/1/2011  720  767 
TECO Energy Inc. 7.00% 5/1/2012  65  68 
TNP Enterprises Inc. 10.25% 4/1/2010  180  195 
Western Resources, Inc. 7.125% 8/1/2009  230  252 
Natural Gas (3.4%)
ANR Pipeline Co. 8.875% 3/15/2010  1,285  1,446 
Centerpoint Energy Resources 7.875% 4/1/2013  1,115  1,316 
El Paso Natural Gas 7.625% 8/1/2010  510  550 
El Paso Production Holdings 7.75% 6/1/2013  1,335  1,335 
Semco Energy Inc. 7.125% 5/15/2008  100  105 
Semco Energy Inc. 7.75% 5/15/2013  85  91 
Southern Natural Gas 8.875% 3/15/2010  1,285  1,446 
Suburban Propane Partners 6.875% 12/15/2013  370  381 
Williams Cos., Inc. 7.125% 9/1/2011  1,025  1,122 
Williams Cos., Inc. 8.125% 3/15/2012  1,270  1,460 
Other (0.1%)
Star Gas Partners 10.25% 2/15/2013  185  203 
  23,158
TOTAL CORPORATE BONDS
 (Cost $232,527) 245,050
U.S. GOVERNMENT SECURITIES (5.5%)
U.S. Treasury Note 6.875% 5/15/2006  2,035  2,178 
U.S. Treasury Note 6.625% 5/15/2007  5,505  6,036 
U.S. Treasury Note 5.625% 5/15/2008  2,795  3,041 
U.S. Treasury Note 5.50% 5/15/2009  2,460  2,694 
U.S. Treasury Note 5.75% 8/15/2010  715  797 
TOTAL U.S. GOVERNMENT SECURITIES
 (Cost $14,645) 14,746
TEMPORARY CASH INVESTMENTS (4.1%)
Repurchase Agreement (2.2%)
Credit Suisse First Boston
1.87%,10/1/2004
(Dated 9/30/2004, Repurchase Value $5,900,000,
Collateralized by Federal National Mortgage Association, 5,900
5.50%, 5/1/2033)
Shares
Money Market Fund (1.9%)
Vanguard Market Liquidity Fund, 1.74%* 5,183,600 5,184
TOTAL TEMPORARY CASH INVESTMENTS
 (Cost $11,084) 11,084
TOTAL INVESTMENTS (101.0%)
 (Cost $258,255) 270,880
OTHER ASSETS AND LIABILITIES-NET (-1.0%) (2,627)
NET ASSETS (100%) $268,253

* Money Market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield.

(1) The average maturity is shorter than the final maturity shown due to scheduled interim principal payments and prepayments.

(2) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30,2004, the aggregate value of these securities was $29,700,000, representing 11.1% of net assets.

(3) Adjustable-rate note.

Investment Securities: Bonds, and temporary cash investments acquired over 60 days to maturity, are valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as security prices, yields, maturities, and ratings), both as furnished by independent pricing services. Investments in Vanguard Market Liquidity Fund are valued at that fund’s net asset value. Other temporary cash investments are valued at amortized cost, which approximates market value. Securities for which market quotations are not readily available, or whose values have been materially affected by events occurring before the fund’s pricing time but after the close of the securities’ primary markets, are valued by methods deemed by the board of trustees to represent fair value.

At September 30, 2004, the cost of investment securities for tax purposes was $258,255,000. Net unrealized appreciation of investment securities for tax purposes was $12,625,000, consisting of unrealized gains of $13,941,000 on securities that had risen in value since their purchase and $1,316,000 in unrealized losses on securities that had fallen in value since their purchase.

Item 2: Controls and Procedures.

(a) Disclosure Controls and Procedures. The Principal Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on their evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.

(b) Internal Control Over Financial Reporting. During the last fiscal quarter, there was no significant change in the Registrant’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 3:

 Exhibits.
(a) Certifications.

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

VANGUARD VARIABLE INSURANCE FUND

BY: (signature)
(HEIDI STAM)
JOHN J. BRENNAN*
CHIEF EXECUTIVE OFFICER

Date: November 15, 2004

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

VANGUARD VARIABLE INSURANCE FUND

BY: (signature)
(HEIDI STAM)
JOHN J. BRENNAN*
CHIEF EXECUTIVE OFFICER

Date: November 15, 2004

VANGUARD VARIABLE INSURANCE FUND

BY: (signature)
(HEIDI STAM)
THOMAS J. HIGGINS*
TREASURER

Date: November 15, 2004

*By Power of Attorney. See File Number 2-57689, filed on December 26, 2002. Incorporated by Reference.