As filed with the Securities and Exchange Commission on April 21, 2011

Registration Nos. 333-01153; 811-07549

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933    (X)

PRE-EFFECTIVE AMENDMENT NO.                (  )

POST-EFFECTIVE AMENDMENT NO.                (23)

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940        (X)

Amendment No.                    (46)

(Check appropriate box or boxes)

VARIABLE ANNUITY-1 SERIES ACCOUNT

(Exact name of Registrant)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

(Name of Depositor)

8515 East Orchard Road

Greenwood Village, Colorado 80111

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

Depositor’s Telephone Number, including Area Code:

(800) 537-2033

Mitchell T.G. Graye

President and Chief Executive Officer

Great-West Life & Annuity Insurance Company

8515 East Orchard Road

Greenwood Village, Colorado 80111

(Name and Address of Agent for Service)

Copy to:

Ann B. Furman, Esq.

Jorden Burt LLP

1025 Thomas Jefferson Street, N.W., Suite 400 East

Washington, D.C. 20007-5208

Approximate Date of Proposed Public Offering: Upon the effective date of this Registration Statement.

	It is proposed that this filing will become effective (check appropriate box)
		Immediately upon filing pursuant to paragraph (b) of Rule 485.
	X	On May 1, 2011, pursuant to paragraph (b) of Rule 485.
		60 days after filing pursuant to paragraph (a)(1) of Rule 485.
		On (date), pursuant to paragraph (a)(1) of Rule 485.
	If appropriate, check the following box:
		This post-effective amendment designates a new effective date for a previously filed post-effective
amendment.
	Title of securities being registered: Flexible Premium Deferred Variable Annuity Contract

Schwab Select Annuity^®

A flexible premium deferred variable and fixed annuity contract

Issued by

Great-West Life & Annuity Insurance Company

Overview

This Prospectus describes the Schwab Select Annuity^®—a flexible premium deferred annuity contract (“Contract”) which allows you to accumulate assets on a tax-deferred basis for retirement or other long-term purposes. This Contract is no longer issued to new purchasers. Even though the Contract has not been offered for sale since April 30, 2007, you may make additional Contributions as permitted under your Contract. This Contract was previously issued either on a group basis or as individual contracts by Great-West Life & Annuity Insurance Company (“we, us, Great-West or GWL&A”). Both will be referred to as the “Contract” throughout this Prospectus.

This Prospectus presents important information you should review about the Schwab Select Annuity^®, including a description of the material rights and obligations under the Contract. Your Contract and any endorsements are the formal contractual agreement between you and us. It is important that you read the Contract and endorsements, which reflect other variations. Please read this Prospectus carefully and keep it on file for future reference. You can find more detailed information pertaining to the Contract in the Statement of Additional Information (“SAI”) dated May 1, 2011 (as may be amended from time to time), and filed with the Securities and Exchange Commission (“SEC”). The SAI is incorporated by reference into this Prospectus as a matter of law, which means it is legally a part of this Prospectus. The table of contents for the SAI may be found on page XX of this Prospectus. You may obtain a copy without charge by contacting the Annuity Service Center at the address or phone number listed on page XX of this Prospectus. Or, you can obtain it by visiting the SEC’s Internet web site (http://www.sec.gov). This web site also contains material incorporated by reference and other information about us and other registrants that file electronically with the SEC.

How to Invest

When the Contract was available for sale, the minimum initial Contribution was:

• $5,000

• $2,000 if an Individual Retirement Account (“IRA”)

• $1,000 if subsequent Contributions are made via Automatic Contribution Plan

The minimum subsequent Contribution is:

• $500 per Contribution, or

• $100 per Contribution if made via Automatic Contribution Plan

Allocating Your Money

When you contribute money to the Schwab Select Annuity, you can allocate it among the Sub-Accounts of the Variable Annuity-1 Series Account (the “Series Account”) which invest in the following Portfolios:

• Alger Large Cap Growth Portfolio – Class I-2 Shares (formerly Alger American LargeCap Growth Portfolio – Class O Shares)

• Alger Mid Cap Growth Portfolio – Class I-2 Shares (formerly Alger American MidCap Growth Portfolio – Class O Shares)

• AllianceBernstein VPS International Growth Portfolio – Class A Shares

• AllianceBernstein VPS Small/Mid Cap Value Portfolio – Class A Shares

• American Century VP Balanced Fund – Class I Shares

• American Century VP Mid Cap Value Fund – Class II Shares

The date of this Prospectus is May 1, 2011

The Securities and Exchange Commission has not approved or disapproved these securities or passed upon the adequacy of this Prospectus. Any representation to the contrary is a criminal offense.

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• American Century VP Value Fund – Class I Shares

• Columbia Variable Portfolio - Marsico 21^st Century Fund – Class 2 Shares (formerly Columbia VIT Marsico 21^st Century

Fund – Class B Shares)

• Columbia Variable Portfolio - Seligman Global Technology Fund – Class 2 Shares (formerly Seligman Communications and Information Portfolio)

• Columbia Variable Portfolio - Small Cap Value Fund – Class 2 Shares (formerly Columbia VIT Small Cap Value Fund –

Class B Shares)

• Delaware VIP Smid Cap Growth Series – Standard Class Shares (formerly Delaware VIP Growth Opportunities Series)

• Delaware VIP Small Cap Value Series – Standard Class Shares

• Dreyfus Variable Investment Fund Appreciation Portfolio – Initial Shares

• DWS Blue Chip VIP – Class A Shares

• DWS Capital Growth VIP – Class A Shares

• DWS Dreman Small Mid Cap Value VIP – Class A Shares (formerly DWS Dreman Small Cap Value VIP)

• DWS Large Cap Value VIP – Class A Shares

• DWS Small Cap Index VIP – Class A Shares

• Federated Fund for U.S. Government Securities II

• Franklin Small Cap Value Securities Fund – Class 2 Shares

• Invesco V.I. International Growth Fund – Series I Shares (formerly AIM V.I. International Growth Fund)

• Invesco V.I. Mid Cap Core Equity Fund – Series I Shares (formerly AIM V.I. Mid Cap Equity Fund)

• Invesco V.I. Small Cap Equity Fund – Series I Shares (formerly AIM V.I. Small Cap Equity Fund)

• Invesco Van Kampen V.I. Comstock Fund – Series I Shares (formerly Van Kampen LIT Comstock Portfolio)

• Invesco Van Kampen V.I. Growth and Income Fund – Series I Shares (formerlyVan Kampen LIT Growth and Income Portfolio)

• Janus Aspen Balanced Portfolio – Service Shares

• Janus Aspen Flexible Bond Portfolio – Service Shares

• Janus Aspen Overseas Portfolio – Service Shares (formerly Janus Aspen International Growth Portfolio)

• Lazard Retirement Emerging Markets Equity Portfolio – Service Class Shares

• LVIP Baron Growth Opportunities Fund – Service Class

• MFS International Value Portfolio – Service Class Shares

• MFS Utilities Series – Service Class Shares

• NVIT Mid Cap Index Fund – Class II Shares (formerly GVIT Mid Cap Index Fund)

• Oppenheimer Global Securities Fund/VA

• PIMCO VIT High Yield Portfolio – Administrative Class Shares

• PIMCO VIT Low Duration Portfolio – Administrative Class Shares (formerly PIMCO VIT Low Duration Bond Portfolio)

• PIMCO VIT Total Return Portfolio – Administrative Class Shares

• Pioneer Fund VCT Portfolio – Class I Shares

• Pioneer Growth Opportunities VCT Portfolio – Class I Shares

• Pioneer Mid Cap Value VCT Portfolio – Class II Shares

• Prudential Series Fund Equity Portfolio – Class II Shares

• Putnam VT American Government Income Portfolio – Class IB Shares

• Putnam VT Equity Income Portfolio – Class IB Shares

This Prospectus does not constitute an offering in any jurisdiction in which such offering may not be lawfully made. No dealer, salesperson or other person is authorized to give any information or make any representations in connection with the Contracts other than those contained in this Prospectus, and, if given or made, such other information or representations must not be relied on.

This Contract is not available in all states

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• Putnam VT Global Health Care Portfolio – Class IB Shares*

• Royce Capital Fund - Small-Cap Portfolio – Service Class Shares

• Schwab MarketTrack Growth Portfolio II™

• Schwab Money Market Portfolio™

• Schwab S&P 500 Index Portfolio

• Sentinel Variable Products Bond Fund

• Sentinel Variable Products Common Stock Fund

• Sentinel Variable Products Small Company Fund

• Templeton Foreign Securities Portfolio – Class 2 Shares

• Touchstone Mid Cap Growth Fund – Class I Shares

• Universal Institutional Funds, Inc. U.S. Real Estate Portfolio – Class I Shares

• Van Eck VIP Global Bond Fund – Initial Class Shares (formerly Van Eck Insurance Trust Worldwide Bond Fund)

• Wells Fargo Advantage VT Opportunity Fund – Class 2 Shares (formerly Wells Fargo Advantage VT Opportunity Fund – Class

VT Shares)

*New Portfolio available as of May 1, 2011

The Sub-Accounts investing in the following Portfolios are no longer open to new Contributions and incoming Transfers:

• AllianceBernstein VPS Growth Portfolio – Class A Shares²

• AllianceBernstein VPS Growth & Income Portfolio – Class A Shares²

• AllianceBernstein VPS International Value Portfolio – Class A Shares¹

• American Century VP International Fund – Class I Shares⁵

• Dreyfus Investment Portfolios MidCap Stock Portfolio – Initial Shares²

• Dreyfus Variable Investment Fund Growth and Income Portfolio – Initial Shares⁵

• Dreyfus Variable Investment Fund Opportunistic Small Cap Portfolio – Initial Shares (formerly Dreyfus Variable Investment

Fund Developing Leaders Portfolio)⁶

• DWS Growth & Income VIP – Class A Shares²

• Federated Capital Appreciation Fund II – Primary Shares (formerly Federated Clover Value Fund II)⁶

• Federated Capital Income Fund II⁶

• Invesco V.I. Core Equity Fund – Series I Shares (formerly AIM V.I. Core Equity Fund)⁵

• Invesco V.I. High Yield Fund – Series I Shares (formerly AIM V.I. High Yield Fund)⁶

• Invesco V.I. Technology Fund – Series I Shares (formerly AIM V.I. Technology Fund)³

• Janus Aspen Balanced Portfolio – Institutional Shares⁴

• Janus Aspen Flexible Bond Portfolio – Institutional Shares⁴

• Janus Aspen Janus Portfolio – Institutional Shares (formerly Janus Aspen Series Large Cap Growth Portfolio)⁵

• Janus Aspen Overseas Portfolio – Institutional Shares (formerly Janus Aspen International Growth Portfolio)⁴

• Janus Aspen Worldwide Portfolio – Institutional Shares (formerly Janus Aspen Worldwide Growth Portfolio)⁶

• Neuberger Berman AMT Regency Portfolio – Class S Shares²

• Third Avenue Value Portfolio – Variable Series Trust Shares²

• Wells Fargo Advantage VT Small Cap Value Fund – Class 2 Shares (formerly Wells Fargo Advantage VT Small/Mid Cap

Value Fund)⁶

This Prospectus does not constitute an offering in any jurisdiction in which such offering may not be lawfully made. No dealer, salesperson or other person is authorized to give any information or make any representations in connection with the Contracts other than those contained in this Prospectus, and, if given or made, such other information or representations must not be relied on.

This Contract is not available in all states

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¹Effective April 27, 2010, the Sub-Account investing in the AllianceBernstein VPS International Value Portfolio – Class A Shares was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

²Effective May 1, 2009, the Sub-Accounts investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

³Effective May 1, 2008, the Sub-Account investing in the Invesco V.I. Technology Fund – Series I Shares (formerly AIM V.I. Technology Fund) was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

⁴Effective May 1, 2007, the Sub-Accounts investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

⁵Effective May 1, 2006, the Sub-Accounts investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

⁶Effective April 29, 2005, the Sub-Accounts investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

The Guarantee Period Fund is no longer offered as an investment option under the Contract. Therefore, you may no longer allocate any additional contributions to the Guarantee Period Fund. Money already allocated to the Guarantee Period Fund may remain until the Maturity Date of the Guarantee Period that you selected. The Guarantee Period Fund allowed you to select one or more Guarantee Periods that offer specific interest rates for a specific period. Please note that the Guarantee Period Fund may not be available in all states.

However, your Guarantee Period Fund may be subject to a new Market Value Adjustment which may increase (but not decrease) the amount Transferred or withdrawn from the value of a Guarantee Period if the Guarantee Period is broken prior to the Guarantee Period Maturity Date.

Sales and Surrender Charges

There are no sales, redemption, surrender, or withdrawal charges under the Schwab Select Annuity.

Free Look Period

After you received your Contract, you could look it over free of obligation for at least 10 days or longer if required by your state law (up to 35 days for replacement policies), during which you could cancel your Contract.

Payout Options

The Schwab Select Annuity offers a variety of annuity payout and periodic withdrawal options. Depending on the option you select, income can be guaranteed for your lifetime, your spouse’s and/or Beneficiaries’ lifetime or for a specified period of time.

The Contracts are not deposits of, or guaranteed or endorsed by, any bank, nor are the Contracts federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency. The Contracts involve certain investment risks, including possible loss of principal.

For account information, please contact:

Annuity Service Center

P.O. Box 173920

Denver, Colorado 80217-3920

888-560-5938

This Prospectus does not constitute an offering in any jurisdiction in which such offering may not be lawfully made. No dealer, salesperson or other person is authorized to give any information or make any representations in connection with the Contracts other than those contained in this Prospectus, and, if given or made, such other information or representations must not be relied on.

This Contract is not available in all states

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Table of Contents

Definitions	6
Fee Table	9
Example	10
Condensed Financial Information	11
Summary	11
How to contact the Annuity Service Center:	11
Great-West Life & Annuity Insurance Company	11
The Series Account	12
The Portfolios	12
Meeting Investment Objectives	26
Where to Find More Information About the Portfolios	26
Addition, Deletion or Substitution	26
The Guarantee Period Fund	27
Investments of the Guarantee Period Fund	27
Breaking a Guarantee Period	28
Interest Rates	28
The Market Value Adjustment	28
Subsequent Contributions	29
Annuity Account Value	29
Transfers	29
Market Timing and Excessive Trading	30
Automatic Custom Transfers	31
Withdrawals	33
Partial Withdrawals to Pay Investment Manager or Financial Advisor Fees	34
Tax Consequences of Withdrawals	34
Telephone and Internet Transactions	34
Death Benefit	34
Proportional Withdrawals (Oregon Only)	34
Beneficiary	35
Distribution of Death Benefit	36
Contingent Annuitant	36
Charges and Deductions	37
Mortality and Expense Risk Charge	37
Contract Maintenance Charge	37
Transfer Fees	38
Expenses of the Portfolios	38
Premium Tax	38
Other Taxes	38
Payout Options	38
Periodic Withdrawals	38
Annuity Payouts	39
Seek Tax Advice	42
Federal Tax Matters	42
Taxation of Annuities	43
Individual Retirement Annuities	45
Assignments or Pledges	46
Distribution of the Contracts	46
Voting Rights	47
Rights Reserved by Great-West	47
Legal Proceedings	47
Legal Matters	48
Independent Registered Public Accounting Firm	48
Available Information	48
Appendix A—Condensed Financial Information	A-1
Appendix B—Market Value Adjustments	B-1
Appendix C—Net Investment Factor	C-1

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Definitions

1035 Exchange—A provision of the Internal Revenue Code of 1986, as amended (the “Code”) that allows for the tax-free exchange of certain types of insurance contracts.

Accumulation Period—The time period between the Effective Date and the Annuity Commencement Date. During this period, you’re contributing to the annuity.

Accumulation Unit—The unit of measure that we use to calculate the value of your interest in a Sub-Account.

Annuitant—The person named in the application upon whose life the payout of an annuity is based and who will receive annuity payouts. If a Contingent Annuitant is named, the Annuitant will be considered the Primary Annuitant.

Annuity Account—An account established by us in your name that reflects all account activity under your Contract.

Schwab Select Annuity Structure

Your total Annuity Account can be made up of a Variable and a Fixed Account

Annuity Account Value—The sum of all the investment options credited to your Annuity Account—less partial withdrawals, amounts applied to an annuity payout option, periodic withdrawals, charges deducted under the Contract, and Premium Tax, if any.

Annuity Commencement Date—The date annuity payouts begin.

Annuity Individual Retirement Account (or Annuity IRA)—An annuity contract used in a retirement savings program that is intended to satisfy the requirements of Section 408 of the Code.

Annuity Payout Period—The period beginning on the Annuity Commencement Date and continuing until all annuity payouts have been made under the Contract. During this period, the Annuitant receives payouts from the annuity.

Annuity Unit—An accounting measure we use to determine the amount of any variable annuity payout after the first annuity payout is made.

Automatic Contribution Plan—A feature which allows you to make automatic periodic Contributions. Contributions will be withdrawn from an account you specify and automatically credited to your Annuity Account.

Beneficiary—The person(s) designated to receive any Death Benefit under the terms of the Contract.

Contingent Annuitant—The person you may name in the application who becomes the Annuitant when the Primary Annuitant dies. The Contingent Annuitant must be designated before the death of the Primary Annuitant.

Contract Maintenance Charge—For Contracts with an Annuity Account Value of less than $50,000 on the applicable Contract anniversary date, an annual charge of $25 applies. Also, if your Annuity Account Value falls below $50,000, the

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Contract Maintenance Charge will apply until the next applicable Contract anniversary date that your Annuity Account Value is equal to or greater than $50,000.

Contributions—The amount of money you invest or deposit into your annuity prior to any Premium Tax or other deductions.

Death Benefit—The amount payable to the Beneficiary when the Owner or the Annuitant dies.

Distribution Period—The period starting with your Payout Commencement Date.

Effective Date—The date on which the first Contribution is credited to your Annuity Account.

Fixed Account Value—The value of the fixed investment option credited to you under the Annuity Account.

Guarantee Period—The number of years available in the Guarantee Period Fund during which Great-West will credit a stated rate of interest. Great-West has discontinued offering a Guarantee Period for new Contributions. Amounts allocated to one or more Guarantee Periods may be subject to a Market Value Adjustment.

Guarantee Period Fund—A fixed investment option which pays a stated rate of interest for a specified time period. The Guaranteed Period Fund is no longer offered as an investment option.

Guarantee Period Maturity Date—The last day of any Guarantee Period.

Guaranteed Interest Rate—The minimum annual interest rate in effect that applies to each Guarantee Period at the time the Contribution is made.

Market Value Adjustment (or MVA)—An amount added to certain transactions involving the Guarantee Period Fund to reflect the impact of changing interest rates. A Market Value Adjustment may increase (but not decrease) the amount Transferred or withdrawn from the value of a Guarantee Period if the Guarantee Period is broken prior to the Guarantee Period Maturity Date.

Non-Qualified Annuity Contract—An annuity contract funded with money outside a tax qualified retirement plan.

Owner (Joint Owner) or You—The person(s) named in the application who is entitled to exercise all rights and privileges under the Contract, while the Annuitant is living. Joint Owners must be husband and wife as of the date the Contract is issued. The Annuitant will be the Owner unless otherwise indicated in the application. If a Contract is purchased in connection with an IRA, the Owner and the Annuitant must be the same individual and a Joint Owner is not allowed.

Payout Commencement Date—The date on which annuity payouts or periodic withdrawals begin under a payout option. The Payout Commencement Date must be at least one year after the Effective Date of the Contract. If you do not indicate a Payout Commencement Date on your application, annuity payouts will begin on the first day of the month of the Annuitant's 91st birthday.

Portfolio—A registered management investment company, or portfolio thereof, in which the assets of the Annuity Account may be invested.

Premium Tax—A tax charged by a state or other governmental authority. Varying by state, the current range of Premium Taxes is 0% to 3.5% and may be assessed at the time you make a Contribution, make withdrawals, or when annuity payments begin.

Primary Annuitant—See Annuitant, above; if a Contingent Annuitant is named in the application, the Primary Annuitant receives payments based on the applicable payout option during his/her lifetime and payments continue, after the death of the Primary Annuitant, for the life of the surviving Contingent Annuitant.

Proportional Withdrawals—(effective for Contracts issued after April 30, 2004 in Oregon only); a partial withdrawal made by you which reduces your Annuity Account Value measured as a percentage of each prior withdrawal against the current Annuity Account Value. A Proportional Withdrawal is determined by calculating the percentage the withdrawal represents of your Annuity Account Value at the time the withdrawal was made. For example, a partial withdrawal of 75% of the Annuity Account Value represents a Proportional Withdrawal of 75% of the total Contributions for purposes of calculating the Death Benefit. See “Death Benefit” on page XX.

Request—Any written, telephoned, or computerized instruction in a form satisfactory to Great-West and Charles Schwab & Co., Inc. (“Schwab”) received at the Annuity Service Center at Great-West (or other annuity service center subsequently

7

named) from you, your designee (as specified in a form acceptable to Great-West and Schwab) or the Beneficiary (as applicable) as required by any provision of the Contract.

Series Account—Variable Annuity-1 Series Account; the segregated asset account established by Great-West under Colorado law and registered as a unit investment trust under the Investment Company Act of 1940, as amended (the “1940 Act”).

Sub-Account—A division of the Series Account containing the shares of a Portfolio. There is a Sub-Account for each Portfolio. A Sub-Account may be also referred to as an “investment division” in the Prospectus, SAI, or Series Account financial statements.

Surrender Value—The value of your Annuity Account with any applicable Market Value Adjustment on the effective date of the surrender, less Premium Tax, if any.

Transaction Date—The date on which any Contribution, Transfer, or other Request from you will be processed. Contributions and Requests received after 4:00 p.m. ET will be priced on the next business day. Requests will be processed and the Variable Account Value will be determined on each day that the New York Stock Exchange (“NYSE”) is open for trading.

Transfer—Moving money from and between the Sub-Account(s) and the Guarantee Period Fund.

Variable Account Value—The value of the Sub-Accounts credited to you under the Annuity Account.

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FEE TABLE

The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the Contract. The first table describes the fees and expenses that you will pay at the time that you buy the Contract, surrender the Contract, or transfer cash value between investment options. State Premium Taxes may also be deducted.

Contract Owner Transaction Expenses

Sales Load Imposed on Purchases: (as a percentage of purchase payments)	None
Surrender Charge: (as a percentage of amount surrendered)	None
Maximum Transfer Charge:	$10*

*Applicable to each Transfer after the first twelve Transfers in each calendar year.

The next table describes the fees and expenses that you will pay periodically during the time that you own the Contract, not including Portfolio fees and expenses.

Annual Contract Maintenance Charge $25*

*The Contract Maintenance Charge is currently waived for Contracts with an Annuity Account Value of at least $50,000 on the applicable Contract anniversary date. If your Annuity Account Value falls below $50,000, the Contract Maintenance Charge will be reinstated until the next applicable Contract anniversary date that your Annuity Account Value is equal to or greater than $50,000.

The next table describes the fees and expenses that you will pay periodically during the time that you own the Contract, not including Portfolio fees and expenses.

Series Account Annual Expenses

(as a percentage of average Annuity Account Value)

Mortality and Expense Risk Charge:	0.85%
Account Fees and Expenses:	None
Total Series Account Annual Expenses:	0.85%

The next item shows the minimum and maximum total operating expenses charged by the Portfolios that you may pay periodically during the time that you own the Contract. More detail concerning each Portfolio’s fees and expenses is contained in the prospectus for each Portfolio.

Total Annual Portfolio Operating Expenses	Minimum	Maximum
(Expenses that are deducted from Portfolio assets, including management fees, distribution and/or service (12b-1) fees, and other expenses)	0.30%	3.07%1

THE EXPENSES FOR THE PORTFOLIOS WERE PROVIDED BY THE PORTFOLIOS. WE HAVE NOT INDEPENDENTLY VERIFIED THE ACCURACY OF THE INFORMATION.

¹ The expenses shown are based, in part, on estimated amounts for the current fiscal year, and do not reflect any fee waiver or expense reimbursement. The advisers and/or other service providers of certain Portfolios have agreed to reduce their fees and/or reimburse the Portfolios’ expenses in order to keep the Portfolios’ expenses below specified limits. The expenses of certain Portfolios are reduced by contractual fee reduction and expense reimbursement arrangements. Other Funds have voluntary fee reduction and/or expense reimbursement arrangements that may be terminated at any time. Each fee reduction and/or expense reimbursement arrangement is not reflected above, but is described in the relevant Portfolio’s prospectus.

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EXAMPLE

This example is intended to help you compare the cost of investing in the Contract with the cost of investing in other variable annuity contracts. These costs include Owner transaction expenses, Contract fees, Series Account annual expenses, and Portfolio fees and expenses.

This example assumes that you invest $10,000 in the Contract for the time periods indicated. The example also assumes that your investment has a 5% return each year and assumes the maximum fees and expenses of any of the Portfolios. In addition, this example assumes no Transfers were made and no Premium Taxes were deducted. If these arrangements were considered, the expenses shown would be higher. This example also does not take into consideration any fee waiver or expense reimbursement arrangements of the Portfolios. If these arrangements were taken into consideration, the expenses shown would be lower.

Although your actual costs may be higher or lower, based on these assumptions, if you retain your Contract, annuitize your Contract or if you surrender your Contract at the end of the applicable time period, your costs would be:

1 year	3 years	5 years	10 years
$437	$1,373	$2,399	$5,427

The example does not show the effect of Premium Taxes. Premium Taxes (ranging from 0% to 3.5%) are deducted from Annuity Account Value upon full surrender, death, or annuitization. The example also does not include any of the taxes or penalties you may be required to pay if you surrender your Contract.

The Variable Annuity Fee Tables and example should not be considered a representation of past or future expenses and charges of the Sub-Accounts. Your actual expenses may be greater or less than those shown. Similarly, the 5% annual rate of return assumed in the example is not an estimate or a guarantee of future investment performance. See “Charges and Deductions – Premium Tax” on page XX of this Prospectus. Owners who purchase the variable annuity described in this Prospectus may be eligible to apply the contract value to the total amount of their household assets maintained at Schwab. If the total amount of their household assets at Schwab meets certain predetermined breakpoints, they may be eligible for certain fee reductions or other related benefits offered by Schwab. All terms and conditions regarding the fees and account types eligible for such consideration are determined by Schwab. Charges and expenses of the Contract described in this Prospectus are NOT subject to reduction or waiver by Schwab. Please consult a Charles Schwab representative for more information.

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Condensed Financial Information

Attached as Appendix A is a table showing selected information concerning Accumulation Units for each Sub-Account for each calendar year since inception. The Accumulation Unit values do not reflect the deduction of certain charges that are subtracted from your Annuity Account Value, such as the Contract Maintenance Charge. The information in the table is derived from various financial statements of the Series Account, which have been audited by Deloitte & Touche LLP, an independent registered public accounting firm. To obtain a more complete picture of each Sub-Account’s finances and performance, you should also review the Series Account’s financial statements, which are in the SAI.

Summary

The Schwab Select Annuity^® allows you to accumulate assets on a tax-deferred basis by investing in a variety of variable investment options (the Sub-Accounts) and a fixed investment option (the Guarantee Period Fund). The performance of your Annuity Account will vary with the investment performance of the Portfolios corresponding to the Sub-Accounts you select. You bear the entire investment risk for all amounts invested in them. Depending on the performance of the Sub-Accounts you select, your Variable Account Value could be less than the total amount of your Contributions.

Further, the Guarantee Period Fund may be subject to a Market Value Adjustment which may increase (but not decrease) the amount Transferred or withdrawn from the value of a Guarantee Period if the Guarantee Period is broken prior to the Guarantee Period Maturity Date.

The Schwab Select Annuity^® is no longer available for purchase, although we continue to accept additional Contributions under the Contract. No additional Contributions may be made to the Guarantee Period Fund.

Tax deferral under IRAs arises under the Code. Tax deferral under non-qualified contracts arises under the Contract.

How to contact the Annuity Service Center:

P.O. Box 173920

Denver, CO 80217-3920

1-888-560-5938

Your initial Contribution was required to be at least $5,000; $2,000 if an IRA, or $1,000 if you were setting up an Automatic Contribution Plan. Subsequent Contributions must be either $500, or $100 if made through an Automatic Contribution Plan. The money you contribute to the Contract will be invested at your direction. Prior to the Payout Commencement Date, you can withdraw all or a part of your Annuity Account Value. There are no surrender or withdrawal charges. Certain withdrawals may be subject to federal income tax as well as a federal penalty tax.

When you’re ready to start taking money out of your Contract, you can select from a variety of payout options, including variable and fixed annuity payouts as well as periodic withdrawals.

If the Annuitant dies before the Annuity Commencement Date, we will pay the Death Benefit to the Beneficiary you select. If the Owner dies before the entire value of the Contract is distributed, the remaining value will be distributed according to the rules outlined in the “Death Benefit” section on page XX.

For accounts under $50,000 as of each Contract anniversary date, we deduct a $25 annual Contract Maintenance Charge from the Annuity Account Value on each such Contract anniversary date. There is no annual Contract Maintenance Charge for accounts of $50,000 or more. We also deduct a mortality and expense risk charge from your Sub-Accounts at the end of each daily valuation period equal to an effective annual rate of 0.85% of the value of the net assets in your Sub-Accounts. Each Portfolio assesses a charge for management fees and other expenses.

This summary highlights some of the more significant aspects of the Schwab Select Annuity^®. You’ll find more detailed information about these topics throughout the Prospectus and in your Contract. Please keep them both for future reference.

Great-West Life & Annuity Insurance Company

Great-West is a stock life insurance company that was originally organized under the laws of the State of Kansas as the National Interment Association. Our name was changed to Ranger National Life Insurance Company in 1963 and to Insuramerica Corporation prior to changing to our current name in 1982. In September of 1990, we redomesticated under the laws of the State of Colorado.

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Great-West is a wholly owned subsidiary of GWL&A Financial, Inc., a Delaware holding company. GWL&A Financial, Inc. is an indirect wholly-owned subsidiary of Great-West Lifeco Inc., a Canadian holding company. Great-West Lifeco Inc. is a subsidiary of Power Financial Corporation, a Canadian holding company with substantial interests in the financial services industry. Power Financial Corporation is a subsidiary of Power Corporation of Canada, a Canadian holding and management company. Mr. Paul Desmarais, through a group of private holding companies that he controls, has voting control of Power Corporation of Canada.

We are authorized to do business in 49 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, and Guam. We issue individual and group life insurance policies and annuity contracts and accident and health insurance policies.

Great-West Life & Annuity Insurance Company

8515 East Orchard Road

Greenwood Village, Colorado 80111

The Series Account

We established the Variable Annuity-1 Series Account in accordance with Colorado laws on July 24, 1995.

The Series Account is registered with the SEC under the 1940 Act, as a unit investment trust. Registration under the 1940 Act does not involve supervision by the SEC of the management or investment practices or policies of the Series Account.

We own the assets of the Series Account. The income, gains or losses, realized or unrealized, from assets allocated to the Series Account are credited to or charged against the Series Account without regard to our other income gains or losses.

We will at all times maintain assets in the Series Account with a total market value at least equal to the reserves and other liabilities relating to the variable benefits under all Contracts participating in the Series Account. These assets may not be charged with our liabilities from our other business. Our obligations under the contracts are, however, our general corporate obligations.

In calculating our corporate income tax liability, we derive certain corporate income tax benefits associated with the investment of company assets, including Series Account assets that are treated as company assets under applicable income tax law. These benefits, which reduce our overall corporate income tax liability may include dividends received deductions and foreign tax credits which can be material. We do not pass these benefits through to the Series Account or our other separate accounts, principally because: (i) the great bulk of the benefits results from the dividends received deduction, which involves no reduction in the dollar amount of dividends that the Series Account receives; and (ii) under applicable income tax law, Owners are not the owners of the assets generating the benefits.

The Series Account is divided into several Sub-Accounts. Each Sub-Account invests exclusively in shares of a corresponding investment Portfolio of a registered investment company (commonly known as a mutual fund). We may in the future add new, or delete existing, Sub-Accounts. The income, gains, or losses, realized or unrealized, from assets allocated to each Sub-Account are credited to or charged against that Sub-Account without regard to the other income, gains, or losses of the other Sub-Accounts. All amounts allocated to a Sub-Account will be fully invested in Portfolio shares.

We hold the assets of the Series Account. We keep those assets physically segregated and held separate and apart from our general account assets. We maintain records of all purchases and redemptions of shares of the Portfolios.

The Portfolios

The Contract offers a number of investment options, corresponding to the Sub-Accounts. Each Sub-Account invests in a single Portfolio. Each Portfolio is a separate mutual fund registered under the 1940 Act. More comprehensive information, including a discussion of potential risks, is found in the current prospectuses for the Portfolios (the “Portfolio Prospectuses”). The Portfolio Prospectuses should be read in connection with this Prospectus. You may obtain a copy of the Portfolio Prospectuses without charge by request. If you received a summary prospectus for a Portfolio, please follow the directions on the first page of the summary prospectus to obtain a copy of the Portfolio Prospectus.

Each Portfolio:

• holds its assets separate from the assets of the other Portfolios,

• has its own distinct investment objective and policy, and

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• operates as a separate investment fund.

The income, gains, and losses of one Portfolio generally have no effect on the investment performance of any other Portfolio.

The Portfolios are not available to the general public directly. The Portfolios are only available as investment options in variable annuity contracts or variable life insurance policies issued by life insurance companies or, in some cases, through participation in certain qualified pension or retirement plans. The Portfolios are used for “mixed” and “shared” funding. “Mixed funding” occurs when shares of a Portfolio, which the Sub-Accounts buy for the Contract, are bought for variable life insurance policies issued by us or other insurance companies. “Shared funding” occurs when shares of a Portfolio, which the Sub-Accounts buy for the Contract, are also bought by other insurance companies for their variable annuity contract.

Some of the Portfolios have been established by investment advisers which manage publicly available mutual funds having similar names and investment objectives. While some of the Portfolios may be similar to, and may in fact be modeled after publicly available mutual funds, you should understand that the Portfolios are not otherwise directly related to any publicly available mutual fund. Consequently, the investment performance of publicly available mutual funds and any corresponding Portfolios may differ. The investment objectives of the Portfolios are briefly described below:

The Alger Portfolios—advised by Fred Alger Management, Inc. of New York, New York.

Alger Large Cap Growth Portfolio–Class I-2 Shares (formerly Alger American LargeCap Growth Portfolio–Class O Shares) seeks long-term capital appreciation. The Portfolio focuses on growing companies that generally have broad product lines, markets, financial resources, and depth of management. Under normal circumstances, the Portfolio invests at least 80% of its net assets in equity securities of companies that, at the time of purchase of the securities, have a market capitalization equal to or greater than the market capitalization of companies included in the Russell 1000 Growth Index, updated quarterly as reported as of the most recent quarter-end.

Alger Mid Cap Growth Portfolio–Class I-2 Shares (formerly Alger American MidCap Growth Portfolio–Class O Shares) seeks long-term capital appreciation. It focuses on midsized companies that the manager believes demonstrate promising growth potential. Under normal circumstances, the Portfolio invests at least 80% of its net assets in the equity securities of companies that, at the time of purchase of the securities, have a market capitalization within the range of companies in the Russell MidCap^® Growth Index or the S&P MidCap 400 Index, as reported by the indexes as of the most recent quarter-end. Both indexes are designed to track the performance of medium-capitalization stocks.

AllianceBernstein Variable Products Series Fund, Inc. —advised by AllianceBernstein L.P., New York, New York.

AllianceBernstein VPS Growth & Income Portfolio–Class A Shares seeks to provide long-term growth of capital. The Portfolio invests primarily in the equity securities of U.S. companies that AllianceBernstein believes are undervalued. AllianceBernstein believes that, over time, a company’s stock price will come to reflect its intrinsic economic value. AllianceBernstein uses a disciplined investment process to evaluate the companies in its extensive research universe and to identify the stocks of companies that offer the best combination of value and potential for price appreciation. The Portfolio may invest in companies of any size and in any industry. The Portfolio also invests in the high-quality securities of non-U.S. issuers.

Effective May 1, 2009, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

AllianceBernstein VPS Growth Portfolio–Class A Shares seeks to provide long-term growth of capital. The Portfolio invests primarily in equity securities of companies with favorable earnings outlooks and whose long-term growth rates are expected to exceed market expectations over time. The Portfolio emphasizes investments in large- and mid-cap companies. The Portfolio has the flexibility to invest across the capitalization spectrum reflecting the Advisor’s internal research.

Effective May 1, 2009, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

AllianceBernstein VPS International Growth Portfolio–Class A Shares seeks long-term growth of capital. The Portfolio invests primarily in an international portfolio of equity securities of companies located in both developed and emerging countries. The Portfolio consists of approximately 90-130 stocks. The Portfolio invests, under normal circumstances, in the equity securities of companies based in at least three countries (and normally substantially more) other than the United States. The Portfolio may invest, without limit, in derivatives, such as options, futures, forwards and swaps. The Portfolio’s investments include investments in securities of companies selected by the Portfolio’s adviser for their growth potential within various market sectors. The Portfolio’s investments include investments in securities of companies that are established as a

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result of privatizations of state enterprises. Currencies can have a dramatic impact on equity returns, significantly adding to returns in some years and greatly diminishing them in others. Currency and equity positions are evaluated separately. The Advisor may seek to hedge the currency exposure resulting from securities positions when it finds the currency exposure unattractive. To hedge a portion of its currency risk the Portfolio may from time to time invest in currency-related derivatives, including the forward currency exchange contracts, futures, option on futures, swaps and options. The Advisor may also seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives.

AllianceBernstein VPS International Value Portfolio–Class A Shares seeks long-term growth of capital. The Portfolio will invest primarily in a diversified portfolio of equity securities of established companies selected from more than 40 industries and more than 40 developed and emerging-market countries. The Portfolio normally invests in companies in at least three countries other than the United States. These countries currently include the developed nations in Europe and the Far East, Canada, Australia and emerging-market countries worldwide. The Portfolio invests in companies that are determined by the Advisor’s Bernstein unit to be undervalued, using a fundamental value approach. In selecting securities for the portfolio, Bernstein uses its fundamental and quantitative research to identify companies whose long-term earnings power is not reflected in the current market price of their securities.

Effective April 27, 2010, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

AllianceBernstein VPS Small/Mid Cap Value Portfolio–Class A Shares seeks long-term growth of capital. The Portfolio invests primarily in a diversified portfolio of equity securities of small-to mid-cap U.S. companies, generally representing 60-125 companies. Under normal circumstances, the Portfolio will invest at least 80% of its net assets in these types of securities. The Portfolio invests in companies that are determined by AllianceBernstein to be undervalued, using its Bernstein unit’s fundamental value approach. In selecting securities for the portfolio, Bernstein uses its fundamental research to identify companies whose long-term earnings power is not reflected in the current market prices of their securities.

American Century Variable Portfolios, Inc.—advised by American Century^® Investment Management, Inc. of Kansas City, Missouri, advisers to the American Century family of mutual funds.

American Century VP Balanced Fund–Class I Shares seeks long-term capital growth and current income by investing approximately 60% of its assets in equity securities and the remainder in bonds and other fixed-income securities.

American Century VP International Fund–Class I Shares seeks capital growth by investing primarily in equity securities of companies located in at least three developed countries world-wide (excluding the United States). The portfolio managers look for stocks of companies they believe will increase in value over time, using an investment strategy developed by American Century Investments. In implementing this strategy, the portfolio managers make their investment decisions based primarily on their analysis of individual companies, rather than on broad economic forecasts. Management of the fund is based on the belief that, over the long term, stock price movements follow growth in earnings, revenues and/or cash flow. The portfolio managers use a variety of analytical research tools and techniques to identify the stocks of companies that meet their investment criteria. Under normal market conditions, the fund’s portfolio will primarily consist of securities of companies whose earnings or revenues are not only growing, but growing at an accelerating pace.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

American Century VP Mid Cap Value Fund–Class II Shares seeks long-term capital growth. Income is a secondary objective. The portfolio managers look for stocks of companies of all sizes that they believe are undervalued at the time of purchase. The portfolio managers us a value investment strategy that looks for companies that are temporarily out of favor in the market. The portfolio managers attempt to purchase the stocks of these undervalued companies and hold each stock until it has returned to favor in the market and the price has increased to, or is higher than, a level the portfolio managers believe more accurately reflects the fair value of the company.

American Century VP Value Fund-Class I Shares seeks long-term capital growth. In selecting stocks for the fund, the portfolio managers look for companies of all sizes whose stock price may not reflect the company’s value. The managers attempt to purchase the stocks of these undervalued companies and hold each stock until the price has increased to, or is higher than, a level the managers believe more accurately reflects the fair value of the company.

Columbia Funds—advised by Columbia Management Investment Advisors, LLC of Boston, Massachusetts.

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Columbia Variable Portfolio – Marsico 21^st Century Fund–Class 2 Shares (formerly Columbia VIT Marsico 21^st Century Fund–Class B Shares) seeks long term growth of capital. The Portfolio invests primarily in equity securities of companies of any capitalization size and generally will hold a core position of between 35 and 50 common stocks. The number of securities held by the Portfolio may occasionally exceed this range at times such as when the Advisor is accumulating new positions, phasing out and replacing existing positions, or responding to exceptional market conditions. The Portfolio may invest without limit in foreign securities, including in emerging markets securities. The Portfolio also may invest in foreign currency exchange contracts to convert foreign currencies to and from the U.S. dollar, and to hedge against changes in foreign currency exchange rates.

Columbia Variable Portfolio – Seligman Global Technology Fund–Class 2 Shares (formerly Seligman Communications and Information Portfolio) seeks long-term capital appreciation. The Portfolio invests at least 80% of its net assets in equity securities of U.S. and non-U.S. companies in technology and technology-related industries. The Portfolio may invest in any country and generally invests in several countries in different geographic regions.

Columbia Variable Portfolio - Small Cap Value Fund–Class 2 Shares (formerly Columbia VIT Small Cap Value Fund–Class B Shares) seeks long term capital appreciation. Under normal circumstances, the Portfolio invests at least 80% of net assets in equity securities of companies that have market capitalizations in the range of the companies in the Russell 2000^® Value Index at the time of purchase (between $29 million and $3.1 billion as of September 30, 2008), that the Advisor believes are undervalued. The Portfolio may invest up to 20% of total assets in foreign securities.

Delaware VIP Trust—The Series is managed by Delaware Management Company, a series of Delaware Management Business Trust, which is an indirect wholly owned subsidiary of Delaware Management Holdings, Inc. (“DMHI”). DMHI is a wholly owned subsidiary of the Macquarie Group, Ltd.

Delaware VIP Small Cap Value Series–Standard Class Shares seeks capital appreciation. The Series invests primarily in investments of small companies whose stock prices appear low relative to their underlying value or future potential. Among other factors, the Series investment manager considers the financial strength of a company, its management, the prospects for its industry, and any anticipated changes within the company, which might suggest a more favorable outlook going forward. Under normal circumstances, the Series will invest at least 80% of its net assets in small-capitalization companies. For purposes of the Series, small-capitalization companies are companies with a market capitalization generally less than 3.5 times the dollar-weighted, median market capitalization of the Russell 2000 Index at the time of purchase.

Delaware VIP Smid Cap Growth Series–Standard Class Shares (formerly Delaware VIP Growth Opportunities Series) seeks long-term capital appreciation. The Series invests primarily in common stocks of growth oriented companies that the Series’ investment manage believes have long-term capital appreciation potential and expect to grow faster than the U.S. economy. The Series generally focuses on small- to mid-sized companies that, at the time of investment, have total market capitalizations within the range of the Russell 2500 Growth Index.

Dreyfus Investment Portfolios—advised by The Dreyfus Corporation of New York, New York.

Dreyfus Investment Portfolios MidCap Stock Portfolio–Initial Shares seeks investment returns that are greater than the total return performance of publicly traded common stocks of medium-size domestic companies in the aggregate, as represented by the Standard & Poor’s MidCap 400^® Index. To pursue this goal, the Portfolio normally invests at least 80% of its assets in stocks of mid-size companies. The Portfolio invests in growth and value stocks, which are chosen through a disciplined investment process that combines computer modeling techniques, fundamental analysis, and risk management. Consistency of returns compared to the S&P 400, the portfolio’s benchmark, is a primary goal of the investment process. The portfolio’s stock investments may include common stocks, preferred stocks, convertible securities and depositary receipts. The portfolio managers will select stocks through a “bottom-up,” structured approach that seeks to identify undervalued securities using a quantitative screening process. The process is driven by a proprietary quantitative model which measures more than 40 characteristics of stocks to identify and rank stocks based on: fundamental momentum; relative value; future value; long-term growth; and additional factors. Next, the portfolio managers focus on stock selection, as opposed to making proactive decisions as to industry or sector exposure, to construct the portfolio. The portfolio managers seek to maintain a portfolio that has exposure to industries and market capitalizations that are generally similar to the S&P 400.

Effective May 1, 2009, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Dreyfus Variable Investment Fund—advised by The Dreyfus Corporation of New York, New York.

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Dreyfus Variable Investment Fund Appreciation Portfolio–Initial Shares seeks long-term capital growth consistent with the preservation of capital. Its secondary goal is current income. To pursue these goals, the Portfolio normally invests at least 80% of its assets in common stocks. The Portfolio focuses on “blue-chip” companies with total market capitalizations of more than $5 billion at the time of purchase, including multinational companies. These established companies have demonstrated sustained patterns of profitability, strong balance sheets, an expanding global presence and the potential to achieve predictable, above-average earnings growth. In choosing stocks, the Portfolio first identifies economic sectors it believes will expand over the next three to five years or longer. Using fundamental analysis, the Portfolio then seeks companies within these sectors that have proven track records and dominant positions in their industries. The Portfolio also may invest in companies which it considers undervalued in terms of earnings, assets or growth prospects. The Sub-adviser is Fayez Sarofim & Co.)

Dreyfus Variable Investment Fund Opportunistic Small Cap Portfolio–Initial Shares (formerly Dreyfus Variable Investment Fund Developing Leaders Portfolio) seeks capital growth. To pursue this goal, the Portfolio normally invests at least 80% of its assets in the stocks of small-cap companies. The Portfolio currently considers small-cap companies to be those companies with market capitalizations that fall within the range of companies in the Russell 2000 Index at the time of purchase. As of December 31, 2009, the market capitalization range of companies in the Russell 2000 Index was between $13 million and $5 billion. Because the Portfolio may continue to hold a security whose market capitalization increases or decreases, a substantial portion of the Portfolio’s holdings can have market capitalizations outside the range of the Russell 2000 Index at any given time. Stocks are selected for the Portfolio based primarily on bottom-up fundamental analysis. The Portfolio’s managers use a disciplined investment process that relies, in general, on proprietary fundamental research and valuation. Generally, elements of the process include analysis of mid-cycle business prospects, estimation of the intrinsic value of the company and the identification of a revaluation trigger. Intrinsic value is based on the combination of the valuation assessment of the company’s operating divisions with the firm’s economic balance sheet. Mid-cycle estimates, growth prospects and competitive advantages are some of the factors used in the valuation assessment. A company’s stated and hidden liabilities and assets are included in the Portfolio managers’ economic balance sheet calculation. Sector overweights and underweights are a function of the relative attractiveness of securities within the Portfolio’s investable universe. The Portfolio’s managers invest in stocks that they believe have attractive reward to risk opportunities and may actively adjust the Portfolio to reflect new developments. In general, the Portfolio’s managers seek exposure to securities and sectors that are perceived to be attractive from a valuation and fundamental standpoint. The Portfolio’s sector weightings and risk characteristics are a result of bottom-up fundamental analysis and may vary from those of the Russell 2000 Index, the Portfolio’s benchmark, at any given time. The Russell 2000 Index is an unmanaged index that measures the performance of the small capitalization sector of the U.S. equity market. The Portfolio may invest in exchange traded funds (ETFs) and similarly structured pooled investments in order to provide exposure to certain equity markets. The Portfolio typically sells a stock when it approaches intrinsic value, a significant deterioration of fundamental expectations develops, the revaluation catalyst becomes impaired or a better risk/reward is presented in the marketplace.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Dreyfus Variable Investment Fund Growth and Income Portfolio–Initial Shares seeks long-term capital growth, current income and growth of income consistent with reasonable investment risk. To pursue its goal, the Portfolio normally invests primarily in stocks of domestic and foreign issuers. The Portfolio’s stock investments may include common stocks, preferred stocks, convertible securities and American Depositary Receipts. The portfolio managers create a broadly diversified portfolio for the Portfolio that includes a blend of growth and dividend paying stocks. In choosing securities, the portfolio managers use a “growth style” of investing as well as focusing on dividend paying stocks and other investments and investment techniques that provide income. The Portfolio’s investment process is designed to provide investors with investment exposure to sector weightings and risk characteristics similar to those of the Standard & Poor’s^® 500 Composite Stock Price Index (S&P 500 Index). The portfolio managers choose stocks through a disciplined investment process that combines computer modeling techniques, bottom-up fundamental analysis and risk management. In selecting securities, the portfolio managers seek companies that possess some or all of the following characteristics: growth of earnings potential; operating margin improvement; revenue growth prospects; business improvement; good business fundamentals; dividend yield consistent with the Portfolio’s strategy pertaining to income; value, or how a stock is priced relative to its perceived intrinsic worth; and healthy financial profile, which measures the financial wellbeing of the company. The portfolio managers monitor the stocks in the Portfolio, and consider selling a security if the company’s business momentum deteriorates or valuation becomes excessive. The portfolio managers also may sell a security if an event occurs that contradicts the portfolio managers’ rationale for owning it, such as deterioration in the company’s financial fundamentals. In addition, the portfolio managers may sell a security if

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better investment opportunities emerge elsewhere, or if the portfolio managers change the portfolio’s industry or sector weightings.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

DWS Variable Series I—advised by Deutsche Investment Management Americas Inc. of New York, New York.

DWS Capital Growth VIP–Class A Shares seeks to provide long-term growth of capital. The Portfolio normally invests at least 65% of total assets in equities, mainly common stocks of U.S. companies. The Portfolio generally focuses on established companies that are similar in size to the companies in the “S&P 500^® Index” (generally 500 of the largest companies in the U.S.) or the Russell 1000^® Growth Index (generally those stocks among the 1,000 largest U.S. companies that have above-average price-to-earnings ratios).

DWS Growth and Income VIP–Class A Shares seeks long-term growth of capital, current income and growth of income. The Portfolio invests at least 65% of its total assets in equities, mainly common stocks. Although the Portfolio can invest in companies of any size and from any country, it invests primarily in large U.S. companies. The managers may favor securities from different industries and companies at different times.

Effective May 1, 2009, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

DWS Variable Series II—advised by Deutsche Investment Management Americas Inc. of New York, New York.

DWS Blue Chip VIP–Class A Shares seeks growth of capital and income. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in common stocks of large U.S. companies that are similar in size to the companies in the S&P 500 Index and that Portfolio management considers to be “blue chip” companies. Blue chip companies are large, well-known companies that typically have an established earnings and dividends history, easy access to credit, solid positions in their industries and strong management. Sub-advised by QS Investors, LLC.

DWS Dreman Small Mid Cap Value VIP–Class A Shares (formerly DWS Dreman Small Cap Value VIP) seeks long-term capital appreciation. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in undervalued common stocks of small and mid-size U.S. companies. Sub-advised by Dreman Value Management LLC.

DWS Large Cap Value VIP–Class A Shares seeks to achieve a high rate of total return. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in common stocks and other equity securities of large U.S. companies that are similar in size to the companies in the Russell 1000^® Value Index and that Portfolio management believes are undervalued. Sub-advised by Deutsche Asset Management International GmbH.

DWS Investments VIT Funds—advised by Deutsche Asset Management, Inc. of New York, New York.

DWS Small Cap Index VIP–Class A Shares seeks to replicate, as closely as possible, before the deduction of expenses, the performance of the Russell 2000^® Index, which emphasizes stock of small U.S. companies. Under normal circumstances, the Portfolio invests at least 80% of its assets, determined at the time of purchase, in stocks of companies included in the Russell 2000^® Index and in derivative instruments, such as stock index futures contracts and options that provide exposure to the stocks of companies in the Russell 2000 Index. Sub-advised by Northern Trust Investments, Inc.

Federated Insurance Series

Federated Capital Appreciation Fund II–Primary Shares (formerly Federated Clover Value Fund II) seeks capital appreciation by investing primarily in common stock of domestic companies with large and medium market capitalizations that offer superior growth prospects or of companies whose stock is undervalued. The Portfolio may also invest in common stocks of foreign issuers (including American Depositary Receipts). The Portfolio may invest in derivative contracts to implement its investment strategies. Advised by Federated Equity Management Company of Pennsylvania.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Federated Fund for U.S. Government Securities II seeks to provide current income. The fund seeks to provide current income. Under normal market conditions, the fund invests primarily in mortgage-backed securities (MBS) of investment-grade quality and seeks to provide returns consistent with investments in the market for U.S. home mortgages. The fund will invest in MBS

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that are issued or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises (GSEs). The fund may invest in non-agency MBS, which are those not issued or guaranteed by GSEs. The fund also may invest in U.S. government securities and certain derivative instruments. Advised by Federated Investment Management Company of Pennsylvania.

Federated Capital Income Fund II seeks to provide high current income and moderate capital appreciation. The Portfolio pursues its investment objectives by investing in both equity and fixed-income securities that have high relative income potential. The Portfolio’s investment adviser’s process for selecting equity investments attempts to identify mature, mid- to large-cap companies with high relative dividend yields that are likely to maintain or increase their dividends. The investment adviser selects fixed-income investments that offer high current yields. Advised by Federated Equity Management Company of Pennsylvania.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Franklin Templeton Variable Insurance Products Trust

Franklin Small Cap Value Securities Fund–Class 2 Shares 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. Advised by Franklin Advisory Services, LLC, Fort Lee, New Jersey.

Templeton Foreign Securities Fund–Class 2 Shares 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. Advised by Templeton Investment Counsel, LLC, Fort Lauderdale, Florida.

Invesco Variable Insurance Fund—advised by Invesco Advisers, Inc., Houston, Texas, and sub-advised by advisory entities affiliated with Invesco Advisers, Inc.

Invesco V.I. Mid Cap Core Equity Fund–Series I Shares (formerly AIM V.I. Mid Cap Core Equity Fund) seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of net assets (plus borrowings for investment purposes) in equity securities of mid-capitalization companies. In complying with the 80% investment requirement, the fund may include synthetic instruments that have economic characteristics similar to the fund’s direct investments that are counted toward the 80% investment requirement. The portfolio management team seeks to construct a portfolio of issuers that have high or improving return on invested capital (ROIC), quality management, a strong competitive position and which are trading at compelling valuations. The fund considers a company to be a mid-capitalization company if it has a market capitalization, at the time of purchase, within the range of the largest and smallest capitalized companies included in the Russell Midcap Index during the most recent 11-month period (based on month-end data) plus the most recent data during the current month. As of January 31, 2011, the capitalization of companies in the Russell Midcap Index range from $228 million to $21.2 billion. The Russell Midcap Index measures the performance of the 800 companies with the lowest market capitalization in the Russell 1000» Index. The Russell 1000 Index is a widely recognized, unmanaged index of common stocks of the 1000 largest companies in the Russell 3000 Index, which measures the performance of the 3000 largest U.S. companies based on total market capitalization. The companies in the Russell Midcap Index are considered representative of medium-sized companies. The fund may invest up to 25% of its total assets in foreign securities. In selecting securities for the fund, the portfolio managers conduct fundamental research of issuers to gain a thorough understanding of their business prospects, appreciation potential and return on invested capital (ROIC). The process they use to identify potential investments for the fund includes three phases: financial analysis, business analysis and valuation analysis. Financial analysis evaluates an issuer’s capital allocation, and provides vital insight into historical and potential ROIC which is a key indicator of business quality and caliber of management. Business analysis allows the team to determine an issuer’s competitive positioning by identifying key drivers of the issuer, understanding industry challenges and evaluating the sustainability of competitive advantages. Both the financial and business analyses serve as a basis to construct valuation models that help estimate an issuer’s value. The portfolio managers use three primary valuation techniques: discounted cash flow, traditional valuation multiples and net asset value. At the conclusion of their research process, the portfolio managers will generally invest in an issuer when they have determined it potentially has high or improving ROIC, quality management, a strong competitive position and is trading at an attractive valuation.

Invesco V.I. Small Cap Equity Fund–Series I Shares (formerly AIM V.I. Small Cap Equity Fund) seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of net assets (plus borrowings for investment purposes) in equity securities of small-capitalization issuers. In complying with the 80% investment requirement, the fund may include synthetic instruments that have economic characteristics similar to the fund’s direct investments that are counted toward the 80% investment requirement.

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Invesco V.I. Core Equity Fund–Series I Shares (formerly AIM V.I. Core Equity Fund) seeks long-term growth of capital. The Fund invests, under normal circumstances, at least 80% of net assets (plus borrowings for investment purposes) in equity securities. In complying with the 80% investment requirement, the Fund may include synthetic instruments that have economic characteristics similar to the Fund’s direct investments that are counted toward the 80% investment requirement. The portfolio management team seeks to construct a portfolio of issuers that have high or improving return on invested capital (ROIC), quality management, a strong competitive position and which are trading at compelling valuations. The Fund may invest up to 25% of its total assets in foreign securities, which includes debt and equity securities.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Invesco V.I. High Yield Fund–Series I Shares (formerly AIM V.I. High Yield Fund) seeks current income and, secondarily, capital appreciation. The fund invests under normal circumstances at least 80% of net assets (plus borrowings for investment purposes) in debt securities that are determined to be below investment grade quality. The fund considers debt securities to be below investment grade quality if there are rated BB/Ba or lower by Standard & Poor’s Ratings Services, Moody’s Investors Service, Inc., or any other nationally recognized statistical rating organization (NRSRO), or are determined by the portfolio managers to be of comparable quality to such rated securities. These types of securities are commonly known as “junk bonds.” The fund will principally invest in junk bonds rated B or above by an NRSRO or deemed to be of comparable quality by the portfolio managers. The fund may invest up to 25% of its total assets in foreign securities. The fund may also invest in securities, whether or not considered foreign securities, which carry foreign credit exposure. The fund may invest up to 15% of its total assets in securities of companies located in developing markets.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Invesco V.I. International Growth Fund–Series I Shares (formerly AIM V.I. International Growth Fund) seeks long-term growth of capital. The Portfolio invests primarily in a diversified portfolio of international securities whose issuers are considered by the portfolio managers to have strong earnings growth. The Portfolios invests primarily in equity securities. The Portfolio focuses its investments in equity securities of foreign issuers that are listed on a recognized foreign or U.S. securities exchange or traded in a foreign or U.S. over-the-counter market. The Portfolio invests, under normal circumstances, in issuers located in at least three countries outside of the U.S., emphasizing investment in issuers in the developed countries of Western Europe and the Pacific Basin. As of December 31, 2010, the principal countries in which the Portfolio invests were United Kingdom, Japan, Switzerland, Australia and the United States. The Portfolio may also invest up to 20% of its total assets in issuers located in developing countries, i.e., those that are identified as in the initial stages of their industrial cycles.

Invesco V.I. Technology Fund–Series I Shares (formerly AIM V.I. Technology Fund) seeks long-term growth of capital. The fund seeks to meet its objective by investing, normally, at least 80% of its net assets, in equity securities of issuers engaged primarily in technology-related industries. The fund invests primarily in equity securities. In complying with the 80% investment requirement, the fund may include synthetic instruments that have economic characteristics similar to the fund’s direct investments that are counted toward the 80% investment requirement. The fund considers an issuer to be doing business in technology related industries if it meets at least one of the following tests: (1) at least 50% of its gross income or its net sales come from activities in technology-related industries; (2) at least 50% of its assets are devoted to producing revenues in technology-related industries; or (3) based on other available information, the portfolio managers determine that its primary business is within technology-related industries. The principal type of equity securities purchased by the fund is equity securities. Issuers in technology-related industries include, but are not limited to, those involved in the design, manufacture, distribution, licensing, or provision of various applied technologies, hardware, software, semiconductors, telecommunications equipment and services, medical technology, biotechnology, as well as service-related companies in information technology. The fund may invest up to 50% of its total assets in foreign securities of issuers doing business in technology-related industries.

Effective May 1, 2008, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Invesco Van Kampen V.I. Comstock Fund–Series I Shares (formerly Van Kampen LIT Comstock Portfolio) seeks capital growth and income through investments in equity securities, including common stocks, preferred stocks and securities convertible into common and preferred stocks.

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Invesco Van Kampen V.I. Growth and Income Fund–Series I Shares (formerly Van Kampen LIT Growth and Income Portfolio) seeks long-term growth of capital and income. The Portfolio may invest up to 15% of its assets in equity real estate investment trusts (“REITs”).

Janus Aspen Series—advised by Janus Capital Management LLC of Denver, Colorado.

Janus Aspen Balanced Portfolio–Institutional Shares seeks long-term capital growth, consistent with preservation of capital and balanced by current income. The Portfolio pursues its investment objective by normally investing 35-65% of its assets in equity securities and the remaining assets in fixed-income securities and cash equivalents. The Portfolio normally invests at least 25% of its assets in fixed-income senior securities. Fixed-income securities may include corporate debt securities, U.S. Government obligations, mortgage-backed securities and other mortgage-related products, and short term securities.

Effective May 1, 2007, the Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Flexible Bond Portfolio–Institutional Shares seeks to obtain maximum total return, consistent with preservation of capital. The Portfolio pursues its investment objective by primarily investing, under normal circumstances, at least 80% of its net assets in bonds. Bonds include, but are not limited to, government bonds, corporate bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The Portfolio will invest at least 65% of its assets in investment grade debt securities and will maintain an average-weighted effective maturity of five to ten years. The Portfolio will limit its investment in high-yield/high-risk bonds, also known as “junk bonds,” to 35% or less of its net assets. This Portfolio generates total return from a combination of current income and capital appreciation, but income is usually the dominant portion.

Effective May 1, 2007, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Janus Portfolio–Institutional Shares (formerly Janus Aspen Series Large Cap Growth Portfolio) seeks long-term growth of capital in a manner consistent with the preservation of capital. The Portfolio pursues its investment objective by investing primarily in common stocks selected for their growth potential. Although the Portfolio may invest in companies of any size, it generally invests in larger, more established companies. As of December 31, 2010, the Portfolio’s weighted average market capitalization was $69.9 billion.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Overseas Portfolio–Institutional Shares (formerly Janus Aspen Series International Growth Portfolio) seeks long-term growth of capital. The Portfolio invests, under normal circumstances, at least 80% of its net assets in securities of issuers from countries outside the United States. The Portfolio normally invests in securities of issuers from several different countries, excluding the United States. Although the Portfolio intends to invest substantially all of its assets in issuers located outside of the United States, it may invest in U.S. issuers and it may, under unusual circumstances, invest all of its assets in a single country. The Portfolio may have significant exposure to emerging markets. The Portfolio may also invest in U.S. and foreign debt securities.

Effective May 1, 2007, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Worldwide Portfolio–Institutional Shares (formerly Janus Aspen Series Worldwide Growth Portfolio). Effective through May 15, 2011, the Portfolio seeks long-term growth of capital in a manner consistent with the preservation of capital. The Portfolio pursues its investment objective by investing primarily in common stocks of companies of any size throughout the world. The Portfolio normally invests in issuers from several different countries, including the United States. The Portfolio may, under unusual circumstances, invest in a single country. The Portfolio may have significant exposure to emerging markets. The Portfolio may also invest in foreign equity and debt securities.

Effective May 16, 2011, the Portfolio seeks long-term growth of capital. The Portfolio pursues its investment objective by investing primarily in equity securities, which include, but are not limited to, common stocks, preferred stocks, and depositary receipts of companies of any size located throughout the world. The Portfolio normally invests in issuers from several different countries, including the United States. The Portfolio may, under unusual circumstances, invest in a single country. The Portfolio may have significant exposure to emerging markets. The Portfolio may also invest in foreign equity and debt securities. The portfolio manager applies a “bottom up” approach in choosing investments. In other words, the portfolio manager looks at companies one at a time to determine if a company is an attractive investment opportunity and if it is consistent with the Portfolio’s investment policies. The Portfolio may invest a significant portion of its assets in derivatives, which are instruments that have a value derived from an underlying asset, such as stocks, bonds, commodities, currencies,

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interest rates, or market indices, as substitutes for securities in which the Portfolio invests. The Portfolio intends to invest in derivative instruments (by taking long and/or short positions) including, but not limited to, put and call options, swaps, and forward currency contracts to increase or decrease the Portfolio’s exposure to a particular market, to manage or adjust the risk profile of the Portfolio, and to earn income and enhance returns. The Portfolio may also invest in derivative instruments for other purposes, including hedging (to offset risks associated with an investment, currency exposure, or market conditions).

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Balanced Portfolio–Service Shares seeks long-term capital growth, consistent with preservation of capital and balanced by current income. The Portfolio pursues its investment objective by normally investing 35-65% of its assets in equity securities and the remaining assets in fixed-income securities and cash equivalents. The Portfolio normally invests at least 25% of its assets in fixed-income senior securities. Fixed-income securities may include corporate debt securities, U.S. Government obligations, mortgage-backed securities and other mortgage-related products, and short term securities.

Janus Aspen Flexible Bond Portfolio–Service Shares seeks to obtain maximum total return, consistent with preservation of capital. The Portfolio pursues its investment objective by primarily investing, under normal circumstances, at least 80% of its net assets in bonds. Bonds include, but are not limited to, government bonds, corporate bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The Portfolio will invest at least 65% of its assets in investment grade debt securities and will maintain an average-weighted effective maturity of five to ten years. The Portfolio will limit its investment in high-yield/high-risk bonds, also known as “junk bonds,” to 35% or less of its net assets. This Portfolio generates total return from a combination of current income and capital appreciation, but income is usually the dominant portion.

Janus Aspen Overseas Portfolio–Service Shares (formerly Janus Aspen Series International Growth Portfolio) seeks long-term growth of capital. The Portfolio invests, under normal circumstances, at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in securities of issuers from countries outside the United States. The Portfolio normally invests in securities of issuers from several different countries, excluding the United States. Although the Portfolio intends to invest substantially all of its assets in issuers located outside of the United States, it may invest in U.S. issuers and it may, under unusual circumstances, invest all of its assets in a single country. The Portfolio may have significant exposure to emerging markets. The Portfolio may also invest in U.S. and foreign debt securities.

Lazard Retirement Series, Inc.—advised by Lazard Asset Management, LLC of New York, New York.

Lazard Retirement Emerging Markets Equity Portfolio–Service Shares seeks long term capital appreciation. The Portfolio invests primarily in equity securities, principally common stocks, of non-U.S. companies whose principal activities are located in emerging market countries and that the investment manager believes are undervalued based on their earnings, cash flow or asset values. Under normal circumstances, the Portfolio invests at least 80% of its assets in equity securities of companies whose principal business activities are located in emerging market countries.

Lincoln Variable Insurance Products Trust—advised by Lincoln Investment Advisors Corporation of Fort Wayne, Indiana, and sub-advised by BAMCO, Inc. of New York, New York.

LVIP Baron Growth Opportunities Fund–Service Class Shares seeks capital appreciation through long-term investments in securities of small and mid-sized companies with undervalued assets or favorable growth prospects.

MFS^® Variable Insurance Trust—advised by Massachusetts Financial Services Company of Boston, Massachusetts.

MFS^® Utilities Series–Service Class Shares seeks total return. The Portfolio’s objective may be changed without shareholder approval. MFS normally invests at least 80% of the Portfolio’s net assets in securities of issuers in the utilities industry. MFS considers a company to be in the utilities industry if, at the time of investment, MFS determines that a substantial portion (i.e., at least 50%) of the company’s assets or revenues are derived from one or more utilities. Issuers in the utilities industry include issuers engaged in the manufacture, production, generation, transmission, sale or distribution of electric, gas or other types of energy, water or other sanitary services; and issuers engaged in telecommunications, including telephone, cellular telephone, satellite, microwave, cable television, and other communications media (but not engaged in public broadcasting). MFS primarily invests the Portfolio’s assets in equity securities, but may also invest in debt instruments. MFS primarily invests the Portfolio’s investments in debt instruments in investment grade debt instruments, but may also invest in lower quality debt instruments. MFS may invest the Portfolio’s assets in companies of any size. MFS may invest the Portfolio’s assets in U.S. and foreign securities, including emerging market securities. While MFS may use derivatives for any investment purpose, to the extent MFS uses derivatives, MFS expects to use derivative primarily to increase or decrease currency exposure. MFS uses a bottom-up investment approach in buying and selling investments for the Portfolio. Investments are selected primarily based

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on fundamental analysis of individual issuers and/or instruments in light of the issuer’s current financial condition and market, economic, political, and regulatory conditions. Factors considered for equity securities may include analysis of an issuer’s earnings, cash flows, competitive position, and management ability. Factors considered for debt instruments may include the instrument’s credit quality, collateral characteristics and indenture provisions and the issuer’s management ability, capital structure, leverage, and ability to meet its current obligations. Quantitative models that systematically evaluate the valuation, price and earnings momentum, earnings quality, and other factors of the issuer of an equity security or the structure of a debt instrument may also be considered.

MFS^® Variable Insurance Trust II—advised by Massachusetts Financial Services Company of Boston, Massachusetts.

MFS^® International Value Portfolio–Service Class Shares seeks capital appreciation. MFS normally invests the Portfolio’s assets primarily in foreign equity securities, including emerging market equity securities. MFS may invest in a relatively large percentage of the Portfolio’s assets in issuers a single country, a small number of countries, or a particular geographic region. MFS focuses on investing the Portfolio’s assets in the stocks of companies that it believes are undervalued compared to their perceived worth (value companies). Value companies tend to have stock prices that are low relative to their earnings, dividends, assets, or other financial measures. MFS may invest the Portfolio’s assets in companies of any size. MFS uses a bottom-up investment approach to buying and selling investments for the Portfolio. Investments are selected primarily based on fundamental analysis of individual issuers and their potential in light of their current financial condition, and market, economic, political, and regulatory conditions. Factors considered may include analysis of an issuer’s earnings, cash flows, competitive position, and management ability. Quantitative models that systematically evaluate an issuer’s valuation, price and earnings momentum, earnings quality, and other factors may also be considered.

Nationwide Variable Insurance Trust—advised by Nationwide Fund Advisors of King of Prussia, Pennsylvania, and sub-advised by BlackRock Investment Management, LLC of Plainsboro, New Jersey.

NVIT Mid Cap Index Fund–Class II Shares (formerly GVIT Mid Cap Index Fund) seeks capital appreciation. Under normal conditions, the Portfolio invests at least 80% of its net assets in equity securities of companies included in, or other instruments that are correlated with, the S&P 400 Index, such as derivates linked to that index.

Neuberger Berman Advisers Management Trust—advised by Neuberger Berman Management LLC of New York, New York.

Neuberger Berman AMT Regency Portfolio–Class S Shares seeks growth of capital. To pursue this goal, the Portfolio invests mainly in common stocks of mid-capitalization companies, which it defines as those with a total market capitalization within the market capitalization range of the Russell Midcap^® Index. The Portfolio seeks to reduce risk by diversifying among many companies, industries and sectors.

Effective May 1, 2009, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Oppenheimer Variable Account Funds—advised by OppenheimerFunds, Inc. of New York, New York.

Oppenheimer Global Securities Fund/VA seeks long term capital appreciation by investing a substantial portion of its assets in securities of foreign issuers, “growth-type” companies, cyclical industries and special situations that are considered to have appreciation possibilities. Under normal market conditions, the Portfolio invests mainly in common stocks of U.S. and foreign companies. The Portfolio can invest without limit in foreign securities and can invest in any country, including countries with developed or emerging markets. However, the Portfolio currently emphasizes investments in developed markets such as the United States, Western Europe countries and Japan. The Portfolio does not limit its investments to companies in a particular capitalization range, but currently focuses its investments in mid- and large-cap companies. The Portfolio is not required to allocate its investments in any set percentages in any particular countries. As a fundamental policy, the Portfolio normally will invest in at least three countries (one of which may be the United States). Typically, the Portfolio invests in a number of different countries.

PIMCO Variable Insurance Trust—advised by Pacific Investment Management Company LLC of Newport Beach, California.

PIMCO VIT High Yield Portfolio –Administrative Class Shares seeks maximum total return, consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing under normal circumstances at least 80% of its assets in a diversified portfolio of high yield securities (“junk bonds”), which may be represented by forwards or derivatives such as options, futures or swap agreements, rated below investment grade by Moody’s,

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or equivalently rated by S&P or Fitch, or, if unrated, determined by Pacific Investment Management Company LLC (“PIMCO”) to be of comparable quality. The Portfolio may invest up to 20% of its total assets in securities rated Caa or below by Moody’s, or equivalently rated by S&P or Fitch, or, if unrated, determined by PIMCO to be of comparable quality. The remainder of the Portfolio’s assets may be invested in investment grade Fixed Income Instruments. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The average portfolio duration of this Portfolio normally varies within two years (plus or minus) of the duration of the BofA Merrill Lynch U.S. High Yield BB-B Rated Constrained Index, which as of March 31, 2010 was 4.50 years. Duration is a measure of the expected life of a fixed income security that is used to determine the sensitivity of a security’s price to changes in interest rates. The Portfolio may invest up to 15% of its total assets in securities and instruments that are economically tied to emerging market countries. The Portfolio may invest up to 20% of its total assets in securities denominated in foreign currencies and may invest beyond this limit in U.S. dollar-denominated securities of foreign issuers. The Portfolio will normally limit its foreign currency exposure (from non-U.S. dollar-denominated securities or currencies) to 20% of its total assets.

PIMCO VIT Low Duration Portfolio–Administrative Class Shares (formerly PIMCO VIT Low Duration Bond Portfolio) seeks maximum total return, consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing under normal circumstances at least 65% of its total assets in a diversified portfolio of Fixed Income Instruments of varying maturities, which may be represented by forwards or derivatives such as options, futures contracts, or swap agreements. The average portfolio duration of this Portfolio normally varies from one to three years based on PIMCO’s forecast for interest rates. The Portfolio invests primarily in investment grade debt securities, but may invest up to 10% of its total assets in high yield securities (“junk bonds”) rated B or higher by Moody’s, or equivalently rated by S&P or Fitch, or, if unrated, determined by PIMCO to be of comparable quality. The Portfolio may invest up to 30% of its total assets in securities denominated in foreign currencies, and may invest beyond this limit in U.S. dollar-denominated securities of foreign issuers. The Portfolio will normally limit its foreign currency exposure (from non-U.S. dollar-denominated securities or currencies) to 20% of its total assets. The Portfolio may invest up to 10% of its total assets in securities and instruments that are economically tied to emerging market countries.

PIMCO VIT Total Return Portfolio–Administrative Class Shares seeks maximum total return, consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing under normal circumstances at least 65% of its total assets in a diversified portfolio of Fixed Income Instruments of varying maturities, which may be represented by forwards or derivatives such as options, futures contracts, or swap agreements. The average portfolio duration of this fund normally varies within two years (plus or minus) of the duration of the Barclays Capital U.S. Aggregate Index, which as of June 30, 2010 was 4.30 years. Duration is a measure of the expected life of a fixed income security that is used to determine the sensitivity of a security’s price to changes in interest rates. The Portfolio invests primarily in investment grade debt securities, but may invest up to 10% of its total assets in high yield securities (“junk bonds”) rated B or higher by Moody’s Investor’s Services, Inc., or equivalently rated by S&P or Fitch or, if unrated, determined by PIMCO to be of comparable quality. The Portfolio may invest up to 15% of its total assets in securities and instruments that are economically tied to emerging market countries. The Portfolio may invest up to 30% of its total assets in securities denominated in foreign currencies, and may invest beyond this limit in U.S. dollar denominated securities of foreign issuers. The Portfolio may invest up to 15% of its total assets in securities and instruments that are economically tied to emerging market countries. The Portfolio will normally limit its foreign currency exposure (from non-U.S. dollar-denominated securities or currencies) to 20% of its total assets. The Portfolio may invest, without limitation, in derivative instruments, such as options, futures contracts or swap agreements, or in mortgage- or asset-backed securities, subject to applicable law and any other restrictions described in the Portfolio’s prospectus or Statement of Additional Information. The Portfolio may purchase or sell securities on a when-issued, delayed delivery or forward commitment basis and may engage in short sales. The Portfolio may invest up to 10% of its total assets in preferred stock, convertible securities and other equity related securities.

Pioneer Variable Contracts Trust—advised by Pioneer Investment Management, Inc. of Boston, Massachusetts.

Pioneer Fund VCT Portfolio–Class I Shares seeks reasonable income and capital growth. The Portfolio invests in a broad group of carefully selected securities that the Portfolio’s adviser believes are reasonably priced, rather than securities whose prices reflect a premium resulting from their current market popularity. The Portfolio invests predominately in equity securities.

Pioneer Growth Opportunities VCT Portfolio–Class I Shares seeks growth of capital. The Portfolio invests primarily in equity securities of companies that the Portfolio‘s investment adviser considers to be reasonably priced or undervalued, with above average growth potential.

Pioneer Mid Cap Value VCT Portfolio–Class II Shares seeks capital appreciation by investing in a diversified portfolio of securities consisting primarily of common stocks. Normally, the Portfolio invests at least 80% of its total assets in equity securities of mid-size companies.

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The Prudential Series Fund, Inc.—managed by Prudential Investments LLC of Newark, New Jersey and sub-advised by Jennison Associates, LLC of New York, NY and Salomon Brothers Asset Management of New York, NY.

The Prudential Series Fund Equity Portfolio–Class II Shares seeks long term growth of capital by investing in common stock of major established companies (companies within the market capitalization range of the Russell 1000^® Index) as well as smaller companies. Sub-advised by Jennison Associates, LLC of New York, NY.

Putnam Variable Trust—advised by Putnam Investments, LLC of Boston, Massachusetts.

Putnam VT American Government Income Fund-Class IB Shares seeks high current income with preservation of capital as its secondary objective. The fund invests mainly in bonds that are securitized debt instruments (such as mortgage backed investments) that are obligations of the U.S. government, its agencies and instrumentalities and accordingly are backed by the full faith and credit of the United States (e.g. U.S. Treasury bonds and Ginnie Mae mortgage-backed bonds) or by only the credit of a federal agency or government-sponsored entity (e.g. Fannie Mae and Freddie Mac mortgage-backed bonds); and have intermediate- to long-term maturities (three years or longer). Under normal circumstances, the fund invests at least 80% of the fund’s net assets in U.S. government securities.

Putnam VT Equity Income Fund-Class IB Shares seeks capital growth and current income. The fund invests mainly in common stocks of U.S. companies, with a focus on value stocks that offer the potential for current growth, current income, or both. Under normal circumstances, the fund invests at least 80% of the fund’s net assets in common stocks and other equity investments that offer the potential for current income.

Putnam VT Global Health Care Fund-Class IB Shares seeks capital appreciation. The fund invests mainly in common stocks (growth or value stocks or both) of large and midsize companies worldwide that the fund believes have favorable investment potential. The fund considers, among other factors, a company’s valuation, financial strength, competitive position in its industry, projected future earnings, cash flows and dividends when deciding whether to buy or sell investments. The fund also uses derivatives, such as futures, options, warrants, and swap contracts, for both hedging and non-hedging purposes and the fund may engage in short sales of securities.

Royce Capital Fund—managed by Royce & Associates, LLC of New York, New York.

Royce Capital Fund - Small-Cap Portfolio–Service Class Shares seeks long-term growth of capital. The Portfolio’s investment adviser invests the Portfolio’s assets primarily in equity securities of small-cap companies, those with market capitalizations from $500 million to $2.5 billion. The Portfolio manager generally looks for companies that have excellent business strengths and/or prospects for growth, high internal rates of return and low leverage, and that are trading significantly below its estimate of their current worth. Normally, the Portfolio invests at least 80% of its net assets in the equity securities of small-cap companies. Although the Portfolio normally focuses on the securities of U.S. companies, it may invest up to 25% of its net assets in foreign securities.

Schwab Annuity Portfolios—advised by Charles Schwab Investment Management, Inc. of San Francisco, California.

Schwab MarketTrack Growth Portfolio II™ seeks high capital growth with less volatility than an all stock portfolio.

Schwab Money Market Portfolio™ seeks the highest current income consistent with stability of capital and liquidity. This Portfolio is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. There can be no assurance that the Portfolio will be able to maintain a stable net asset value of $1.00 per share.

Schwab S&P 500 Index Portfolio seeks to track the total return of the S&P 500^® Index.

Sentinel Variable Products Trust—advised by Sentinel Asset Management, Inc. of Montpelier, Vermont.

Sentinel Variable Products Small Company Fund seeks growth of capital. The Portfolio normally invests at least 80% of its net assets in small-capitalization companies. This principal investment strategy is a non-fundamental policy that may not be changed without 60 days’ prior notice to the Portfolio’s shareholders. For this purpose, small companies are considered to be companies that have, at the time of purchase, market capitalizations of less than $3 billion. The Portfolio invests primarily in common stocks of small companies that Sentinel believes are high quality, have superior business models, solid management teams, sustainable growth potential and are attractively valued. The weighted median market capitalization of the Portfolio’s holdings as of March 31, 2010 was $2.10 billion. Market capitalization is the total value of all the outstanding shares of common stock of a company.

Sentinel Variable Products Common Stock Fund seeks a combination of growth of capital, current income, growth of income and relatively low risk as compared with the stock market as a whole. The Portfolio normally invests at least 80% of its net

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assets in common stocks. This principal investment strategy is a non-fundamental policy that may not be changed without 60 days’ prior written notice to the Portfolio’s shareholders. The Portfolio invests mainly in a diverse group of common stocks of well-established companies, typically above $5 billion in market capitalization, most of which pay regular dividends. When appropriate, the Portfolio also may invest in preferred stocks or debentures convertible into common stocks. Up to 25% of the Portfolio’s assets may be invested in securities within a single industry. The Portfolio may invest without limitation in foreign securities, although only where the securities are trading in the U.S. or Canada and only where trading is denominated in U.S. or Canadian dollars.

Sentinel Variable Products Bond Fund seeks high current income while seeking to control risk. The Portfolio invests mainly in investment grade bonds. The Portfolio will invest exclusively in fixed-income securities, and to a limited extent in related derivatives. At least 80% of the Portfolio’s assets will normally be invested in the following types of bonds: (1) Corporate bonds which at the time of purchase are rated within the four highest rating categories of Moody’s, Standard & Poor’s or any other nationally recognized statistical rating organization; (2) Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities, including mortgage-backed securities and dollar roll transactions; (3) Debt securities (payable in U.S. dollars) issued or guaranteed by Canadian governmental entities; and (4) Debt obligations of domestic banks or bank holding companies, even though not rated by Moody’s or Standard & Poor’s, that Sentinel believes have investment qualities comparable to investment-grade corporate securities. The Portfolio’s policy of investing, under normal circumstances, at least 80% of its assets in bonds is a nonfundamental policy that may not be changed without 60 days’ prior notice to the Portfolio’s shareholders. The Portfolio may also invest in other fixed income securities, such as straight or convertible debt securities and straight or convertible preferred stocks. The Portfolio will invest no more than 20% of its total assets in lower quality bonds, sometimes called “junk bonds.” These bonds, because of the greater possibility that the issuers will default, are not investment grade - that is, they are rated below BBB by Standard & Poor’s or below Baa by Moody’s, or are unrated but considered by Sentinel to be of comparable credit quality. Up to 25% of the Portfolio’s assets may be invested in securities within a single industry. The Portfolio utilizes an active trading approach, which may result in portfolio turnover greater than 100%.

Third Avenue Variable Series Trust—advised by Third Avenue Management LLC, of New York, New York.

Third Avenue Value Portfolio Variable Series Trust Shares seeks long-term capital appreciation mainly by acquiring common stocks of well-financed companies (meaning companies with high quality assets and a relative absence of liabilities) at a discount to what the adviser believes is their intrinsic value (meaning the value of the company’s net assets or the adviser’s estimate of what the issuer would be worth as a takeover or merger candidate). The Portfolio also seeks to acquire senior securities, and debt instruments (including high-yield and “junk” bonds and distressed securities that may be in default and may have any or no credit rating from a credit rating agency) where the adviser determines that these securities can be purchased at less than the value of the assets securing the debt or the amount that would be realized in a restricting. The adviser searches for companies that meet these criteria all over the world and makes investment decisions based primarily on the attributes of each individual company and security rather than any estimates of macro-economic or sector performance. Accordingly, the Portfolio may invest in foreign securities, some of which may be denominated in or tied to currencies of the countries in which they are primarily traded. The Portfolio may invest in companies of any market capitalization, including companies that are considered ranging from small-cap to large-cap by relevant rating and tracking agencies such as S&P. When the Portfolio acquires debt securities, it primarily does so where the adviser believes that those securities will be worth significantly more when they are eventually sold, redeemed, mature or are converted into another form through a company restructuring. These securities may be defaulted or may be paying a current yield, but the Portfolio does not generally seek interest income as a primary strategy. The adviser, on behalf of the Portfolio, may also participate on committees formed by the creditors to negotiate with debtors with respect to restructuring issues. The Portfolio is non-diversified. This means that the Portfolio may have investments in fewer issuers than a diversified portfolio of comparable size.

Effective May 1, 2009, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Touchstone Variable Series Trust—advised by Touchstone Advisors, Inc. of Cincinnati, Ohio.

Touchstone Mid Cap Growth Fund–Class I Shares seeks to increase the value of portfolio shares as a primary goal and to earn income as a secondary goal. Under normal circumstances, the fund will invest at least 80% of its assets in common stocks of mid cap U.S. companies. This is a non-fundamental investment policy that can be changed by the fund upon 60 days’ prior notice to shareholders. A mid cap company has a market capitalization between $1.5 billion and $12 billion or within the range of market capitalizations represented in the Russell Midcap Index (between $1.3 billion and $14 billion at the time of its most

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recent reconstitution on May 31, 2010) at the time of purchase. The fund may also invest in companies in the technology sector.

The Universal Institutional Funds, Inc.—advised by Morgan Stanley Investment Management Inc. (“MSIM”) of New York, New York.

Universal Institutional Funds Inc. U.S. Real Estate Portfolio–Class I Shares seeks to provide above average current income and long-term capital appreciation by investing primarily in equity securities of companies engaged in the U.S. real estate industry, including real estate investment trusts.

Van Eck VIP Trust—advised by Van Eck Associates Corporation of New York New York.

Van Eck VIP Global Bond Fund–Initial Class Shares (formerly Van Eck Insurance Trust Worldwide Bond Fund) seeks high total return—income plus capital appreciation—by investing globally, primarily in a variety of debt securities.

Wells Fargo Variable Trust Funds—advised by Wells Fargo Funds Management, LLC, a subsidiary of Wells Fargo & Company, located in San Francisco, California.

Wells Fargo Advantage VT Opportunity Fund–Class 2 Shares (formerly Wells Fargo Advantage VT Opportunity Fund– Class VT Shares) seeks long-term capital appreciation. Under normal circumstances, the fund invests at least 80% of the fund’s total assets in equity securities and up to 25% of the fund’s total assets in equity securities of foreign issuers, including ADRs and similar investments. The fund invests principally in equity securities of medium-capitalization companies, which the fund defines as those within the range of market capitalizations of companies in the Russell Midcap^® Index. Furthermore, the fund may use futures, options, repurchase or reverse repurchase agreements or swap agreements, as well as other derivatives, to manage risk or to enhance return. The fund reserves the right to hedge the fund’s foreign currency exposure to purchasing or selling currency futures and foreign currency forward contracts. However, under normal circumstances, the fund will not engage in extensive foreign currency hedging.

Wells Fargo Advantage VT Small Cap Value Fund–Class 2 Shares (formerly Wells Fargo Advantage VT Small/Mid Cap Value Fund) seeks long-term capital appreciation. Under normal circumstances, the fund invests at least 80% of the fund’s net assets in equity securities of small-capitalization companies and up to 30% of the fund’s total assets in equity securities of foreign issuers, including ADRs and similar investments. The fund invests principally in equity securities of small-capitalization companies, which the fund defines as companies with market capitalizations within the range of the Russell 2500^TM Index. The fund may also invest in equity securities of foreign issuers through ADRs and similar investments. Furthermore, the fund may use futures, options or swap agreements, as well as other derivatives, to manage risk or to enhance return.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Meeting Investment Objectives

Meeting investment objectives depends on various factors, including, but not limited to, how well the Portfolio managers anticipate changing economic and market conditions. There is no guarantee that any of these Portfolios will achieve their stated objectives.

Where to Find More Information About the Portfolios

Additional information about the investment objectives and policies of all the Portfolios and the investment advisory and administrative services and charges can be found in the current Portfolio Prospectuses, which can be obtained without charge from the Annuity Service Center. You may also visit www.Schwab.com/annuity.

The Portfolio Prospectuses should be read carefully before any decision is made concerning the allocation of Contributions to, or Transfers among, the Sub-Accounts.

Addition, Deletion or Substitution

Great-West does not control the Portfolios and cannot guarantee that any of the Portfolios will always be available for allocation of Contributions or Transfers. We retain the right to make changes in the Series Account and in its investments.

Great-West and GWFS Equities, Inc. (“GWFS”), the principal underwriter and distributor of the Contracts, reserve the right to discontinue the offering of any Portfolio. If a Portfolio is discontinued, we may substitute shares of another Portfolio or shares

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of another investment company for the discontinued Portfolio’s shares. Any share substitution will comply with the requirements of the 1940 Act.

If you are contributing to a Sub-Account corresponding to a Portfolio that is being discontinued, you will be given notice prior to the Portfolio’s elimination.

Based on marketing, tax, investment and other conditions, we may establish new Sub-Accounts and make them available to Owners at our discretion. Each additional Sub-Account will purchase shares in a Portfolio or in another mutual fund or investment vehicle.

If, in our sole discretion, marketing, tax, investment or other conditions warrant, we may also eliminate one or more Sub-Accounts. If a Sub-Account is eliminated, we will notify you and request that you reallocate the amounts invested in the eliminated Sub-Account.

The Guarantee Period Fund

The Guarantee Period Fund is no longer offered as an investment option under the Contract. As a result, new Contributions and Transfers into the Guarantee Period Fund are no longer accepted.

The Guarantee Period Fund is not part of the Series Account. Amounts previously allocated to the Guarantee Period Fund were deposited to, and accounted for, in a non-unitized market value separate account. As a result, you do not participate in the performance of the assets through unit values.

Consequently, these assets accrue solely to the benefit of Great-West and any gain or loss in the non-unitized market value separate account is borne entirely by Great-West. You will receive the Contract guarantees made by Great-West for amounts you contribute to the Guarantee Period Fund.

In addition, a new Market Value Adjustment (“MVA”) for existing Guarantee Periods in the Guarantee Period Fund is available in all states. Your Contract has been amended by an endorsement to contractually waive any negative MVA on existing Guarantee Periods. Prior to the endorsement, your Contract was subject to a negative MVA, which may have resulted in an effective interest rate lower than the Guaranteed Interest Rate and the value of the Contribution(s) allocated to a Guarantee Period being less than the Contribution(s) made. The purpose of the endorsement is to enhance the MVA formula (described below) for your Contract by eliminating any downward MVA that might be applied to withdrawals and transfers out of an existing Guarantee Period. Thus, regardless of any changes in interest rates, if you withdraw money from an existing Guarantee Period before it expires, we will not impose an MVA that would reduce your surrender value. However, we will continue to apply any positive MVA that would increase your surrender value.

The new MVA will automatically apply to any amounts you currently have allocated to the current Guarantee Period Fund. Other than the new MVA formula, the terms and conditions of the Guarantee Period Fund remained unchanged. The new MVA is described in more detail, below.

If you provided us with standing instructions relating to premium payment allocations or automatic custom transfers, including systematic transfers as part of a dollar cost averaging strategy or Rebalancer transfers as part of an asset allocation plan, you need to provide alternative allocation instructions if your instructions include the Guaranteed Period Fund. If you have not provided alternative allocation instructions, amounts that otherwise would have been allocated to the Guaranteed Period Fund in accordance with your standing instructions will instead be allocated to the Schwab Money Market Sub-Account.

Investments of the Guarantee Period Fund

We use various techniques to invest in assets that have similar characteristics to our general account assets—especially cash flow patterns. We will primarily invest in investment-grade fixed income securities including:

• Securities issued by the U.S. Government or its agencies or instrumentalities, which may or may not be guaranteed by the U.S. Government.

• Debt securities which have an investment grade, at the time of purchase, within the four highest grades assigned by Moody’s Investment Services, Inc. (Aaa, Aa, A or Baa), Standard & Poor’s Corporation (AAA, AA, A or BBB) or any other nationally recognized rating service.

• Other debt instruments, including, but not limited to, issues of banks or bank holding companies and of corporations, which obligations—although not rated by Moody’s, Standard & Poor’s, or other nationally recognized rating firms—are deemed by us to have an investment quality comparable to securities which may be purchased as stated above.

• Commercial paper, cash, or cash equivalents and other short-term investments having a maturity of less than one year which are considered by us to have investment quality comparable to securities which may be purchased as stated above.

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In addition, we may invest in futures and options solely for non-speculative hedging purposes. We may sell a futures contract or purchase a put option on futures or securities to protect the value of securities held in or to be sold for the general account or the non-unitized market value separate account if the securities prices are anticipated to decline. Similarly, if securities prices are expected to rise, we may purchase a futures contract or a call option against anticipated positive cash flow or may purchase options on securities.

The above information generally describes the investment strategy for the Guarantee Period Fund. However, we are not obligated to invest the assets in the Guarantee Period Fund according to any particular strategy, except as may be required by Colorado and other state insurance laws. The stated rate of interest that we establish will not necessarily relate to the performance of the non-unitized market value separate account.

Breaking a Guarantee Period

If you begin annuity payouts, Transfer or withdraw prior to the Guarantee Period Maturity Date, you are breaking a Guarantee Period. When we receive a request to break a Guarantee Period and you have another Guarantee Period that is closer to its maturity date, we will break that Guarantee Period first.

If you break a Guarantee Period prior to the Guarantee Period Maturity Date, we apply an interest rate adjustment called a Market Value Adjustment that may increase (but not decrease) the amount Transferred or withdrawn from the value of a Guarantee Period.

Interest Rates

The declared annual rates of interest are guaranteed throughout the Guarantee Period. The stated rate of interest must be at least equal to the Guaranteed Interest Rate, but Great-West may declare higher rates. The Guaranteed Interest Rate is based on the applicable state standard non-forfeiture law.

We guarantee an effective yearly interest rate that complies with the non-forfeiture law that is in effect on the issue date for the state in which this Contract was delivered.

The determination of the stated interest rate is influenced by, but does not necessarily correspond to, interest rates available on fixed income investments which Great-West may acquire using funds deposited into the Guarantee Period Fund. In addition, Great-West considers regulatory and tax requirements, sales and administrative expenses, general economic trends and competitive factors in determining the stated interest rate.

The Market Value Adjustment

Amounts you allocate to the Guarantee Period Fund may be subject to an interest rate adjustment called a Market Value Adjustment that may increase (but not decrease) the amounts allocated if, six months or more before a Guarantee Period Fund’s Maturity Date, you:

• surrender your investment in the Guarantee Period Fund;

• transfer money from the Guarantee Period Fund;

• partially withdraw money from the Guarantee Period Fund;

• take a periodic withdrawal;

• apply amounts from the Guarantee Period Fund to purchase an annuity to receive payouts from your account; or

• take a distribution from the Guarantee Period Fund upon the death of the Owner or the Annuitant.

The Market Value Adjustment will not apply to any Guarantee Period having fewer than six months prior to the Guarantee Period Maturity Date in each of the following situations:

• transfer to a Sub-Account offered under this Contract;

• surrenders, partial withdrawals, annuitization or periodic withdrawals; or

• a single sum payout upon death of the Owner or Annuitant.

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The Market Value Adjustment may only increase the amount payable on the above-described distributions. The formula for calculating Market Value Adjustments and examples of how the Market Value Adjustments work are detailed in Appendix B.

As a result of the issuance of the endorsement, the interests under the Contract relating to the Guarantee Period Fund will no longer be securities registered under the Securities Act of 1933.

Subsequent Contributions

You can make subsequent Contributions at any time prior to the Payout Commencement Date, as long as the Annuitant is living. Additional Contributions must be at least $500, or $100 if made via an Automatic Contribution Plan. Total Contributions may exceed $1,000,000 only with our prior approval. Additional Contributions will be credited on the date received by the Annuity Service Center at GWL&A if received before 4:00 p.m. ET and the NYSE is open for business. Additional Contributions received after 4:00 p.m. ET will be credited on the next business day the NYSE is open for business.

Subsequent Contributions can be made by check or via an Automatic Contribution Plan directly from your bank or savings account. You can designate the date you’d like your subsequent Contributions deducted from your account each month. If you make subsequent Contributions by check, your check should be payable to GWL&A.

You’ll receive a confirmation of each Contribution you make upon its acceptance.

Great-West reserves the right to modify the limitations set forth in this section.

Annuity Account Value

Prior to the Annuity Commencement Date, your Annuity Account Value is the sum of the Variable and Fixed Account Values established under your Contract.

Before your Annuity Commencement Date, the Variable Account Value is the total dollar amount of all Accumulation Units credited to you for each Sub-Account. Initially, the value of each Accumulation Unit was set at $10.00. Each Sub-Account’s value prior to the Annuity Commencement Date is equal to:

• net Contributions allocated to the corresponding Sub-Account,

• plus or minus any increase or decrease in the value of the assets of the Sub-Account due to investment results,

• minus the daily mortality and expense risk charge,

• minus any applicable reductions for the Contract Maintenance Charge deducted on the Contract anniversary date,

• minus any applicable Transfer fees, and

• minus any withdrawals or Transfers from the Sub-Account.

The value of a Sub-Account’s assets is determined at the end of each day that the NYSE is open for regular business (a “valuation date”). A valuation period is the period between successive valuation dates. It begins at the close of the NYSE (generally 4:00 p.m. ET) on each valuation date and ends at the close of the NYSE on the next succeeding valuation date.

The Variable Account Value is expected to change from valuation period to valuation period, reflecting the investment experience of the selected Sub-Account(s), as well as the deductions for applicable charges.

Upon allocating Variable Account Values to a Sub-Account you will be credited with variable Accumulation Units in that Sub-Account. The number of Accumulation Units you will be credited is determined by dividing the portion of each Contribution allocated to the Sub-Account by the value of an Accumulation Unit. The value of the Accumulation Unit is determined and credited at the end of the valuation period during which the Contribution was received.

Each Sub-Account’s Accumulation Unit value is established at the end of each valuation period. It is calculated by multiplying the value of that unit at the end of the prior valuation period by the Sub-Account’s Net Investment Factor for the valuation period. The formula used to calculate the Net Investment Factor is discussed in Appendix C.

Unlike a brokerage account, amounts held under a Contract are not covered by the Securities Investor Protection Corporation (“SIPC”).

Transfers

At any time while your Contract is in force, you may Transfer all or part of your Annuity Account Value among and between the Sub-Accounts by telephone, in writing by sending a Request to the Annuity Service Center, or through the Internet at www.schwab.com/annuity where you will be redirected to a Great-West website where you may make the Transfer. Incoming Transfers to closed Sub-Accounts are not permitted.

Your Request must specify:

• the amounts being Transferred;

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• the Sub-Account(s) from which the Transfer is to be made; and

• the Sub-Account(s) that will receive the Transfer.

Currently, there is no limit on the number of Transfers you can make among the Sub-Accounts during any calendar year, subject to certain restrictions discussed in this section. We reserve the right to limit the number of Transfers you make.

There is no charge for the first 12 Transfers each calendar year, but there will be a charge of $10 for each additional Transfer made. The charge will be deducted from the amount Transferred. All Transfers made on a single Transaction Date will count as only one Transfer toward the 12 free Transfers. However, if a one-time rebalancing Transfer also occurs on the Transaction Date, it will be counted as a separate and additional Transfer.

A Transfer generally will be effective on the date the Request for Transfer is received by the Annuity Service Center at Great-West if received before 4:00 p.m. ET. Requests received after 4:00 p.m. ET will be effective on the next business day we and the NYSE are open for business. Under current tax law, there will not be any tax liability to you if you make a Transfer.

Transfers involving the Sub-Accounts will result in the purchase and/or cancellation of Accumulation Units having a total value equal to the dollar amount being transferred. The purchase and/or cancellation of such units is made using the Variable Account Value as of the end of the valuation date on which the Transfer is effective.

Transfers among the Sub-Accounts may also be subject to certain terms and conditions imposed by the Portfolios that could result in a Transfer request being rejected or the pricing for that Transfer delayed. Please review the respective Portfolio prospectus for details on any Portfolio level restrictions.

When you make a Transfer from amounts in a Guarantee Period before the Guarantee Period Maturity Date, the amount Transferred may be subject to a Market Value Adjustment as discussed on page XX. If you request in advance to Transfer amounts from a maturing Guarantee Period upon maturity, your Transfer will not count toward the 12 free Transfers and no Transfer fees will be charged.

Market Timing and Excessive Trading

The Contracts are intended for long-term investment and not for the purpose of market timing or excessive trading activity. Market timing activity may dilute the interests of Contract Owners in the underlying Portfolios. Market timing generally involves frequent or unusually large Transfers that are intended to take advantage of short-term fluctuations in the value of a Portfolio’s portfolio securities and the reflection of that change in the Portfolio’s share price. In addition, frequent or unusually large Transfers may harm performance by increasing Portfolio expenses and disrupting Portfolio management strategies. For example, excessive trading may result in forced liquidations of portfolio securities or cause the Portfolio to keep a relatively higher cash position, resulting in increased brokerage costs and lost investment opportunities.

We maintain procedures designed to prevent or minimize market timing and excessive trading (collectively, “prohibited trading”) by Owners. As part of those procedures, certain of the Portfolios have instructed us to perform standardized trade monitoring, while other Portfolios perform their own monitoring and request reports of the Owner’s trading activity if prohibited trading is suspected. If an Owner’s trading activity is determined to constitute prohibited trading, as defined by the applicable Portfolio, Great-West will notify the Owner that a trading restriction will be implemented if the Owner does not cease the prohibited trading. Some Portfolios may require that trading restrictions be implemented immediately without warning, in which case we will notify the Owner of the restriction imposed by the Portfolio(s), as applicable.

If a Portfolio determines, or, for Portfolios for which we perform trade monitoring, we determine based on the applicable Portfolio’s definition of prohibited trading, that the Owner continues to engage in prohibited trading, we will restrict the Owner from making Transfers into the identified Portfolio(s) for the period of time specified by the Portfolio(s). Restricted Owners will be permitted to make Transfers out of the identified Portfolio(s) to other available Portfolio(s). When the Portfolio’s restriction period has been met, the Owner will automatically be allowed to resume Transfers into the identified Portfolio(s).

For Portfolios that perform their own monitoring, the Series Account does not impose trading restrictions unless or until a Portfolio first detects and notifies us of prohibited trading activity. Accordingly, we cannot prevent all prohibited trading activity before it occurs, as it may not be possible to identify it unless and until a trading pattern is established. To the extent such Portfolios do not detect and notify us of prohibited trading or the trading restrictions we impose fail to curtail it, it is possible that a market timer may be able to make prohibited trading transactions with the result that the management of the Portfolios may be disrupted and the Owners may suffer detrimental effects such as increased costs, reduced performance, and dilution of their interests in the affected Portfolios.

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We endeavor to ensure that our procedures are uniformly and consistently applied to all Owners, and we do not exempt any persons from these procedures. We do not enter into agreements with Owners whereby we permit prohibited trading. Subject to applicable state law and the terms of each Contract, we reserve the right without prior notice to modify, restrict, suspend or eliminate the Transfer privileges (including telephone Transfers) at any time, to require that all Transfer Requests be made by you and not by your designee, and to require that each Transfer Request be made by a separate communication to us. We also reserve the right to require that each Transfer Request be submitted in writing and be signed by you.

The Portfolios may have adopted their own policies and procedures with respect to frequent purchases and redemptions of their respective shares. The prospectuses for the Portfolios should describe any policies and procedures relating to restricting prohibited trading. The frequent trading policies and procedures of a Portfolio may be different, and more or less restrictive, than the frequent trading policies and procedures of other Portfolios and the policies and procedures we have adopted to discourage prohibited trading. For example, a Portfolio may impose a redemption fee. The Owner should also be aware that we are legally obligated to provide (at the Portfolios’ request) information about each amount you cause to be deposited into a Portfolio (including by way of premium payments and Transfers under your Contract) or removed from the Portfolio (including by way of withdrawals and Transfers under your Contract). If a Portfolio identifies you as having violated the Portfolio’s frequent trading policies and procedures, we are obligated, if the Portfolio requests, to restrict or prohibit any further deposits or exchanges by you in respect to that Portfolio. Under rules recently adopted by the SEC we are required to: (1) enter into a written agreement with each Portfolio or its principal underwriter that will obligate us to provide to the Portfolio promptly upon request certain information about the trading activity of individual Owners and (2) execute instructions from the Portfolio to restrict or prohibit further purchases or Transfers by specific Owners who violate the frequent trading policies established by the Portfolio. Accordingly, if you do not comply with any Portfolio’s frequent trading policies and procedures, you may be prohibited from directing any additional amounts into that Portfolio or directing any Transfers or other exchanges involving that Portfolio. You should review and comply with each Portfolio’s frequent trading policies and procedures, which are disclosed in the Portfolios’ current prospectuses.

We may revise our market timing and excessive trading policy and related procedures at our sole discretion, at any time and without prior notice, as we deem necessary or appropriate to comply with state or federal regulatory requirements or to impose additional or alternative restrictions on Owners engaging in prohibited trading. In addition, our orders to purchase shares of the Portfolios are generally subject to acceptance by the Portfolio, and in some cases a Portfolio may reject or reverse our purchase order. Therefore, we reserve the right to reject any Owner’s Transfer Request if our order to purchase shares of the Portfolio is not accepted by, or is reversed by, an applicable Portfolio.

You should note that other insurance companies and retirement plans may also invest in the Portfolios and that those companies or plans may or may not have their own policies and procedures on frequent Transfers. You should also know that the purchase and redemption orders received by the Portfolios generally are “omnibus” orders from intermediaries such as retirement plans or separate accounts funding variable insurance contracts. Omnibus orders reflect the aggregation and netting of multiple orders from individual retirement plan Owners and/or individual owners of variable insurance contracts. The nature of such orders may limit the Portfolios’ ability to apply their respective frequent trading policies and procedures. As a result, there is a risk that the Portfolios may not be able to detect potential prohibited trading activities in the omnibus orders they receive. We cannot guarantee that the Portfolios will not be harmed by Transfer activity relating to the retirement plans and/or other insurance companies that invest in the Portfolios. If the policies and procedures of other insurance companies or retirement plans fail to successfully discourage frequent Transfer activity, it may affect the value of your investments in the Portfolios. In addition, if a Portfolio believes that an omnibus order we submit may reflect one or more Transfer Requests from an Owner engaged in frequent Transfer activity, the Portfolio may reject the entire omnibus order and thereby interfere with our ability to satisfy your Request even if you have not made frequent Transfers. For Transfers into more than one investment option, we may reject or reverse the entire Transfer Request if any part of it is not accepted by or is reversed by a Portfolio.

Automatic Custom Transfers

Dollar Cost Averaging

You may arrange for systematic Transfers from any open Sub-Account to any other open Sub-Account. (Transfers into closed Sub-Accounts are not permitted). These systematic Transfers may be used to Transfer values from the Schwab Money Market Sub-Account to the other Sub-Accounts as part of a dollar cost averaging strategy. Dollar cost averaging allows you to buy more units when the price is low and fewer units when the price is high. Over time, your average cost per unit may be more or less than if you invested all your money at one time. However, dollar cost averaging does not assure a greater profit, or any

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profit, and will not prevent or necessarily alleviate losses in a declining market. There is no charge for participating in Dollar Cost Averaging.

You can set up automatic dollar cost averaging on a monthly, quarterly, semi-annual, or annual basis. Your Transfer will be initiated on the Transaction Date one frequency period following the date of the Request. For example, if you request quarterly Transfers on January 9th, your first Transfer will be made on April 9th and every three months on the 9th thereafter. Transfers will continue on that same day for each interval unless terminated by you or for other reasons as set forth in the Contract.

If there are insufficient funds in the applicable Sub-Account on the date your Transfer is scheduled, your Transfer will not be made. However, your dollar cost averaging Transfers will resume once there are sufficient funds in the applicable Sub-Account. Dollar cost averaging will terminate automatically when you start taking payouts from the Contract. Dollar cost averaging Transfers are not included in the twelve free Transfers allowed in a calendar year.

Dollar cost averaging Transfers must meet the following conditions:

• The minimum amount that can be Transferred out of the selected Sub-Account is $100.

• You must: (1) specify the dollar amount to be Transferred, (2) designate the Sub-Account(s) to which the Transfer will be made, and (3) designate the percentage of the dollar amount to be allocated to each Sub-Account into which you are Transferring money. The Accumulation Unit values will be determined on the Transfer date.

How dollar cost averaging works:

Month	Contribution	Units Purchased	Price per     unit
Jan.	$250	10	$25.00
Feb.	250	12	20.83
Mar.	250	20	12.50
Apr.	250	20	12.50
May	250	15	16.67
June	250	12	20.83
Average market value per unit $18.06
Investor’s average cost per unit $16.85

In the chart above, if all units had been purchased at one time at the highest unit value of $25.00, only 60 units could have been purchased with $1,500. By contributing smaller amounts over time, dollar cost averaging allowed 89 units to be purchased with $1,500 at an average unit price of $16.85. This investor purchased 29 more units at $1.21 less per unit than the average market value per unit of $18.06.

You may not participate in dollar cost averaging and Rebalancer at the same time.

Great-West reserves the right to modify, suspend, or terminate dollar cost averaging at any time.

Rebalancer

Over time, variations in each Sub-Account’s investment results will change your asset allocation plan percentages. Rebalancer allows you to automatically reallocate your Variable Account Value to maintain your desired asset allocation. Participation in Rebalancer does not assure a greater profit, or any profit, nor will it prevent or necessarily alleviate losses in a declining market. There is no charge for participating in Rebalancer.

You can set up Rebalancer as a one-time Transfer or on a quarterly, semi-annual, or annual basis. If you select to rebalance only once, the Transfer will take place on the Transaction Date of the Request. One-time Rebalancer Transfers count toward the 12 free Transfers allowed in a calendar year.

If you select to rebalance on a quarterly, semi-annual, or annual basis, the first Transfer will be initiated on the Transaction Date one frequency period following the date of the Request. For example, if you request quarterly Transfers on January 9th, your first Transfer will be made on April 9th and every three months on the 9th thereafter. Transfers will continue on that same day for each interval unless terminated by you or for other reasons as set forth in the Contract. Quarterly, semi-annual, and annual Transfers will not count toward the twelve free Transfers.

How Rebalancer works:

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Suppose you purchased your annuity and you decided to allocate 60% of your initial contribution to stocks; 30% to bonds and 10% to cash equivalents as in this pie chart:

Now assume that stock portfolios outperform bond portfolios and cash equivalents over a certain period of time. Over this period, the unequal performance may alter the asset allocation of the above hypothetical plan to look like this:

Rebalancer automatically reallocates your Variable Account Value to maintain your desired asset allocation. In this example, the portfolio would be reallocated back to 60% in stocks; 30% in bonds; 10% in cash equivalents.

On the Transaction Date for the specified Request, assets will be automatically reallocated to the Sub-Accounts you selected. The Rebalancer option will terminate automatically when you start taking payouts from the Contract.

Rebalancer Transfers must meet the following conditions:

• Your entire Variable Account Value must be included (except for Sub-Accounts that are closed to new Contributions and incoming Transfers).

• You must specify the percentage of your Variable Account Value you wish allocated to each Sub-Account and the frequency of rebalancing. You may modify the allocations or stop the Rebalancer option at any time.

• You may not participate in dollar cost averaging and Rebalancer at the same time.

Great-West reserves the right to modify, suspend, or terminate the Rebalancer option at any time.

Withdrawals

You may withdraw all or part of your Annuity Account Value at any time during the life of the Annuitant and prior to the Annuity Commencement Date by submitting a written withdrawal request to the Annuity Service Center at Great-West. Withdrawals are not permitted by telephone. Withdrawals are subject to the rules below and federal or state laws, rules, or regulations may also apply. The amount payable to you if you surrender your Contract is your Annuity Account Value, plus any applicable Market Value Adjustment on the Effective Date of the surrender, less any applicable Premium Tax. No withdrawals may be made after the date annuity payouts begin.

If you Request a partial withdrawal, your Annuity Account Value will be reduced by the dollar amount withdrawn. A Market Value Adjustment may apply. Market Value Adjustments are discussed on page XX.

Partial withdrawals are unlimited. However, you must specify the Sub-Account(s) or Guarantee Period(s) from which the withdrawal is to be made. After any partial withdrawal, if your remaining Annuity Account Value is less than $2,000, then a full surrender may be required. The minimum partial withdrawal (before application of the MVA) is $500.

The following terms apply to withdrawals:

• Partial withdrawals or surrenders are not permitted after the Annuity Commencement Date.

• If a partial withdrawal is made within 30 days of the Annuity Commencement Date, Great-West may delay the Annuity Commencement Date by 30 days,

• A partial withdrawal or surrender will be effective upon the Transaction Date.

• A partial withdrawal or surrender from amounts in a Guarantee Period may be subject to the Market Value Adjustment provisions, and the Guarantee Period Fund provisions of the Contract.

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Withdrawal Requests must be in writing with your original signature. If your instructions are not clear, your Request will be denied and no surrender or partial withdrawal will be processed.

After a withdrawal of all of your Annuity Account Value, or at any time that your Annuity Account Value is zero, all your rights under the Contract will terminate.

Tax consequences of withdrawals are detailed below, but you should consult a competent tax advisor prior to authorizing a withdrawal from your Annuity Account Value.

Partial Withdrawals to Pay Investment Manager or Financial Advisor Fees

You may Request partial withdrawals from your Annuity Account Value and direct us to remit the amount withdrawn directly to your designated Investment Manager or Financial Advisor (collectively “Consultant”). A withdrawal Request for this purpose must meet the $500 minimum withdrawal requirements and comply with all terms and conditions applicable to partial withdrawals, as described above. Tax consequences of withdrawals are detailed below, but you should consult a competent tax advisor prior to authorizing a withdrawal from your Annuity Account Value to pay Consultant fees.

Tax Consequences of Withdrawals

Withdrawals made for any purpose may be taxable—including payments made by us directly to your Consultant.

In addition, the Code may require us to withhold federal income taxes from withdrawals and report such withdrawals to the IRS. If you request partial withdrawals to pay Consultant fees, your Annuity Account Value will be reduced by the sum of the fees paid to the Consultant and the related withholding.

You may elect, in writing, to have us not withhold federal income tax from withdrawals, unless withholding is mandatory for your Contract. If you are younger than 59 ¹/2, the taxable portion of any withdrawal is generally considered to be an early withdrawal and may be subject to an additional federal penalty tax of 10%.

Some states also require withholding for state income taxes. For details about withholding, please “Federal Tax Matters” on page XX.

If this Contract is an IRA, please refer to Section 408 of the Code for limitations and restrictions on cash withdrawals.

Telephone and Internet Transactions

You may make Transfer Requests by telephone, fax, and/or Internet. Transfer Requests received before 4:00 p.m. ET on a day that we and the NYSE are open for business will be made on that day at that day’s unit value. Transfer requests received after 4:00 p.m. ET will be made on the next business day that we and the NYSE are open for business, at that day’s unit value.

We will use reasonable procedures to confirm that instructions communicated by telephone, fax and/or Internet are genuine, such as:

• requiring some form of personal identification prior to acting on instructions;

• providing written confirmation of the transaction; and/or

• tape recording the instructions given by telephone.

If we follow such procedures we will not be liable for any losses due to unauthorized or fraudulent instructions.

We reserve the right to suspend telephone, fax, and/or Internet transaction privileges at any time, for some or all Contracts, and for any reason. Withdrawals are not permitted by telephone.

Death Benefit

The Death Benefit, if any, will be equal to the greater of:

• the Annuity Account Value with an MVA, if applicable, as of the date a Request for payout is received, less any Premium Tax, or

• the sum of Contributions, less partial withdrawals and/or periodic withdrawals, and less any Premium Tax.

Proportional Withdrawals (Oregon Only)

Before the Annuity Commencement Date, the Death Benefit, if any, for Contracts issued prior to April 30, 2004, in the State of Oregon will be as stated above. For Contracts issued in Oregon after April 30, 2004, the Death Benefit will be equal to the greater of:

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• the Annuity Account Value with an MVA, if applicable, as of the date a Request for payout is received, less any Premium Tax, or

• the sum of Contributions, less Proportional Withdrawals and less any Premium Tax.

Proportional Withdrawals (effective for Contracts issued after April 30, 2004 in Oregon only) are withdrawals, if any, made by you, whether partial and/or periodic, which reduce your Annuity Account Value as measured as a percentage of each prior withdrawal against the current Annuity Account Value. Proportional Withdrawals are determined by calculating the percentage of your Annuity Account Value that each prior withdrawal represented when the withdrawal was made. Therefore, a partial withdrawal of 75% of the Annuity Account Value will be considered a 75% reduction in the total Contributions.

For example, in a rising market, where an Owner contributed $100,000 which increased to $200,000 due to market appreciation and then withdrew $150,000, the new balance is $50,000 and the Proportional Withdrawal is 75% ($150,000/$200,000 = 75%). This 75% Proportional Withdrawal is calculated against the total Contribution amount of $100,000 for a Death Benefit equal to the greater of the Annuity Account Value ($50,000) or total Contributions reduced by 75% ($100,000 reduced by 75%, or $25,000). Here, the Death Benefit would be $50,000.

Separately, if the Owner withdrew $50,000, or 25% of the Annuity Account Value, for a new balance of $150,000, the Death Benefit remains the greater of the Annuity Account Value ($150,000) or total Contributions reduced by the Proportional Withdrawal calculation ($100,000 reduced by 25%, or $75,000). Here, the Death Benefit is $150,000.

If the Owner withdraws an additional $50,000, this represents an additional Proportional Withdrawal of 33% ($50,000/$150,000 = 33%). The Death Benefit is now equal to the greater of the Annuity Account Value ($100,000) or total Contributions reduced by all the Proportional Withdrawal calculations ($100,000 reduced by 25%, or $75,000, and then reduced by 33%, or $24,750 to equal $50,250). Here, the Death Benefit is $100,000.

In a declining market, where an Owner contributed $100,000 which declined in value due to market losses to $50,000, and the Owner then withdrew $40,000, or 80% of Annuity Account Value, the result is a new account balance of $10,000. When applying Proportional Withdrawals, here 80%, the Death Benefit is the greater of the Annuity Account Value ($10,000) or total Contributions reduced by the Proportional Withdrawal calculation ($100,000 reduced by 80%, or $20,000). Here, the Death Benefit is $20,000.

The Death Benefit will become payable following our receipt of the Beneficiary’s claim in good order. When an Owner or the Annuitant dies before the Annuity Commencement Date and a Death Benefit is payable to a Beneficiary, the Death Benefit proceeds will remain invested according to the allocation instructions given by the Owner(s) until new allocation instructions are requested by the Beneficiary or until the Death Benefit is actually paid to the Beneficiary.

The amount of the Death Benefit will be determined as of the date payouts begin. However, on the date a payout option is processed, the Variable Account Value will be Transferred to the Schwab Money Market Sub-Account unless the Beneficiary elects otherwise.

Subject to the distribution rules below, payout of the Death Benefit may be made as follows:

Variable Account Value

• payout in a single sum, or

• payout under any of the variable annuity options provided under this Contract.

Fixed Account Value

• payout in a single sum that may be subject to a Market Value Adjustment, or

• payout under any of the annuity options provided under this Contract that may be subject to a Market Value Adjustment.

Any payment within six months of the Guarantee Period Maturity Date will not be subject to a Market Value Adjustment.

In any event, no payout of benefits provided under the Contract will be allowed that does not satisfy the requirements of the Code and any other applicable federal or state laws, rules or regulations.

Beneficiary

You may select one or more Beneficiaries. If more than one Beneficiary is selected, they will share equally in any Death Benefit payable unless you indicate otherwise. You may change the Beneficiary at any time before the Annuitant's death.

A change of Beneficiary will take effect as of the date the request is processed by the Annuity Service Center, unless a certain date is specified by the Owner. If the Owner dies before the Request is processed, the change will take effect as of the date the request

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was made, unless we have already made a payout or otherwise taken action on a designation or change before receipt or processing of such Request. A Beneficiary designated irrevocably may not be changed without the written consent of that Beneficiary, except as allowed by law.

The interest of any Beneficiary who dies before the Owner or the Annuitant will terminate at the death of the Beneficiary. The interest of any Beneficiary who dies at the time of, or within 30 days after the death of an Owner or the Annuitant, will also terminate if no benefits have been paid to such Beneficiary, unless the Owner otherwise indicates by Request. The benefits will then be paid as though the Beneficiary had died before the deceased Owner or Annuitant. If no Beneficiary survives the Owner or Annuitant, as applicable, we will pay the Death Benefit proceeds to the Owner’s estate.

If the Beneficiary is not the Owner’s surviving spouse, she/he may elect, not later than one year after the Owner’s date of death, to receive the Death Benefit in either a single sum or payout under any of the variable or fixed annuity options available under the Contract, provided that:

• such annuity is distributed in substantially equal installments over the life or life expectancy of the Beneficiary or over a period not extending beyond the life expectancy of the Beneficiary; and

• such distributions begin not later than one year after the Owner’s date of death.

If an election is not received by Great-West from a non-spouse Beneficiary or substantially equal installments begin later than one year after the Owner’s date of death, then the entire amount must be distributed within five years of the Owner’s date of death. The Death Benefit will be determined as of the date the payouts begin.

If a corporation or other non-individual entity is entitled to receive benefits upon the Owner’s death, the Death Benefit must be completely distributed within five years of the Owner’s date of death.

Distribution of Death Benefit

Death of Annuitant

Upon the death of the Annuitant while the Owner is living, and before the Annuity Commencement Date, we will pay the Death Benefit to the Beneficiary unless there is a Contingent Annuitant.

If a Contingent Annuitant was named by the Owner(s) prior to the Annuitant’s death, and the Annuitant dies before the Annuity Commencement Date while the Owner and Contingent Annuitant are living, no Death Benefit will be payable and the Contingent Annuitant will become the Annuitant.

If the Annuitant dies after the Annuity Commencement Date and before the entire interest has been distributed, any benefit payable must be distributed to the Beneficiary according to and as rapidly as under the payout option which was in effect on the Annuitant’s date of death.

If the deceased Annuitant is an Owner, or if a corporation or other non-individual is an Owner, the death of the Annuitant will be treated as the death of an Owner and the Contract will be subject to the “Death of Owner” provisions described below.

Contingent Annuitant

While the Annuitant is living, you may, by Request, designate or change a Contingent Annuitant from time to time. A change of Contingent Annuitant will take effect as of the date the request is processed at the Annuity Service Center at Great-West, unless a certain date is specified by the Owner(s). Please note, you are not required to designate a Contingent Annuitant.

Death of Owner Who Is Not the Annuitant

If there is a Joint Owner who is the surviving spouse and the Beneficiary of the deceased Owner, the Joint Owner becomes the Owner and Beneficiary and the Joint Owner may elect to take the Death Benefit or to continue the Contract in force.

If the Owner dies after the Annuity Commencement Date and before the entire interest has been distributed while the Annuitant is living, any benefit payable will continue to be distributed to the Annuitant as rapidly as under the payout option applicable on the Owner’s date of death. All rights granted the Owner under the Contract will pass to any surviving Joint Owner and, if none, to the Annuitant.

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In all other cases, we will pay the Death Benefit to the Beneficiary even if a Joint Owner (who was not the Owner’s spouse on the date of the Owner’s death), the Annuitant and/or the Contingent Annuitant are alive at the time of the Owner’s death, unless the sole Beneficiary is the deceased Owner’s surviving spouse who may elect to become the Owner and Annuitant and continue the Contract in force.

Death of Owner Who Is the Annuitant

If there is a Joint Owner who is the surviving spouse of the deceased Owner and a Contingent Annuitant, the Joint Owner becomes the Owner and the Beneficiary, the Contingent Annuitant will become the Annuitant, and the Contract will continue in force.

If there is a Joint Owner who is the surviving spouse and the Beneficiary of the deceased Owner but no Contingent Annuitant, the Joint Owner will become the Owner, Annuitant, and Beneficiary and may elect to take the Death Benefit or continue the Contract in force.

In all other cases, we will pay the Death Benefit to the Beneficiary, even if a Joint Owner (who was not the Owner’s spouse on the date of the Owner’s death), Annuitant and/or Contingent Annuitant are alive at the time of the Owner’s death, unless the sole Beneficiary is the deceased Owner’s surviving spouse who may elect to become the Owner and Annuitant and continue the Contract in force.

Charges and Deductions

No amounts will be deducted from your Contributions except for any applicable Premium Tax. As a result, the full amount of your Contributions (less any applicable Premium Tax) is invested in the Contract.

As more fully described below, charges under the Contract are assessed only as deductions for:

• Premium Tax, if applicable;

• Certain Transfers;

• a Contract Maintenance Charge; and

• our assumption of mortality and expense risks.

Mortality and Expense Risk Charge

We deduct a mortality and expense risk charge from your Variable Account Value at the end of each valuation period to compensate us for bearing certain mortality and expense risks under the Contract. This is a daily charge equal to an effective annual rate of 0.85%. We guarantee that this charge will never increase beyond 0.85%.

The mortality and expense risk charge is reflected in the unit values of each of the Sub-Accounts you have selected. Thus, this charge will continue to be applicable should you choose a variable annuity payout option or the periodic withdrawal option.

Annuity Account Values and annuity payouts are not affected by changes in actual mortality experience incurred by us. The mortality risks assumed by us arise from our contractual obligations to make annuity payouts determined in accordance with the annuity tables and other provisions contained in the Contract. This means that you can be sure that neither the Annuitant’s longevity nor an unanticipated improvement in general life expectancy will adversely affect the annuity payouts under the Contract.

We bear substantial risk in connection with the Death Benefit before the Annuity Commencement Date.

The expense risk assumed is the risk that our actual expenses in administering the Contracts and the Series Account will be greater than we anticipated.

If the mortality and expense risk charge is insufficient to cover actual costs and risks assumed, the loss will fall on us. If this charge is more than sufficient, any excess will be profit to us. Currently, we expect a profit from this charge. Our expenses for distributing the Contracts will be borne by our general assets, including any profits from this charge.

Contract Maintenance Charge

We currently deduct a $25 annual Contract Maintenance Charge from the Annuity Account Value on each Contract anniversary date for accounts under $50,000 as of such anniversary date. This charge partially covers our costs for administering the Contracts and the Series Account. Once you have started receiving payouts from the Contract, this charge will stop unless you choose the periodic withdrawal option.

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The Contract Maintenance Charge is deducted from the portion of your Annuity Account Value allocated to the Schwab Money Market Sub-Account. If the portion of your Annuity Account Value in this Sub-Account is not sufficient to cover the Contract Maintenance Charge, then the charge or any portion of it will be deducted on a pro rata basis from all your Sub-Accounts with current value. If the entire Annuity Account is held in the Guarantee Period Fund or there are not enough funds in any Sub-Account to pay the entire charge, then the Contract Maintenance Charge will be deducted on a pro rata basis from amounts held in all Guarantee Periods. There is no MVA on amounts deducted from a Guarantee Period for the Contract Maintenance Charge.

The Contract Maintenance Charge is currently waived for Contracts with an Annuity Account Value of at least $50,000 as of such Contract anniversary date. If your Annuity Account Value falls below $50,000, the Contract Maintenance Charge will be reinstated until an anniversary date on which your Annuity Account Value is equal to or greater than $50,000. We do not expect a profit from amounts received from the Contract Maintenance Charge.

Transfer Fees

There will be a $10 charge for each Transfer in excess of 12 Transfers in any calendar year. We do not expect a profit from the Transfer fees.

Expenses of the Portfolios

The values of the assets in the Sub-Accounts reflect the values of the Sub-Accounts’ respective Portfolio shares and therefore the fees and expenses paid by each Portfolio.

Some of the Portfolios’ investment advisers or administrators may compensate us for providing administrative services in connection with the Portfolios or cost savings experienced by the investment advisers or administrators of the Portfolios. Such compensation is typically a percentage of the value of the assets invested in the relevant Sub-Accounts and generally may range up to 0.35% annually of net assets. GWFS may also receive Rule 12b-1 fees (ranging up to 0.25% annually of net assets) directly from certain Portfolios for providing distribution related services related to shares of the Portfolios offered in connection with a Rule 12b-1 plan. If GWFS receives 12b-1 fees, combined compensation for administrative and distribution related services generally ranges up to 0.60% annually of the assets invested in the relevant Sub-Accounts.

Premium Tax

We may be required to pay state Premium Taxes or retaliatory taxes currently ranging from 0% to 3.5% in connection with Contributions or values under the Contracts. Depending upon applicable state law, we may deduct charges for the Premium Taxes we incur with respect to your Contributions, from amounts withdrawn, or from amounts applied on the Payout Commencement Date. In some states, charges for both direct Premium Taxes and retaliatory Premium Taxes may be imposed at the same or different times with respect to the same Contribution, depending on applicable state law.

Other Taxes

Under present laws, we will incur state or local taxes (in addition to the Premium Tax described above) in several states. No charges are currently deducted for taxes other than Premium Tax. However, we reserve the right to deduct charges in the future for federal, state, and local taxes or the economic burden resulting from the application of any tax laws that we determine to be attributable to the Contract.

Payout Options

During the Distribution Period, you can choose to receive payouts in four ways—through periodic withdrawals, variable annuity payouts, fixed annuity payouts or a single sum payment. The Payout Commencement Date must be at least one year after the Effective Date of the Contract. If you do not select a Payout Commencement Date, payouts will begin on the first day of the month of the Annuitant’s 91st birthday.

You may change the Payout Commencement Date within 30 days prior to commencement of payouts or your Beneficiary may change it upon the death of the Owner.

If this is an IRA, payouts which satisfy the minimum distribution requirements of the Code must begin no later than April 1 of the calendar year following the calendar year in which you become age 70 ¹/2.

Periodic Withdrawals

You may request that all or part of the Annuity Account Value be applied to a periodic withdrawal option. The amount applied to a periodic withdrawal is the Annuity Account Value with any applicable MVA, less Premium Tax, if any.

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In requesting periodic withdrawals, you must elect:

• The withdrawal frequency of either 1-, 3-, 6- or 12-month intervals.

• A minimum withdrawal amount of at least $100.

• The calendar day of the month on which withdrawals will be made.

• One of the periodic withdrawal payout options discussed below— you may change the withdrawal option and/or the frequency once each calendar year.

Your withdrawals may be prorated across the Guarantee Period Fund, if applicable, and the Sub-Accounts in proportion to their assets. Or, they can be made specifically from the Guarantee Period Fund and specific Sub-Account(s) until they are depleted. Then, we will automatically prorate the remaining withdrawals against any remaining Guarantee Period Fund and Sub-Account assets unless you request otherwise.

While periodic withdrawals are being received:

• You may continue to exercise all contractual rights, except that no Contributions may be made.

• A Market Value Adjustment, if applicable, will be assessed for periodic withdrawals from Guarantee Periods made six or more months prior to their Guarantee Period Maturity Date.

• You may keep the same Sub-Accounts as you had selected before periodic withdrawals began.

• Charges and fees under the Contract continue to apply.

• Maturing Guarantee Periods renew into the shortest Guarantee Period then available.

Periodic withdrawals will cease on the earlier of the date:

• The amount elected to be paid under the option selected has been reduced to zero;

• The Annuity Account Value is zero;

• You request that withdrawals stop; or

• The Owner or the Annuitant dies.

If periodic withdrawals stop, you may resume making Contributions. However, we may limit the number of times you may restart a periodic withdrawal program.

Periodic withdrawals made for any purpose may be taxable, subject to withholding and to the 10% federal penalty tax if you are younger than age 59 ¹/2. IRAs are subject to complex rules with respect to restrictions on and taxation of distributions, including penalty taxes.

If you choose to receive payouts from your Contract through periodic withdrawals, you may select from the following payout options:

Income for a specified period (at least 36 months)—You elect the length of time over which withdrawals will be made. The amount paid will vary based on the duration you choose.

Income of a specified amount (at least 36 months)—You elect the dollar amount of the withdrawals. Based on the amount elected, the duration may vary.

Interest only—Your withdrawals will be based on the amount of interest credited to the Guarantee Period Fund between withdrawals. Available only if 100% of your Account Value is invested in the Guarantee Period Fund.

Minimum distribution—If you are using this Contract as an IRA, you may request minimum distributions as specified under Code Section 401(a) (9).

Any other form of periodic withdrawal acceptable to Great-West, which is for a period of at least 36 months.

In accordance with the provisions outlined in this section, you may request a periodic withdrawal to remit fees paid to your Consultant. There may be income tax consequences to any periodic withdrawal made for this purpose. Please see the sections on “Withdrawals” on page XX and “Federal Tax Matters” on page XX in this Prospectus.

Annuity Payouts

You can choose the Annuity Commencement Date either when you purchase the Contract or at a later date. The date you choose must be at least one year after the Effective Date of the Contract. If you do not select an Annuity Commencement Date, payouts will begin on the first day of the month of the Annuitant’s 91st birthday. You can change your selection at any time up to 30 days before the Annuity Commencement Date you selected.

If you have not elected a payout option within 30 days of the Annuity Commencement Date, the portion of the Annuity Account Value held in your Fixed Account will be paid out as a fixed life annuity with a guarantee period of 20 years. The

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Annuity Account Value held in the Sub-Account(s) will be paid out as a variable life annuity with a guarantee period of 20 years.

The amount to be paid out is the Annuity Account Value on the Annuity Commencement Date. The minimum amount that may be withdrawn from the Annuity Account Value to purchase an annuity payout option is $2,000 with a Market Value Adjustment, if applicable. If after the Market Value Adjustment, your Annuity Account Value is less than $2,000, we may pay the amount in a single sum subject to the Contract provisions applicable to a partial withdrawal.

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If you choose to receive variable annuity payouts from your Contract, you may select from the following payout options:

Variable life annuity with guaranteed period—This option provides for monthly payouts during a guaranteed period or for the lifetime of the Annuitant, whichever is longer. The guaranteed period may be 5, 10, 15, or 20 years.

Variable life annuity—This option provides for monthly payouts during the lifetime of the Annuitant. The annuity terminates with the last payout due prior to the death of the Annuitant. Since no minimum number of payouts is guaranteed, this option may offer the maximum level of monthly payouts. It is possible that only one payout may be made if the Annuitant died before the date on which the second payout is due.

Under an annuity payout option, you can receive payouts monthly, quarterly, semi-annually or annually in payments which must be at least $50. We reserve the right to make payouts using the most frequent payout interval which produces a payout of at least $50.

If you elect to receive a single sum payment, the amount paid is the Surrender Value.

Amount of First Variable Payout

The first payout under a variable annuity payout option will be based on the value of the amounts held in each Sub-Account you have selected on the fifth valuation date preceding the Annuity Commencement Date. It will be determined by applying the appropriate rate to the amount applied under the payout option. The rate set by Contract and applied reflects an assumed investment return (“AIR”) of 5%.

For annuity options involving life income, the actual age, year in which annuitization commences, and/or gender of the Annuitant will affect the amount of each payout. We reserve the right to ask for satisfactory proof of the Annuitant’s age. We may delay annuity payouts until satisfactory proof is received. Because payouts to older Annuitants are expected to be fewer in number, the amount of each annuity payout under a selected annuity form will be greater for older Annuitants than for younger Annuitants.

If the age of the Annuitant has been misstated, the payouts established will be made on the basis of the correct age. If payouts were too large because of misstatement, the difference with interest may be deducted by us from the next payout or payouts. If payouts were too small, the difference with interest may be added by us to the next payout. This interest is at an annual effective rate which will not be less than the Guaranteed Interest Rate.

Variable Annuity Units

The number of Annuity Units paid for each Sub-Account is determined by dividing the amount of the first monthly payout by its Annuity Unit value on the fifth valuation date preceding the date the first payout is due. The number of Annuity Units used to calculate each payout for a Sub-Account remains fixed during the Annuity Payout Period.

Amount of Variable Payouts After the

First Payout

Payouts after the first will vary depending upon the investment performance of the Sub-Accounts. Your payments will increase in amount over time if the Sub-Account(s) you select earn more than the 5% AIR. Likewise, your payments will decrease in amount over time if the Sub-Account(s) you select earn less than the 5% AIR. The subsequent amount paid from each Sub-Account is determined by multiplying (a) by (b) where (a) is the number of Sub-Account Annuity Units to be paid and (b) is the Sub-Account Annuity Unit value on the fifth valuation date preceding the date the annuity payout is due. The total amount of each variable annuity payout will be the sum of the variable annuity payouts for each Sub-Account you have selected. We guarantee that the dollar amount of each payout after the first will not be affected by variations in expenses or mortality experience.

Transfers After the Variable Annuity

Commencement Date

Once annuity payouts have begun, no Transfers may be made from a fixed annuity payout option to a variable annuity payout option, or vice versa. However, for variable annuity payout options, Transfers may be made within the variable annuity payout option among the available Sub-Accounts. Transfers after the Annuity Commencement Date will be made by converting the number of Annuity Units being Transferred to the number of Annuity Units of the Sub-Account to which the Transfer is made. The result will be that the next annuity payout, if it were made at that time, would be the same amount that it would have been without the Transfer. Thereafter, annuity payouts will reflect changes in the value of the new Annuity Units.

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Other Restrictions

Once payouts start under the annuity payout option you select:

• no changes can be made in the payout option,

• no additional Contributions will be accepted under the Contract, and

• no further withdrawals, other than withdrawals made to provide annuity benefits, will be allowed.

A portion or the entire amount of the annuity payouts may be taxable as ordinary income. If, at the time the annuity payouts begin, we have not received a proper written election not to have federal income taxes withheld, we must by law withhold such taxes from the taxable portion of such annuity payouts and remit that amount to the federal government (an election not to have taxes withheld is not permitted for certain distributions from Qualified Contracts). State income tax withholding may also apply. Please see “Federal Tax Matters” on page XX for details.

If you choose to receive fixed annuity payouts from your Contract, you may select from the following payout options:

Income of specified amount—The amount applied under this option may be paid in equal annual, semi-annual, quarterly or monthly installments in the dollar amount elected for not more than 240 months.

Income for a specified period—Payouts are paid annually, semi-annually, quarterly or monthly, as elected, for a selected number of years not to exceed 240 months.

Fixed life annuity with guaranteed period—This option provides monthly payouts during a guaranteed period or for the lifetime of the Annuitant, whichever is longer. The guaranteed period may be 5, 10, 15, or 20 years.

Fixed life annuity—This option provides for monthly payouts during the lifetime of the Annuitant. The annuity ends with the last payout due prior to the death of the Annuitant. Because no minimum number of payouts is guaranteed, this option may offer the maximum level of monthly payouts. It is possible that only one payout may be made if the Annuitant died before the date on which the second payout is due.

Any other form of a fixed annuity acceptable to us.

Annuity IRAs

The annuity date and options available for IRAs may be controlled by endorsements, the plan documents, or applicable law.

Under the Code, a Contract purchased and used in connection with an IRA or with certain other plans qualifying for special federal income tax treatment is subject to complex “minimum distribution” requirements. Under a minimum distribution plan, distributions must begin by a specific date and the entire interest of the plan participant must be distributed within a certain specified period of time. The application of the minimum distribution requirements vary according to your age and other circumstances.

Seek Tax Advice

The following discussion of the federal income tax consequences is only a brief summary and is not intended as tax advice. The federal income tax consequences discussed here reflect our understanding of current law and the law may change. Federal estate tax consequences and state and local estate, inheritance, and other tax consequences of ownership or receipt of distributions under a Contract depend on your individual circumstances or the circumstances of the person who receives the distribution. A tax advisor should be consulted for further information.

Federal Tax Matters

The following discussion is a general description of the federal income tax considerations relating to the Contracts and is not intended as tax advice. This discussion assumes that the Contract qualifies as an annuity contract for federal income tax purposes. This discussion is not intended to address the tax consequences resulting from all situations. If you are concerned about the tax implications relating to the ownership or use of the Contract, you should consult a competent tax advisor before initiating any transaction.

This discussion is based upon our understanding of the present federal income tax laws as they are currently interpreted by the IRS. No representation is made as to the likelihood of the continuation of the present federal income tax laws or of the current interpretation by the IRS. Moreover, no attempt has been made to consider any applicable state or other tax laws.

The Contract was either purchased on a non-tax qualified basis (“Non-Qualified Contract”) or purchased and used in connection with IRAs (“Annuity IRA”). The ultimate effect of federal income taxes on the amounts held under a Contract, on annuity payouts, and on the economic benefit to you, the Annuitant, or the Beneficiary depends on the type of Contract, and on the tax status of the individual concerned.

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Because tax laws, rules, and regulations are constantly changing, we do not make any guarantees about the Contract’s tax status.

Certain requirements must be satisfied in purchasing an Annuity IRA and receiving distributions from an Annuity IRA in order to continue receiving favorable tax treatment. As a result, purchasers of Annuity IRAs should seek competent legal and tax advice regarding the suitability of the Contract for their situation, the applicable requirements, and the tax treatment of the rights and benefits of the Contract. The following discussion assumes that an Annuity IRA was purchased with proceeds and/or Contributions that qualify for the intended special federal income tax treatment.

Taxation of Annuities

Section 72 of the Code governs the taxation of annuities and distributions from IRAs. You, as a “natural person,” will not generally be taxed on increases, if any, in the value of your Annuity Account Value until a distribution occurs by withdrawing all or part of the Annuity Account Value (for example, withdrawals or annuity payouts under the annuity payout option elected). However, under certain circumstances, you may be subject to current taxation. In addition, an assignment, pledge, or agreement to assign or pledge any portion of the Non-Qualified Annuity Account Value will be treated as a distribution of such portion. The taxable portion of a distribution (in the form of a single sum payout or an annuity) is taxable as ordinary income. An Annuity IRA may not be assigned as collateral for a loan.

As a general rule, if the Non-Qualified Contract is not owned by a natural person (for example, a corporation or certain trusts), the Contract will not be treated as an annuity contract for federal tax purposes. The Owner generally must include in income any increase in the excess of the Annuity Account Value over the “investment in the Contract” (discussed below) during each taxable year. The rule generally does not apply, however, where the non-natural person is only the nominal Owner of a Contract and the beneficial Owner is a natural person.

The rule also does not apply where:

• The annuity Contract is acquired by the estate of a decedent.

• The Contract is an Annuity IRA.

• The Contract is a qualified funding asset for a structured settlement.

• The Contract is purchased on behalf of an employee upon termination of a qualified plan.

• The Contract is an immediate annuity.

The following discussion generally applies to a Contract owned by a natural person.

Withdrawals

In the case of a withdrawal under a Non-Qualified Contract, partial withdrawals, including periodic withdrawals that are not part of an annuity payout, are generally treated as taxable income to the extent that the Annuity Account Value immediately before the withdrawal exceeds the “investment in the Contract” at that time. The “investment in the Contract” generally equals the amount of any nondeductible Contributions paid by or on behalf of any individual less any withdrawals that were excludable from income. If a partial withdrawal is made from a Guarantee Period which is subject to a Market Value Adjustment, then the Annuity Account Value immediately before the withdrawal will not be altered to take into account the Market Value Adjustment. As a result, for purposes of determining the taxable portion of the partial withdrawal, the Annuity Account Value will not reflect the amount, if any, deducted from, or added to the Guarantee Period due to the Market Value Adjustment.

Full surrenders are treated as taxable income to the extent that the amount received exceeds the “investment in the Contract.”

The taxable portion of any withdrawal is taxed at ordinary income tax rates.

In the case of a withdrawal under an Annuity IRA, including withdrawals under the periodic withdrawal option, a portion of the amount received may be non-taxable. The amount of the non-taxable portion is generally determined by the ratio of the “investment in the Contract” to the individual’s Annuity Account Value. Special tax rules may be available for certain distributions from an Annuity IRA.

Annuity Payouts

Although the tax consequences may vary depending on the annuity form elected under the Contract, in general, only the portion of the annuity payout that exceeds the exclusion amount will be taxed. The exclusion amount is generally determined by a formula that establishes the ratio of the “investment in the Contract” to the expected return under the Contract. For fixed

43

annuity payouts, in general there is no tax on the portion of each payout which represents the same ratio that the “investment in the Contract” allocated to the fixed annuity payouts bears to the total expected value of the annuity payouts for the term of the payouts (determined under Treasury Department regulations). For variable annuity payouts, in general there is no tax on the portion of each payout which represents the same ratio that the “investment in the Contract” allocated to the variable annuity payouts bears to the number of payments expected to be made (determined by Treasury Department regulations which take into account the Annuitant’s life expectancy and the form of annuity benefit selected). However, the remainder of each annuity payout is taxable. Once the “investment in the Contract” has been fully recovered, the full amount of any additional annuity payouts is taxable. If the annuity payments stop as a result of an Annuitant’s death before full recovery of the “investment in the Contract,” you should consult a competent tax advisor regarding the deductibility of the unrecovered amount.

The taxable portion of any annuity payout is taxed at ordinary income tax rates.

Penalty Tax

For distributions from a Non-Qualified Contract, there may be a federal income tax penalty imposed equal to 10% of the amount treated as taxable income. In general, however, there is no penalty tax on distributions:

• Made on or after the date on which the Owner reaches age 59 ¹/2.

• Made as a result of death or disability of the Owner.

• Received in substantially equal periodic payouts (at least annually) for your life (or life expectancy) or the joint lives (or joint life expectancies) of you and the Beneficiary.

Other exceptions may apply to distributions from a Non-Qualified Contract. Similar exceptions from the penalty tax on distributions are provided for distributions from an Annuity IRA. For more details regarding this penalty tax and other exceptions that may be applicable, consult a competent tax advisor.

Taxation of Death Benefit Proceeds

Amounts may be distributed from the Contract because of the death of an Owner or the Annuitant. Generally such amounts are included in the income of the recipient as follows:

• If distributed in a lump sum, they are taxed in the same manner as a full withdrawal, as described above.

• If distributed under an annuity form, they are taxed in the same manner as annuity payouts, as described above.

Distribution at Death

In order to be treated as an annuity contract, the terms of a Non-Qualified Contract must provide the following two distribution rules:

• If the Owner dies before the date annuity payouts start, the entire interest in the Contract must generally be distributed within five years after the date of the Owner’s death. If payable to a designated Beneficiary, the distributions may be paid over the life of that designated Beneficiary or over a period not extending beyond the life expectancy of that Beneficiary, so long as payouts start within one year of the Owner’s death. If the sole designated Beneficiary is your spouse, the Contract may be continued in the name of the spouse as Owner.

• If the Owner dies on or after the date annuity payouts start, and before the entire interest in the Contract has been distributed, the remainder of the interest in the Contract must be distributed on the same or on a more rapid schedule than that provided for in the method in effect on the date of death.

If the Owner is not an individual, then for purposes of the distribution at death rules, the Primary Annuitant is considered the Owner. In addition, when the Owner is not an individual, a change in the Primary Annuitant is treated as the death of the Owner.

Distributions made to a Beneficiary upon the Owner’s death from an IRA must be made pursuant to similar rules in Section 401(a)(9) of the Code.

Diversification of Investments

For a Non-Qualified Contract to be treated as an annuity for federal income tax purposes, the investments of the Sub-accounts must be “adequately diversified” in accordance with Treasury Department Regulations. The diversification requirements do not apply to Annuity IRAs. If the Series Account or a Sub-account failed to comply with these diversification standards, a Non-Qualified Contract would not be treated as an annuity contract for federal income tax purposes and the Owner would generally be taxable currently on the excess of the Annuity Account Value over the “investment in the Contract.”

Although the Company may not control the investments of the Sub-accounts or the Portfolios, it expects that the Sub-accounts and the Portfolios will comply with such regulations so that the Sub-accounts will be considered “adequately diversified.”

44

Owners bear the risk that the entire Non-Qualified Contract could be disqualified as an annuity under the Code due to the failure of the Series Account or a Sub-account to be deemed to be adequately diversified.

Owner Control

In connection with its issuance of temporary and proposed regulations under Section 817(h) in 1986, the Treasury Department announced that those regulations did not “provide guidance concerning the circumstances in which investor control of the investments of a segregated asset account may cause the investor (i.e., the Owner), rather than the insurance company to be treated as the owner of the assets in the account” (which would result in the current taxation of the income on those assets to the Owner). In Revenue Ruling 2003-91, the IRS provided such guidance by describing the circumstances under which the owner of a variable contract will not possess sufficient control over the assets underlying the contract to be treated as the owner of those assets for federal income tax purposes. Rev. Rul. 2003-91 states that the determination of whether the owner of a variable contract is to be treated as the owner of the assets held by the insurance company under the contract will depend on all of the facts and circumstances. We do not believe that the ownership rights of an Owner under a Contract would result in any Owner being treated as the owner of the assets of the Contract under Rev. Rul. 2003-91. However, we do not know whether additional guidance will be provided by the IRS on this issue and what standards may be contained in such guidance. Therefore, we reserve the right to modify the Contract as necessary to attempt to prevent an Owner from being considered the owner of a pro rata share of the assets of the Contract.

Transfers, Assignments or Exchanges

A transfer of ownership of a Contract, the designation of an Annuitant, Payee, or other Beneficiary who is not also the Owner, or the exchange of a Contract may result in adverse tax consequences that are not discussed in this Prospectus.

Multiple Contracts

All deferred, Non-Qualified Annuity Contracts that are issued by Great-West (or our affiliates) to the same Owner during any calendar year will be treated as one annuity contract for purposes of determining the taxable amount.

Withholding

Non-Qualified Annuity Contract and Annuity IRA distributions generally are subject to withholding at rates that vary according to the type of distribution and the recipient’s tax status. Recipients, however, generally are provided the opportunity to elect not to have tax withheld from distributions.

Section 1035 Exchanges

Code Section 1035 provides that no gain or loss shall be recognized on the exchange of one annuity contract for another. Generally, an annuity contract issued in an exchange for another annuity contract is treated as new for purposes of the penalty and distribution at death rules. Prospective Owners wishing to take advantage of a Section 1035 exchange should consult their tax advisor.

In March 2008, the Internal Revenue Service issued Rev. Proc. 2008-24, which addresses the income tax consequences of the direct transfer of a portion of the cash value of an annuity contract in exchange for the issuance of a second annuity contract. A direct transfer that satisfies the revenue procedure will be treated as a tax-free exchange under section 1035 of the Code if, for a period of at least twelve months from the date of the direct transfer, there are no distributions or surrenders from either annuity contract involved in the exchange. In addition, the tax-free status of the exchange may still be preserved despite a distribution or surrender from either contract if the contract owner can show that between the date of the direct transfer and the distribution or surrender, one of the conditions described under section 72(q)(2) of the Code that would exempt the distribution from the 10% early distribution penalty (such as turning age 59 ¹/2, or becoming disabled; but not a series of substantially equal periodic payments or an immediate annuity) or “other similar life event” such as divorce or loss of employment occurred. Absent a showing of such an occurrence, Rev. Proc. 2008-24 concludes that the direct transfer would fail to qualify as a tax-free 1035 exchange, and the full amount transferred from the original contract would be treated as a taxable distribution, followed by the purchase of a new annuity contract. Rev. Proc. 2008-24 applies to direct transfers completed on or after June 30, 2008. Please discuss any tax consequences concerning any contemplated or completed transactions with a competent tax advisor.

Individual Retirement Annuities

The Contract could have been used with IRAs as described in Section 408 of the Code which permits eligible individuals to contribute to an individual retirement program known as an Individual Retirement Annuity. Also, certain kinds of distributions

45

from certain types of qualified and non-qualified retirement plans may be “rolled over” into an Annuity IRA following the rules set out in the Code and your Contract and IRA endorsement. If you purchased this Contract for use with an IRA, you would have been provided with supplemental information. You also have the right to revoke your purchase within seven days of purchase of the IRA Contract.

If a Contract was purchased to fund an IRA, the Annuitant must also have been the Owner. In addition, if a Contract was purchased to fund an IRA, minimum distributions must commence not later than April 1st of the calendar year following the calendar year in which you attain age 70 ¹/2. You should consult your tax advisor concerning these matters.

Various tax penalties may apply to Contributions in excess of specified limits, distributions that do not satisfy specified requirements, and certain other transactions. The Contract will be amended as necessary to conform to the requirements of the Code if there is a change in the law. Purchasers should seek competent advice as to the suitability of the Contract for use with IRAs.

When you made your initial Contribution, you had to specify whether you were purchasing a Non-Qualified Contract or an IRA. If the initial Contribution was made as a result of an exchange or surrender of another annuity contract, we required that you did provide information with regard to the federal income tax status of the previous annuity contract.

We required that you purchase separate Contracts if you wanted to invest money qualifying for different annuity tax treatment under the Code. For each separate Contract you had to make the required minimum initial Contribution. Additional Contributions under the Contract must qualify for the same federal income tax treatment as the initial Contribution under the Contract. We will not accept an additional Contribution under a Contract if the federal income tax treatment of the Contribution would be different from the initial Contribution.

If a Contract was issued in connection with an employer’s Simplified Employee Pension plan, Owners, Annuitants, and Beneficiaries were cautioned that the rights of any person to any of the benefits under the Contract will be subject to the terms and conditions of the plan itself, regardless of the terms and conditions of the Contract.

Assignments or Pledges

Generally, rights in the Non-Qualified Contract may be assigned or pledged for loans at any time during the life of the Annuitant. However, if the Contract is an Annuity IRA, you may not assign the Contract as collateral.

If a Non-Qualified Contract is assigned, the interest of the assignee has priority over your interest and the interest of the Beneficiary. Any amount payable to the assignee will be paid in a single sum.

A copy of any assignment must be submitted to the Annuity Service Center at Great-West. All assignments are subject to any action taken or payout made by Great-West before the assignment was processed. We are not responsible for the validity or sufficiency of any assignment.

If any portion of the Annuity Account Value is assigned or pledged for a loan, it will be treated as a withdrawal as discussed above under Taxation of Annuities. Please consult a competent tax advisor for further information.

Distribution of the Contracts

The Contracts are no longer available for sale. We previously offered the Contract on a continuous basis pursuant to a distribution agreement with Charles Schwab & Co., Inc. (“Schwab”) and GWFS. Contracts were sold in those states where the Contract could lawfully be sold by licensed insurance agents who are registered representatives of Schwab. Schwab is registered as a broker/dealer under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and is a member of the Financial Industry Regulatory Authority (“FINRA”). Schwab’s principal offices are located at 211 Main Street, San Francisco, California 94105.

GWFS is the principal underwriter and distributor of the Contracts and is a wholly-owned indirect subsidiary of Great-West. GWFS is registered with the SEC as a broker/dealer under the Exchange Act and is a member of FINRA. Its principal offices are located at 8515 East Orchard Road, Greenwood Village, Colorado 80111.

Great-West (or its affiliates, for purposes of this section only, collectively, “the Company”) pays Schwab compensation for ongoing support based on an annual rate of average monthly Series Account and Fixed Account assets. Compensation paid to Schwab is not paid directly by the Owner or the Series Account. The Company intends to fund this compensation through fees and charges imposed under the Contract and payable to the Company, and from profits on payments received by the Company from Portfolios’ advisers or administrators for providing administrative, marketing, and other support and services to the Portfolios. See “Expenses of the Portfolios” on page XX of this Prospectus.

46

The Company also may pay a marketing allowance or allow other promotional incentives or payments to Schwab in the form of cash or other compensation, as mutually agreed upon by the Company and Schwab, to the extent permitted by FINRA rules and other applicable laws and regulations. In the past, the marketing allowance and/or other promotional incentives or payments to Schwab have amounted to less than $25,000 per year.

You should ask your Schwab representative for further information about what compensation he or she, or Schwab, may have received or will continue to receive in connection with your purchase of a Contract.

Voting Rights

In general, you do not have a direct right to vote the Portfolio shares held in the Series Account. However, under current law, you are entitled to give us instructions on how to vote the shares. We will vote the shares according to those instructions at regular and special shareholder meetings. If the law changes and we can vote the shares in our own right, we may elect to do so.

Before the Annuity Commencement Date, you have the voting interest. The number of votes available to you will be calculated separately for each of your Sub-Accounts. That number will be determined by applying your percentage interest, if any, in a particular Sub-Account to the total number of votes attributable to that Sub-Account. You hold a voting interest in each Sub-Account to which your Annuity Account Value is allocated. If you select a variable annuity option, the votes attributable to your Contract will decrease as annuity payouts are made.

The number of votes of a Portfolio will be determined as of the date established by that Portfolio for determining shareholders eligible to vote at the meeting of the Portfolios. Voting instructions will be solicited by written communication prior to such meeting in accordance with procedures established by the respective Portfolios.

If we do not receive timely instructions and Owners have no beneficial interest in shares held by us, we will vote according to the voting instructions as a proportion of all Contracts participating in the Sub-Account. If you indicate in your instructions that you do not wish to vote an item, we will apply your instructions on a pro rata basis to reduce the votes eligible to be cast.

Each person or entity having a voting interest in a Sub-Account will receive proxy material, reports, and other material relating to the appropriate Portfolio.

Please note, generally the Portfolios are not required to, and do not intend to, hold annual or other regular meetings of shareholders.

Owners have no voting rights in Great-West.

Rights Reserved by Great-West

We reserve the right to make certain changes we believe would best serve the interests of Owners and Annuitants or would be appropriate in carrying out the purposes of the Contracts. Any changes will be made only to the extent and in the manner permitted by applicable laws. Also, when required by law, we will obtain your approval and approval from any appropriate regulatory authority of the changes. Approval may not be required in all cases, however.

Examples of the changes we may make include:

• To operate the Series Account in any form permitted under the 1940 Act or in any other form permitted by law;

• To Transfer any assets in any Sub-Account to another Sub-Account, or to one or more separate accounts, or to a Guarantee Period; or to add, combine or remove Sub-Accounts of the Series Account;

• To substitute, for the Portfolio shares in any Sub-Account, the shares of another Portfolio or shares of another investment company or any other investment permitted by law;

• To make any changes required by the Code or by any other applicable law in order to continue treatment of the Contract as an annuity;

• To change the time or time of day at which a valuation date is deemed to have ended, and/or;

• To make any other necessary technical changes in the Contract in order to conform with any action the above provisions permit us to take, including changing the way we assess charges, without increasing them for any outstanding Contract beyond the aggregate amount guaranteed.

Legal Proceedings

Currently, the Series Account is not a party to, and its assets are not subject to, any material legal proceedings. Further, Great-West is not currently a party to, and its property is not currently subject to, any material legal proceedings. The lawsuits to

47

which Great-West is a party are, in the opinion of management, in the ordinary course of business, and are not expected to have a material adverse effect on the financial results, conditions, or prospects of Great-West.

Legal Matters

Advice regarding certain legal matters concerning the federal securities laws applicable to the issue and sale of the Contract has been provided by Jorden Burt LLP.

Independent Registered Public Accounting Firm

The financial statements of each of the investment divisions of the Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company and the consolidated financial statements of Great-West Life & Annuity Insurance Company and subsidiaries included in this Prospectus and elsewhere in the Registration Statement have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports appearing herein and elsewhere in the Registration Statement which report expresses an unqualified opinion on the consolidated financial statements and financial statement schedule of Great-West Life & Annuity Insurance Company and subsidiaries and includes an explanatory paragraph referring to the change in accounting for the recognition and presentation of other-than-temporary impairments for certain investments, as required by accounting guidance adopted on April 1, 2009, and both have been so included in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.

Available Information

You may request a free copy of the Statement of Additional Information. Please direct any oral or written request for such documents to:

Annuity Service Center

P. O. Box 173920

Denver, Colorado 80217-3920

1-888-560-5938

The SEC maintains an Internet web site (http://www.sec.gov) that contains the SAI information incorporated by reference and other information filed electronically by Great-West concerning the Contract and the Series Account. Certain information concerning Great-West and its products is also available online at http://www.gwla.com.

You also can review and copy any materials filed with the SEC at its Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference room by calling the SEC at 1-800-SEC-0330.

The Statement of Additional Information contains more specific information relating to the Series Account and Great-West, such as:

• general information;

• information about Great-West Life & Annuity Insurance Company and the Variable Annuity-1 Series Account;

• the calculation of annuity payments;

• postponement of payments;

• services;

• withholding; and

• financial statements for the Series Account and Great-West Life & Annuity Insurance Company.

48

APPENDIX A

CONDENSED FINANCIAL INFORMATION

Selected Data for Accumulation Units Outstanding Throughout Each Period

For the Periods Ended December 31

	Alger LargeCap Growth		Alger Mid Cap Growth		Alliance- Bernstein VPS Growth & Income
Date Sub-Account Commenced Operations		11/1/1996		6/13/2003		5/1/2006
2010
Beginning Unit Value		18.39		13.29		8.19
Ending Unit Value		20.68		15.73		9.18
Number of Units Outstanding		594,776		177,512		60,016
Net Assets (000’s)		12,357		2,792		551
2009
Beginning Unit Value		12.57		8.83		6.84
Ending Unit Value		18.39		13.29		8.19
Number of Units Outstanding		690,919		221,160		66,445
Net Assets (000’s)		12,760		2,939		544
2008
Beginning Unit Value		23.55		21.40		11.61
Ending Unit Value		12.57		8.83		6.84
Number of Units Outstanding		758,866		222,754		84,762
Net Assets (000’s)		9,580		1,968		580
2007
Beginning Unit Value		19.80		16.40		11.14
Ending Unit Value		23.55		21.40		11.61
Number of Units Outstanding		880,656		313,927		113,600
Net Assets (000’s)		20,797		6,717		1,319
2006
Beginning Unit Value		18.99		15.02		10.00
Ending Unit Value		19.80		16.40		11.14
Number of Units Outstanding		881,549		180,152		41,021
Net Assets (000’s)		17,453		2,954		457
2005
Beginning Unit Value		17.09		13.79
Ending Unit Value		18.99		15.02
Number of Units Outstanding		1,228,712		248,806
Net Assets (000’s)		23,333		3,737
2004
Beginning Unit Value		16.34		12.30
Ending Unit Value		17.09		13.79
Number of Units Outstanding		1,500,779		269,117
Net Assets (000’s)		25,655		3,712
2003
Beginning Unit Value		12.19		10.00
Ending Unit Value		16.34		12.30
Number of Units Outstanding		1,821,665		194,735
Net Assets (000’s)		29,776		2,396
2002
Beginning Unit Value		18.35

Ending Unit Value	12.19
Number of Units Outstanding	2,113,428
Net Assets (000’s)	25,771
2001
Beginning Unit Value	20.99
Ending Unit Value	18.35
Number of Units Outstanding	2,859,914
Net Assets (000’s)	52,489

Alliance- Bernstein VPS Growth		Alliance- Bernstein VPS International Growth		Alliance- Bernstein VPS International Value		Alliance- Bernstein VPS Small/Mid Cap Value		American Century VP Balanced
	5/1/2006		5/2/2005		5/1/2006		5/1/2006		6/13/2003
	8.37		12.63		7.34		9.55		12.64
	9.55		14.13		7.61		12.02		13.99
	58,710		350,488		309,204		160,450		159,921
	561		4,977		2,353		1,929		2,237
	6.34		9.12		5.49		6.74		11.04
	8.37		12.63		7.34		9.55		12.64
	60,248		411,967		472,186		172,719		161,074
	504		5,224		3,464		1,650		2,035
	11.11		17.99		11.84		10.56		13.97
	6.34		9.12		5.49		6.74		11.04
	72,249		538,827		569,565		135,303		152,396
	458		4,922		3,129		913		1,682
	9.91		15.36		11.28		10.47		13.43
	11.11		17.99		11.84		10.56		13.97
	80,877		629,566		642,716		113,576		166,561
	899		11,324		7,607		1,199		2,327
	10.00		12.18		10.00		10.00		12.35
	9.91		15.36		11.28		10.47		13.43
	61,689		573,308		549,832		47,367		206,522
	612		8,804		6,201		496		2,773
			10.00						11.87
			12.18						12.35
			412,970						223,672
			5,029						2,763
									10.91
									11.87
									153,302
									1,820
									10.00
									10.91
									76,175
									831

American Century VP International		American Century VP Mid Cap Value		American Century VP Value		Columbia VIT Marsico 21st Century		Columbia VIT Small Cap Value
	11/1/1996		5/1/2009		6/13/2003		5/1/2009		5/1/2009
	17.99		13.09		13.08		13.30		12.63
	20.21		15.45		14.71		15.45		15.84
	178,053		15,762		298,203		6,938		31,237
	3,685		243		4,395		107		495
	13.57		10.00		11.01		10.00		10.00
	17.99		13.09		13.08		13.30		12.63
	218,454		8,005		323,364		11,859		2,023
	4,005		105		4,239		158		26
	24.80				15.16
	13.57				11.01
	272,686				394,650
	3,792				4,352
	21.19				16.12
	24.80				15.16
	370,098				548,064
	9,178				8,314
	17.09				13.70
	21.19				16.12
	451,911				594,217
	9,572				9,578
	15.22				13.16
	17.09				13.70
	685,109				606,613
	11,708				8,311
	13.35				11.60
	15.22				13.16
	604,502				455,097
	9,199				5,987
	10.82				10.00
	13.35				11.60
	702,872				207,509
	9,386				2,408
	13.70

10.82

684,511

7,404

19.51

13.70

756,485

10,364

Delaware Smid Growth Series		Delaware VIP Small Cap Value Series		Dreyfus IP MidCap Stock		Dreyfus VIF Appreciation		Dreyfus VIF Developing Leaders
	5/1/2006		6/13/2003		6/13/2003		5/3/1999		6/13/2003
	9.31		15.68		12.28		10.10		9.70
	12.58		20.57		15.47		11.55		12.61
	144,912		189,661		33,668		427,225		3,735
	1,842		3,936		521		5,071		47
	6.46		12.00		9.14		8.32		7.76
	9.31		15.68		12.28		10.10		9.70
	56,061		200,465		47,501		402,735		4,989
	522		3,144		583		4,164		48
	10.95		17.26		15.46		11.90		12.54
	6.46		12.00		9.14		8.32		7.76
	13,300		217,191		69,579		501,025		5,811
	86		2,606		636		4,271		45
	9.78		18.64		15.37		11.21		14.22
	10.95		17.26		15.46		11.90		12.54
	24,872		278,630		75,449		625,089		11,188
	272		4,808		1,167		7,591		140
	10.00		16.18		14.38		9.70		13.82
	9.78		18.64		15.37		11.21		14.22
	2,102		371,418		97,405		748,494		15,916
	21		6,923		1,497		8,388		226
			14.91		13.29		9.38		13.18
			16.18		14.38		9.70		13.82
			433,971		166,558		966,050		31,391
			7,021		2,396		9,374		434
			12.38		11.71		9.00		11.94
			14.91		13.29		9.38		13.18
			333,652		105,545		1,146,506		53,873
			4,975		1,402		10,749		710
			10.00		10.00		7.49		10.00
			12.38		11.71		9.00		11.94
			271,405		71,020		1,205,655		32,811
			3,360		831		10,852		392
							9.07

7.49

1,123,321

8,416

10.09

9.07

880,333

7,987

Dreyfus VIF Growth & Income		DWS Blue Chip VIP		DWS Capital Growth VIP		DWS Dreman Small Mid Cap Value VIP		DWS Growth & Income VIP
	5/3/1999		5/1/2006		5/3/1999		5/1/2006		5/3/1999
	8.93		8.96		9.27		9.19		8.11
	10.51		10.11		10.73		11.22		9.19
	124,049		169,860		225,068		150,302		45,221
	1,303		1,717		2,440		1,708		421
	7.00		6.74		7.37		7.15		6.09
	8.93		8.96		9.27		9.19		8.11
	156,925		170,778		257,590		145,818		65,396
	1,402		1,530		2,410		1,345		535
	11.84		11.06		11.09		10.83		9.96
	7.00		6.74		7.37		7.15		6.09
	187,349		102,568		295,187		160,202		69,564
	1,311		692		2,205		1,151		429
	11.01		10.78		9.93		10.59		9.91
	11.84		11.06		11.09		10.83		9.96
	213,391		102,435		228,407		123,867		73,752
	2,527		1,133		2,573		1,341		735
	9.70		10.00		9.23		10.00		8.80
	11.01		10.78		9.93		10.59		9.91
	284,156		65,905		252,611		172,640		102,578
	3,129		710		2,509		1,829		1,017
	9.46				8.54				8.37
	9.70				9.23				8.80
	470,061				300,559				150,972
	4,559				2,774				1,328
	8.88				7.98				7.66
	9.46				8.54				8.37
	499,256				285,636				196,536
	4,725				2,440				1,644
	7.08				6.34				6.09
	8.88				7.98				7.66
	509,435				353,028				273,363
	4,528				2,817				2,094
	9.56				9.03				7.99

7.08	6.34	6.09
479,690	320,017	244,202
3,398	2,029	1,488
10.24	11.30	9.09
9.56	9.03	7.99
778,050	438,902	376,108
7,440	3,964	3,006

DWS Health Care VIP		DWS Large Cap Value VIP		DWS Small Cap Index VIP		DWS Strategic Value VIP		Federated Capital Appreciation II
	5/1/2006		5/2/2005		5/3/1999		5/2/2005		11/1/1996
	11.08		10.53		14.40		8.22		14.30
	11.88		11.57		18.05		9.18		16.03
	75,403		97,207		368,141		121,731		195,262
	916		1,125		6,675		1,117		3,152
	9.14		8.47		11.48		6.62		12.57
	11.08		10.53		14.40		8.22		14.30
	108,210		98,357		389,455		172,276		241,802
	1,205		1,036		5,626		1,417		3,479
	12.01		13.44		17.57		12.36		19.15
	9.14		8.47		11.48		6.62		12.57
	103,787		145,702		456,135		269,837		374,047
	949		1,235		5,237		1,786		4,729
	10.70		11.98		18.06		12.70		21.38
	12.01		13.44		17.57		12.36		19.15
	94,811		63,813		522,916		354,883		459,059
	1,138		857		9,193		4,386		8,839
	10.00		10.47		15.51		10.79		18.46
	10.70		11.98		18.06		12.70		21.38
	55,203		36,121		655,536		393,335		594,989
	591		433		11,839		4,996		12,721
			10.00		15.00		10.00		17.73
			10.47		15.51		10.79		18.46
			21,833		833,460		159,933		798,024
			229		12,923		1,725		14,734
					12.85				16.29
					15.00				17.73
					1,084,191				1,139,114
					16,261				20,197
					8.85				12.86
					12.85				16.29
					1,223,240				1,235,169
					15,713				20,143
					11.24				16.26

8.85	12.86
930,019	1,404,975
8,228	18,098
11.10	17.12
11.24	16.26
843,685	1,491,691
9,484	24,283

Federated Capital Income II		Federated Fund for U.S. Government Securities II		Franklin Small Cap Value Securities		Franklin Templeton Foreign Securities		INVESCO V.I. Core Equity
	5/1/1997		11/1/1996		5/1/2006		4/30/2010		11/1/1996
	13.48		17.61		8.39		10.00		18.25
	14.98		18.37		10.66		10.80		19.83
	45,452		1,323,644		103,202		17,049		254,855
	681		24,387		1,100		184		5,053
	10.60		16.88		6.55				14.35
	13.48		17.61		8.39				18.25
	50,510		1,553,587		94,180				278,436
	681		27,428		790				5,082
	13.43		16.33		9.86				20.71
	10.60		16.88		6.55				14.35
	54,977		1,771,510		54,178				339,965
	583		29,978		355				4,877
	13.02		15.49		10.19				19.32
	13.43		16.33		9.86				20.71
	60,680		1,880,992		52,226				395,998
	815		30,802		515				8,202
	11.35		15.01		10.00				16.75
	13.02		15.49		10.19				19.32
	84,898		2,126,743		46,636				491,295
	1,105		32,952		475				9,483
	10.77		14.83						16.34
	11.35		15.01						16.75
	131,204		2,552,069						671,647
	1,489		38,297						11,249
	9.88		14.44						15.81
	10.77		14.83						16.34
	152,278		3,072,649						910,736
	1,640		45,578						14,884
	8.26		14.23						13.01
	9.88		14.44						15.81
	210,670		3,813,779						1,318,309
	2,082		55,067						20,856
	10.95		13.16						16.22

8.26	14.23	13.01
208,766	5,341,399	1,584,575
1,724	75,984	20,623
12.81	12.40	17.97
10.95	13.16	16.22
238,710	4,482,043	2,191,193
2,615	58,968	35,560

INVESCO V.I. High Yield		INVESCO V.I. International Growth		INVESCO V.I. Mid Cap Core Equity		INVESCO V.I. Small-Cap Equity		INVESCO V.I. Technology
	11/1/1996		5/1/2006		5/1/2009		5/1/2009		3/1/2000
	16.22		10.01		12.48		12.20		2.41
	18.27		11.20		14.12		15.55		2.90
	171,549		196,852		15,933		22,143		673,863
	3,133		2,220		225		344		1,959
	10.71		7.46		10.00		10.00		1.54
	16.22		10.01		12.48		12.20		2.41
	206,948		194,567		10,778		5,983		749,511
	3,357		1,947		135		73		1,811
	14.53		12.62						2.81
	10.71		7.46						1.54
	261,397		148,707						966,487
	2,799		1,110						1,498
	14.48		11.10						2.63
	14.53		12.62						2.81
	351,270		230,421						1,574,855
	5,105		2,909						4,429
	13.18		10.00						2.40
	14.48		11.10						2.63
	461,672		114,372						1,901,920
	6,681		1,269						4,997
	12.94								2.37
	13.18								2.40
	648,673								2,585,222
	8,552								6,201
	11.77								2.28
	12.94								2.37
	1,180,535								3,999,568
	15,281								9,469
	9.50								1.58
	11.77								2.28
	1,612,798								4,628,543
	18,989								10,562
	9.70								3.01

9.50	1.58
1,586,371	3,230,415
15,065	5,117
11.51	5.60
9.70	3.01
1,802,549	4,253,860
17,491	12,785

Invesco Van Kampen LIT Comstock		Invesco Van Kampen LIT Growth & Income		Janus Aspen Balanced Institutional Shares		Janus Aspen Balanced Service Shares		Janus Aspen Flexible Bond Institutional Shares
	5/2/2005		5/2/2005		6/13/2003		7/10/2007		5/3/1999
	9.68		10.75		15.41		10.80		17.47
	11.13		12.00		16.56		11.58		18.71
	81,844		158,720		143,171		454,555		716,245
	911		1,909		2,426		5,263		13,471
	7.58		8.72		12.35		8.67		15.56
	9.68		10.75		15.41		10.80		17.47
	76,747		190,374		166,691		436,380		835,886
	743		2,052		2,569		4,713		14,655
	11.88		12.94		14.80		10.42		14.81
	7.58		8.72		12.35		8.67		15.56
	56,279		185,348		226,037		317,546		997,069
	427		1,621		2,791		2,754		15,582
	12.23		12.70		13.50		10.00		13.95
	11.88		12.94		14.80		10.42		14.81
	75,106		190,221		289,887		139,803		1,238,890
	892		2,462		4,289		1,457		18,413
	10.61		11.02		12.30				13.50
	12.23		12.70		13.50				13.95
	92,190		170,507		330,379				1,492,279
	1,128		2,165		4,460				20,817
	10.00		10.00		11.49				13.35
	10.61		11.02		12.30				13.50
	70,737		79,968		230,243				1,759,803
	751		881		2,831				23,756
					10.68				12.95
					11.49				13.35
					141,112				2,186,335
					1,621				29,181
					10.00				12.27
					10.68				12.95
					50,999				2,699,036
					545				34,946
									11.20

12.27

3,619,361

44,421

10.49

11.20

2,866,207

32,113

Janus Aspen Flexible Bond Service Shares		Janus Aspen Janus		Janus Aspen Overseas Institutional Shares		Janus Aspen Overseas Service Shares		Janus Aspen Worldwide
	7/10/2007		11/1/1996		5/3/1999		7/10/2007		11/1/1996
	12.23		15.75		25.88		10.01		15.99
	13.07		17.88		32.16		12.41		18.36
	580,655		437,384		504,307		571,108		446,009
	7,586		7,851		16,251		7,085		8,248
	10.92		11.65		14.54		5.64		11.71
	12.23		15.75		25.88		10.01		15.99
	521,951		496,702		586,322		660,123		522,431
	6,391		7,849		15,202		6,609		8,403
	10.42		19.49		30.62		11.90		21.34
	10.92		11.65		14.54		5.64		11.71
	310,926		580,836		699,129		343,365		599,096
	3,395		6,790		10,186		1,935		7,070
	10.00		17.08		24.06		10.00		19.63
	10.42		19.49		30.62		11.90		21.34
	244,864		663,980		941,230		490,829		677,485
	2,551		12,976		28,860		5,841		14,544
			15.46		16.51				16.75
			17.08		24.06				19.63
			813,133		1,180,543				795,482
			13,884		28,409				15,616
			14.95		12.58				15.96
			15.46		16.51				16.75
			1,079,726		1,284,382				1,065,418
			16,694		21,202				17,845
			14.43		10.67				15.36
			14.95		12.58				15.96
			1,359,375		940,175				1,498,862
			20,326		11,831				23,916
			11.05		7.98				12.49
			14.43		10.67				15.36
			1,841,786		1,180,411				1,959,271
			26,576		12,597				30,092
			15.16		10.81				16.91

11.05	7.98	12.49
2,411,606	1,715,998	2,821,900
26,640	13,686	35,252
20.32	14.20	21.99
15.16	10.81	16.91
3,590,948	2,109,314	3,763,889
54,439	22,800	63,654

Lazard Retirement Emerging Markets Equity Series		LVIP Baron Growth Opportunities		MFS International Value		MFS Utilities		Neuberger Berman AMT Regency
	5/1/2009		5/3/1999		5/1/2009		5/1/2008		5/1/2006
	14.64		16.68		13.11		8.32		8.10
	17.81		20.90		14.14		9.36		10.12
	225,561		426,254		92,896		117,209		8,361
	4,018		8,953		1,313		1,097		85
	10.00		12.16		10.00		6.31		5.59
	14.64		16.68		13.11		8.32		8.10
	149,215		460,553		27,855		296,633		8,999
	2,188		7,717		365		2,468		73
			20.15				10.00		10.43
			12.16				6.31		5.59
			554,994				30,815		33,798
			6,785				195		189
			19.65						10.21
			20.15						10.43
			678,775						22,743
			13,749						237
			17.16						10.00
			19.65						10.21
			938,572						14,983
			18,447						153
			16.74
			17.16
			1,294,788
			22,217
			13.44
			16.74
			1,652,140
			27,659
			10.42
			13.44
			1,704,855
			22,911
	.
			12.25

10.42

1,568,750

16,353

11.00

12.25

1,057,192

12,954

NVIT MidCap Index		Oppenheimer Global Securities VA		PIMCO VIT High Yield		PIMCO VIT Low Duration		PIMCO VIT Total Return
	6/13/2003		6/13/2003		6/13/2003		6/13/2003		5/2/2005
	15.09		17.52		14.22		12.26		13.13
	18.83		20.14		16.14		12.80		14.07
	132,068		478,249		482,980		1,367,593		2,102,541
	2,514		9,701		7,814		17,653		29,633
	11.15		12.64		10.23		10.91		11.61
	15.09		17.52		14.22		12.26		13.13
	132,812		513,909		576,976		1,272,335		2,208,858
	2,017		9,061		8,222		15,741		29,048
	17.74		21.31		13.48		11.05		11.17
	11.15		12.64		10.23		10.91		11.61
	159,719		596,411		349,100		1,185,530		1,691,403
	1,780		7,598		3,576		13,061		19,691
	16.66		20.22		13.13		10.38		10.36
	17.74		21.31		13.48		11.05		11.17
	199,822		749,591		451,295		1,427,719		1,373,045
	3,544		16,096		6,084		15,891		15,341
	15.31		17.33		12.15		10.07		10.06
	16.66		20.22		13.13		10.38		10.36
	274,219		861,712		640,350		1,573,871		1,068,975
	4,569		17,423		8,410		16,335		11,075
	13.80		15.29		11.77		10.05		10.00
	15.31		17.33		12.15		10.07		10.06
	321,995		964,276		478,371		1,805,174		511,482
	4,930		16,707		5,811		18,177		5,148
	12.05		12.94		10.83		9.96
	13.80		15.29		11.77		10.05
	206,161		734,406		494,089		1,705,181
	2,845		11,226		5,814		17,144
	10.00		10.00		10.00		10.00
	12.05		12.94		10.83		9.96
	89,494		465,732		371,489		1,377,547
	1,082		6,025		4,025		13,714

Pioneer Fund VCT	Pioneer Growth Opportunities VCT		Pioneer Mid Cap Value VCT		Prudential Series Fund Equity		Putnam American Government Income IB
5/1/1997		5/3/1999		5/1/2006		5/3/1999		4/30/2010
12.56		12.93		9.05		10.51		10.00
14.45		15.41		10.58		11.61		10.23
163,586		249,310		60,759		40,315		40,191
2,364		3,851		643		468		411
10.12		9.02		7.29		7.70
12.56		12.93		9.05		10.51
190,005		309,539		67,835		31,743
2,386		4,009		614		333
15.52		14.10		11.10		12.61
10.12		9.02		7.29		7.70
234,248		298,721		34,373		40,014
2,370		2,701		251		308
14.91		14.79		10.63		11.68
15.52		14.10		11.10		12.61
280,297		351,884		24,191		87,717
4,351		4,972		269		1,106
12.89		14.13		10.00		10.50
14.91		14.79		10.63		11.68
339,662		482,332		1,936		92,861
5,065		7,146		21		1,084
12.25		13.35				9.54
12.89		14.13				10.50
328,504		720,993				148,552
4,236		10,198				1,560
11.47		11.01				8.79
12.25		13.35				9.54
383,444		866,022				92,693
4,696		11,577				884
9.27		7.77				6.76
11.47		11.01				8.79
467,227		899,779				92,393
5,359		9,907				812
12.62		12.57				8.81

9.27	7.77	6.76
530,496	795,324	57,585
4,918	6,178	389
14.05	10.64	10.05
12.62	12.57	8.81
859,655	1,066,369	119,514
10,848	13,404	1,053

Putnam Equity Income IB		Royce Small-Cap		Schwab MarketTrack Growth		Schwab Money Market		Schwab S&P 500 Index
	4/30/2010		5/1/2009		11/1/1996		11/1/1996		11/1/1996
	10.00		13.10		17.85		13.58		17.20
	10.61		15.62		20.11		13.47		19.56
	7,604		84,625		474,805		3,212,647		2,691,786
	81		1,322		9,585		43,313		52,929
			10.00		14.52		13.68		13.75
			13.10		17.85		13.58		17.20
			24,258		491,270		3,520,891		2,900,190
			318		8,790		47,858		50,105
					21.32		13.51		21.86
					14.52		13.68		13.75
					561,917		5,003,035		3,333,901
					8,156		68,637		46,082
					20.36		13.01		20.92
					21.32		13.51		21.86
					674,092		4,866,328		3,628,132
					14,375		65,967		79,551
					17.85		12.55		18.26
					20.36		13.01		20.92
					768,094		4,679,657		4,214,715
					15,638		60,970		88,285
					17.02		12.31		17.58
					17.85		12.55		18.26
					815,592		4,715,418		5,037,740
					14,558		59,235		92,063
					15.38		12.31		16.04
					17.02		12.31		17.58
					851,014		4,934,291		5,807,198
					14,485		60,763		102,165
					12.22		12.32		12.62
					15.38		12.31		16.04
					897,279		6,586,308		6,460,145
					13,807		81,092		103,661
					14.57		12.26		16.40

12.22	12.32	12.62
881,998	11,154,891	6,117,652
10,778	137,495	77,178
16.05	11.93	18.83
14.57	12.26	16.40
896,576	13,479,708	6,729,128
13,067	165,358	110,371

Seligman Communications & Information		Sentinel Variable Products Bond		Sentinel Variable Products Common Stock		Sentinel Variable Products Small Company		Third Avenue Value
	5/1/2008		5/1/2009		5/1/2009		5/1/2009		5/1/2006
	10.61		10.58		12.62		12.62		7.84
	12.07		11.26		14.49		15.48		8.86
	118,161		61,158		6,493		7,556		183,369
	1,427		688		94		117		1,625
	6.71		10.00		10.00		10.00		5.44
	10.61		10.58		12.62		12.62		7.84
	148,913		7,268		5,638		2,260		222,223
	1,580		77		71		29		1,741
	10.00								9.73
	6.71								5.44
	31,284								282,964
	210								1,539
									10.31
									9.73
									362,784
									3,531
									10.00
									10.31
									301,045
									3,104

Touchstone Mid Cap Growth		Universal Institutional U.S. Real Estate		Van Eck VIP Global Bond		Wells Fargo Advantage VT Small/Mid Cap Value		Wells Fargo Advantage VT Opportunity
	5/1/2009		9/17/1997		5/1/2009		5/3/1999		5/1/2006
	13.13		22.76		10.89		13.16		9.58
	15.83		29.33		11.47		15.30		11.75
	24,506		298,689		130,764		197,744		125,990
	388		8,761		1,499		3,057		1,509
	10.00		17.88		10.00		8.29		6.54
	13.13		22.76		10.89		13.16		9.58
	3,870		307,560		46,575		222,781		118,303
	51		7,002		507		2,963		1,142
			29.04				15.07		11.01
			17.88				8.29		6.54
			338,995				283,390		90,640
			6,068				2,378		593
			35.32				15.30		10.41
			29.04				15.07		11.01
			401,003				362,468		53,096
			11,659				5,544		584
			25.80				13.34		10.00
			35.32				15.30		10.41
			670,443				487,390		44,787
			23,695				7,450		466
			22.23				11.55
			25.80				13.34
			708,617				642,411
			18,297				8,569
			16.44				9.97
			22.24				11.55
			971,354				960,428
			21,606				11,090
			12.06				7.27
			16.44				9.97
			1,117,565				1,209,130
			18,379				12,086
			12.26				9.54

12.06	7.27
1,059,611	1,361,907
12,782	9,923
11.25	9.24
12.26	9.54
830,637	1,463,902
10,186	13,995

Appendix B—Market Value Adjustments

The amount available for a full surrender, partial withdrawal, or Transfer equals the amount requested plus or minus the Market Value Adjustment (MVA). The MVA is calculated by multiplying the amount requested by the Market Value Adjustment Factor (MVAF).

The MVA formula

The MVA is determined using the following formula:

MVA = (amount applied) X (Market Value Adjustment Factor)

The MVAF is:

{[(1 + i)/(1 + j +.10%)] ^N/12} – 1

Where:

• i is the U.S. Treasury Strip ask side yield as published by Bloomberg Professional^® on the last business day of the week prior to the date the stated rate of interest was established for the Guarantee Period. The term of i is measured in years and equals the term of the Guarantee Period.

• j is the U.S. Treasury Strip ask side yield as published by Bloomberg Professional^® on the last business day of the week prior to the week the Guarantee Period is broken. The term of j equals the remaining term to maturity of the Guarantee Period, rounded up to the higher number of years.

• N is the number of complete months remaining until maturity.

The MVA will equal 0 if:

• i and j differ by less than .10%

• N is less than 6

• The MVAF is less than 0

Examples

Following are four examples of Market Value Adjustments illustrating (1) increasing interest rates, (2) decreasing interest rates, (3) flat interest rates (i and j are within .10% of each other), and (4) less than 6 months to maturity.

Example 1—Increasing Interest Rates

Deposit	$25,000 on November 1, 2000
Maturity date	December 31, 2009
Interest Guarantee Period	10 years
I	Assumed to be 6.15%
Surrender date	July 1, 2004
J	7.00%
Amount surrendered	$10,000
N	65

MVAF = {[(1 + i)/(1 + j + .10%)]^N/12 } - 1

= {[1.0615/1.071]^65/12 } - 1

= .952885 - 1

= -.047115

However, if the MVAF formula result is < 0, there will be no

market value adjustment to the amount of the distribution.

MVA = (amount transferred or surrendered) x MVAF

= $10,000 x 0

= 0

Surrender Value = (amount transferred or surrendered + MVA)

= ($10,000 + 0)

= $10,000

Example 2—Decreasing Interest Rates

Deposit	$25,000 on November 1, 2000
Maturity date	December 31, 2009
Interest Guarantee Period	10 years
I	Assumed to be 6.15%
Surrender date	July 1, 2004
j	5.00%
Amount surrendered	$10,000
N	65

MVAF = {[(1 + i)/(1 + j + .10%)]^N/12 } - 1

= {[1.0615/1.051]^65/12 } - 1

= .055323

MVA = (amount transferred or surrendered) x MVAF

= $10,000 x .0055323

= $553.23

Surrender Value = (amount transferred or surrendered + MVA)

= ($10,000 + $553.23)

= $10,553.23

B-1

Example 3—Flat Interest Rates (i and j are within .10% of each other)

Deposit	$25,000 on November 1, 2000
Maturity date	December 31, 2009
Interest Guarantee Period	10 years
i	Assumed to be 6.15%
Surrender date	July 1, 2004
J	6.24%
Amount surrendered	$10,000
N	65

MVAF = {[(1 + i)/(1 + j + .10%)]^N/12 } - 1

= {[1.0615/1.0634]^65/12 } - 1

= .99036 - 1

= -.00964

However, [i-j] <.10%, so MVAF = 0

MVA = (amount transferred or surrendered) x MVAF

= $10,000 x 0

= $0

Surrender Value = (amount transferred or surrendered + MVA)

= ($10,000 + $0)

= $10,000

Example 4—N equals less than six months to maturity

Deposit	$25,000 on November 1, 2000
Maturity date	December 31, 2009
Interest Guarantee Period	10 years
i	assumed to be 6.15%
Surrender date	July 1, 2009
j	7.00%
Amount surrendered	$10,000
N	5

MVAF = {[(1 + i)/(1 + j + .10%)]^N/12 } - 1

= {[1.0615/1.071]^5/12 } - 1

= .99629 - 1

= -.00371

However, N<6, so MVAF = 0

MVA = (amount transferred or surrendered) x MVAF

= $10,000 x 0

= $0

Surrender Value = (amount transferred or surrendered + MVA)

= ($10,000 + $0)

= $10,000

B-2

Appendix C—Net Investment Factor

The net investment factor is determined by dividing (a) by (b), and subtracting (c) from the result where:

(a) is the net result of:

1) the net asset value per share of the Portfolio shares determined as of the end of the current Valuation Period, plus

2) the per share amount of any dividend (or, if applicable, capital gain distributions) made by the Portfolio on shares if the “ex-dividend” date occurs during the current Valuation Period, minus or plus

3) a per unit charge or credit for any taxes incurred by or provided for in the Sub-Account, which is determined by GWL&A to have resulted from the investment operations of the Sub-Account, and

(b) is the net asset value per share of the Portfolio shares determined as of the end of the immediately preceding Valuation Period, and

(c) is an amount representing the mortality and expense risk charge deducted from each Sub-Account on a daily basis. Such amount is equal to 0.85%.

The Net Investment Factor may be greater than, less than, or equal to one. Therefore, the Accumulation Unit Value may increase, decrease, or remain unchanged.

The net asset value per share referred to in paragraphs (a)(1) and (b) above, reflects the investment performance of the Portfolio as well as the payment of Portfolio expenses.

C-1

VARIABLE ANNUITY-1 SERIES ACCOUNT

SCHWAB SELECT ANNUITY^®

Flexible Premium Deferred

Combination Variable and Fixed Annuity Contracts

issued by

Great-West Life & Annuity Insurance Company

8515 East Orchard Road

Greenwood Village, Colorado 80111

Telephone: (800) 468-8661 (Outside Colorado)

(800) 547-4957 (Colorado)

STATEMENT OF ADDITIONAL INFORMATION

This Statement of Additional Information is not a prospectus and should be read in conjunction with the Prospectus, dated May 1, 2011, which is available without charge by contacting the Annuity Service Center, P.O. Box 173920 Denver, Colorado 80217-3920 or at 1-800-838-0650.

May 1, 2011

TABLE OF CONTENTS

	Page
GENERAL INFORMATION		B-3
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY AND THE VARIABLE ANNUITY-1 SERIES ACCOUNT		B-3
CALCULATION OF ANNUITY PAYMENTS		B-3
-Fixed Annuity Options		B-3
-Variable Annuity Options		B-4
POSTPONEMENT OF PAYMENTS		B-4
SERVICES		B-4
- Safekeeping of Series Account Assets		B-4
- Independent Registered Public Accounting Firm		B-5
- Principal Underwriter		B-5
WITHHOLDING		B-5
FINANCIAL STATEMENTS		B-5

GENERAL INFORMATION

In order to supplement the description in the Prospectus, the following provides additional information about the Contracts and other matters which may be of interest to you. Terms used in this Statement of Additional Information have the same meanings as are defined in the Prospectus under the heading “Definitions.”

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

AND THE VARIABLE ANNUITY-1 SERIES ACCOUNT

Great-West Life & Annuity Insurance Company (the “Company” or “GWL&A”), the issuer of the Contract, is a Colorado corporation qualified to sell life insurance and annuity contracts in Puerto Rico, U.S. Virgin Islands, Guam, the District of Columbia and all states except New York. GWL&A is a wholly owned subsidiary of GWL&A Financial, Inc., a Delaware holding company. GWL&A Financial, Inc. is an indirect wholly-owned subsidiary of Great-West Lifeco Inc., a Canadian holding company. Great-West Lifeco Inc. is a subsidiary of Power Financial Corporation, a Canadian holding company with substantial interests in the financial services industry. Power Financial Corporation is a subsidiary of Power Corporation of Canada, a Canadian holding and management company. Mr. Paul Desmarais, through a group of private holding companies that he controls, has voting control of Power Corporation of Canada.

The assets allocated to the Variable Annuity-1 Series Account (the “Series Account”) are the exclusive property of the Company. Registration of the Series Account under the Investment Company Act of 1940 does not involve supervision of the management or investment practices or policies of the Series Account or of the Company by the Securities and Exchange Commission (the “SEC”). The Company may accumulate in the Series Account proceeds from charges under the Contracts and other amounts in excess of the Series Account assets representing reserves and liabilities under the Contract and other variable annuity contracts issued by the Company. The Company may from time to time transfer to its general account any of such excess amounts. Under certain remote circumstances, the assets of one Sub-Account may not be insulated from liability associated with another Sub-Account.

CALCULATION OF ANNUITY PAYMENTS

A. Fixed Annuity Options

The amount of each annuity payment under a fixed annuity option is fixed and guaranteed by the Company. On the Payout Commencement Date, the Annuity Account Value held in the Guarantee Period Fund, with a Market Value Adjustment, if applicable, less Premium Tax, if any, is computed and that portion of the Annuity Account Value which will be applied to the fixed annuity option selected is determined. The amount of the first monthly payment under the fixed annuity option selected will be at least as large as would result from using the annuity tables contained in the Contract to apply to the annuity option selected. The dollar amounts of any fixed annuity payments will not vary during the entire period of annuity payments and are determined according to the provisions of the annuity option selected.

B. Variable Annuity Options

To the extent a variable annuity option has been selected, the Company converts the Accumulation Units for each Sub-Account held by you into Annuity Units at their values determined

as of the end of the Valuation Period which contains the Payout Commencement Date. The number of Annuity Units paid for each Sub-Account is determined by dividing the amount of the first monthly payment by the Annuity Unit Value on the fifth Valuation Date preceding the date the first payout is due. The number of Annuity Units used to calculate each payment for a Sub-Account remains fixed during the Annuity Payout Period.

The first payment under a variable annuity payment option will be based on the value of each Sub-Account on the fifth Valuation Date preceding the Payout Commencement Date. It will be determined by applying the appropriate rate to the amount applied under the payment option. Payments after the first will vary depending upon the investment experience of the Sub-Accounts. The subsequent amount paid is determined by multiplying (a) by (b) where (a) is the number of Annuity Units to be paid and (b) is the Annuity Unit value on the fifth Valuation Date preceding the date the annuity payout is due. The total amount of each Variable Annuity Payment will be the sum of the variable annuity payments for each Sub-Account.

POSTPONEMENT OF PAYMENTS

With respect to amounts allocated to the Series Account, payment of any amount due upon a total or partial surrender, death or under an annuity option will ordinarily be made within seven days after all documents required for such payment are received by Great-West Annuity Service Center. However, the determination, application or payment of any death benefit, Transfer, full surrender, partial withdrawal or annuity payment may be deferred to the extent dependent on Accumulation or Annuity Unit Values, for any period during which the New York Stock Exchange is closed (other than customary weekend and holiday closings) or trading on the New York Stock Exchange is restricted as determined by the SEC, for any period during which any emergency exists as a result of which it is not reasonably practicable for the Company to determine the investment experience, of such Accumulation or Annuity Units or for such other periods as the SEC may by order permit for the protection of investors.

SERVICES

A. Safekeeping of Series Account Assets

The assets of the Series Account are held by GWL&A. The assets of the Series Account are kept physically segregated and held separate and apart from the general account of GWL&A. GWL&A maintains records of all purchases and redemptions of shares of the underlying Portfolios. Additional protection for the assets of the Series Account is afforded by a financial institution bond that includes fidelity coverage issued to Great-West Lifeco Inc. and subsidiary companies in the amount of $50 million (Canadian) per occurrence and $100 million (Canadian) in the aggregate, which covers all officers and employees of GWL&A.

B. Independent Registered Public Accounting Firm

Deloitte & Touche LLP, 555 Seventeenth Street, Suite 3600, Denver, Colorado 80202, serves as GWL&A’s and the Series Account’s independent registered public accounting firm. Deloitte & Touche LLP audits financial statements for GWL&A and each of the investment divisions of the Series Account and provides other audit, tax, and related services.

The financial statements of each of the investment divisions of the Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company and the consolidated financial statements of Great-West Life & Annuity Insurance Company and subsidiaries included in this

Prospectus and elsewhere in the Registration Statement have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports appearing herein and elsewhere in the Registration Statement which report expresses an unqualified opinion on the consolidated financial statements and financial statement schedule of Great-West Life & Annuity Insurance Company and subsidiaries and includes an explanatory paragraph referring to the change in accounting for the recognition and presentation of other-than-temporary impairments for certain investments, as required by accounting guidance adopted on April 1, 2009, and both have been so included in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.

C. Principal Underwriter

The Company has discontinued the offering of the Contract. Prior to April 30, 2007, the offering of the Contracts was made on a continuous basis by GWFS Equities, Inc. (“GWFS”), an affiliate of GWL&A. GWFS is a Delaware corporation and is a member of the Financial Industry Regulatory Authority (“FINRA”). The Contract generally was issued for Annuitants from birth to age ninety. The aggregate dollar amount of commissions paid to, and retained by, GWFS or any previous principal underwriter for the Contracts was zero for the last three fiscal years.

D. Administrative Services

Certain administrative services are provided by GWFS to assist GWL&A in processing the Contracts. These services are described in written agreements between GWFS and GWL&A. The total compensation paid to GWFS in connection with these services was zero for the last three fiscal years.

WITHHOLDING

Annuity payments and other amounts received under the Contract are subject to income tax withholding unless the recipient elects not to have taxes withheld. The amounts withheld will vary among recipients depending on the tax status of the individual and the type of payments from which taxes are withheld.

Notwithstanding the recipient’s election, withholding may be required with respect to certain payments to be delivered outside the United States and, with respect to certain distributions from certain types of qualified retirement plans, unless the proceeds are transferred directly to another qualified retirement plan. Moreover, special “backup withholding” rules may require the Company to disregard the recipient’s election if the recipient fails to supply the Company with a taxpayer identification number (“TIN”) (social security number for individuals), or if the Internal Revenue Service notifies the Company that the TIN provided by the recipient is incorrect.

FINANCIAL STATEMENTS

The consolidated financial statements of GWL&A should be considered only as bearing upon GWL&A’s ability to meet its obligations under the Contracts, and they should not be considered as bearing on the investment performance of the Series Account. The variable interest of Owners under the Contracts is affected solely by the investment results of the investment division of the Series Account. The financial statements of the Series Account are also included herein.

Great-West Life & Annuity

Insurance Company (a wholly-

owned subsidiary of GWL&A

Financial Inc.)

Consolidated Balance Sheets as of December 31, 2010

and 2009 and Related Consolidated Statements of

Income, Statements of Stockholder’s Equity and

Statements of Cash Flows for Each of the Three Years in

the Period Ended December 31, 2010 and Report of

Independent Registered Public Accounting Firm

1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholder of

Great-West Life & Annuity Insurance Company

Greenwood Village, Colorado

We have audited the accompanying consolidated balance sheets of Great-West Life & Annuity Insurance Company and subsidiaries (the “Company”) as of December 31, 2010 and 2009, and the related consolidated statements of income, stockholder’s equity, and cash flows for each of the three years in the period ended December 31, 2010. Our audits also included the financial statement schedule listed in the Index at Item 15. These consolidated financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on the consolidated financial statements and financial statement schedule 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. The Company is not required to have, nor were we engaged to perform, an audit of its 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 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, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Great-West Life & Annuity Insurance Company and subsidiaries as of December 31, 2010 and 2009, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2010, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 2, the Company changed its accounting for the recognition and presentation of other-than-temporary impairments for certain investments, as required by accounting guidance adopted on April 1, 2009.

/s/ DELOITTE & TOUCHE LLP

Denver, Colorado

March 31, 2011

2

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Consolidated Balance Sheets

December 31, 2010 and 2009

(In Thousands, Except Share Amounts)

	December 31,
	2010		2009
Assets
Investments:
Fixed maturities, available-for-sale, at fair value (amortized cost $15,382,402 and $14,117,799)	$	15,943,057	$	13,917,813
Fixed maturities, held for trading, at fair value (amortized cost $134,587 and $135,425)		144,174		140,174
Mortgage loans on real estate (net of allowances of $16,300 and $14,854)		1,722,422		1,554,132
Equity investments, available-for-sale, at fair value (cost $1,313 and $18,860)		1,888		25,679
Policy loans		4,059,640		3,971,833
Short-term investments, available-for-sale (cost approximates fair value)		964,507		488,480
Limited partnership and other corporation interests		210,146		253,605
Other investments		22,762		24,312
Total investments		23,068,596		20,376,028
Other assets:
Cash		4,476		170,978
Reinsurance receivable		594,997		573,963
Deferred acquisition costs and value of business acquired		306,948		445,257
Investment income due and accrued		239,345		225,449
Premiums in course of collection		15,421		9,015
Deferred income tax assets, net		-		182,441
Collateral under securities lending agreements		51,749		38,296
Due from parent and affiliates		203,231		185,972
Goodwill		105,255		105,255
Other intangible assets		25,642		29,632
Other assets		460,573		491,471
Assets of discontinued operations		62,091		87,719
Separate account assets		22,489,038		18,886,901
Total assets	$	47,627,362	$	41,808,377
See notes to consolidated financial statements.				(Continued	)

3

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Consolidated Balance Sheets

December 31, 2010 and 2009

(In Thousands, Except Share Amounts)

	December 31,
	2010		2009
Liabilities and stockholder’s equity
Policy benefit liabilities:
Future policy benefits	$	20,420,875	$	18,972,560
Policy and contract claims		293,383		286,176
Policyholders’ funds		372,980		358,795
Provision for policyholders’ dividends		66,244		69,494
Undistributed earnings on participating business		6,803		3,580
Total policy benefit liabilities		21,160,285		19,690,605
General liabilities:
Due to parent and affiliates		537,474		537,563
Repurchase agreements		936,762		491,338
Commercial paper		91,681		97,613
Payable under securities lending agreements		51,749		38,296
Deferred income tax liabilities, net		57,798		-
Other liabilities		460,310		618,508
Liabilities of discontinued operations		62,042		87,719
Separate account liabilities		22,489,038		18,886,901
Total liabilities		45,847,139		40,448,543
Commitments and contingencies (Note 20)
Stockholder’s equity:
Preferred stock, $1 par value, 50,000,000 shares authorized; none issued and outstanding		-		-
Common stock, $1 par value, 50,000,000 shares authorized; 7,032,000 shares issued and outstanding		7,032		7,032
Additional paid-in capital		764,644		761,330
Accumulated other comprehensive income (loss)		242,516		(132,721	)
Retained earnings		766,031		724,193
Total stockholder’s equity		1,780,223		1,359,834
Total liabilities and stockholder’s equity	$	47,627,362	$	41,808,377

See notes to consolidated financial statements. (Concluded)

4

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Consolidated Statements of Income

Years Ended December 31, 2010, 2009 and 2008

(In Thousands)

	Year ended December 31,
	2010			2009			2008
Revenues:
Premium income, net of premiums ceded of $41,474, $48,761 and $37,176	$	805,622		$	560,252		$	525,137
Fee income		447,954			386,201			429,221
Net investment income		1,174,744			1,149,084			1,078,469
Realized investment gains (losses), net:
Total other-than-temporary losses		(96,648	)		(112,764	)		(91,398	)
Other-than-temporary losses transferred to other comprehensive income		16,747			13,422			-
Other realized investment gains, net		55,406			31,802			69,702
Total realized investment gains (losses), net		(24,495	)		(67,540	)		(21,696	)
Total revenues		2,403,825			2,027,997			2,011,131
Benefits and expenses:
Life and other policy benefits, net of reinsurance recoveries of $30,678, $47,077 and $42,380		628,895			590,456			605,111
Increase (decrease) in future policy benefits		320,167			109,728			(38,354	)
Interest paid or credited to contractholders		518,918			552,620			515,428
Provision (benefit) for policyholders’ share of earnings on participating business (Note 4)		2,197			1,245			(206,415	)
Dividends to policyholders		70,230			72,755			71,818
Total benefits		1,540,407			1,326,804			947,588
General insurance expenses		498,386			435,478			436,987
Amortization of deferred acquisition costs and value of business acquired		50,741			62,274			50,541
Interest expense		37,421			37,508			39,804
Total benefits and expenses, net		2,126,955			1,862,064			1,474,920
Income from continuing operations before income taxes		276,870			165,933			536,211
Income tax expense		72,515			41,433			83,491
Income from continuing operations		204,355			124,500			452,720
Income (loss) from discontinued operations, net of income tax expense (benefit) of ($900), $- and $373,436		(1,600	)		-			668,188
Net income	$	202,755		$	124,500		$	1,120,908

See notes to consolidated financial statements.

5

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Consolidated Statements of Stockholder’s Equity

Years ended December 31, 2010, 2009 and 2008

(In Thousands)

					Accumulated Other Comprehensive Income (Loss)
	Common stock		Additional paid-in capital		Unrealized gains (losses) on securities			Employee benefit plan adjustments			Retained earnings			Total
Balances, January 1, 2008	$	7,032	$	747,533	$	(5,687	)	$	4,169		$	1,267,438		$	2,020,485
Net income												1,120,908			1,120,908
Other comprehensive income (loss), net of income taxes:
Net change in unrealized gains (losses)						(685,907	)								(685,907	)
Employee benefit plan adjustment									(75,248	)					(75,248	)
Total comprehensive income															359,753
Impact of adopting ASC section 715-20-65 “Defined Benefit Plans” measurement date provisions												(206	)		(206	)
Dividends												(1,772,293	)		(1,772,293	)
Capital contribution-stock-based compensation				5,123											5,123
Income tax benefit on stock-based compensation				4,256											4,256
Balances, December 31, 2008		7,032		756,912		(691,594	)		(71,079	)		615,847			617,118
Net income												124,500			124,500
Other comprehensive income (loss), net of income taxes:
Non-credit component of impaired losses on fixed maturities available-for-sale						(4,367	)								(4,367	)
Net change in unrealized gains (losses)						614,379									614,379
Employee benefit plan adjustment									28,468						28,468
Total comprehensive income															762,980
Impact of adopting ASC section 320-10-65 “Investments - Debt and Equity Securities” on available-for-sale securities, net of tax						(8,528	)					8,528			-
Dividends												(24,682	)		(24,682	)
Capital contribution-stock-based compensation				2,181											2,181
Income tax benefit on stock-based compensation				2,237											2,237
Balances, December 31, 2009		7,032		761,330		(90,110	)		(42,611	)		724,193			1,359,834
Net income												202,755			202,755
Other comprehensive income (loss), net of income taxes:
Non-credit component of impaired losses on fixed maturities available-for-sale						6,346									6,346
Net change in unrealized gains (losses)						372,233									372,233
Employee benefit plan adjustment									(3,342	)					(3,342	)
Total comprehensive income															577,992
Dividends												(160,917	)		(160,917	)
Capital contribution-stock-based compensation				1,855											1,855
Income tax benefit on stock-based compensation				1,459											1,459
Balances, December 31, 2010	$	7,032	$	764,644	$	288,469		$	(45,953	)	$	766,031		$	1,780,223

See notes to consolidated financial statements.

6

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Consolidated Statements of Cash Flows

Years ended December 31, 2010, 2009 and 2008

(In Thousands)

	Year ended December 31,
	2010			2009			2008
Cash flows from operating activities:
Net income	$	202,755		$	124,500		$	1,120,908
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Earnings allocated to participating policyholders		2,197			1,245			(206,415	)
Amortization of premiums / (accretion) of discounts on investments, net		(44,096	)		(59,048	)		(55,161	)
Net realized (gains) losses on investments		26,665			85,627			33,789
Net proceeds / (purchases) of trading securities		901			(97,474	)		(22,341	)
Interest credited to contractholders		514,002			546,429			510,996
Depreciation and amortization		65,938			80,227			73,062
Deferral of acquisition costs		(80,020	)		(74,642	)		(57,816	)
Deferred income taxes		37,524			94,096			3,228
Gain from discontinued operations		-			-			(696,928	)
Other, net		(9,834	)		2,911			3,546
Changes in assets and liabilities:
Policy benefit liabilities		135,731			59,227			(285,955	)
Reinsurance receivable		4,594			8,898			(158,532	)
Accrued interest and other receivables		(20,302	)		(80,380	)		(8,388	)
Other assets		15,662			(26,218	)		6,466
Other liabilities		(112,002	)		(86,125	)		83,792
Net cash provided by operating activities		739,715			579,273			344,251
Cash flows from investing activities:
Proceeds from sales, maturities and redemptions of investments:
Fixed maturities available-for-sale		4,515,507			3,639,252			4,038,077
Mortgage loans on real estate		158,246			96,160			112,597
Equity investments and other limited partnership interests		88,639			51,982			46,344
Purchases of investments:
Fixed maturities available-for-sale		(5,355,943	)		(3,975,219	)		(3,742,716	)
Mortgage loans on real estate		(331,843	)		(281,962	)		(297,715	)
Equity investments and other limited partnership interests		(19,439	)		(14,316	)		(13,421	)
Net change in short-term investments		(919,023	)		(360,896	)		44,130
Net change in repurchase agreements		445,424			289,259			63,542
Policy loans, net		24,257			(625	)		(39,351	)
Other, net		1,507			2,613			-
Proceeds from the disposition of Healthcare segment, net of cash disposed, direct expenses and income taxes		-			-			846,759
Net cash provided by (used in) investing activities		(1,392,668	)		(553,752	)		1,058,246

See notes to consolidated financial statements. (Continued)

7

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Consolidated Statements of Cash Flows

Years ended December 31, 2010, 2009 and 2008

(In Thousands)

	Year ended December 31,
	2010			2009			2008
Cash flows from financing activities:
Contract deposits	$	2,234,984		$	1,921,471		$	1,921,238
Contract withdrawals		(1,570,767	)		(1,660,454	)		(1,465,420	)
Change in due to parent and affiliates		(16,274	)		(141,770	)		(20,444	)
Dividends paid		(160,917	)		(24,682	)		(1,772,293	)
Net commercial paper borrowings		(5,932	)		446			1,500
Change in bank overdrafts		3,898			19,857			(108,418	)
Income tax benefit of stock option exercises		1,459			2,237			4,256
Net cash provided by (used in) financing activities		486,451			117,105			(1,439,581	)
Net increase (decrease) in cash		(166,502	)		142,626			(37,084	)
Cash, continuing and discontinued operations, beginning of year		170,978			28,352			65,436
Cash, end of year	$	4,476		$	170,978		$	28,352
Supplemental disclosures of cash flow information:
Net cash paid (received) during the year for:
Income taxes	$	33		$	(44,878	)	$	390,897
Income tax payments withheld and remitted to taxing authorities		56,664			55,055			56,637
Interest		37,421			37,508			39,804
Non-cash investing and financing transactions during the years:
Share-based compensation expense	$	1,855		$	2,181		$	5,123
Fair value of assets acquired in settlement of fixed maturity investments		-			-			6,388

See notes to consolidated financial statements. (Concluded ) 

8

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

1. Organization, Basis of Presentation and Significant Accounting Policies

Organization - Great-West Life & Annuity Insurance Company (“GWLA”) and its subsidiaries (collectively, the “Company”) is a direct wholly-owned subsidiary of GWL&A Financial Inc. (“GWL&A Financial”), a holding company formed in 1998. GWL&A Financial is a direct wholly-owned subsidiary of Great-West Lifeco U.S. Inc. (“Lifeco U.S.”) and an indirect wholly-owned subsidiary of Great-West Lifeco Inc. (“Lifeco”). The Company offers a wide range of life insurance, retirement and investment products to individuals, businesses and other private and public organizations throughout the United States. The Company is an insurance company domiciled in the State of Colorado and is subject to regulation by the Colorado Division of Insurance.

Basis of presentation - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates are required to account for valuation of investments and other-than-temporary impairments, valuation and accounting for derivative instruments, policy and contract benefits and claims, deferred acquisition costs and value of business acquired, goodwill, employee benefits plans and taxes on income. Actual results could differ from those estimates.

The consolidated financial statements include the accounts of the Company and its subsidiaries. Intercompany transactions and balances have been eliminated in consolidation.

Restatement of the December 31, 2009 and 2008 consolidated financial statements - The accompanying consolidated financial statements as of and for the years ended December 31, 2009 and 2008 have been restated to reflect the following:

• Current and deferred income taxes for continuing and discontinued operations were each overstated due to errors in the current and deferred tax accounts. These errors are primarily the result of an omitted deferred tax asset related to pensions and other less significant items in the current and deferred tax accounts. As a result of these tax errors, stockholder’s equity was understated by $33,313 and $29,551 for the years ended December 31, 2009 and 2008, respectively.

• Deferred acquisition costs were overstated due to the inclusion of certain expenses related to service contracts that were not associated with annuity contracts. The deferred acquisition costs have been reduced for these service contracts and their expenses are included as part of general insurance expenses. As a result of the error in deferred acquisition costs, stockholder’s equity was overstated by $23,262 and $21,564 for the years ended December 31, 2009 and 2008, respectively.

• Adjustments were made to correct the consolidated statement of cash flows to reflect the adjustments above in addition to adjustments for a misclassification of cash flows from in process trades. As a result of the corrections to the statement of cash flows, net cash flows from operations (decreased) increased by ($31,845) and $11,228 and net cash flows from investing activities increased by $5,213 and $2,827 and net cash flows from financing activities increased (decreased) by $26,632 and $14,055 for the years ended December 31, 2009 and 2008, respectively.

9

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following table summarizes the effect of the adjustments the Company made to its consolidated financial statements as a result of these adjustments:

	As previously reported		Adjustments			As restated
Consolidated Balance Sheets
2009
Deferred acquisition costs and value of business acquired	$	481,044	$	(35,787	)	$	445,257
Deferred income tax assets, net		125,878		56,563			182,441
Due from parent and affiliates		196,697		(10,725	)		185,972
Total assets		41,798,326		10,051			41,808,377
Retained earnings		714,142		10,051			724,193
Total stockholder’s equity		1,349,783		10,051			1,359,834
Total liabilities and stockholder’s equity		41,798,326		10,051			41,808,377
Consolidated Statements of Income
2008
General insurance expenses		429,695		7,292			436,987
Amortization of deferred acquistion costs and value of business acquired		52,699		(2,158	)		50,541
Total benefits and expenses, net		1,469,786		5,134			1,474,920
Income from continuing operations before income taxes		541,345		(5,134	)		536,211
Income tax expense		95,838		(12,347	)		83,491
Income from continuing operations		445,507		7,213			452,720
Income (loss) from discontinued operations, net of income tax		652,788		15,400			668,188
Net income		1,098,295		22,613			1,120,908
2009
General insurance expenses		429,143		6,335			435,478
Amortization of deferred acquistion costs and value of business acquired		65,998		(3,724	)		62,274
Total benefits and expenses, net		1,859,453		2,611			1,862,064
Income from continuing operations before income taxes		168,544		(2,611	)		165,933
Income tax expense		46,108		(4,675	)		41,433
Income from continuing operations		122,436		2,064			124,500
Net income		122,436		2,064			124,500
Consolidated Statements of Stockholder’s Equity
Balances, January 1, 2008, Retained Earnings		1,282,064		(14,626	)		1,267,438
Balances, January 1, 2008, Total		2,035,111		(14,626	)		2,020,485
Net Income, 2008		1,098,295		22,613			1,120,908
Balances, December 31, 2008, Retained Earnings		607,860		7,987			615,847
Balances, December 31, 2008, Total		609,131		7,987			617,118
Net Income, 2009		122,436		2,064			124,500
Balances, December 31, 2009, Retained Earnings		714,142		10,051			724,193
Balances, December 31, 2009, Total		1,349,783		10,051			1,359,834

10

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	As previously reported			Adjustments			As restated
Consolidated Statements of Cash Flows
2008
Net income		1,098,295			22,613			1,120,908
Net realized losses on investments		24,205			9,584			33,789
Purchases of trading securities		(18,869	)		(3,472	)		(22,341	)
Depreciation and amortization		75,220			(2,158	)		73,062
Deferral of acquisition costs		(65,108	)		7,292			(57,816	)
Deferred income taxes		5,525			(2,297	)		3,228
Gain from discontinued operations		(681,528	)		(15,400	)		(696,928	)
Other, net		138,089			(134,543	)		3,546
Policy benefit liabilities		(325,306	)		39,351			(285,955	)
Net cash provided by operating activities		333,023			11,228			344,251
Proceeds, Fixed maturities available-for-sale		4,056,869			(18,792	)		4,038,077
Proceeds, Mortgage loans on real estate		112,760			(163	)		112,597
Proceeds, Equity investments and other limited partnership interests		46,860			(516	)		46,344
Net change in short- term investments		81,143			(37,013	)		44,130
Other, net		(98,662	)		98,662			-
Net cash provided by investing activities		1,055,419			2,827			1,058,246
Change in due to parent and affiliates		(6,389	)		(14,055	)		(20,444	)
Net cash used in financing activities		(1,425,526	)		(14,055	)		(1,439,581	)
2009
Net income		122,436			2,064			124,500
Net realized losses on investments		67,540			18,087			85,627
Depreciation and amortization		83,951			(3,724	)		80,227
Deferral of acquisition costs		(80,977	)		6,335			(74,642	)
Deferred income taxes		125,525			(31,429	)		94,096
Other, net		(86,254	)		89,165			2,911
Net cash provided by operating activities		611,118			(31,845	)		579,273
Proceeds, Fixed maturities available-for-sale		3,625,569			13,683			3,639,252
Proceeds, Mortgage loans on real estate		96,258			(98	)		96,160
Proceeds, Equity investments and other limited partnership interests		52,144			(162	)		51,982
Purchases, Fixed maturities available-for-sale		(4,026,580	)		51,361			(3,975,219	)
Purchases, Mortgage loans on real estate		(282,252	)		290			(281,962	)
Net change in short- term investments		(400,781	)		39,885			(360,896	)
Other, net		101,734			(99,121	)		2,613
Net cash used in investing activities		(558,965	)		5,213			(553,752	)
Change in due to parent and affiliates		(168,402	)		26,632			(141,770	)
Net cash provided by financing activities		90,473			26,632			117,105

Significant Accounting Policies

Investments - Investments are reported as follows:

1. The Company classifies the majority of its fixed maturity and all of its equity investments as available-for-sale and records them at fair value with the related net unrealized gain or loss, net of policyholder related amounts and deferred taxes, in accumulated other comprehensive income (loss) in the stockholder’s equity section of the consolidated balance sheets. Net unrealized gains and losses related to participating contract policies that cannot be distributed are recorded as undistributed earnings on participating business in the Company’s consolidated balance sheets. The Company recognizes the acquisition of its public fixed maturity and equity investments on a trade date basis.

Premiums and discounts are recognized as a component of net investment income using the scientific interest method, realized gains and losses are included in net realized investment gains (losses) and declines in value determined to be other-than-temporary are included in total other-than-temporary losses.

The Company purchases fixed maturity securities which are classified as held for trading. Assets in the held for trading category are carried at fair value with changes in fair value reported in net investment income.

11

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The recognition of income on certain investments (e.g. loan-backed securities, including mortgage-backed and asset-backed securities) is dependent upon market conditions, which may result in prepayments and changes in amounts to be earned. Prepayments on all mortgage-backed and asset-backed securities are monitored monthly and amortization of the premium and/or the accretion of the discount associated with the purchase of such securities are adjusted by such prepayments.

2. Mortgage loans on real estate consist of domestic commercial collateralized loans and are carried at their unpaid principal balances adjusted for any unamortized premiums or discounts and allowances for credit losses. Interest income is accrued on the unpaid principal balance for all loans, except for loans on non-accrual status. Premiums and discounts are amortized to net investment income using the scientific interest method. Prepayment penalty fees are recognized in other realized investment gains upon receipt.

The Company reviews the reasonableness of its credit loss methodology quarterly, by reviewing certain key indicators by loan type, including but not limited to, trends in the number of individual loans in default, number of late payments and other data indicative of underperforming loans. Additionally, the Company’s provision methodology is reviewed for reasonableness in relation to current trends in market data affecting collateral values, local and national economic market conditions and their effect on the Company’s historic loan loss experience. The primary risk characteristics in the portfolio include the borrower’s inability to service debt from operations and collateral valuation declines due to leasing or market conditions. Risk is mitigated through first position collateralization, guarantees, loan covenants and borrower reporting requirements. Since the Company does not originate or hold uncollateralized mortgages, loans are generally not fully charged off. Generally, unrecoverable amounts are charged off during the final stage of the foreclosure process.

3. Equity investments classified as available-for-sale are carried at fair value with net unrealized gains and losses, net of deferred taxes, reported as accumulated other comprehensive income (loss) in the stockholder’s equity section of the Company’s consolidated balance sheets. Realized gains and losses are included in net realized investment gains (losses). Declines in value, determined to be other-than-temporary, are included in total other-than-temporary losses.

4. Limited partnership and other corporation interests are accounted for using either the cost or equity method of accounting. The Company uses the cost method on investments where it has a minor equity interest and no significant influence over the entity’s operations. The Company uses the equity method on investments in which it has a partnership interest in excess of 5%, although the Company has no significant influence over the entity’s operations. Also included in limited partnership interests are limited partnerships established for the purpose of investing in low-income housing that qualify for federal and state tax credits. These interests are carried at amortized cost as determined using the effective yield method.

5. Policy loans are carried at their unpaid balances.

6. Short-term investments include securities purchased with initial maturities of one year or less and are carried at amortized cost, which approximates fair value. The Company classifies its short-term investments as available-for-sale.

7. The Company may employ a trading strategy that involves the sale of securities with a simultaneous agreement to repurchase similar securities at a future date at an agreed-upon price. Proceeds of the sale are reinvested in other securities and may enhance the current yield and total return. The difference between the sales price and the future repurchase price is recorded as an adjustment to net investment income. During the period between the sale and repurchase, the Company will not be entitled to receive interest and principal payments on the securities sold. Losses may arise from changes in the value of the securities or if the counterparty enters bankruptcy proceedings or becomes insolvent. In such cases, the Company’s right to repurchase the security may be restricted. Amounts

12

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

owed to brokers under these arrangements are included in repurchase agreements in the accompanying consolidated balance sheets. The liability is collateralized by securities with approximately the same fair value.

8. The Company receives collateral for lending securities that are held as part of its investment portfolio. The Company requires collateral in an amount greater than or equal to 102% of the market value of domestic securities loaned and 105% of foreign securities loaned. Such collateral is used to replace the securities loaned in event of default by the borrower. The Company’s securities lending transactions are accounted for as collateralized borrowings. Collateral is defined as government securities, letters of credit and/or cash collateral. The borrower can return and the Company can request the loaned securities at any time. The Company maintains ownership of the loaned securities at all times and is entitled to receive from the borrower any payments for interest or dividends received on such securities during the loan term.

9. One of the significant estimates inherent in the valuation of investments is the evaluation of fixed maturity for other-than-temporary impairments. The evaluation of impairments is a quantitative and qualitative process, which is subject to risks and uncertainties and is intended to determine whether declines in the fair value of investments should be recognized in current period earnings. The risks and uncertainties include changes in general economic conditions, the issuer’s financial condition or near term recovery prospects, the effects of changes in interest rates or credit spreads and the recovery period. The Company’s accounting policy requires that a decline in the value of a security below its cost or amortized cost basis be assessed to determine if the decline is other-than-temporary.

If management either (a) has the intent to sell a fixed maturity investment or (b) it is more likely than not the Company will be required to sell a fixed maturity investment before its anticipated recovery, a charge is recorded in net realized investment losses equal to the difference between the fair value and cost or amortized cost basis of the security. If management does not intend to sell the security and it is not more likely than not the Company will be required to sell the fixed maturity investment before recovery of its amortized cost basis, but the present value of the cash flows expected to be collected (discounted at the effective interest rate implicit in the fixed maturity investment prior to impairment) is less than the amortized cost basis of the fixed maturity investment (referred to as the credit loss portion), an other-than-temporary impairment is considered to have occurred. In this instance, total other-than-temporary impairment is bifurcated into two components: the amount related to the credit loss, which is recognized in current period earnings; and the amount attributed to other factors (referred to as the non-credit portion), which is recognized as a separate component in accumulated other comprehensive income (loss). After the recognition of an other-than-temporary impairment, a fixed maturity investment is accounted for as if it had been purchased on the measurement date of the other-than-temporary impairment, with an amortized cost basis equal to the previous amortized cost basis less the other-than-temporary impairment recognized in earnings.

Derivative financial instruments - All derivatives, regardless of hedge accounting treatment, are recorded on the consolidated balance sheets in other assets and other liabilities at fair value. Accounting for the ongoing changes in the fair value of a derivative depends upon the intended use of the derivative and its designation as determined when the derivative contract is entered into. If the derivative is designated as a fair value hedge, the changes in its fair value and of the fair value of the hedged item attributable to the hedged risk are recognized in earnings in net investment income. If the derivative is designated as a cash flow hedge, the effective portions of the changes in the fair value of the derivative are recorded in accumulated other comprehensive income (loss) in the Company’s consolidated balance sheets and are recognized in the consolidated income statements when the hedged item affects earnings. Changes in the fair value of derivatives not qualifying for hedge accounting and the over effective portion of cash flow hedges are recognized in net investment income in the period of the change. Investment gains and losses generally result from the termination of derivative contracts prior to expiration. Certain derivatives in a net asset position have cash pledged as collateral to the Company in accordance with the collateral support

13

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

agreements with the counterparty. This collateral is held directly by the Company. This unrestricted cash collateral is included in other assets and the obligation to return is included in other liabilities.

Cash - Cash includes only amounts in demand deposit accounts.

Bank overdrafts - The Company’s cash management system provides for the reimbursement of all major bank disbursement accounts on a daily basis. Checks issued but not yet presented to banks for payment can result in overdraft balances for accounting purposes and are included in other liabilities in the accompanying consolidated balance sheets. At December 31, 2010 and 2009, these liabilities were $32,572 and $28,674, respectively.

Internal use software - Purchased software costs, as well as certain internal and external costs incurred to develop internal use computer software during the application development stage are capitalized. Capitalized internal use software development costs, net of accumulated amortization, in the amounts of $24,196 and $20,590, are included in other assets at December 31, 2010 and 2009, respectively. The Company capitalized $9,816, $8,014 and $2,324 of internal use software development costs during the years ended December 31, 2010, 2009 and 2008, respectively.

Deferred acquisition costs and value of business acquired - Deferred acquisition costs (“DAC”), which primarily consists of sales commissions and costs associated with the Company’s sales representatives related to the production of new business or through the acquisition of insurance or annuity contracts through indemnity reinsurance transactions, have been deferred to the extent recoverable. The value of business acquired (“VOBA”) represents the estimated fair value of insurance or annuity contracts acquired either directly through the acquisition of another insurance company or through the acquisition of insurance or annuity contracts through assumption reinsurance transactions. The recoverability of such costs is dependent upon the future profitability of the related business. DAC and VOBA associated with the annuity products and flexible premium universal life insurance products are being amortized over the life of the contracts in proportion to the emergence of gross profits. Retrospective adjustments of these amounts are made when the Company revises its estimates of current or future gross profits. DAC and VOBA associated with traditional life insurance are amortized over the premium-paying period of the related policies in proportion to premium revenues recognized. DAC and VOBA, for applicable products, are adjusted for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in “Accumulated Other Comprehensive Income (Loss)”. See Note 9 for additional information regarding deferred acquisition costs and the value of business acquired.

Goodwill and other intangible assets - Goodwill is the excess of cost over the fair value of assets acquired and liabilities assumed in connection with an acquisition and is considered an indefinite lived asset and therefore is not amortized. The Company tests goodwill for impairment annually or more frequently if events or circumstances indicate that there may be justification for conducting an interim test. If the carrying value of goodwill exceeds its fair value, the excess is recognized as an impairment and recorded as a charge against net income in the period in which the impairment is identified. There were no impairments of goodwill recognized during the years ended December 31, 2010, 2009 or 2008.

Other intangible assets represent the estimated fair value of the portion of the purchase price that was allocated to the value of customer relationships and preferred provider relationships in various acquisitions. These intangible assets have been assigned values using various methodologies, including present value of projected future cash flows, analysis of similar transactions that have occurred or could be expected to occur in the market, and replacement or reproduction cost. The initial valuations of these intangible assets were supported by an independent valuation study that was commissioned by the Company. Other identified intangible assets with finite lives are amortized over their estimated useful lives, which initially ranged from 4 to 14 years (weighted average 13 years), primarily based upon the cash flows generated by these assets.

14

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Separate accounts - Separate account assets and related liabilities are carried at fair value in the accompanying consolidated balance sheets. The Company issues variable annuity contracts through separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contractholder and therefore, are not included in the Company’s consolidated statements of income.

Revenues to the Company from the separate accounts consist of contract maintenance fees, investment management fees, administrative fees and mortality and expense risk charges.

The Company’s separate accounts invest in shares of Maxim Series Fund Inc. and Putnam Funds, open-end management investment companies, which are affiliates of the Company, and shares of other non-affiliated mutual funds and government and corporate bonds. See footnote 5 for a further discussion of separate accounts.

Life insurance and annuity future benefits - Life insurance and annuity future benefits with life contingencies in the amounts of $12,395,926 and $11,807,570 at December 31, 2010 and 2009, respectively, are computed on the basis of estimated mortality, investment yield, withdrawals, future maintenance and settlement expenses and retrospective experience rating premium refunds. Annuity contract benefits without life contingencies in the amounts of $7,976,954 and $7,117,591 at December 31, 2010 and 2009, respectively, are established at the contractholder’s account value.

Reinsurance - The Company enters into reinsurance transactions as both a provider and purchaser of reinsurance. In the normal course of its business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding risks to other insurance enterprises under excess coverage and coinsurance contracts. For each of its reinsurance agreements, the Company determines if the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. If the Company determines that a reinsurance agreement does not provide indemnification against loss or liability relating to insurance risk, the Company records the agreement using the deposit method of accounting. The Company reviews all contractual features, particularly those that may limit the amount of insurance risk to which the reinsurer is subject or features that delay the timely reimbursement of claims.

Policy benefits and policy and contract claims ceded to other insurance companies are carried as a reinsurance receivable in the accompanying consolidated balance sheets. The cost of reinsurance related to long duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies.

Policy and contract claims - Policy and contract claims include provisions for claims incurred but not reported and claims in the process of settlement. The provision for claims incurred but not reported is valued based primarily on the Company’s prior experience. The claims in the process of settlement are valued in accordance with the terms of the related policies and contracts.

Participating business - The Company has participating policies in which the policyholder shares in the Company’s earnings through policyholder dividends that reflect the difference between the assumptions used in the premium charged and the actual experience on those policies. The amount of dividends to be paid is determined by the Board of Directors.

Participating life and annuity policy benefit liabilities are $6,544,238 and $6,354,261 at December 31, 2010 and 2009, respectively. Participating business approximates 9% of the Company’s individual life insurance in-force at December 31, 2010 and 2009 and 13%, 19% and 24% of individual life insurance premium income for the years ended December 31, 2010, 2009 and 2008, respectively. The policyholder’s share of net income on participating policies is excluded from stockholder’s equity and recorded as undistributed earnings on participating business in the consolidated balance sheet.

15

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The Company had established a Participating Policyholder Experience Account (“PPEA”) for the benefit of all participating policyholders. The Company had also established a Participation Fund Account (“PFA”) for the benefit of the participating policyholders previously assumed from The Great-West Life Assurance Company (“GWL”) under an assumption reinsurance transaction. The PFA was part of the PPEA. As discussed in Note 4, on January 1, 2008, the Company was no longer required to maintain the PPEA.

Recognition of premium and fee income and benefits and expenses - Life insurance premiums are recognized when due. Annuity contract premiums with life contingencies are recognized as received. Revenues for annuity and other contracts without significant life contingencies consist of contract charges for the cost of insurance and contract administration and surrender fees that have been assessed against the contract account balance during the period and are recognized when earned. Fees from assets under management, which consist of contract maintenance fees, administration fees and mortality and expense risk charges, are recognized when due. Benefits and expenses on policies with life contingencies are associated with earned premiums so as to result in recognition of profits over the life of the contracts. Premiums and policyholder benefits and expenses are presented net of reinsurance.

Net investment income - Interest income from fixed maturities and mortgage loans on real estate is recognized when earned. Net investment income on equity securities is primarily comprised of dividend income and is recognized on ex-dividend date.

Realized investment gains (losses) and derivative financial instruments - Realized investment gains and losses are reported as a component of revenues and are determined on a specific identification basis. Realized investment gains and losses also result from the termination of derivative contracts prior to expiration that are not designated as hedges for accounting purposes and certain fair-value hedge relationships. See item 9 above for a description of realized investment gains (losses) as it relates to other-than-temporary impairments.

Income taxes - Income taxes are recorded using the asset and liability method in which deferred tax assets and liabilities are recorded for expected future tax consequences of events that have been recognized in either the Company’s consolidated financial statements or consolidated tax returns. In estimating future tax consequences, all expected future events, other than the enactments or changes in the tax laws or rules, are considered. Although realization is not assured, management believes it is more likely than not that the deferred tax asset will be realized.

Share-based compensation - Lifeco maintains the Great-West Lifeco Inc. Stock Option Plan (the “Lifeco plan”) that provides for the granting of options on its common shares to certain of its officers and employees and those of its subsidiaries, including the Company. The Company uses the fair value method to recognize the cost of share-based employee compensation under the Lifeco plan.

2. Application of Recent Accounting Pronouncements

Recently adopted accounting pronouncements

In March 2008, the Financial Accounting Standards Board (the “FASB”) issued Statement of Financial Accounting Standards No. 161, “Disclosures About Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133” (“SFAS No. 161”). Effective July 1, 2009, SFAS No. 161 was superseded and replaced by certain provisions of the FASB Accounting Standards Codification^TM (the “ASC”) topic 815, “Derivatives and Hedging” (“ASC topic 815”). These provisions of ASC topic 815 apply to all derivative instruments and related hedged items. These provisions of ASC topic 815 require entities to provide enhanced disclosures regarding (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for and (c) how derivative instruments and related hedged items affect an entity’s financial position, results of operations and cash flows. These provisions of ASC topic 815 are effective for fiscal years beginning after November 15, 2008. The Company adopted these provisions of ASC topic 815 for its fiscal year beginning January 1, 2009.

16

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

In April 2009, the FASB issued Staff Position No. FAS 115-2 and FAS 124-2, “Recognition and Presentation of Other-Than-Temporary Impairments” (“FSP No. FAS 115-2 and FAS 124-2”). Effective July 1, 2009, FSP No. FAS 115-2 and FAS 124-2 was superseded and replaced by certain provisions of ASC topic 320, “Investments - Debt and Equity Securities” (“ASC topic 320”). These provisions of ASC topic 320 require companies, among other things, to bring greater consistency to the timing of impairment recognition and provide for greater clarity about the credit and non-credit components of impaired debt securities that are not expected to be sold. These provisions of ASC topic 320 also require increased and timelier disclosures regarding expected cash flows, credit losses and an aging of securities with unrealized losses. These provisions of ASC topic 320 were effective for interim and annual periods ending after June 15, 2009. The Company adopted these provisions of ASC topic 320 for its fiscal quarter ended June 30, 2009 and recognized the effect of applying them as a change in accounting principle. The Company recognized an $8,528, net of income taxes, cumulative effect adjustment upon initially applying these provisions of ASC topic 320 as an increase to retained earnings with a corresponding decrease to accumulated other comprehensive income (loss).

In January 2010, the FASB issued ASU No. 2010-06 “Fair Value Measurements and Disclosures: Improving Disclosures about Fair Value Measurements” (“ASU No. 2010-06”). ASU No. 2010-06 provides for disclosure of significant transfers in and out of the fair value hierarchy Levels 1 and 2, and the reasons for these transfers. In addition, ASU No. 2010-06 provides for separate disclosure about purchases, sales, issuances and settlements in the Level 3 hierarchy roll forward activity. ASU No. 2010-06 is effective for interim and annual periods beginning after December 31, 2009 except for the provisions relating to purchases, sales, issuances and settlements of Level 3 investments, which are effective for fiscal years beginning after December 15, 2010. The Company adopted the disclosure provisions of ASU 2010-06 for its fiscal year beginning January 1, 2010 and will adopt the Level 3 purchase, sales, issuances and settlement provisions for its fiscal year beginning January 1, 2011. The adoption ASU No. 2010-06 did not have an impact on the Company’s consolidated financial position or the results of its operations.

In February 2010, the FASB issued Accounting Standards Update (“ASU”) No. 2010-10 “Consolidation: Amendments for Certain Investment Funds” (“ASU No. 2010-10”). ASU No. 2010-10 defers the effective date of the amendments to the consolidation requirements made by certain provisions of ASC topic 810 (formerly SFAS No. 167), specifically the evaluation of a company’s interests in mutual funds, private equity funds, hedge funds, real estate entities that measure their investments at fair value, real estate investment trusts and venture capital funds. The deferral provisions of ASU No. 2010-10 will continue indefinitely. ASU No. 2010-10 was effective for interim and annual periods in fiscal years beginning after November 15, 2009. The Company adopted ASU No. 2010-10 for its fiscal year beginning January 1, 2010. The adoption of ASU No. 2010-10 did not have an impact on the Company’s consolidated financial position or the results of its operations.

In July 2010, the FASB issued ASU No. 2010-20 “Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses” (“ASU No. 2010-20”). ASU No. 2010-20 provides for entities to disclose credit quality indicators, aging of past due amounts, the nature and extent of troubled debt restructurings, modifications as a result of troubled debt restructurings and significant sales or purchases, by disaggregated class, for its financing receivables. ASU No. 2010-20 is effective for fiscal periods ending after December 15, 2010. The Company adopted ASU No. 2010-20 for its fiscal year ended December 31, 2010. The provisions of ASU No. 2010-20 related to troubled debt restructurings have been temporarily deferred and are expected to be effective for periods ending on or after June 15, 2011. As such, the Company has not adopted the provisions of ASU No. 2010-20 related to this deferral. The provisions of ASU No. 2010-20 relate only to financial statement disclosures regarding financing receivables and, accordingly, its adoption did not have an impact on the Company’s consolidated financial position or the results of its operations.

17

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Future adoption of new accounting pronouncements

In April 2010, the FASB issued ASU No. 2010-15 “How Investments Held through Separate Accounts Affect an Insurer’s Consolidation Analysis of Those Investments” (“ASU No. 2010-15”). ASU No. 2010-15 clarifies that an insurance company should not consider any separate account interests in an investment held for the benefit of policyholders to be its interests and that those interests should not be combined with interests of its general account in the same investment when assessing the investment for consolidation. ASU No. 2010-15 also provides that an insurance company is required to consider a separate account as a subsidiary for purposes of evaluating whether the retention of specialized accounting for investments in consolidation is appropriate. ASU No. 2010-15 is effective for fiscal years beginning after December 15, 2010. The Company will adopt ASU No. 2010-15 for its fiscal year beginning on January 1, 2011. The adoption of ASU No. 2010-15 will not have an impact on the Company’s consolidated financial position or the results of its operations.

In October 2010, the FASB issued ASU No. 2010-26 “Financial Services - Insurance (Topic 944): Accounting for Costs Associated with Acquiring or Renewing Insurance Contracts - a Consensus of the FASB Emerging Issues Task Force” (“ASU No. 2010-26”). ASU No. 2010-26 provides guidance and modifies the definition of the types and nature of costs incurred by insurance enterprises that can be capitalized in connection with the acquisition of new or renewal insurance contracts. Further, ASU No. 2010-26 clarifies which costs may not be capitalized as deferred acquisition costs. ASU No. 2010-26 is effective for interim and annual periods in fiscal years beginning after December 15, 2011 with early adoption permitted. The Company is evaluating the impact of the adoption of ASU No. 2010-26.

3. Discontinued Operations

On April 1, 2008, the Company and certain of its subsidiaries completed the sale of substantially all of their healthcare insurance business to a subsidiary of CIGNA Corporation (“CIGNA”) for $1.5 billion in cash. During the year ended December 31, 2008, the Company recognized a gain of $696,928, net of income taxes, upon completion of the transaction. Income from discontinued operations for the year ended December 31, 2008 includes charges of $63,739, net of income taxes, related to costs associated with the sale. The business that was sold, formerly reported as the Company’s Healthcare segment, was the vehicle through which it marketed and administered group life and health insurance to small, mid-sized and national employers. CIGNA acquired from the Company the stop loss, group life, group disability, group medical, group dental, group vision, group prescription drug coverage and group accidental death and dismemberment insurance business in the United States and the Company’s supporting information technology infrastructure through a combination of 100% indemnity reinsurance agreements, renewal rights, related administrative service agreements and the acquisition of certain of the Company’s subsidiaries. The Company retained a small portion of its healthcare business and reports it within its Individual Markets segment. As discussed in Note 17, the Company’s business is now comprised of its Individual Markets, Retirement Services and Other segments. The statements of income and balance sheets of the disposed business activities are presented as discontinued operations for all periods presented in the consolidated financial statements.

18

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Certain assets and liabilities of the disposed business activities continue to be held by the Company and are presented as discontinued operations for all periods presented in the consolidated balance sheets. The following table summarizes the classifications of assets and liabilities of discontinued operations at December 31, 2010 and 2009:

	December 31,
Assets	2010		2009(1)
Reinsurance receivable	$	62,091	$	87,719
Total assets	$	62,091	$	87,719
Liabilities
Future policy benefits	$	20,975	$	28,509
Policy and contract claims		41,067		59,210
Total liabilities	$	62,042	$	87,719
(1)  Amounts have been restated due to a missclassification of future policy benefits and policy and contract claims from that previously reported of $56,219 and $31,500, respectively.

The following table summarizes selected financial information included in income (loss) from discontinued operations in the consolidated statements of income for the years ended December 31, 2010, 2009 and 2008:

	Year ended December 31,
	2010			2009		2008
Revenues from discontinued operations	$	-		$	-	$	317,658
Benefits and expenses from discontinued operations		1,600			-		346,398
Loss from discontinued operations, net of income tax benefit of $900, $ - and $19,258		(1,600	)		-		(28,740	)
Gain on sale of discontinued operations, net of income taxes of $ - , $ - and $392,694		-			-		696,928
Income (loss) from discontinued operations	$	(1,600	)	$	-	$	668,188

4. Undistributed Earnings on Participating Business

During the first quarter of 2008, the liability for undistributed earnings on participating business decreased by $207,785 in connection with a long-standing assumption reinsurance agreement under which the Company had reinsured a block of participating policies. In addition, the agreement also required the Company to perform an analysis as of March 31, 2008, to determine whether the policyholders were eligible for a special dividend. Based on the Company’s analysis, it was determined that a special dividend was not required and, accordingly, the liability was released. An income tax provision was recorded on the undistributed earnings when those earnings occurred. Accordingly, there was no income tax provision recorded at the time of the liability release. On January 1, 2008, the Company began recognizing the net earnings on these policies in its net income. A liability for undistributed earnings on participating business remains for those participating policies that are not subject to this reinsurance agreement.

5. Related Party Transactions

19

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Included in the consolidated balance sheets at December 31, 2010 and 2009 are the following related party amounts:

	December 31,
	2010		2009
Reinsurance receivable	$	483,564	$	452,510
Future policy benefits		2,183,167		2,293,712

Included in the consolidated statements of income for the years ended December 31, 2010, 2009 and 2008 are the following related party amounts:

	Year ended December 31,
	2010			2009			2008
Premium income, net of related party premiums ceded of $3,588, $3,411, and $3,662	$	131,037		$	137,085		$	155,752
Life and other policy benefits, net of reinsurance recoveries of $4,906, $7,415 and $7,356		122,830			118,624			120,999
Increase (decrease) in future policy benefits		(65,778	)		(45,960	)		(42,180	)

The Company provides administrative and operational services for the United States operations of The Great-West Life Assurance Company (“GWL”) and the United States operations of The Canada Life Assurance Company (“CLAC”), wholly-owned subsidiaries of Lifeco. The Company also provides investment services for London Reinsurance Group, an indirect subsidiary of GWL. The following table presents revenue and expense reimbursement from related parties for services provided pursuant to these service agreements for the years ended December 31, 2010, 2009 and 2008. These amounts, in accordance with the terms of the various contracts, are based upon estimated costs incurred, including a profit charge, and resources expended based upon the number of policies, certificates in-force and/or administered assets.

	Year ended December 31,
	2010		2009		2008
Investment management and administrative revenue included in fee income and net investment income	$	7,505	$	7,334	$	7,856
Administrative and underwriting expense reimbursements included as a reduction to general insurance expense		988		944		1,092
Total	$	8,493	$	8,278	$	8,948

The following table summarizes amounts due from parent and affiliates at December 31, 2010 and 2009:

20

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

					December 31,
Related party	Indebtedness		Due date		2010		2009
GWL&A Financial Inc.		On account		On demand	$	11,298	$	17,248
Great-West Lifeco U.S. Inc.		On account		On demand		191,185		166,991
Great-West Lifeco Finance LP		On account		On demand		-		598
Great-West Lifeco Finance LP II		On account		On demand		187		-
Great-West Life & Annuity Insurance Capital (Nova Scotia) Co.		On account		On demand		-		142
Great-West Life & Annuity Insurance Capital (Nova Scotia) Co. II		On account		On demand		-		237
Putnam Investments LLC		On account		On demand		182		125
The Crown Life Insurance Company		On account		On demand		152		491
Other related party receivables		On account		On demand		227		140
Total					$	203,231	$	185,972
The following table summarizes amounts due to parent and affiliates at December 31, 2010 and 2009:
					December 31,
Related party	Indebtedness		Due date		2010		2009
GWL&A Financial Inc. (1)		Surplus note		November 2034	$	194,231	$	194,218
GWL&A Financial Inc. (2)		Surplus note		May 2046		333,400		333,400
GWL&A Financial Inc.		Note interest		May 2011		4,701		4,701
Great-West Life & Annuity Insurance Capital (Nova Scotia) Co. II		On account		On demand		13		-
Great-West Lifeco Finance LP II		On account		On demand		-		2,223
The Great-West Life Assurance Company		On account		On demand		4,046		1,352
The Canada Life Assurance Company		On account		On demand		1,083		1,669
Total					$	537,474	$	537,563

⁽¹⁾ A note payable to GWL&A Financial was issued as a surplus note on November 15, 2004, with a face amount of $195,000 and carrying amounts of $194,230 and $194,218 at December 31, 2010 and 2009, respectively. The surplus note bears interest at the rate of 6.675% per annum, payable in arrears on each May 14 and November 14. The note matures on November 14, 2034.

⁽²⁾ A note payable to GWL&A Financial was issued as a surplus note on May 19, 2006, with a face amount and carrying amount of $333,400. The surplus note bears interest initially at the rate of 7.203% per annum, payable in arrears on each May 16 and November 16 until May 16, 2016. After May 16, 2016, the surplus note bears an interest rate of 2.588% plus the then-current three-month London Interbank Offering Rate. The surplus note is redeemable by the Company at the principal amount plus any accrued and unpaid interest after May 16, 2016. The note matures on May 16, 2046.

Payments of principal and interest under the surplus notes shall be made only out of surplus funds of the Company and only with prior written approval of the Commissioner of Insurance of the State of Colorado when the Commissioner of Insurance is satisfied that the financial condition of the Company warrants such action pursuant to applicable Colorado law. Payments of principal and interest on the surplus notes are payable only if at the time of such payment and after giving effect to the making thereof, the Company’s surplus would not fall below two and one half times the authorized control level as required by the most recent risk-based capital calculations.

Interest expense attributable to these related party debt obligations was $37,042, for each of the three years ended December 31, 2010.

The Company’s wholly owned subsidiary, Great-West Life & Annuity Insurance Company of South Carolina (“GWSC”) and CLAC are parties to a reinsurance agreement pursuant to which GWSC assumes term life insurance from CLAC. GWL&A Financial obtained two letters of credit for the benefit of the

21

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Company as collateral under the GWSC and CLAC reinsurance agreement for policy liabilities and capital support. The first letter of credit is for $1,068,300 and renews annually until it expires on December 31, 2025. The second letter of credit is for $70,000 and renews annually for an indefinite period of time. At December 31, 2010 and 2009 there were no outstanding amounts related to the letters of credit.

Included within reinsurance receivable in the consolidated balance sheets are $436,661 and $407,154 of funds withheld assets as of December 31, 2010 and 2009, respectively. CLAC pays the Company on a quarterly basis, interest on the funds withheld balance at a rate of 4.55% per annum.

A subsidiary of the Company, GW Capital Management, LLC, serves as a Registered Investment Advisor to Maxim Series Fund, Inc. an affiliated open-end management investment company and to several affiliated insurance company separate accounts. Included in fee income on the consolidated statements of income is $59,320, $52,540 and $61,403 of advisory and management fee income from these affiliated entities for the years ended December 31, 2010, 2009 and 2008, respectively.

The Company’s separate accounts invest in shares of Maxim Series Fund, Inc. and Putnam Funds which are affiliates of the Company and shares of other non-affiliated mutual funds and government and corporate bonds. The Company’s separate accounts include mutual funds or other investment options that purchase guaranteed interest annuity contracts issued by the Company. During the years ended December 31, 2010, 2009 and 2008, these purchases totaled $162,504, $149,302 and $64,723, respectively. As the general account investment contracts are also included in the separate account balances in the accompanying consolidated balance sheets, the Company has reduced the separate account assets and liabilities by $269,495 and $364,233 at December 31, 2010 and 2009, respectively, to eliminate these amounts in its consolidated balance sheets at those dates.

6. Summary of Investments

22

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following tables summarize fixed maturity investments and equity securities classified as available-for-sale and the amount of other-than-temporary impairments (“OTTI”) classified as the non-credit-related component of previously impaired fixed maturity investments that the Company does not intend to sell included in accumulated other comprehensive income (loss) (“AOCI”) at December 31, 2010 and 2009:

	December 31, 2010
Fixed maturities:	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value and carrying value		OTTI (gain) loss included in AOCI (1)
U.S. government direct obligations and U.S. agencies	$	2,289,010	$	96,924	$	14,784	$	2,371,150	$	-
Obligations of U.S. states and their subdivisions		1,784,299		173,567		15,603		1,942,263		-
Corporate debt securities		7,625,810		557,104		144,486		8,038,428		5,439
Asset-backed securities (2)		2,104,420		51,663		154,157		2,001,926		(22,284	)
Residential mortgage-backed securities		730,293		20,888		12,119		739,062		505
Commercial mortgage-backed securities		812,915		28,049		20,615		820,349		-
Collateralized debt obligations		35,655		5		5,781		29,879		-
Total fixed maturities	$	15,382,402	$	928,200	$	367,545	$	15,943,057	$	(16,340	)
Equity investments:
Financial services	$	192	$	533	$	-	$	725	$	-
Equity mutual funds		432		119		-		551		-
Airline industry		689		-		77		612		-
Total equity investments	$	1,313	$	652	$	77	$	1,888	$	-

⁽¹⁾ Indicates the amount of any OTTI (gain) loss included in AOCI that is included in gross unrealized gains and losses.

⁽²⁾ OTTI (gain) loss included in AOCI, as presented above, includes both the initial recognition of non-credit losses and the effects of subsequent increases and decreases in estimated fair value for those fixed maturity securities that had previous non-credit impairment. The non-credit loss component of OTTI (gain) loss for asset-backed securities was in an unrealized gain position of $22,284 at December 31, 2010 due to increases in estimated fair value subsequent to initial recognition of non-credit losses on such securities.

23

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	December 31, 2009
Fixed maturities:	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value and carrying value		OTTI (gain) loss included in AOCI (1)
U.S. government direct obligations and U.S. agencies	$	1,972,541	$	77,068	$	10,815	$	2,038,794	$	-
Obligations of U.S. states and their subdivisions		1,247,854		120,211		4,214		1,363,851		-
Foreign governments		461		4		-		465		-
Corporate debt securities		7,030,032		316,599		216,886		7,129,745		10,049
Asset-backed securities		2,268,789		3,221		383,965		1,888,045		13,422
Residential mortgage-backed securities		842,427		4,533		75,897		771,063		-
Commercial mortgage-backed securities		703,864		8,058		35,792		676,130		-
Collateralized debt obligations		51,831		332		2,443		49,720		-
Total fixed maturities	$	14,117,799	$	530,026	$	730,012	$	13,917,813	$	23,471
Equity investments:
Financial services	$	191	$	314	$	-	$	505	$	-
Consumer products		4		66		2		68		-
Equity mutual funds		15,504		5,223		450		20,277		-
Airline industry		3,161		1,673		5		4,829		-
Total equity investments	$	18,860	$	7,276	$	457	$	25,679	$	-

^{(1 )} Indicates the amount of any OTTI (gain) loss included in AOCI that is included in gross unrealized gains and losses.

See Note 7 for additional information on policies regarding estimated fair value of fixed maturity and equity investments.

The amortized cost and estimated fair value of fixed maturity investments classified as available-for-sale at December 31, 2010, based on estimated cash flows, are shown in the table below. Actual maturities will likely differ from these projections because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	December 31, 2010
	Amortized cost		Estimated fair value
Maturing in one year or less	$	558,282	$	588,661
Maturing after one year through five years		2,899,335		3,132,330
Maturing after five years through ten years		3,284,278		3,595,103
Maturing after ten years		2,830,812		2,834,422
Mortgage-backed and asset-backed securities		5,809,695		5,792,541
	$	15,382,402	$	15,943,057

Mortgage-backed (commercial and residential) and asset-backed securities, including those issued by U.S. government and U.S. agencies, include collateralized mortgage obligations that consist primarily of sequential and planned amortization classes with legal final stated maturities of up to thirty years and expected average lives of up to fifteen years.

24

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following table summarizes information regarding the sales of fixed maturity investments classified as available-for-sale for the years ended December 31, 2010, 2009 and 2008:

	Year ended December 31,
	2010			2009			2008
Proceeds from sales	$	3,222,700		$	2,258,653		$	2,696,635
Gross realized investment gains from sales		62,702			42,375			50,173
Gross realized investment losses from sales		(26	)		(267	)		(1,456	)

Gross realized gains and losses from sales were primarily attributable to changes in interest rates and gains on repurchase agreement transactions.

The Company has a corporate fixed maturity security with fair values of $8,845 and $7,979 that has been non-income producing for the twelve months preceding December 31, 2010 and 2009, respectively. This security was written down to its fair value in the period it was deemed to be other-than-temporarily impaired. No additional impairment has been recognized since the period in which it was deemed impaired.

The Company holds certain performing securities subject to deferred coupons in which the issuer has exercised its contractual right to defer the payment of the coupons. At December 31, 2010, the Company had total coupon payment receivables of $457. The Company expects to receive these payments in 2012. Based on the information presently available, management believes there is reasonable assurance of collection of the deferred coupons at the end of the deferral period. At December 31, 2009, the Company held certain performing securities subject to deferred coupons where deferral was not elected.

Derivative financial instruments - The Company uses derivative financial instruments for risk management purposes associated with certain invested assets and policy liabilities. Derivatives are not used for speculative purposes. As detailed below, derivatives are used to (a) hedge the economic effects of interest rate and stock market movements on the Company’s guaranteed minimum withdrawal benefit (“GMWB”) liabilities, (b) hedge the economic effect of a large increase in interest rates on the Company’s general account life insurance, group pension liabilities and separate account life insurance liabilities, (c) hedge the economic risks of other transactions such as future asset acquisitions or dispositions, the timing of liability pricing, currency risks on non-U.S. dollar denominated assets, and (d) convert floating rate assets to fixed rate assets for asset/liability management purposes.

Derivative transactions are entered into pursuant to master agreements that provide for a single net payment to be made by one party to the other on a daily basis, periodic payment dates, or at the due date, expiration or termination of the agreement.

The Company controls the credit risk of its derivative contracts through credit approvals, limits, monitoring procedures, and in most cases, requiring collateral. The Company’s exposure is limited to the portion of the fair value of derivative instruments that exceeds the value of the collateral held and not to the notional or contractual amounts of the derivatives. The Company incorporates the market’s perception of its own and the counterparty’s non-performance risk through review of credit spreads in determining the fair value of the portion of its over-the-counter (“OTC”) derivative assets and liabilities that are uncollateralized. Fair values are adjusted accordingly based on an internal carry value adjustment model at December 31, 2010. As the Company enters into derivative transactions only with high quality institutions, no losses have been incurred due to non-performance by any of the counterparties. Certain of these arrangements require collateral when the fair value exceeds certain thresholds and also include credit contingent provisions that provide for a reduction of these thresholds in the event of downgrades in the credit ratings of the Company and/or the counterparty.

25

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Certain interest rate swaptions and swaps in a net asset position have cash pledged as collateral to the Company in accordance with the collateral support agreements with the counterparty. As of December 31, 2010 and 2009, the $7,790 and $4,300, respectively, of unrestricted cash collateral received is included in other assets and the obligation to return is included in other liabilities. The cash collateral is reinvested in a government money market fund. These collateral amounts are not offset against the derivative fair values in the accompanying tables.

Requirements for collateral pledged to the Company are determined based on the counterpartys’ credit rating. Requirements for collateral pledged by the Company are determined based on the Company’s credit rating. In the event of credit downgrades, additional collateral may be required. At December 31, 2010, the Company did not have derivatives in a net liability position. As a result, the Company would not be required to pledge any additional collateral in the event of a downgrade.

The Company may purchase a financial instrument that contains a derivative embedded in the financial instrument. Upon purchasing the instrument, the Company determines if (a) the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and (b) a separate instrument with the same terms would qualify as a derivative instrument. If the Company determines that these conditions are met, the embedded derivative is bifurcated from the host contract and accounted for as a freestanding derivative.

Cash flow hedges - Interest rate swap agreements are used to convert the interest rate on certain debt securities from a floating rate to a fixed rate. Foreign currency exchange contracts are used to manage the foreign exchange rate risk associated with bonds denominated in other than U.S. dollars. Interest rate futures are used to manage the interest rate risks of forecasted acquisitions of fixed rate maturity investments. The Company’s derivatives treated as cash flow hedges are eligible for hedge accounting.

As of December 31, 2010, the Company estimates that $6,323 of net derivative gains included in accumulated other comprehensive income (loss) will be reclassified into net income within the next twelve months.

Fair value hedges - Interest rate futures are used to manage the risk of the change in the fair value of certain fixed rate maturity investments. The Company’s derivatives treated as fair value hedges are eligible for hedge accounting.

Derivatives not designated as hedging instruments

GMWB Derivative Instruments - The Company introduced a variable annuity product with a GMWB in 2010. This product utilizes an investment risk hedging program including purchases of the following derivative instruments: exchange-traded interest rate swap futures and exchange traded equity index futures on certain indices. The Company anticipates adding OTC interest rate swaps as the product sales volume grows. While these derivatives are economic hedges and used to manage risk, the Company will not elect hedge accounting on these transactions. Although the hedge program is actively managed, it may not exactly offset changes in the GMWB liability due to, among other things, divergence between the performance of the underlying investments and the hedge instruments, high levels of volatility in the equity and interest rate markets and differences between actual contractholder behavior and what is assumed. The performance of the underlying investments compared to the hedge instruments is further impacted by a time lag, since the data is not reported and incorporated into the required hedge position on a real time basis.

Interest Rate Risk Derivative Instruments - The Company began an interest rate risk hedging program during the fourth quarter of 2009 to hedge the economic effect of a large increase in interest rates on the Company’s general account life insurance and group pension liabilities as well as certain separate account life insurance liabilities. While these derivatives are economic hedges and used to manage risk, the Company will not elect hedge accounting on these transactions.

26

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The hedging program for the general account life insurance and group pension liabilities incorporates a combination of static hedges purchased in 2009 and dynamic (i.e. frequently rebalanced based on interest rate movements) hedges which were put in place in 2010. These hedges are used to manage the potential variability in future interest payments due to a change in credited interest rates and the related change in cash flows due to increased surrenders. The Company has purchased the following derivative instruments: (a) OTC interest rate swaptions as static hedges, and (b) OTC interest rate swaps, exchange-traded interest rate swap futures, and exchange-traded Eurodollar interest rate futures as dynamic hedges.

The hedging program for certain separate account life insurance liabilities is also a combination of static and dynamic hedges using OTC interest rate swaptions, OTC interest rate swaps, exchange-traded interest rate swap futures, and exchange-traded Eurodollar interest rate futures. These hedges are used to manage the potential change of cash flows due to increased surrenders. The costs and performance of these hedges are passed directly to the associated separate account liabilities through an adjustment to the liability credited rates. The notional amount of the Company’s swaptions associated with the separate account liabilities is approximately 28% of the total swaption notional amount as of December 31, 2010. The notional amount of the derivatives used in the dynamic hedging program associated with separate account liabilities is approximately 5% of the total notional within that program as of December 31, 2010.

Other Derivative Instruments - In 2009, the Company used U.S. Treasury futures contracts to hedge fair value changes in certain interest rate swaps. During the fourth quarter of 2010, the Company utilized futures on equity indices to hedge the Company’s equity based fee income. While these derivatives are economic hedges and used to manage risk, the Company did not elect hedge accounting on these transactions.

27

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following tables summarize derivative financial instruments at December 31, 2010 and 2009:

	December 31, 2010
			Net derivatives			Asset derivatives		Liability derivatives
	Notional amount		Fair value			Fair value (1)		Fair value (1)
Hedge designation/derivative type:
Derivatives designated as hedges:
Cash flow hedges:
Interest rate swaps	$	90,700	$	10,255		$	10,386	$	131
Foreign currency exchange contracts		30,000		(252	)		-		252
Interest rate futures		80,700		-			-		-
Total cash flow hedges		201,400		10,003			10,386		383
Fair value hedges:
Interest rate futures		128,900		-			-		-
Total fair value hedges		128,900		-			-		-
Total derivatives designated as hedges		330,300		10,003			10,386		383
Derivatives not designated as hedges:
GMWB derivative instruments:
Interest rate swap futures		5,300		-			-		-
Futures on equity indices		680		-			-		-
Total GMWB derivative instruments		5,980		-			-		-
Interest rate risk derivative instruments:
Interest rate swaps		612,902		4,036			9,484		5,448
Interest rate futures		2,460		-			-		-
Interest rate swap futures		44,600		-			-		-
Interest rate swaptions		1,083,000		4,956			4,956		-
Total interest rate risk derivative instruments		1,742,962		8,992			14,440		5,448
Total derivatives not designated as hedges		1,748,942		8,992			14,440		5,448
Total cash flow hedges, fair value hedges, and derivatives not
designated as hedges	$	2,079,242	$	18,995		$	24,826	$	5,831

⁽¹⁾ The estimated fair value of all derivatives in an asset position are reported within other assets and the estimated fair value of all derivatives in a liability position are reported within other liabilities in the consolidated balance sheets.

28

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	December 31, 2009
			Net derivatives			Asset derivatives		Liability derivatives
	Notional amount		Fair value			Fair value (1)		Fair value (1)
Hedge designation/derivative type:
Derivatives designated as hedges:
Cash flow hedges:
Interest rate swaps	$	156,500	$	14,690		$	14,690	$	-
Foreign currency exchange contracts		30,000		(3,317	)		-		3,317
Interest rate futures		22,500		-			-		-
Total cash flow hedges		209,000		11,373			14,690		3,317
Fair value hedges:
Interest rate futures		39,200		-			-		-
Total fair value hedges		39,200		-			-		-
Total derivatives designated as hedges	$	248,200	$	11,373		$	14,690	$	3,317
Derivatives not designated as hedges:
Interest rate risk derivative instruments:
Interest rate swaptions		1,140,000		8,460			8,460		-
Total interest rate risk derivative instruments		1,140,000		8,460			8,460		-
Other derivative instruments:
Interest rate futures		103,500		-			-		-
Total other derivative instruments		103,500		-			-		-
Total derivatives not designated as hedges		1,243,500		8,460			8,460		-
Total cash flow hedges, fair value hedges, and derivatives not designated as hedges	$	1,491,700	$	19,833		$	23,150	$	3,317

⁽¹⁾ The estimated fair value of all derivatives in an asset position are reported within other assets and the estimated fair value of all derivatives in a liability position are reported within other liabilities in the consolidated balance sheets.

Notional amounts are used to express the extent of the Company’s involvement in derivative transactions and represent a standard measurement of the volume of its derivative activity. Notional amounts represent those amounts used to calculate contractual flows to be exchanged. Notional amounts are not paid or received.

The Company had 117 and 18 swap transactions with an average notional amount of $19,745 and $9,415 during the years ended December 31, 2010 and 2009, respectively. The Company had 979 and 129 futures transactions with an average number of contracts per transaction of 26 and 113 during the years ended December 31, 2010 and 2009, respectively. The decrease in the average number is related to smaller, more frequent trades in the interest rate risk dynamic hedging program. As of December 31, 2010, the Company had three swaptions expire.

The change in notional amount of derivatives since December 31, 2009 was primarily due to the following:

29

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

• The increased number of derivative transactions, and therefore notional amount, is associated with the Interest Rate Risk dynamic hedging program and the GMWB hedging program both of which began in June 2010. Volumes are expected to continue to grow under these programs.

• The decrease in the notional regarding interest rate futures under other derivative instruments was due to the Company closing futures hedging interest rate swaps during the fourth quarter of the current year.

The Company recognized total derivative gains (losses) in net investment income of $1,366 and $2,105 for the years ended December 31, 2010 and 2009, respectively. The preceding amounts are all shown net of any gains (losses) on the hedged assets in a fair value hedge that has been recorded in net investment income. The Company realized net investment gains (losses) on closed derivative positions of ($17,076) and ($3,905) for the years ended December 31, 2010 and 2009, respectively.

The following tables present the effect of derivative instruments in the consolidated statements of income for the years ended December 31, 2010 and 2009 reported by cash flow hedges, fair value hedges and economic hedges:

	Gain (loss) recognized in AOCI on derivatives (Effective portion)					Gain (loss) reclassified from AOCI into net income (Effective  portion)					Gain (loss) recognized in net income on derivatives (Ineffective portion  and amount excluded from effectiveness testing)
	Year ended December 31,					Year ended December 31,				Income statement location	Year ended December 31,				Income statement location
	2010		2009			2010		2009			2010		2009
Cash flow hedges:
Interest rate swaps		13,896	$	(52,350	)	$	1,582	$	553	(A)		-	$	6		(A)
Foreign currency exchange contracts		3,065		(5,334	)		-		-			-		-
Interest rate futures		-		-			-		-			92		-		(A)
Interest rate futures		332		466			110		53	(A)		545		-		(B)
Total cash flow hedges	$	17,293	$	(57,218	)	$	1,691	$	606		$	637	$	6
(A)Net investment income. (B)Realized investment gains (losses), net. Represents realized gains (losses) on closed positions.

	Gain (loss) on derivatives recognized in net income						Gain (loss) on hedged assets recognized in net income
	Year ended December 31,				Income statement location		Year ended December 31,				Income statement location
	2010		2009				2010		2009
Fair value hedges:
Interest rate futures	$	(1,027)	$	6,030		(A)	$	-	$	-
Interest rate futures		(1,088)		(1,124)		(B)		-		-
Items hedged in interest rate futures		-		-				3,632		(4,691)		(A)
Total fair value hedges (1)	$	(2,115)	$	4,906			$	3,632	$	(4,691)

⁽¹⁾  Hedge ineffectiveness of $1,517 and $215 for the years ended 2010 and 2009, respectively, is recognized in net investment income.

(A) Net investment income.

(B) Realized investment gains (losses), net. Represents realized gains (losses) on closed positions.

30

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Gain (loss) on derivatives recognized in net income
	Year ended December 31, 2010			Income statement location			Year ended December 31, 2009			Income statement location
Derivatives not designated as hedging instruments:
GMWB derivative instruments:
Interest rate swap futures	$	16			(A	)	$	-
Interest rate swap futures		(352	)		(B	)		-
Futures on equity indices		(9	)		(A	)		-
Futures on equity indices		(84	)		(B	)		-
Total GMWB derivative instruments		(429	)					-
Interest rate risk derivative instruments:
Interest rate swaps		4,036			(A	)		-
Interest rate swaps		(4,305	)		(B	)		-
Interest rate futures		98			(A	)		-
Interest rate futures		(432	)		(B	)		-
Interest rate swaptions		(3,450	)		(A	)		-
Interest rate swaptions		(54	)		(B	)		-
Total interest rate risk derivative instruments		(4,107	)					-
Other derivative instruments:
Interest rate futures		(3,714	)		(A	)		3,714			(A	)
Interest rate futures		(10,856	)		(B	)		(2,781	)		(B	)
Interest rate swaptions		-			(A	)		(3,560	)		(A	)
Interest rate swaps		(171	)		(B	)		-
Futures on equity indicies		(279	)		(B	)		-
Total other derivative instruments		(15,020	)					(2,627	)
Total derivatives not designated as hedging instruments	$	(19,556	)				$	(2,627	)

(A) Net investment income

(B) Realized investment gains (losses), net. Represents realized gains (losses) on closed positions.

Mortgage loans - The Company’s mortgage loans on real estate are comprised exclusively of domestic commercial collateralized real estate loans. The table below summarizes the carry value of the mortgage loan portfolio by component as of December 31, 2010 and 2009:

	December 31,
	2010			2009
Principal	$	1,709,075		$	1,532,596
Write-offs		-			-
Unamortized premium (discount)		29,647			36,390
Allowance for credit loss		(16,300	)		(14,854	)
Total mortgage loans	$	1,722,422		$	1,554,132

Of the total principal balance in the mortgage loan portfolio, $8,470 and $578 related to impaired loans at December 31, 2010 and 2009, respectively.

The Company uses an internal risk assessment process as a primary credit quality indicator, which is updated quarterly, with regard to impairment review and credit loss calculations. The Company follows a

31

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

comprehensive approach with the management of mortgage loans that includes ongoing analysis of factors such as debt service coverage ratios, loan-to-value ratios, payment status, default or legal status, annual collateral property evaluations and general market conditions. Management’s risk assessment process is subjective and includes the categorization of all loans, based on the above mentioned credit quality indicators, into one of the following categories:

•    Performing - generally indicates the loan has standard market risk and is within its original underwriting guidelines.

•    Non-performing - generally indicates that there is a potential for loss due to the deterioration of financial/monetary default indicators, or potential foreclosure. Due to the potential for loss, these loans are disclosed as impaired.

The Company’s allowance for credit loss is reviewed and determined by applying the Company’s historic loss percentages, adjusted to current credit market conditions, to loan groups with similar credit quality indicators. Loans that meet the non-performing category and other loans with certain substandard credit quality indicators are individually reviewed to determine if a specific impairment is required. Loans reviewed for specific impairment are excluded from the analysis to estimate the credit loss allowance for the loans categorized as performing in the portfolio.

The recorded investment of impaired mortgage loans was $9,576 and $626 for the years ended December 31, 2010 and 2009, respectively. The Company estimated no loss and therefore no specific allowance was recorded at December 31, 2010, 2009 or 2008. The average recorded investment of impaired mortgage loans was $5,101 and $313 for the years ended December 31, 2010 and 2009, respectively. The interest income earned and recognized on impaired loans during the years ended December 31, 2010 and 2009 was $465 and $48, respectively. The interest income collected on impaired loans during the years ended December 31, 2010 and 2009 was $610 and $51, respectively. For the year ended December 31, 2008, there was no interest income earned and recognized or collected on impaired loans.

The following table summarizes the recorded investment of the mortgage loan portfolio by risk assessment category as of December 31, 2010 and 2009:

	Years ended December 31,
	2010		2009
Performing	$	1,729,146	$	1,568,360
Non-performing		9,576		626
Total	$	1,738,722	$	1,568,986

The following table summarizes activity in the allowance for mortgage loan credit losses for the years 2010 and 2009:

32

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	December 31,
	2010		2009
	Commercial mortgages		Commercial mortgages
Beginning balance	$	14,854	$	8,834
Charge offs		-		-
Recoveries		-		-
Provision increases		1,446		6,172
Provision decreases		-		(152	)
Quantitative change in policy or methodology		-		-
Ending balance	$	16,300	$	14,854
Ending allowance balance from loans individually evaluated for impairment	$	-	$	-
Ending allowance balance from loans collectively evaluated for impairment		16,300		14,854
Ending allowance balance from loans acquired with deteriorated credit quality		-		-
Mortgage loans, gross of allowance, ending recorded investment	$	1,738,722	$	1,568,986
Ending recorded investment of loans individually evaluated for impairment		27,250		4,506
Ending recorded investment of loans collectively evaluated for impairment		1,711,472		1,564,480
Ending recorded investment of loans acquired with deteriorated credit quality		-		-

There was no specific impairment for the years ended December 31, 2010, 2009 or 2008. One property was acquired through foreclosure during 2010. There were no properties acquired through foreclosure during 2009. The property acquired through foreclosure in 2010 was liquidated during 2010 for $513. As of December 31, 2010 and 2009, there were four and one properties, respectively, in the process of foreclosure which had carry values of $2,158 and $626, respectively. The Company did not complete any significant purchases or sales of mortgage loans during the years ended December 31, 2010 and 2009.

The tables below summarize the recorded investment of the mortgage loan portfolio by aging category as of December 31, 2010 and 2009:

33

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	December 31, 2010
	Current		Loan balances 31-60 days past due		Loan balances 61-89 days past due		Loan balances greater than 90 days past due or in process of foreclosure (1)		Total portfolio balance
Commercial mortgages	$	1,733,922	$	2,642	$	-	$	2,158	$	1,738,722
(1) Includes four loans in the amount of $2,158 in process of foreclosure.
	December 31, 2009
	Current		Loan balances 31-60 days past due		Loan balances 61-89 days past due		Loan balances greater than 90 days past due or in process of foreclosure (1)		Total portfolio balance
Commercial mortgages	$	1,568,360	$	-	$	-	$	626	$	1,568,986
(1) Includes one loan in the amount of $626 in process of foreclosure.

Loan balances are considered past due when payment has not been received based on contractually agreed upon terms. For loan balances greater than 90 days past due or in the process of foreclosure, all accrual of interest was discontinued. There were no loans greater than 90 days past due and accruing interest during the years ended December 31, 2010 and 2009. The Company resumes interest accrual on loans when a loan returns to current status. Interest accrual may also resume under new terms when loans are restructured or modified.

Occasionally, the Company elects to restructure certain mortgage loans if the economic benefits are considered to be more favorable than those achieved by acquiring the collateral through foreclosure. At December 31, 2010, the Company had one loan, with a carry value of $6,355, classified as a troubled debt restructuring with loan modifications which primarily reduced the interest rate for the life of the loan, but did not extend the maturity date or forgive any principal. The Company did not create a specific allowance for the restructured loan. At December 31, 2009, there were no restructured loans.

Equity investments - The carrying value of the Company’s equity investments was $1,888 and $25,679 at December 31, 2010 and 2009, respectively. The decrease in the carry value of the Company’s equity investments was due to the sale of certain holdings in mutual funds with exposure to the S&P 500 index and growth oriented securities.

Limited partnership and other corporation interests - The Company invests in limited partnership interests, which include limited partnerships established for the purpose of investing in low-income housing that qualify for federal and state tax credits, and other corporation interests. At December 31, 2010 and 2009, the Company had $210,146 and $253,605, respectively, invested in limited partnerships and other corporation interests.

In the normal course of its activities, the Company is involved with other entities that are considered variable interest entities (“VIE”). An entity would be determined to be a primary beneficiary, and thus consolidated when the entity has both (a) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (b) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE. When the Company becomes involved with a VIE and when the nature of the Company’s involvement with the entity changes, in order to determine if the Company is the primary beneficiary and must consolidate the entity, it evaluates:

34

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

• The structure and purpose of the entity;

• The risks and rewards created by and shared through the entity and

• The entity’s participants’ ability to direct the activities, receive its benefits and absorb its losses.

Accordingly, the Company has determined its investment in low-income housing limited partnerships (“LIHLP”) to be considered a VIE. The purpose of an LIHLP is to provide financing of affordable housing by making certain tax credits available to investors. Beginning in 2002, the Company made initial cash investments for the various tax credits. The Company is a 99% limited partner in various upper-tier LIHLPs. The general partner is most closely involved in the development and management of the LIHLP project. As limited partner, the Company has few or no voting rights, but expects to receive the tax credits allocated to the partnership and operating losses from depreciation and interest expense. The Company is only an equity investor and views the LIHLP as a single investment. The general partner has a small ownership of the partnership, which requires a de minimus capital contribution. This equity investment is reduced based on fees paid at inception by the limited partner; therefore, the general partner does not qualify as having an equity investment at risk in the LIHLP project. However, the limited partner does not have the direct or indirect ability through voting rights or similar rights to make decisions about the general partner’s activities that have a significant effect on the success of the partnership.

Although the Company is involved with the VIE, it determined that consolidation was not required because it has no power to direct the activities that most significantly impact the entities’ economic performance (exert influence over the entity’s operations).

The Company performs ongoing qualitative analyses of its involvement with VIEs to determine if consolidation is required.

The following table presents information about the nature and activities of the VIE and effect on the Company’s financial statements as of December 31, 2010 as follows:

Limited partnership interests and limited  liability corporation interests		Liabilities		Maximum exposure to loss
$	151,158	$	-	$	151,158

All of the Company’s investments in LIHLPs are guaranteed by third parties. One of the guarantors, guaranteeing 7% of the LIHLPs, filed for bankruptcy protection in 2009; however, the bankruptcy does not currently impact the guarantee. Eighty-two percent, or $123,853 of the interests, are backed by third party guarantors with an investment grade rating.

The Company is not required to provide any additional funding to the LIHLPs unless the investment exceeds the minimum yield guarantee. The Company has not provided any additional financial or other support during the period from January 1, 2010 to December 31, 2010 that it was not previously contractually required to provide.

Securities pledged, special deposits and securities lending - The Company pledges investment securities it owns to unaffiliated parties related to interest rate futures initial margin. The fair value of margin deposits related to futures contracts was approximately $5,979 and $4,955 at December 31, 2010 and 2009, respectively. These pledged securities are included in fixed maturities in the accompanying consolidated balance sheets.

The Company had securities on deposit with governmental authorities as required by certain insurance laws with fair values in the amounts of $14,144 and $13,599 at December 31, 2010 and 2009, respectively. These deposits are included in short-term investments in the accompanying consolidated balance sheets.

35

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The Company participates in a securities lending program whereby securities, which are included in investments in the accompanying consolidated balance sheets, are loaned to third parties. Securities with a cost or amortized cost in the amounts of $45,000 and $34,940 and estimated fair values in the amounts of $50,807 and $37,081 were on loan under the program at December 31, 2010 and 2009, respectively. The Company received restricted cash collateral in the amounts of $51,749 and $38,296 at December 31, 2010 and 2009, respectively.

Impairment of fixed maturity and equity investments classified as available-for-sale - The Company classifies the majority of its fixed maturity investments and all of its equity investments as available-for-sale and records them at fair value with the related net unrealized gain or loss, net of policyholder related amounts and deferred taxes, in accumulated other comprehensive income (loss) in the stockholder’s equity section in the accompanying consolidated balance sheets. All available-for-sale securities with gross unrealized losses at the consolidated balance sheet date are subjected to the Company’s process for the identification and evaluation of other-than-temporary impairments.

The assessment of whether an other-than-temporary impairment has occurred on fixed maturity investments where management does not intend to sell the fixed maturity investment and it is not more likely than not the Company will be required to sell the fixed maturity investment before recovery of its amortized cost basis, is based upon management’s case-by-case evaluation of the underlying reasons for the decline in fair value. Management considers a wide range of factors, as described below, regarding the security issuer and uses its best judgment in evaluating the cause of the decline in its estimated fair value and in assessing the prospects for near-term recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the issuer’s operations and ability to generate future cash flows. While all available information is taken into account, it is difficult to predict the ultimate recoverable amount from a distressed or impaired security.

Considerations used by the Company in the impairment evaluation process include, but are not limited to, the following:

• Fair value is below cost.

• The decline in fair value is attributable to specific adverse conditions affecting a particular instrument, its issuer, an industry or geographic area.

• The decline in fair value has existed for an extended period of time.

• A fixed maturity investment has been downgraded by a credit rating agency.

• The financial condition of the issuer has deteriorated.

• The payment structure of the fixed maturity investment and the likelihood of the issuer being able to make payments in the future.

• Dividends have been reduced or eliminated or scheduled interest payments have not been made.

Unrealized losses on fixed maturity and equity investments classified as available-for-sale

36

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following tables summarize unrealized investment losses, including the non-credit-related portion of other-than-temporary impairment losses reported in accumulated other comprehensive income (loss), by class of investment at December 31, 2010 and 2009:

Fixed maturities:	December 31, 2010
	Less than twelve months				Twelve months or longer				Total
	Estimated fair value		Unrealized loss and OTTI		Estimated fair value		Unrealized loss and OTTI		Estimated fair value		Unrealized loss and OTTI
U.S. government direct obligations and U.S. agencies	$	892,025	$	14,551	$	22,471	$	233	$	914,496	$	14,784
Obligations of U.S. states and their subdivisions		391,101		11,332		99,720		4,271		490,821		15,603
Corporate debt securities		477,059		15,486		819,627		129,000		1,296,686		144,486
Asset-backed securities		52,814		1,505		1,071,557		152,652		1,124,371		154,157
Residential mortgage-backed securities		26,142		509		146,532		11,610		172,674		12,119
Commercial mortgage-backed securities		53,462		2,086		79,429		18,529		132,891		20,615
Collateralized debt obligations		5,745		29		23,112		5,752		28,857		5,781
Total fixed maturities	$	1,898,348	$	45,498	$	2,262,448	$	322,047	$	4,160,796	$	367,545
Equity investments:
Equity mutual funds	$	6	$	-	$	3	$	-	$	9	$	-
Airline industry		612		77		-		-		612		77
Total equity investments	$	618	$	77	$	3	$	-	$	621	$	77
Total number of securities in an unrealized loss position				183				237				420

Fixed maturities:	December 31, 2009
	Less than twelve months				Twelve months or longer				Total
	Estimated fair value		Unrealized loss and OTTI		Estimated fair value		Unrealized loss and OTTI		Estimated fair value		Unrealized loss and OTTI
U.S. government direct obligations and U.S. agencies	$	535,595	$	10,502	$	19,330	$	313	$	554,925	$	10,815
Obligations of U.S. states and their subdivisions		132,151		4,214		608		-		132,759		4,214
Corporate debt securities		673,534		74,461		1,190,858		142,425		1,864,392		216,886
Asset-backed securities		92,005		52,042		1,558,338		331,923		1,650,343		383,965
Residential mortgage-backed securities		53,623		3,629		550,036		72,268		603,659		75,897
Commercial mortgage-backed securities		-		-		297,604		35,792		297,604		35,792
Collateralized debt obligations		1,400		173		34,678		2,270		36,078		2,443
Total fixed maturities	$	1,488,308	$	145,021	$	3,651,452	$	584,991	$	5,139,760	$	730,012
Equity investments:
Consumer products	$	-	$	-	$	2	$	2	$	2	$	2
Equity mutual funds		2,374		450		-		-		2,374		450
Airline industry		694		5		-		-		694		5
Total equity investments	$	3,068	$	455	$	2	$	2	$	3,070	$	457
Total number of securities in an unrealized loss position				159				358				517

Fixed maturity investments - Total unrealized losses and other-than-temporary impairment losses decreased by $362,467 or 50%, from December 31, 2009 to December 31, 2010. This decrease in unrealized losses was across most asset classes and reflects recovery in market liquidity, lower interest rates and tightening of credit spreads, although the economic uncertainty in these markets still remains.

37

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Unrealized losses on securities of U.S. government and U.S. states and their subdivisions increased by $3,969 and $11,389, respectively from December 31, 2009 to December 31, 2010. These increases were primarily due to the increase in interest rates subsequent to the acquisition of these securities by the Company.

Unrealized losses on corporate debt securities decreased by $72,400 from December 31, 2009 to December 31, 2010. The valuation of these securities has been significantly influenced by market conditions with increased liquidity, lower interest rates and tightening of credit spreads resulting in generally higher valuations of fixed income securities. Management has classified these securities by sector, calculated as a percentage of total unrealized losses as follows:

	December 31,
Sector	2010		2009
Finance		78%		77%
Utility		8%		10%
Natural resources		4%		4%
Consumer		4%		4%
Transportation		1%		2%
Other		5%		3%
		100%		100%

While the proportionate percentage in the finance sector had an increase of 1%, the actual unrealized losses in the sector decreased by $54,644 from December 31, 2009 to December 31, 2010. The proportionate percentage in the utility sector decreased by 2%, and the actual unrealized losses decreased by $9,437.

Unrealized losses on asset-backed, residential and commercial mortgage-backed securities decreased by $229,808, $63,778, and $15,177, respectively, since December 31, 2009, generally due to tightening of credit spreads, lower interest rates, increased market liquidity and other-than-temporary impairment recognized during the period.

Of the total estimated fair value of fixed maturities with unrealized losses and OTTI greater than twelve months, asset-backed securities account for 47%. Of the $152,652 of unrealized losses and OTTI over twelve months on asset-backed securities, 69% are on securities which continue to be rated investment grade. Of the securities which are not rated investment grade (approximately $48,084 of the $152,652), 90% are securities that are guaranteed by monoline insurers. Of the remaining securities, the unrealized losses have decreased 66% since December 31, 2009, from $13,621 to $4,578. The present value of the cash flows expected to be collected is not less than amortized cost. Management does not have the intent to sell these assets prior to a full recovery; therefore, an OTTI was not recognized in earnings. Accordingly, unless otherwise noted below in the other-than-temporary impairment recognition section, the underlying collateral on the asset-backed securities within the portfolio along with credit enhancement is sufficient to expect full repayment of the principal.

Of the $129,000 of unrealized losses and OTTI over twelve months on corporate debt securities, 64% are on securities which continue to be rated investment grade. Of the non-investment grade securities with unrealized losses since December 31, 2009 and OTTI greater than twelve months, the unrealized losses have decreased 49% from $91,726 to $46,693. Of the $46,693, $32,565 of losses are on investments held in foreign banks. The prices of securities held in foreign banks have been impacted by their long duration combined with widening spreads and the low London Interbank Offering Rate (“LIBOR”) based floating rates. Although foreign banks have suffered from the weak credit and economic environment, they benefit from central bank support. Management does not have the intent to sell these assets prior to a full recovery; therefore, an OTTI was not recognized in earnings.

38

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

See Note 7 for additional discussion regarding fair value measurements.

Equity investments - The decrease in unrealized losses of $380 from December 31, 2009 to December 31, 2010 is primarily due to the sale of certain holdings in mutual funds with exposure to the S&P 500 index and growth oriented securities.

Other-than-temporary impairment recognition - The Company recorded other-than-temporary impairments on fixed maturity investments and equity securities for the years ended December 31, 2010, 2009 and 2008 as follows:

	Year ended December 31, 2010
	OTTI recognized in realized gains/(losses)				OTTI recognized in OCI (2)
Fixed maturities:	Credit related (1)		Non-credit related		Non-credit related		Total
U.S. government direct obligations and U.S. agencies	$	750	$	10,035	$	-	$	10,785
Corporate debt securities		-		1,529		-		1,529
Asset-backed securities		64,896		-		16,242		81,138
Residential mortgage-backed securities		1,390		-		505		1,895
Collateralized debt obligations		34		-		-		34
Total fixed maturities	$	67,070	$	11,564	$	16,747	$	95,381
Equity investments:
Equity mutual funds	$	-	$	268	$	-	$	268
Total equity investments	$	-	$	268	$	-	$	268
Limited partnership investment:
Limited partnership interest	$	999	$	-	$	-	$	999
Total limited partnership investments	$	999	$	-	$	-	$	999
Total OTTI impairments	$	68,069	$	11,832	$	16,747	$	96,648

⁽¹⁾ Of the credit-related other-than-temporary impairment on asset-backed securities, $53,327 and $8,558 were related to Ambac Financial Group, Inc. and Financial Guaranty Insurance Company, respectively, for the year ended December 31, 2010. Of the $67,070 in total fixed maturities, $66,286 is the bifurcated loss recognized on securities.

⁽²⁾ Amounts are recognized in OCI in the period incurred.

39

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Fixed maturities:	Year ended December 31, 2009
	OTTI recognized in realized gains/(losses)				OTTI recognized in OCI (2)
	Credit related (1)		Non-credit related		Non-credit related		Total
U.S. government direct obligations and U.S. agencies	$	-	$	684	$	-	$	684
Corporate debt securities		3,652		6,181		-		9,833
Asset-backed securities		88,134		502		13,422		102,058
Residential mortgage-backed securities		-		28		-		28
Collateralized debt obligations		154		-		-		154
Total fixed maturities	$	91,940	$	7,395	$	13,422	$	112,757
Equity investments:
Equity mutual funds	$	7	$	-	$	-	$	7
Total equity investments	$	7	$	-	$	-	$	7
Total OTTI impairments	$	91,947	$	7,395	$	13,422	$	112,764

⁽¹⁾ Of the credit-related other-than-temporary impairment on asset-backed securities, all of it was related to Financial Guaranty Insurance Company for the year ended December 31, 2009.

⁽²⁾ Amounts are recognized in OCI in the period incurred.

40

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Fixed maturities:	Year ended December 31, 2008
	OTTI recognized in realized gains/(losses)				OTTI recognized in OCI
	Credit related (1)		Non-credit related		Non-credit related		Total
U.S. government direct obligations and U.S. agencies	$	-	$	8,302	$	-	$	8,302
Corporate debt securities		61,953		7,047		-		69,000
Asset-backed securities		-		3,259		-		3,259
Residential mortgage-backed securities		-		4,140		-		4,140
Commercial mortgage-backed securities		-		3,185		-		3,185
Total fixed maturities	$	61,953	$	25,933	$	-	$	87,886
Equity investments:
Airline industry	$	2,146	$	-	$	-	$	2,146
Technology industry		244		-		-		244
Total equity investments	$	2,390	$	-	$	-	$	2,390
Limited partnership investment:
Limited partnership interest	$	1,122	$	-	$	-	$	1,122
Total limited partnership investments	$	1,122	$	-	$	-	$	1,122
Total OTTI impairments	$	65,465	$	25,933	$	-	$	91,398

⁽¹⁾ Of the credit-related other-than-temporary impairment on corporate debt securities, $35,657 and $25,939 were related to General Motors Corporation and Lehman Brothers, respectively, for the year ended December 31, 2008.

The other-than-temporary impairments of fixed maturity securities where the loss portion is bifurcated and the credit related component is recognized in realized investment gains (losses) is summarized as follows:

Bifurcated credit loss balance, April 1, 2009	$	43,871
Non-credit losses reclassified out of retained earning into AOCI		(16,680	)
Credit loss recognized on securities		88,134
Bifurcated credit loss balance, December 31, 2009		115,325
Credit loss recognized on securities		66,286
Bifurcated credit loss balance, December 31, 2010	$	181,611

The credit loss portion on fixed maturities was determined as the difference between the securities’ amortized cost and the present value of expected future cash flows. These expected cash flows were determined using judgment and the best information available to the Company and were discounted at the securities’ original effective interest rate. Inputs used to derive expected cash flows included default rates, credit ratings, collateral characteristics and current levels of subordination.

41

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Net Investment Income

The following table summarizes net investment income for the years ended December 31, 2010, 2009 and 2008:

	Year ended December 31,
	2010			2009			2008
Investment income:
Fixed maturity and short-term investments	$	823,828		$	795,323		$	766,625
Equity investments		68			532			1,240
Mortgage loans on real estate		96,711			85,116			73,838
Policy loans		234,944			244,140			218,687
Limited partnership interests		5,767			2,514			2,601
Net interest on funds withheld balances under reinsurance agreements, related party		17,130			18,448			13,969
Derivative instruments (1)		7,182			10,489			5,987
Other		5,011			6,082			8,788
		1,190,641			1,162,644			1,091,735
Investment expenses		(15,897	)		(13,560	)		(13,266	)
Net investment income	$	1,174,744		$	1,149,084		$	1,078,469

⁽¹⁾ Includes fair value gains (losses) of $1,366, $2,105 and ($216), net of any gains (losses) on the hedged assets in a fair value hedge, for the years ended December 31, 2010, 2009 and 2008, respectively.

Included in net investment income are unrealized gains (losses) of $9,587, $4,749 and ($969) on held-for-trading fixed maturity investments still held at December 31, 2010, 2009 and 2008, respectively.

Realized Investment Gains (Losses)

The following table summarizes realized investment gains (losses) for the years ended December 31, 2010, 2009 and 2008:

	Year ended December 31,
	2010			2009			2008
Realized investment gains (losses):
Fixed maturity and short-term investments	$	(15,793	)	$	(58,208	)	$	(30,797	)
Equity investments		8,007			7			(4,162	)
Mortgage loans on real estate		2,736			1,091			2,568
Limited partnership interests		(999	)		-			1,112
Derivative instruments		(17,076	)		(3,905	)		9,583
Other		76			(353	)		-
Provision for mortgage impairments, net of recoveries		(1,446	)		(6,172	)		-
Realized investment gains (losses):	$	(24,495	)	$	(67,540	)	$	(21,696	)

Included in net investment income and realized investment gains (losses) are amounts allocable to the participating fund account. This allocation is based upon the activity in a specific block of investments that are segmented for the benefit of the participating fund account. The amounts of net investment income allocated to the participating fund account were $4,481, $4,799 and $4,823 for the years ended December 31, 2010, 2009 and 2008, respectively. The amounts of realized investment gains (losses) allocated to the participating fund account were $438, $234 and $177 for the years ended December 31, 2010, 2009 and

42

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

2008, respectively. Net investment income and realized investment gains (losses) do not include any amounts from separate accounts.

7. Fair Value Measurements

The following tables summarize the carrying amounts and estimated fair values of the Company’s financial instruments at December 31, 2010 and 2009:

Assets	December 31, 2010				December 31, 2009
	Carrying amount		Estimated fair value		Carrying amount		Estimated fair value
Fixed maturities and short-term investments	$	17,051,738	$	17,051,738	$	14,546,467	$	14,546,467
Mortgage loans on real estate		1,722,422		1,809,356		1,554,132		1,570,217
Equity investments		1,888		1,888		25,679		25,679
Policy loans		4,059,640		4,059,640		3,971,833		3,971,833
Other investments		22,762		46,608		24,312		50,159
Derivative instruments		24,826		24,826		23,150		23,150
Collateral under securities lending agreements		51,749		51,749		38,296		38,296
Collateral under derivative counterparty collateral agreements		7,790		7,790		4,300		4,300
Separate account assets		22,489,038		22,489,038		18,886,901		18,886,901

Liabilities	December 31, 2010				December 31, 2009
	Carrying amount		Estimated fair value		Carrying amount		Estimated fair value
Annuity contract reserves without life contingencies (1)	$	7,976,954	$	7,912,850	$	7,117,591	$	7,105,090
Policyholders’ funds (2)		372,980		372,980		358,795		358,795
Repurchase agreements		936,762		936,762		491,338		491,338
Commercial paper		91,681		91,681		97,613		97,613
Payable under securities lending agreements		51,749		51,749		38,296		38,296
Payable under derivative counterparty collateral agreements		7,790		7,790		4,300		4,300
Derivative instruments		5,831		5,831		3,317		3,317
Notes payable		532,332		532,332		532,319		532,319

⁽¹⁾ The carrying amount for annuity contract reserves without life contingencies has been restated due to a previous misstatement from that previously reported of $7,167,733 as of December 31, 2009.

⁽²⁾ The carrying amount and estimated fair value for policyholders’ funds have been restated due to a previous misstatement from that previously reported of $286,175 and $286,175, respectively, as of December 31, 2009.

Fixed maturity and equity investments

The fair values for fixed maturity and equity securities are based upon quoted market prices or estimates from independent pricing services. However, in cases where quoted market prices are not readily available, such as for private fixed maturity investments, fair values are estimated. To determine estimated fair value for these instruments, the Company generally utilizes discounted cash flows calculated at current market rates on investments of similar quality and term. Fair value estimates are made at a specific point in time, based on available market information and judgments about financial instruments, including estimates of the timing and amounts of expected future cash flows and the credit standing of the issuer or

43

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

counterparty. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts of the Company’s financial instruments.

Short-term investments, securities lending agreements, repurchase agreements and commercial paper

The carrying value of short-term investments, collateral and payable under securities lending agreements, repurchase agreements and commercial paper is a reasonable estimate of fair value due to their short-term nature.

Mortgage loans on real estate

Mortgage loan fair value estimates are generally based on discounted cash flows. A discount rate matrix is incorporated whereby the discount rate used in valuing a specific mortgage generally corresponds to that mortgage’s remaining term and credit quality. Management believes the discount rate used is commensurate with the credit, interest rate, term, servicing costs and risks of loans similar to the portfolio loans that the Company would make today given its internal pricing strategy.

Policy loans

Policy loans accrue interest at variable rates with no fixed maturity dates; therefore, estimated fair values approximate carrying values.

Other investments

Other investments include the Company’s percentage ownership of foreclosed lease interests in aircraft. The estimated fair value is based on the present value of anticipated lease payments plus the residual value of the aircraft. Also included in other investments is real estate held for investment. The estimated fair value is based on appraised value.

Derivative counterparty collateral agreements

Included in other assets and other liabilities is cash collateral received from derivative counterparties and the obligation to return the cash collateral to the counterparties. The carrying value of the collateral approximates fair value.

Derivative instruments

Included in other assets and other liabilities are derivative financial instruments. The estimated fair values of OTC derivatives, primarily consisting of interest rate swaps and interest rate swaptions which are held for other than trading purposes, are the estimated amounts the Company would receive or pay to terminate the agreements at the end of each reporting period, taking into consideration current interest rates, counterparty credit risk and other relevant factors.

Separate account assets

Separate account assets include investments in mutual fund, fixed maturity and short-term securities. Mutual funds are recorded at net asset value, which approximates fair value, on a daily basis. The fixed maturity and short-term investments are valued in the same manner, and using the same pricing sources and inputs as the fixed maturity and short-term investments of the Company.

Annuity contract benefits without life contingencies

44

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The estimated fair values of annuity contract benefits without life contingencies are estimated by discounting the projected expected cash flows to the maturity of the contracts utilizing risk-free spot interest rates plus a provision for the Company’s credit risk.

Policyholders’ funds

The estimated fair values of policyholders’ funds are the same as the carrying amounts since the Company can change the interest crediting rates with thirty days notice.

Notes payable

The estimated fair values of the notes payable to GWL&A Financial are based upon discounted cash flows at current market rates on high quality investments.

Fair value hierarchy

The Company’s assets and liabilities recorded at fair value have been categorized based upon the following fair value hierarchy:

—      Level 1 inputs, which are utilized for general and separate account assets and liabilities, utilize observable, quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Financial assets and liabilities utilizing Level 1 inputs include actively exchange-traded equity securities.

—      Level 2 inputs utilize other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs, which are utilized for general and separate account assets and liabilities, include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. The fair values for some Level 2 securities were obtained from pricing services. The inputs used by the pricing services are reviewed at least quarterly or when the pricing vendor issues updates to its pricing methodology. For fixed maturity securities and separate account assets and liabilities, inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, evaluated bids, offers and reference data including market research publications. Additional inputs utilized for assets and liabilities classified as Level 2 are:

o Asset-backed, residential mortgage-backed, commercial mortgage-backed securities and collateralized debt obligations - new issue data, monthly payment information, collateral performance and third party real estate analysis.

o U.S. states and their subdivisions - material event notices.

o Equity investments - exchange rates, various index data and news sources.

o Short-term investments - valued on the basis of amortized cost, which approximates fair value.

o Other assets and liabilities (derivatives) - reported trades, swap curves, credit spreads, recovery rates, restructuring, currency volatility, net present value of cash flows and news sources.

o Separate account assets and liabilities - exchange rates, various index data and news sources, amortized cost (which approximates fair value), reported trades, swap curves, credit spreads, recovery rates, restructuring, currency volatility, net present value of cash flows and quoted prices in

45

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

markets that are not active or for which all significant inputs are observable, either directly or indirectly.

See Note 6 for further discussions of derivatives and their impact on the Company’s consolidated financial statements.

—      Level 3 inputs are unobservable and include situations where there is little, if any, market activity for the asset or liability. In general, the prices of Level 3 securities, which include both general and separate account assets and liabilities, were obtained from single broker quotes and internal pricing models. If the broker’s inputs are largely unobservable, the valuation is classified as a Level 3. Broker quotes are validated through an internal analyst review process, which includes validation through known market conditions and other relevant data. Internal models are usually cash flow based utilizing characteristics of the underlying collateral of the security such as default rate and other relevant data. Inputs utilized for securities classified as Level 3 are as follows:

o Corporate debt securities - single broker quotes which may be in an illiquid market or otherwise deemed unobservable.

o Asset-backed securities - internal models utilizing asset-backed securities index spreads.

o Separate account assets - single broker quotes which may be in an illiquid market or otherwise deemed unobservable or net asset value per share of the underlying investments.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2010 and 2009 and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value:

46

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Assets and liabilities measured at fair value on a recurring basis
	December 31, 2010
Assets	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Fixed maturities available-for-sale:
U.S. government direct obligations and U.S. agencies	$	-	$	2,371,150	$	-	$	2,371,150
Obligations of U.S. states and their subdivisions		-		1,942,263		-		1,942,263
Corporate debt securities		-		7,979,736		58,692		8,038,428
Asset-backed securities		-		1,711,438		290,488		2,001,926
Residential mortgage-backed securities		-		739,062		-		739,062
Commercial mortgage-backed securities		-		820,349		-		820,349
Collateralized debt obligations		-		29,865		14		29,879
Total fixed maturities available- for-sale		-		15,593,863		349,194		15,943,057
Fixed maturities held for trading:
U.S. government direct obligations and U.S. agencies		-		41,834		-		41,834
Corporate debt securities		-		49,961		-		49,961
Asset-backed securities		-		44,060		-		44,060
Commercial mortgage-backed securities		-		8,319		-		8,319
Total fixed maturities held for trading		-		144,174		-		144,174
Equity investments available-for-sale:
Financial services		-		725		-		725
Equity mutual funds		551		-		-		551
Airline industry		612		-		-		612
Total equity investments		1,163		725		-		1,888
Short-term investments available-for-sale		140,922		823,585		-		964,507
Collateral under securities lending agreements		51,749		-		-		51,749
Collateral under derivative counterparty collateral agreements		7,790		-		-		7,790
Other assets (1)		-		24,826		-		24,826
Separate account assets (2)		11,222,384		10,838,983		4,278		22,065,645
Total assets	$	11,424,008	$	27,426,156	$	353,472	$	39,203,636
Liabilities
Other liabilities (1)	$	-	$	5,831	$	-	$	5,831
Separate account liabilities (2)		93		301,108		-		301,201
Total liabilities	$	93	$	306,939	$	-	$	307,032

⁽¹⁾ Includes derivative financial instruments.

⁽²⁾  Includes only separate account investments which are carried at the fair value of the underlying invested assets owned by the separate accounts.

There were no significant transfers between Level 1 and Level 2 during the year ended December 31, 2010.

47

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Assets and liabilities measured at fair value on a recurring basis
	December 31, 2009
Assets	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Fixed maturities available-for-sale:
U.S. government direct obligations and U.S. agencies	$	-	$	2,038,794	$	-	$	2,038,794
Obligations of U.S. states and their subdivisions		-		1,363,851		-		1,363,851
Foreign governments		-		465		-		465
Corporate debt securities		-		6,940,809		188,936		7,129,745
Asset-backed securities		-		1,495,680		392,365		1,888,045
Residential mortgage-backed securities		-		771,063		-		771,063
Commercial mortgage-backed securities		-		617,860		58,270		676,130
Collateralized debt obligations		-		47,991		1,729		49,720
Total fixed maturities available- for-sale		-		13,276,513		641,300		13,917,813
Fixed maturities held for trading:
U.S. government direct obligations and U.S. agencies		-		39,112		-		39,112
Corporate debt securities		-		50,128		-		50,128
Asset-backed securities		-		42,717		-		42,717
Commercial mortgage-backed securities		-		8,217		-		8,217
Total fixed maturities held for trading		-		140,174		-		140,174
Equity investments available-for-sale:
Financial services		-		505		-		505
Consumer products		68		-		-		68
Equity mutual funds		20,277		-		-		20,277
Airline industry		4,829		-		-		4,829
Total equity investments		25,174		505		-		25,679
Short-term investments available-for-sale		55,557		432,923		-		488,480
Collateral under securities lending agreements		38,296		-		-		38,296
Collateral under derivative counterparty collateral agreements		4,300		-		-		4,300
Other assets (1)		-		23,150		-		23,150
Separate account assets (2)		11,039,441		7,303,499		9,960		18,352,900
Total assets	$	11,162,768	$	21,176,764	$	651,260	$	32,990,792
Liabilities
Other liabilities (1)	$	-	$	-	$	3,317	$	3,317
Total liabilities	$	-	$	-	$	3,317	$	3,317

⁽¹⁾ Includes derivative financial instruments.

⁽²⁾  Includes only separate account investments which are carried at the fair value of the underlying invested assets owned by the separate accounts.

There were no significant transfers between Level 1 and Level 2 during the year ended December 31, 2009.

The following tables present additional information about assets and liabilities measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value:

48

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Recurring Level 3 financial assets and liabilities Year ended December 31, 2010
	Fixed maturities available-for- sale: corporate debt securities			Fixed maturities available-for- sale: asset- backed securities			Fixed maturities available-for- sale: commercial mortgage-backed securities			Fixed  maturities available-for-sale: collateralized debt obligations			Other assets and liabilities  (1)			Separate accounts
Balance, January 1, 2010	$	188,936		$	392,365		$	58,270		$	1,729		$	(3,317	)	$	9,960
Realized and unrealized gains and losses:
Gains (losses) included in net income		475			(49,393	)		-			(34	)		-			-
Gains (losses) included in other comprehensive income (loss)		5,630			70,026			-			161			-			622
Purchases, issuances and settlements, net		(30,084	)		(98,807	)		-			(1,842	)		-			(1,700	)
Transfers in (out) of Level 3 (2)		(106,265	)		(23,703	)		(58,270	)		-			3,317			(4,604	)
Balance, December 31, 2010	$	58,692		$	290,488		$	-		$	14		$	-		$	4,278
Total gains (losses) for the period included in net income attributable to the change in unrealized gains and losses relating to assets held at December 31, 2010	$	-		$	-		$	-		$	-		$	-		$	-

⁽¹⁾ Includes derivative financial instruments.

⁽²⁾Transfers out of Level 3 are due primarily to increased observability of inputs in valuation methodologies.

	Recurring Level 3 financial assets and liabilities Year ended December 31, 2009
	Fixed maturities available-for- sale:  U.S. government and U.S. agencies			Fixed maturities available-for- sale: corporate debt securities			Fixed maturities available-for- sale: asset- backed securities			Fixed maturities available-for- sale: commercial mortgage-backed securities			Fixed maturities available-for-sale: collateralized debt obligations			Other assets and liabilities  (1)			Separate accounts
Balance, January 1, 2009	$	14,711		$	203,975		$	521,351		$	55,321		$	213		$	3,224		$	532
Realized and unrealized gains and losses:
Gains (losses) included in net income		-			(2,597	)		(84,990	)		-			-			-			-
Gains (losses) included in other comprehensive income (loss)		2,227			47,030			178,951			3,281			1,592			(6,541	)		1,902
Purchases, issuances and settlements, net		(256	)		(52,008	)		(124,017	)		(332	)		(12,027	)		-			7,526
Transfers in (out) of Level 3 (2)		(16,682	)		(7,464	)		(98,930	)		-			11,951			-			-
Balance, December 31, 2009	$	-		$	188,936		$	392,365		$	58,270		$	1,729		$	(3,317	)	$	9,960
Total gains (losses) for the period included in net income attributable to the change in unrealized gains and losses relating to assets held at December 31, 2009	$	-		$	-		$	-		$	-		$	-		$	-		$	-

⁽¹⁾ Includes derivative financial instruments.

⁽²⁾Transfers into (out of) Level 3 are from (to) Level 2 and are due primarily to decreased (increased) observability of inputs in valuation methodologies.

Realized and unrealized gains and losses due to the changes in fair value on assets classified as Level 3 included in net income for the year ended December 31, 2010 and 2009 are as follows:

49

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Year ended December 31, 2010
	Net realized gains (losses) on investments			Net investment income
Realized and unrealized gains and losses included in net income for the period	$	(48,952	)	$	-
	Year ended December 31, 2009
	Net realized gains (losses) on investments			Net investment income
Realized and unrealized gains and losses included in net income for the period	$	(87,587	)	$	-

Non-recurring fair value measurements - The Company held $980 of adjusted cost basis limited partnership interests which were impaired during the year ended December 31, 2010 based on the fair value disclosed in the limited partnership financial statements. These limited partnership interests were recorded at estimated fair value and represent a non-recurring fair value measurement. The estimated fair value was categorized as Level 3. The Company held $1,900 of cost basis in other assets comprised of head office properties which were impaired during the year ended December 31, 2009. The property was recorded at estimated fair value and represents a non-recurring fair value measurement. The estimated fair value was categorized as Level 2 since the fair value was based on an independent third party appraisal. The Company has no liabilities measured at fair value on a non-recurring basis at December 31, 2010 and 2009.

8. Reinsurance

In the normal course of its business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding risks to other insurance enterprises under excess coverage and coinsurance contracts. The Company retains a maximum liability in the amount of $3,500 of coverage per individual life.

Ceded reinsurance contracts do not relieve the Company from its obligations to policyholders. The failure of reinsurers to honor their obligations could result in losses to the Company. The Company evaluates the financial condition of its reinsurers and monitors concentrations of credit risk arising from similar geographic regions, activities or economic characteristics of the reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. At December 31, 2010 and 2009, the reinsurance receivables had carrying values in the amounts of $594,997 and $573,963, respectively. Included in these amounts are $483,564 and $452,510 at December 31, 2010 and 2009, respectively, associated with reinsurance agreements with related parties. At December 31, 2010 and 2009, 73% and 71%, respectively, of the total reinsurance receivable was due from CLAC. There were no allowances for potential uncollectible reinsurance receivables at either December 31, 2010 or 2009. Included within life insurance in the tables below is a small portion of Healthcare business as discussed in Note 17.

The following tables summarize life insurance in-force and total premium income at and for the year ended, December 31, 2010:

50

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Life insurance in-force
	Individual			Group			Total
Written and earned direct	$	50,976,256		$	34,985,650		$	85,961,906
Reinsurance ceded		(9,878,257	)		-			(9,878,257	)
Reinsurance assumed		80,618,669			-			80,618,669
Net	$	121,716,668		$	34,985,650		$	156,702,318
Percentage of amount assumed to net		66.2%			0.0%			51.4%
	Premium income
	Life insurance			Annuities			Total
Written and earned direct	$	674,726		$	5,665		$	680,391
Reinsurance ceded		(41,362	)		(112	)		(41,474	)
Reinsurance assumed		166,705			-			166,705
Net	$	800,069		$	5,553		$	805,622

The following tables summarize life insurance in-force and total premium income at and for the year ended, December 31, 2009:

	Life insurance in-force
	Individual			Group		Total
Written and earned direct	$	50,468,445		$	33,398,994	$	83,867,439
Reinsurance ceded (1)		(10,404,557	)		-		(10,404,557	)
Reinsurance assumed (2)		85,281,541			-		85,281,541
Net (3)	$	125,345,429		$	33,398,994	$	158,744,423
Percentage of amount assumed to net		68.0%			0.0%		53.7%

⁽¹⁾ Reinsurance ceded has been restated due to a previous misstatement from that previously reported of ($11,468,482).

⁽²⁾ Reinsurance assumed has been restated due to a previous misstatement from that previously reported of $86,580,158.

⁽³⁾ Net life insurance in-force has been restated due to a previous misstatement from that previously reported of $125,580,121 Net, Individual and $158,979,115 Net, Total.

	Premium income
	Life insurance			Annuities			Total
Written and earned direct	$	431,585		$	3,039		$	434,624
Reinsurance ceded		(48,687	)		(74	)		(48,761	)
Reinsurance assumed		174,389			-			174,389
Net	$	557,287		$	2,965		$	560,252

The following table summarizes total premium income for the year ended, December 31, 2008:

51

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Premium income
	Life insurance			Annuities			Total
Written and earned direct	$	371,952		$	(1,153	)	$	370,799
Reinsurance ceded		(37,035	)		(141	)		(37,176	)
Reinsurance assumed		189,908			1,605			191,513
Net	$	524,825		$	311		$	525,136

9. Deferred Acquisition Costs and Value of Business Acquired

The following table summarizes activity in deferred acquisition costs (“DAC”) and value of business acquired (“VOBA”) for the years ended December 31, 2010, 2009 and 2008:

	DAC			VOBA			Total
Balance, January 1, 2008	$	368,781		$	46,479		$	415,260
Capitalized additions		57,816			-			57,816
Amortization and writedowns		(53,393	)		2,852			(50,541	)
Unrealized investment (gains) losses		251,940			6,380			258,320
Balance, December 31, 2008		625,144			55,711			680,855
Capitalized additions		74,642			-			74,642
Amortization and writedowns		(61,113	)		(1,161	)		(62,274	)
Unrealized investment (gains) losses		(242,085	)		(5,881	)		(247,966	)
Balance, December 31, 2009		396,588			48,669			445,257
Capitalized additions		80,020			-			80,020
Amortization and writedowns		(48,903	)		(1,837	)		(50,740	)
Unrealized investment (gains) losses		(167,162	)		(427	)		(167,589	)
Balance, December 31, 2010	$	260,543		$	46,405		$	306,948

In 2010, the Company refined its DAC calculation methodology which resulted in a $6,300 increase to the DAC balance through a decrease in DAC amortization for the year.

The estimated future amortization of VOBA for the years ended December 31, 2011 through December 31, 2015 is as follows:

Year ended December 31,	Amount
2011	$	4,253
2012		4,492
2013		4,389
2014		4,222
2015		4,019

10. Goodwill and Other Intangible Assets

The balances of goodwill, all of which is within the Retirement Services segment, at December 31, 2010 and 2009 were $105,255.

The following tables summarize other intangible assets, all of which are within the Retirement Services segment, as of December 31, 2010 and 2009:

52

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	December 31, 2010
	Gross carrying amount		Accumulated amortization			Net book value
Customer relationships	$	36,314	$	(12,701	)	$	23,613
Preferred provider agreements		7,970		(5,941	)		2,029
Total	$	44,284	$	(18,642	)	$	25,642

	December 31, 2009
	Gross carrying amount		Accumulated amortization			Net book value
Customer relationships	$	36,314	$	(10,039	)	$	26,275
Preferred provider agreements		7,970		(4,613	)		3,357
Total	$	44,284	$	(14,652	)	$	29,632

Amortization expense for other intangible assets included in general insurance expenses was $3,990, $4,192 and $4,725 for the years ended December 31, 2010, 2009 and 2008, respectively. Except for goodwill, the Company has no intangible assets with indefinite lives. The Company did not incur costs to renew or extend the term of acquired intangible assets during the year ended December 31, 2010.

The estimated future amortization of other intangible assets using current assumptions, which are subject to change, for the years ended December 31, 2011 through December 31, 2015 is as follows:

Year ended December 31,	Amount
2011	$	3,793
2012		3,590
2013		3,410
2014		3,215
2015		3,012

11. Commercial Paper

The Company maintains a commercial paper program that is partially supported by a $50,000 corporate credit facility (See Note 20).

The following table provides information regarding the Company’s commercial paper program at December 31, 2010 and 2009:

	December 31,
	2010	2009
Commercial paper outstanding	$91,681	$97,613
Maturity range (days)	3 - 74	7 - 20
Interest rate range	0.3% - 0.4%	0.3%- 0.4%

12. Stockholder’s Equity and Dividend Restrictions

53

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

At December 31, 2010 and 2009, the Company had 50,000,000 shares of $1 par value preferred stock authorized, none of which were issued or outstanding at either date. In addition, the Company has 50,000,000 shares of $1 par value common stock authorized, 7,032,000 of which were issued and outstanding at both December 31, 2010 and 2009.

GWLA’s net income and capital and surplus, as determined in accordance with statutory accounting principles and practices as prescribed by the National Association of Insurance Commissioners, for the years ended December 31, 2010, 2009 and 2008 are as follows:

	Year ended December 31,
	2010(1)		2009(2)		2008(2)
Net income	$	405,343	$	282,033	$	280,862
Capital and surplus		1,159,657		1,360,896		901,429

⁽¹⁾ As filed with the Colorado Division of Insurance

⁽²⁾ As filed in an amended filing with the Colorado Division of Insurance

Dividends are paid as determined by the Board of Directors, subject to restrictions as discussed below. During the years ended December 31, 2010, 2009 and 2008, the Company paid dividends in the amounts of $160,917, $24,682 and $1,772,293, respectively, to its parent company, GWL&A Financial. Dividends paid during 2008 were paid in part using the proceeds received from the sale of the Company’s Healthcare business as discussed in Note 3.

The maximum amount of dividends that can be paid to stockholders by insurance companies domiciled in the State of Colorado, without prior approval of the Insurance Commissioner, is subject to restrictions relating to statutory capital and surplus and statutory net gain from operations. Unaudited statutory capital and surplus and net gain from operations at and for the year ended December 31, 2010 were $1,159,657 and $445,656, respectively. GWLA may pay up to $445,656 (unaudited) of dividends during the year ended December 31, 2011 without the prior approval of the Colorado insurance commissioner. Prior to any payments of dividends, the Company seeks approval from the Colorado Insurance Commissioner.

13.  Other Comprehensive Income

54

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following table presents the composition of other comprehensive income (loss) for the year ended December 31, 2010:

	Year ended December 31, 2010
	Before-tax amount			Tax (expense) benefit			Net-of-tax amount
Unrealized holding gains (losses) arising during the year on available-for-sale fixed maturity investments	$	724,296		$	(253,504)		$	470,792
Net changes during the year related to cash flow hedges		17,293			(6,053	)		11,240
Reclassification adjustment for (gains) losses realized in net income		23,198			(8,119	)		15,079
Net unrealized gains (losses)		764,787			(267,676	)		497,111
Future policy benefits, deferred acquisition costs and value of business acquired adjustments		(182,357	)		63,825			(118,532	)
Net unrealized gains (losses)		582,430			(203,851	)		378,579
Employee benefit plan adjustment		(5,142	)		1,800			(3,342	)
Other comprehensive income (loss)	$	577,288		$	(202,051	)	$	375,237

The following table presents the composition of other comprehensive income (loss) for the year ended December 31, 2009:

	Year ended December 31, 2009
	Before-tax amount			Tax (expense) benefit			Net-of-tax amount
Unrealized holding gains (losses) arising during the year on available-for-sale fixed maturity investments	$	1,174,693		$	(411,143	)	$	763,550
Net changes during the year related to cash flow hedges		(57,218	)		20,027			(37,191	)
Reclassification adjustment for (gains) losses realized in net income		71,473			(25,016	)		46,457
Net unrealized gains (losses)		1,188,948			(416,132	)		772,816
Future policy benefits, deferred acquisition costs and value of business acquired adjustments		(250,468	)		87,664			(162,804	)
Net unrealized gains (losses)		938,480			(328,468	)		610,012
Employee benefit plan adjustment		43,797			(15,329	)		28,468
Other comprehensive income (loss)	$	982,277		$	(343,797	)	$	638,480

The following table presents the composition of other comprehensive income (loss) for the year ended December 31, 2008:

55

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Year ended December 31, 2008
	Before-tax amount			Tax (expense) benefit			Net-of-tax amount
Unrealized holding gains (losses) arising during the year on available-for-sale fixed maturity investments	$	(1,431,239	)	$	496,555		$	(934,684	)
Net changes during the year related to cash flow hedges		85,494			(29,923	)		55,571
Reclassification adjustment for (gains) losses realized in net income		38,978			(10,989	)		27,989
Net unrealized gains (losses)		(1,306,767	)		455,643			(851,124	)
Future policy benefits, deferred acquisition costs and value of business acquired adjustments		254,180			(88,963	)		165,217
Net unrealized gains (losses)		(1,052,587	)		366,680			(685,907	)
Employee benefit plan adjustment		(115,766	)		40,518			(75,248	)
Other comprehensive income (loss)	$	(1,168,353	)	$	407,198		$	(761,155	)

14.  General Insurance Expenses

The following table summarizes the components of general insurance expenses for the years ended December 31, 2010, 2009 and 2008:

	Year ended December 31,
	2010			2009			2008
Compensation	$	294,923		$	273,934		$	282,502
Commissions		143,680			114,461			118,978
Premium and other taxes		27,964			22,947			25,704
Capitalization of DAC		(80,020	)		(74,642	)		(57,816	)
Depreciation and amortization		12,975			15,603			19,240
Rent, net of sublease income		6,047			6,767			3,875
Other		92,817			76,408			44,504
Total general insurance expenses	$	498,386		$	435,478		$	436,987

15.  Employee Benefit Plans

Defined Benefit Pension, Post-Retirement Medical and Supplemental Executive Retirement Plans - The Company has a noncontributory Defined Benefit Pension Plan covering substantially all of its employees that were hired before January 1, 1999. Pension benefits are based principally on an employee’s years of service and compensation levels near retirement. The Company’s policy for funding the defined benefit pension plans is to make annual contributions, which equal or exceed regulatory requirements.

The Company sponsors an unfunded Post-Retirement Medical Plan (the “Medical Plan”) that provides health benefits to retired employees who are not Medicare eligible. The medical plan is contributory and contains other cost sharing features which may be adjusted annually for the expected general inflation rate. The Company’s policy is to fund the cost of the medical plan benefits in amounts determined at the discretion of management.

The Company also provides supplemental executive retirement plans to certain key executives. These plans provide key executives with certain benefits upon retirement, disability or death based upon total

56

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

compensation. The Company has purchased individual life insurance policies with respect to each employee covered by this plan. The Company is the owner and beneficiary of the insurance contracts.

The following tables provide a reconciliation of the changes in the benefit obligations, fair value of plan assets and the under funded status for the Company’s Defined Benefit Pension, Post-Retirement Medical and Supplemental Executive Retirement plans as of the years ended December 31, 2010 and 2009:

	Defined benefit pension plan						Post-retirement medical plan						Supplemental executive retirement plan						Total
	2010			2009			2010			2009			2010			2009			2010			2009
Change in projected benefit obligation:
Benefit obligation, January 1	$	318,278		$	303,383		$	12,136		$	16,483		$	44,430		$	45,765		$	374,844		$	365,631
Service cost		3,739			4,087			728			680			672			717			5,139			5,484
Interest cost		19,578			19,135			713			709			2,905			2,856			23,196			22,700
Actuarial (gain) loss		18,644			2,253			(2,843	)		(5,129	)		5,973			(2,517	)		21,774			(5,393	)
Regular benefits paid		(10,804	)		(10,580	)		(572	)		(607	)		(2,646	)		(2,391	)		(14,022	)		(13,578	)
Plan amendments		-			-			-			-			3,521			-			3,521			-
Benefit obligation, December 31	$	349,435		$	318,278		$	10,162		$	12,136		$	54,855		$	44,430		$	414,452		$	374,844

	Defined benefit pension plan						Post-retirement medical plan						Supplemental executive retirement plan						Total
	2010			2009			2010			2009			2010			2009			2010			2009
Change in plan assets:
Value of plan assets, January 1	$	251,078		$	201,970		$	-		$	-		$	-		$	-		$	251,078		$	201,970
Actual return (loss) on plan assets		36,642			47,188			-			-			-			-			36,642			47,188
Employer contributions		5,700			12,500			572			607			2,646			2,391			8,918			15,498
Benefits paid		(10,804	)		(10,580	)		(572	)		(607	)		(2,646	)		(2,391	)		(14,022	)		(13,578	)
Value of plan assets, December 31	$	282,616		$	251,078		$	-		$	-		$	-		$	-		$	282,616		$	251,078

	Defined benefit pension plan						Post-retirement medical plan						Supplemental executive retirement plan						Total
	2010			2009			2010			2009			2010			2009			2010			2009
Funded (under funded) status at December 31	$	(66,819	)	$	(67,200	)	$	(10,162	)	$	(12,136	)	$	(54,855	)	$	(44,430	)	$	(131,836	)	$	(123,766	)

A recovery in market liquidity has resulted in improved market values for the Company’s Defined Benefit Pension Plan assets since December 31, 2009.

The following table presents amounts recognized in the consolidated balance sheets at December 31, 2010 and 2009 for the Company’s Defined Benefit Pension, Post-retirement Medical and Supplemental Executive Retirement plans:

	Defined benefit pension plan						Post-retirement medical plan				Supplemental executive retirement plan						Total
	2010			2009			2010		2009		2010			2009			2010			2009
Amounts recognized in consolidated balance sheets:
Accumulated other comprehensive (expense) income (loss)	$	(76,314	)	$	(79,353	)	$	18,695	$	17,964	$	(13,079	)	$	(4,484	)	$	(70,698	)	$	(65,873	)

The accumulated benefit obligation for the Defined Benefit Pension Plan was $342,967 and $303,352 at December 31, 2010 and 2009, respectively.

The following table provides information regarding amounts in accumulated other comprehensive income (loss) that have not yet been recognized as components of net periodic benefit costs at December 31, 2010:

57

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Defined benefit pension plan						Post-retirement medical plan				Supplemental executive retirement plan						Total
	Gross			Net of tax			Gross		Net of tax		Gross			Net of tax			Gross			Net of tax
Net gain (loss)	$	(77,485	)	$	(50,365	)	$	8,904	$	5,788	$	(6,211	)	$	(4,037	)	$	(74,792	)	$	(48,614	)
Net prior service (cost) credit		(217	)		(141	)		9,791		6,364		(6,868	)		(4,464	)		2,706			1,759
Net transition asset (obligation)		1,388			902			-		-		-			-			1,388			902
	$	(76,314	)	$	(49,604	)	$	18,695	$	12,152	$	(13,079	)	$	(8,501	)	$	(70,698	)	$	(45,953	)

The following table provides information regarding amounts in accumulated other comprehensive income (loss) that are expected to be recognized as components of net periodic benefit costs during the year ended December 31, 2011:

	Defined benefit pension plan						Post-retirement medical plan				Supplemental executive retirement plan						Total
	Gross			Net of tax			Gross		Net of tax		Gross			Net of tax			Gross			Net of tax
Net gain (loss)	$	(5,581	)	$	(3,628	)	$	593	$	386	$	(145	)	$	(94	)	$	(5,133	)	$	(3,336	)
Net prior service (cost) credit		(51	)		(33	)		1,650		1,072		(934	)		(607	)		665			432
Net transition asset (obligation)		1,388			902			-		-		-			-			1,388			902
	$	(4,244	)	$	(2,759	)	$	2,243	$	1,458	$	(1,079	)	$	(701	)	$	(3,080	)	$	(2,002	)

The expected benefit payments for the Company’s Defined Benefit Pension, Post-Retirement Medical and Supplemental Executive Retirement plans for the years indicated are as follows:

	Defined benefit pension plan		Post-retirement medical plan		Supplemental executive retirement plan
2011	$	11,402	$	706	$	2,653
2012		12,245		668		3,575
2013		13,020		652		3,572
2014		13,742		723		3,388
2015		14,793		780		4,807
2016 through 2020		95,143		4,584		29,889

Net periodic (benefit) cost of the Defined Benefit Pension, Post-Retirement Medical and Supplemental Executive Retirement plans included in general insurance expenses in the accompanying consolidated statements of income for the years ended December 31, 2010, 2009 and 2008 includes the following components:

	Defined benefit pension plan
	2010			2009			2008
Components of net periodic (benefit) cost:
Service cost	$	3,739		$	4,087		$	5,743
Interest cost		19,578			19,135			18,356
Expected return on plan assets		(18,618	)		(16,073	)		(20,499	)
Amortization of transition obligation		(1,514	)		(1,514	)		(1,514)
Amortization of unrecognized prior service cost		82			88			120
Amortization of loss from earlier periods		5,091			10,131			679
Net periodic (benefit) cost	$	8,358		$	15,854		$	2,885

	Post-retirement medical plan
	2010			2009			2008
Components of net periodic (benefit) cost:
Service cost	$	728		$	680		$	1,263
Interest cost		713			709			1,254
Amortization of unrecognized prior service benefit		(1,650)			(1,650)			(2,169)
Amortization of (gain) loss from earlier periods		(461	)		(440	)		85
Net periodic (benefit) cost	$	(670	)	$	(701	)	$	433

58

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Supplemental executive retirement plan
	2010		2009		2008
Components of net periodic (benefit) cost:
Service cost	$	673	$	716	$	665
Interest cost		2,905		2,856		2,735
Amortization of unrecognized prior service cost		899		675		814
Net periodic (benefit) cost	$	4,477	$	4,247	$	4,214

The following tables present the weighted average interest rate assumptions used in determining benefit obligations and net periodic benefit/cost of the Defined Benefit Pension, Post-Retirement Medical and the Supplemental Executive Retirement plans for the years ended December 31, 2010 and 2009:

	Defined benefit pension plan
	2010	2009
Discount rate	5.87%	6.37%
Expected return on plan assets	7.50%	8.00%
Rate of compensation increase	3.14%	4.94%
	Post-retirement medical plan
	2010	2009
Discount rate	5.87%	6.37%
	Supplemental executive retirement plan
	2010	2009
Discount rate	5.87%	6.37%
Rate of compensation increase	6.00%	6.00%

The discount rate has been set based upon the rates of return on high-quality fixed-income investments currently available and expected to be available during the period the benefits will be paid. In particular, the yields on bonds rated AA or better on the measurement date have been used to set the discount rate.

Assumed healthcare cost trend rates have a significant effect on the amounts reported for the Post- Retirement Medical Plan. For measurement purposes, a 7.50% annual rate of increase in the per capita cost of covered healthcare benefits was assumed and that the rate would gradually decrease to a level of 5.25% by 2016.

The following table presents what a one-percentage-point change in assumed healthcare cost trend rates would have on the following:

	One percentage point increase		One percentage point decrease
Increase (decrease) on total service and interest cost on components	$	193	$	(165	)
Increase (decrease) on post-retirement benefit obligation		1,073		(937	)

59

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following table presents how the Company’s Defined Benefit Pension Plan assets are invested at December 31, 2010 and 2009:

	December 31,
	2010		2009
Equity securities		65%		65%
Debt securities		33%		33%
Other		2%		2%
Total		100%		100%

The following tables present information about the Defined Benefit Retirement Plan’s assets measured at fair value on a recurring basis as of December 31, 2010 and 2009 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value. See Note 7 for a description of Level 1, Level 2 and Level 3 hierarchies and for valuation methods applied.

60

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Defined Benefit Plan Assets Measured at Fair Value on a Recurring  Basis December 31, 2010
	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Common collective trust funds:
Equity index funds	$	-	$	54,784	$	-	$	54,784
Midcap index funds		-		57,007		-		57,007
World equity index funds		-		15,549		-		15,549
U.S. equity market funds		-		55,487		-		55,487
Total common collective trust funds		-		182,827		-		182,827
Fixed maturity investments:
U.S. government direct obligations and agencies		-		10,767		-		10,767
Obligations of U.S. states and their municpalities		-		9,716		-		9,716
Corporate debt securities		-		61,350		-		61,350
Asset-backed securities		-		8,091		-		8,091
Commercial mortgage-backed securities		-		2,174		-		2,174
Total fixed maturity investments		-		92,098		-		92,098
Preferred stock		-		45		-		45
Limited partnership investments		-		-		6,030		6,030
Money market funds		1,616		-		-		1,616
Total defined benefit plan assets	$	1,616	$	274,970	$	6,030	$	282,616
	Defined Benefit Plan Assets Measured at Fair Value on a Recurring  Basis December 31, 2009
	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Common collective trust funds:
Equity index funds	$	-	$	48,075	$	-	$	48,075
Midcap index funds		-		51,724		-		51,724
World equity index funds		-		14,247		-		14,247
U.S. equity market funds		-		48,589		-		48,589
Total common collective trust funds		-		162,635		-		162,635
Fixed maturity investments:
U.S. government direct obligations and agencies		-		12,589		-		12,589
Obligations of U.S. states and their municpalities		-		3,398		-		3,398
Corporate debt securities		-		56,705		-		56,705
Asset-backed securities		-		7,589		-		7,589
Commercial mortgage-backed securities		-		2,089		-		2,089
Total fixed maturity investments		-		82,370		-		82,370
Preferred stock		-		88		-		88
Limited partnership investments		-		-		4,495		4,495
Money market funds		1,490		-		-		1,490
Total defined benefit plan assets	$	1,490	$	245,093	$	4,495	$	251,078

61

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following tables present additional information at December 31, 2010 and 2009 about assets and liabilities of the Defined Benefit Retirement Plan measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Limited partnership interests		Fixed maturity investments		Total
Balance, December 31, 2009	$	4,495	$	-	$	4,495
Actual return on plan assets:
Relating to assets held at the reporting date		-		-		-
Purchases, issuances and settlements, net		1,535		-		1,535
Balance, December 31, 2010	$	6,030	$	-	$	6,030
	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Limited partnership interests		Fixed maturity investments		Total
Balance, December 31, 2008	$	2,750	$	3,627	$	6,377
Actual return on plan assets:
Relating to assets held at the reporting date		142		-		142
Purchases, issuances and settlements, net		1,603		-		1,603
Transfers in (out) of Level 3		-		(3,627)		(3,627	)
Balance, December 31, 2009	$	4,495	$	-	$	4,495

The investment objective of the Defined Benefit Pension Plan is to provide a risk-adjusted return that will ensure the payment of benefits while protecting against the risk of substantial investment losses. Correlations among the asset classes are used to identify an asset mix that the Company believes will provide the most attractive returns. Long-term return forecasts for each asset class using historical data and other qualitative considerations to adjust for projected economic forecasts are used to set the expected rate of return for the entire portfolio.

The Defined Benefit Pension Plan utilizes various investment securities. Generally, investment securities are exposed to various risks, such as interest rate risks, credit risk and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur and that such changes could materially affect the amounts reported.

The following table presents the ranges the Company targets for the allocation of invested Defined Benefit Pension Plan assets at December 31, 2011:

	December 31, 2011
Equity securities	25% - 75%
Debt securities	25% - 75%
Other	0% - 15%

62

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

Management estimates the value of these investments will be recoverable. The Company does not expect any plan assets to be returned to it during the year ended December 31, 2011. The Company made contributions in the amounts of $5,700 and $12,500 to its Defined Benefit Pension Plan during the years ended December 31, 2010 and 2009, respectively. The Company expects to contribute approximately $706 to its Post-Retirement Medical Plan and $2,653 to its Supplemental Executive Retirement Plan during the year ended December 31, 2011. The Company will make a contribution at least equal to the minimum contribution of $12,000 to its Defined Benefit Pension Plan during the year ended December 31, 2011.

During the second quarter of 2008, the Company recorded defined benefit pension plan costs of $672, post-retirement medical plan benefits of $19,346 and supplemental executive retirement plan costs of $1,833 as adjustments to income from discontinued operations due to plan curtailments related to the sale of the Healthcare segment.

Other employee benefit plans - The Company sponsors a defined contribution 401(k) retirement plan which provides eligible participants with the opportunity to defer up to 50% of base compensation. The Company matches 50% of the first 5% of participant pre-tax contributions for employees hired before January 1, 1999. For all other employees, the Company matches 50% of the first 8% of participant pre-tax contributions. Company contributions for the years ended December 31, 2010, 2009 and 2008 were $5,228, $5,006 and $7,384, respectively.

The Company has an executive deferred compensation plan providing key executives with the opportunity to participate in an unfunded deferred compensation program. Under the program, participants may defer base compensation and bonuses and earn interest on the amounts deferred. The program is not qualified under Section 401 of the Internal Revenue Code. Participant balances, which are reflected in other liabilities in the accompanying consolidated balance sheets, are $14,139 and $15,286 at December 31, 2010 and 2009, respectively. The participant deferrals earned interest at the average rates of 7.55% and 6.93% during the years ended December 31, 2010 and 2009, respectively. The interest rate is based on the Moody’s Average Annual Corporate Bond Index rate plus 0.45% for actively employed participants and fixed rates ranging from 6.37% to 8.30% for retired participants. Interest expense related to this plan was $1,004, $1,110 and $1,224 for the years ended December 31, 2010, 2009 and 2008, respectively, and is included in general insurance expenses in the consolidated statements of income.

The Company has a deferred compensation plan for select sales personnel with the opportunity to participate in an unfunded deferred compensation program. Under this program, participants may defer compensation and earn interest on the amounts deferred. The program is not qualified under Section 401 of the Internal Revenue Code. Effective January 1, 2005, this program no longer accepted participant deferrals. Participant balances, which are included in other liabilities in the accompanying consolidated balance sheets, are $3,139 and $3,772 at December 31, 2010 and 2009, respectively. The participant deferrals earned interest at the average rate of 4.0% and 4.4% during the years ended December 31, 2010 and 2009, respectively. The interest rate is based on an annual rate determined by the Company. The interest expense related to this plan was $146, $187 and $233 for the years ended December 31, 2010, 2009 and 2008, respectively, and is included in general insurance expense in the consolidated statements of income.

The Company offers an unfunded, non-qualified deferred compensation plan to a select group of management and highly compensated individuals. Participants defer a portion of their compensation and realize potential market gains or losses on the invested contributions. The program is not qualified under Section 401 of the Internal Revenue Code. Participant balances, which are included in other liabilities in the accompanying consolidated balance sheets, are $10,848 and $10,576 (as restated, from previously reported of $12,240) at December 31, 2010 and 2009, respectively. Unrealized gains (losses) on invested participant deferrals were $1,076, $2,053 and ($3,709) for the years ended December 31, 2010, 2009 and 2008, respectively.

63

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

16.  Federal Income Taxes

The provision for income taxes from continuing operations is comprised of the following:

	Year ended December 31,
	2010		2009			2008
Current	$	34,090	$	(21,088	)	$	8,024
Deferred		38,425		62,521			75,467
Total income tax provision from continuing operations	$	72,515	$	41,433		$	83,491

The following table presents a reconciliation between the statutory federal income tax rate and the Company’s effective federal income tax rate from continuing operations for the years ended December 31, 2010, 2009 and 2008:

	Year ended December 31,
	2010			2009			2008
Statutory federal income tax rate		35.0	%		35.0	%		35.0	%
Income tax effect of:
Investment income not subject to federal tax		(2.2	%)		(4.9	%)		(1.4	%)
Tax credits		(2.9	%)		(4.9	%)		(2.5	%)
State income taxes, net of federal benefit		0.7	%		(2.8	%)		1.1	%
Provision for policyholders’ share of earnings on participating business		0.3	%		0.3	%		(13.2	%)
Prior period adjustment		(0.5	%)		(0.6	%)		(2.2	%)
Income tax contingency provisions		(3.9	%)		0.9	%		1.0	%
Other, net		(0.3	%)		2.0	%		(2.2	%)
Effective federal income tax rate from continuing operations		26.2	%		25.0	%		15.6	%

Included above in the provision for policyholder’s share of earnings on participating business for the year ended December 31, 2008 is the income tax effect of the $207,785 decrease in undistributed earnings on participating business as discussed in Note 4.

A reconciliation of unrecognized tax benefits for the years ended December 31, 2010, 2009 and 2008 is as follows:

	Year ended December 31,
	2010			2009			2008
Balance, beginning of year	$	81,390		$	60,079		$	61,286
Additions to tax positions in the current year		6,939			24,843			6,600
Reductions to tax positions in the current year		-			(2,670	)		(1,935	)
Additions to tax positions in the prior year		142			-			17,349
Reductions to tax positions in the prior year		(47,922	)		(862	)		(23,221	)
Reductions to tax positions from statutes expiring		(5,253	)		-			-
Settlements		(40	)		-			-
Balance, end of year	$	35,256		$	81,390		$	60,079

Included in the unrecognized tax benefits of $35,256 at December 31, 2010 was $2,937 of tax benefits that, if recognized, would increase the annual effective tax rate. Also included in the balance at December 31, 2010 is $32,319 of tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. Because of the impact of deferred tax accounting,

64

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

other than interest and penalties, the disallowance of the shorter deductibility period would not affect the annual effective rate but would accelerate the payment of cash to the taxing authority to an earlier period.

The Company anticipates additional increases in its unrecognized tax benefits of $12,000 to $14,000 in the next twelve months, due to changes in the composition of the consolidated group. The Company does not anticipate that this increase in its unrecognized tax benefit will impact the effective tax rate.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits in current income tax expense. The Company recognized approximately ($13,403) $2,430 and $6,916 in interest and penalties related to the uncertain tax positions during the years ended December 31, 2010, 2009 and 2008, respectively. The Company had approximately $1,575 and $14,978 accrued for the payment of interest and penalties at December 31, 2010 and 2009, respectively.

The Company files income tax returns in the U.S. federal jurisdiction and various states. With few exceptions, the Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years 2005 and prior. Tax year 2006 is subject to a limited scope federal examination by the Internal Revenue Service (the “I.R.S.”) in regards to an immaterial matter. Tax years 2007, 2008 and 2009 are open to federal examination by the I.R.S. The Company does not expect significant increases or decreases to unrecognized tax benefits relating to federal, state or local audits.

Deferred income taxes represent the tax effect of the differences between the book and tax bases of assets and liabilities. The tax effect of temporary differences, which give rise to the deferred tax assets and liabilities as of December 31, 2010 and 2009, are as follows:

	December 31,
	2010				2009
	Deferred tax asset		Deferred tax liability		Deferred tax asset		Deferred tax liability
Policyholder reserves	$	-	$	200,110	$	-	$	246,807
Deferred acquisition costs		26,976		-		-		44,551
Investment assets		-		169,852		141,330		-
Policyholder dividends		18,706		-		19,861		-
Net operating loss carryforward		193,828		-		212,633		-
Pension plan accrued benefit liability		59,178		-		55,399		-
Goodwill		-		24,126		-		21,172
Experience rated refunds		19,335		-		87,397		-
Other		18,267		-		-		21,649
Total deferred taxes	$	336,290	$	394,088	$	516,620	$	334,179

Amounts presented for investment assets above include ($145,517) and $58,348 related to the net unrealized losses (gains) on the Company’s fixed maturity and equity investments, which are classified as available-for-sale at December 31, 2010 and 2009, respectively.

The Company, together with certain of its subsidiaries, and Lifeco U.S. have entered into an income tax allocation agreement whereby Lifeco U.S. files a consolidated federal income tax return. Under the agreement, these companies are responsible for and will receive the benefits of any income tax liability or benefit computed on a separate tax return basis.

65

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The Company has federal net operating loss carry forwards generated by a subsidiary that files an income tax return separate from the Lifeco U.S. consolidated federal income tax return. As of December 31, 2010, the subsidiary had net operating loss carry forwards expiring as follows:

Year	Amount
2020	$	149,162
2021		113,002
2022		136,796
2023		81,693
Total	$	480,653

During 2010, the Company generated $36,039 of Guaranteed Federal Low Income Housing tax credit carryforwards. The credits will expire in 2030.

Included in due from parent and affiliates at December 31, 2010 and 2009 is $199,884 and $166,991, respectively, of income taxes receivable from Lifeco U.S. related to the consolidated income tax return filed by the Company and certain subsidiaries. Included in the consolidated balance sheets at December 31, 2010 and 2009 is $10,311 and $34,905 of income taxes receivable in other assets related to the separate federal income tax returns filed by certain subsidiaries, state income tax returns and unrecognized tax benefits.

17. Segment Information

The Company has three reportable segments: Individual Markets, Retirement Services and Other. The Individual Markets segment distributes life insurance and individual annuity products to both individuals and businesses through various distribution channels. Life insurance products in-force include participating and non-participating term life, whole life, universal life and variable universal life. The Retirement Services segment provides retirement plan enrollment services, communication materials, various retirement plan investment options and educational services to employer-sponsored defined contribution/defined benefit plans and 401(k) and 403(b) plans, as well as comprehensive administrative and record-keeping services for financial institutions and employers. The Company’s Other segment includes corporate items not directly allocated to any of its other business segments, interest expense on long-term debt and the activities of a wholly owned subsidiary whose sole business is the assumption of a certain block of term life insurance from an affiliated company.

As discussed in Note 3, during 2008, substantially all of the Company’s former Healthcare segment has been sold and reclassified as discontinued operations and, accordingly, is no longer reported as a separate business segment. The Company retained a small portion of its Healthcare business and reports it within its Individual Markets segment.

The accounting policies of each of the reportable segments are the same as those described in Note 1. The Company evaluates performance of its reportable segments based on their profitability from operations after income taxes. Inter-segment transactions and balances have been eliminated in consolidation. The Company’s operations are not materially dependent on one or a few customers, brokers or agents.

66

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

The following tables summarize segment financial information for the year ended and as of December 31, 2010:

	Year ended December 31, 2010
	Individual Markets			Retirement Services			Other			Total
Revenue:
Premium income	$	676,395		$	5,509		$	123,718		$	805,622
Fee income		56,232			387,103			4,619			447,954
Net investment income		730,439			399,456			44,849			1,174,744
Net realized gains (losses) on investments		(1,239	)		(23,229	)		(27	)		(24,495	)
Total revenues		1,461,827			768,839			173,159			2,403,825
Benefits and expenses:
Policyholder benefits		1,218,791			221,943			99,673			1,540,407
Operating expenses		132,962			391,491			62,095			586,548
Total benefits and expenses		1,351,753			613,434			161,768			2,126,955
Income (loss) from continuing operations before income taxes		110,074			155,405			11,391			276,870
Income tax expense		30,006			37,916			4,593			72,515
Income (loss) from continuing operations	$	80,068		$	117,489		$	6,798		$	204,355

	December 31, 2010
	Individual Markets		Retirement Services		Other		Total
Assets:
Investments	$	13,159,008	$	8,277,926	$	1,631,662	$	23,068,596
Other assets		1,167,474		695,401		144,762		2,007,637
Separate account assets		6,264,046		16,224,992		-		22,489,038
Assets from continuing operations		20,590,528		25,198,319		1,776,424		47,565,271
Assets from discontinued operations		-		-		-		62,091
Total assets	$	20,590,528	$	25,198,319	$	1,776,424	$	47,627,362

The following tables summarize segment financial information for the year ended and as of December 31, 2009:

	Year ended December 31, 2009
	Individual Markets			Retirement Services			Other			Total
Revenue:
Premium income	$	428,142		$	2,949		$	129,161		$	560,252
Fee income		49,845			331,242			5,114			386,201
Net investment income		718,040			383,446			47,598			1,149,084
Net realized losses on investments		(38,382	)		(23,239	)		(5,919	)		(67,540	)
Total revenues		1,157,645			694,398			175,954			2,027,997
Benefits and expenses:
Policyholder benefits		982,465			231,648			112,691			1,326,804
Operating expenses		101,662			362,775			70,823			535,260
Total benefits and expenses		1,084,127			594,423			183,514			1,862,064
Income (loss) from continuing operations before income taxes		73,518			99,975			(7,560	)		165,933
Income tax expense		17,104			24,417			(88	)		41,433
Income (loss) from continuing operations	$	56,414		$	75,558		$	(7,472	)	$	124,500

67

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	December 31, 2009
	Individual Markets		Retirement Services		Other		Total
Assets:
Investments	$	11,907,136	$	7,101,489	$	1,367,403	$	20,376,028
Other assets		1,449,816		841,417		166,496		2,457,729
Separate account assets		4,598,607		14,288,294		-		18,886,901
Assets from continuing operations		17,955,559		22,231,200		1,533,899		41,720,658
Assets from discontinued operations		-		-		-		87,719
Total assets	$	17,955,559	$	22,231,200	$	1,533,899	$	41,808,377

The following table summarizes segment financial information for the year ended December 31, 2008:

	Year ended December 31, 2008
	Individual Markets			Retirement Services			Other			Total
Revenue:
Premium income	$	377,525		$	2,291		$	145,321		$	525,137
Fee income		55,852			368,536			4,833			429,221
Net investment income		692,193			351,585			34,691			1,078,469
Net realized gains (losses) on investments		(11,500	)		(10,165	)		(31	)		(21,696	)
Total revenues		1,114,070			712,247			184,814			2,011,131
Benefits and expenses:
Policyholder benefits		889,967			229,948			(172,327	)		947,588
Operating expenses		108,702			329,634			88,996			527,332
Total benefits and expenses		998,669			559,582			(83,331	)		1,474,920
Income from continuing operations before income taxes		115,401			152,665			268,145			536,211
Income tax expense		32,196			34,235			17,060			83,491
Income from continuing operations	$	83,205		$	118,430		$	251,085		$	452,720

18. Share-Based Compensation

Lifeco, of which the Company is an indirect wholly-owned subsidiary, has a stock option plan (the “Lifeco plan”) that provides for the granting of options on its common shares to certain of its officers and employees and those of its subsidiaries, including the Company. Options are granted with exercise prices not less than the average market price of the shares on the five days preceding the date of the grant. Termination of employment prior to the vesting of the options results in the forfeiture of the unvested options. The Lifeco plan provides for the granting of options with varying terms and vesting requirements with vesting commencing on the first anniversary of the grant and expiring ten years from the date of grant. During the year ended December 31, 2010, Lifeco granted 404,700 stock options to employees of the Company. These stock options vest over a five-year period ending in February 2015. Compensation expense of $1,696 will be recognized in the Company’s financial statements over the vesting period of these stock options using the accelerated method of recognition.

The following table presents information regarding the share-based compensation expense the Company recognized during the years ended December 31, 2010, 2009 and 2008. Share-based compensation expense of continuing operations is included in general insurance expenses in the consolidated statements of income. Share-based compensation expense of discontinued operations is included in income from discontinued operations in the consolidated statement of income for the year ended December 31, 2008.

68

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Year ended December 31,
	2010		2009		2008
Continuing operations	$	1,855	$	2,181	$	3,143
Discontinued operations		-		-		1,980
	$	1,855	$	2,181	$	5,123

The Lifeco plan contains a provision that permits a retiring option holder with unvested stock options on the date of retirement to continue to vest in them after retirement for a period of up to five years. Upon the retirement of an option holder with unvested options, the Company accelerates the recognition period to the date of retirement for any unrecognized share-based compensation cost related thereto and recognizes it in its earnings at that time.

At December 31, 2010, the Company had $2,346, net of estimated forfeitures, of unrecognized share-based compensation costs, which will be recognized in its earnings through 2015. The weighted-average period over which these costs will be recognized in earnings is 2.0 years.

The following table summarizes the status of, and changes in, the Lifeco plan options granted to Company employees which are outstanding at December 31, 2010. The options granted relate to underlying stock traded in Canadian dollars on the Toronto Stock Exchange, therefore, the amounts, which are presented in United States dollars, will fluctuate as a result of exchange rate fluctuations.

				Weighted average
	Shares under option			Exercise price (Whole dollars)		Remaining contractual term (Years)		Aggregate intrinsic value (1)
Outstanding, January 1, 2010		3,745,302		$	24.30
Granted		404,700			27.41
Exercised		(601,960	)		15.73
Cancelled		(5,400	)		27.41
Outstanding, December 31, 2010		3,542,642			27.66		5.0	$	8,852
Vested and expected to vest, December 31, 2010		3,502,712		$	27.66		4.7	$	8,843
Exercisable, December 31, 2010		2,386,536		$	25.85		4.0	$	8,843

⁽¹⁾ The aggregate intrinsic value is calculated as the difference between the market price of Lifeco common shares on December 31, 2010 and the exercise price of the option (only if the result is positive) multiplied by the number of options.

The following table presents other information regarding stock options under the Lifeco plan during the year ended December 31, 2010:

69

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

	Year ended December 31, 2010
Weighted average fair value of options granted	$	4.41
Intrinsic value of options exercised (1)		5,218
Fair value of options vested		943

⁽¹⁾ The intrinsic value of options exercised is calculated as the difference between the market price of Lifeco common shares on the date of exercise and the exercise price of the option multiplied by the number of options exercised.

The fair value of the options granted during the year ended December 31, 2010 was estimated on the date of the grant using the Black-Scholes option-pricing model with the following assumptions:

Dividend yield	4.53%
Expected volatility	25.03%
Risk free interest rate	2.62%
Expected duration (years)	5.5

19.  Obligations Relating to Debt and Leases

The Company enters into operating leases primarily for the rental of office space. The following table shows, as of December 31, 2010, scheduled related party principal repayments under notes payable to GWL&A Financial and the minimum annual rental commitments for operating leases having initial or remaining non-cancelable lease terms in excess of one year during the years ended December 31, 2011 through 2015 and thereafter:

Year ended December 31,	Related party notes		Operating leases		Total debt and lease obligations
2011	$	-	$	4,837	$	4,837
2012		-		4,166		4,166
2013		-		3,379		3,379
2014		-		1,948		1,948
2015		-		1,394		1,394
Thereafter		528,400		-		528,400

20.  Commitments and Contingencies

The Company is involved in various legal proceedings that arise in the ordinary course of its business. In the opinion of management, after consultation with counsel, the resolution of these proceedings are not expected to have a material adverse effect on the Company’s consolidated financial position or the results of its operations.

On May 26, 2010, the Company entered into a revolving credit facility agreement in the amount of $50,000 for general corporate purposes. The credit facility matures on May 26, 2013. Interest accrues at a rate dependent on various conditions and the terms of borrowings. The agreement requires, among other things, the Company to maintain a minimum adjusted net worth, as defined, of $1,000,000 plus 50% of its net income, if positive and as defined in the credit facility agreement (both compiled by the unconsolidated statutory accounting basis prescribed by the National Association of Insurance Commissioners), for each quarter ending after March 31, 2010. The Company had no borrowings under the credit facility at December 31, 2010 and was in compliance with all covenants. The credit facility replaced a similar

70

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Notes to Consolidated Financial Statements

Years Ended December 31, 2010, 2009 and 2008

(Dollars in Thousands)

$50,000 credit facility which expired on May 26, 2010. The Company had no borrowings under the expired credit facility at December 31, 2009 or through its expiration and was in compliance with all covenants.

The Company makes commitments to fund partnership interests, mortgage loans on real estate and investments in the normal course of its business. The amounts of these unfunded commitments at December 31, 2010 and 2009 were $95,688 and $126,882, respectively, all of which is due within one year from the dates indicated.

21.  Subsequent Event

On February 4, 2011, the Company’s Board of Directors declared a dividend of $47,800 to be paid to its sole shareholder, GWL&A Financial, during the first quarter of 2011.

71

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

Schedule III

Supplemental Insurance Information

(In Thousands)

	As of and for the year ended December 31, 2010
Operations:	Individual Markets Segment		Retirement Services Segment		Other Segment		Total
Deferred acquisition costs	$	110,247	$	150,296	$	-	$	260,543
Future policy benefits, losses, claims and expenses		12,140,361		7,888,725		351,955		20,381,041
Unearned premium reserves		39,834		-		-		39,834
Other policy claims and benefits payable		714,099		387		24,924		739,410
Premium income		676,395		5,509		123,718		805,622
Net investment income		730,439		399,456		44,849		1,174,744
Benefits, claims, losses and settlement expenses		1,218,791		221,943		99,673		1,540,407
Amortization of deferred acquisition costs		22,743		26,160		-		48,903
Other operating expenses		110,219		365,331		62,095		537,645

	As of and for the year ended December 31, 2009
Operations:	Individual Markets Segment		Retirement Services Segment		Other Segment		Total
Deferred acquisition costs	$	174,360	$	222,228	$	-	$	396,588
Future policy benefits, losses, claims and expenses		11,598,641		6,994,319		341,688		18,934,648
Unearned premium reserves		37,912		-		-		37,912
Other policy claims and benefits payable		689,377		319		28,349		718,045
Premium income		428,142		2,949		129,161		560,252
Net investment income		718,040		383,446		47,598		1,149,084
Benefits, claims, losses and settlement expenses		982,465		231,648		112,691		1,326,804
Amortization of deferred acquisition costs		16,221		44,892		-		61,113
Other operating expenses		85,441		317,883		70,823		474,147

	For the year ended December 31, 2008
Operations:	Individual Markets Segment		Retirement Services Segment		Other Segment			Total
Premium income	$	377,525	$	2,291	$	145,321		$	525,137
Net investment income		692,193		351,585		34,691			1,078,469
Benefits, claims, losses and settlement expenses		889,967		229,948		(172,327	)		947,588
Amortization of deferred acquisition costs		21,081		32,312		-			53,393
Other operating expenses		87,621		297,322		88,996			473,939

72

Variable Annuity-1 Series

Account of Great-West Life

& Annuity Insurance

Company

Financial Statements for the Years Ended

December 31, 2010 and 2009

and Report of Independent Registered Public

Accounting Firm

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Contract Owners of

Variable Annuity-1 Series Account

and the Board of Directors of

Great-West Life & Annuity Insurance Company

We have audited the accompanying statements of assets and liabilities of each of the investment divisions which comprise Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company (the “Series Account”) as listed in Appendix A as of December 31, 2010, and the related statements of operations for the periods presented in Appendix A, the statements of changes in net assets for each of the periods presented in Appendix A, and the financial highlights in Note 4 for each of the periods presented. These financial statements and financial highlights are the responsibility of the Series Account’s management. Our responsibility is to express an opinion on these financial statements and financial highlights 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 and financial highlights are free of material misstatement. The Series Account is not required to have, nor were we engaged to perform, an audit of its 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 Series 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, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2010, by correspondence with the mutual fund companies; where replies were not received from the mutual fund companies, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the investment divisions constituting the Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company as of December 31, 2010, the results of their operations, the changes in their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.

/s/ DELOITTE & TOUCHE LLP

Denver, Colorado

April 15, 2011

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
Alger Balanced Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Alger LargeCap Growth Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Alger MidCap Growth Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS Growth & Income Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS Growth Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS International Growth Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS International Value Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS Real Estate Investment Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS Small/Mid Cap Value Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
AllianceBernstein VPS Utility Income Portfolio	N/A	N/A	the Period from January 1, 2009 to September 28, 2009 **
American Century VP Balanced Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
American Century VP Income & Growth Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
American Century VP International Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
American Century VP Mid Cap Value Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 5, 2009 * to December 31, 2009

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Continued)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
American Century VP Value Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Columbia VIT Marsico 21st Century Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 4, 2009 * to December 31, 2009
Columbia VIT Small Cap Value Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 11, 2009 * to December 31, 2009
Delaware VIP Small Cap Value Series	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Delaware VIP Smid Cap Growth Series	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Dreyfus IP MidCap Stock Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Dreyfus VIF Appreciation Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Dreyfus VIF Growth & Income Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Dreyfus VIF Opportunistic Small Cap Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Blue Chip VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Capital Growth VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Dreman Small Mid Cap Value VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Growth & Income VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Health Care VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Continued)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
DWS Large Cap Value VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Small Cap Growth VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Small Cap Index VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
DWS Strategic Value VIP Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Federated Capital Appreciation Fund II	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Federated Capital Income Fund II	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Federated Fund for U.S. Government Securities II	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Federated International Equity Fund II	N/A	Period from January 1, 2010 to March 15, 2010 **	the Period from January 1, 2010 to March 15, 2010 ** and Year Ended December 31, 2009
Franklin Small Cap Value Securities Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Franklin Templeton Foreign Securities Portfolio	December 31, 2010	Period from May 13, 2010 * to December 31, 2010	the Period from May 13, 2010 * to December 31, 2010
Invesco V.I. Core Equity Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Invesco V.I. High Yield Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Invesco V.I. International Growth Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Invesco V.I. Mid Cap Core Equity Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 12, 2009 * to December 31, 2009

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Continued)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
Invesco V.I. Small Cap Equity Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from June 1, 2009 * to December 31, 2009
Invesco V.I. Technology Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Invesco Van Kampen VI Comstock Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Invesco Van Kampen VI Growth & Income Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Balanced Portfolio Institutional Shares	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Balanced Portfolio Service Shares	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Flexible Bond Portfolio Institutional Shares	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Flexible Bond Portfolio Service Shares	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Growth & Income Portfolio Institutional Shares	N/A	Period from January 1, 2010 to May 3, 2010 **	the Period from January 1, 2010 to May 3, 2010 ** and Year Ended December 31, 2009
Janus Aspen Growth & Income Portfolio Service Shares	N/A	Period from January 1, 2010 to May 12, 2010 **	the Period from January 1, 2010 to May 12, 2010 ** and Year Ended December 31, 2009
Janus Aspen Janus Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Overseas Portfolio Institutional Shares	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Janus Aspen Overseas Portfolio Service Shares	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Continued)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
Janus Aspen Worldwide Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
JPMorgan Insurance Trust Small Cap Core Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Lazard Retirement Emerging Markets Equity Series Portfolio	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 6, 2009 * to December 31, 2009
LVIP Baron Growth Opportunities Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
MFS International Value Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from June 16, 2009 * to December 31, 2009
MFS Utilities Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Neuberger Berman AMT Regency Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
NVIT Mid Cap Index Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Oppenheimer Global Securities Fund/VA	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Oppenheimer International Growth Fund/VA	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
PIMCO VIT High Yield Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
PIMCO VIT Low Duration Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
PIMCO VIT Total Return Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Continued)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
Pioneer Emerging Markets VCT Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Pioneer Fund VCT Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Pioneer Growth Opportunities VCT Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Pioneer Mid Cap Value VCT Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Pioneer Small Cap Value VCT Portfolio	N/A	N/A	the Period from January 1, 2009 to April 29, 2009 **
Prudential Series Fund Equity Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Prudential Series Fund Natural Resources Portfolio	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 11, 2009 * to December 31, 2009
Putnam VT American Government Income IB Portfolio	December 31, 2010	Period from May 3, 2010 * to December 31, 2010	the Period from May 3, 2010 * to December 31, 2010
Putnam VT Equity Income IB Portfolio	December 31, 2010	Period from June 7, 2010 * to December 31, 2010	the Period from June 7, 2010 * to December 31, 2010
Royce Small-Cap Portfolio	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 4, 2009 * to December 31, 2009
Schwab MarketTrack Growth Portfolio II	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Schwab Money Market Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Schwab S&P 500 Index Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Continued)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
Seligman Communications & Information Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Sentinel Variable Products Bond Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from June 16, 2009 * to December 31, 2009
Sentinel Variable Products Common Stock Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from June 16, 2009 * to December 31, 2009
Sentinel Variable Products Small Company Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 4 * to December 31, 2009
Third Avenue Value Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Touchstone Mid Cap Growth Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from July 6, 2009 * to December 31, 2009
Universal Institutional Fund U.S. Real Estate Portfolio	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Van Eck VIP Global Bond Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 13, 2009 * to December 31, 2009
Van Eck VIP Global Hard Assets Fund	December 31, 2010	Year Ended December 31, 2010	the Year Ended December 31, 2010 and Period from May 4, 2009 * to December 31, 2009
Wells Fargo Advantage VT Discovery Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010
Wells Fargo Advantage VT Opportunity Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010

Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company –

APPENDIX A (Concluded)

Investment Division	Statements of Assets and Liabilities as of	Statements of Operations for the	Statements of Changes in Net Assets for
Wells Fargo Advantage VT Small Cap Value Fund	December 31, 2010	Year Ended December 31, 2010	each of the Two Years Ended December 31, 2010

*Date represents commencement of operations

**Date represents cessation of operations

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	ALGER BALANCED PORTFOLIO		ALGER LARGE CAP GROWTH PORTFOLIO		ALGER MID CAP GROWTH PORTFOLIO		ALLIANCE- BERNSTEIN VPS GROWTH & INCOME PORTFOLIO		ALLIANCE- BERNSTEIN VPS GROWTH PORTFOLIO		ALLIANCE- BERNSTEIN  VPS INTERNATIONAL GROWTH PORTFOLIO
ASSETS:
Investments at market value (1)	$	1,127,048	$	20,591,688	$	8,185,866	$	6,703,802	$	2,351,294	$	23,160,854
Investment income due and accrued
Receivable for investments sold						291		30,305
Purchase payments receivable				4,374								58,367
Due from Great West Life & Annuity Insurance Company				20,619		8,594		70,868				4,315
Total assets		1,127,048		20,616,681		8,194,751		6,804,975		2,351,294		23,223,536
LIABILITIES:
Payable for investments purchased				1,890								58,056
Redemptions payable				2,484		291		30,305				311
Due to Great West Life & Annuity Insurance Company		2,420		1,339		516		401		144		1,384
Total liabilities		2,420		5,713		807		30,706		144		59,751
NET ASSETS	$	1,124,628	$	20,610,968	$	8,193,944	$	6,774,269	$	2,351,150	$	23,163,785
NET ASSETS REPRESENTED BY:
Accumulation units	$	1,094,918	$	20,554,064	$	8,157,024	$	6,513,764	$	2,351,150	$	23,119,738
Contracts in payout phase		29,710		56,904		36,920		260,505				44,047
NET ASSETS	$	1,124,628	$	20,610,968	$	8,193,944	$	6,774,269	$	2,351,150	$	23,163,785
ACCUMULATION UNITS OUTSTANDING		88,193		1,347,100		523,962		597,969		225,741		1,625,397
UNIT VALUE (ACCUMULATION)	$	12.42	$	15.26	$	15.57	$	10.89	$	10.42	$	14.22
(1)     Cost of investments:	$	1,281,812	$	18,761,398	$	7,047,316	$	7,859,678	$	2,338,355	$	23,855,347
Shares of investments:		97,076		471,421		642,029		389,983		116,690		1,257,375

The accompanying notes are an integral part of these financial statements.

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	ALLIANCE - BERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO		ALLIANCE - BERNSTEIN VPS REAL ESTATE INVESTMENT PORTFOLIO		ALLIANCE- BERNSTEIN VPS SMALL/MID  CAP VALUE PORTFOLIO		AMERICAN CENTURY VP BALANCED FUND		AMERICAN CENTURY VP INCOME & GROWTH FUND		AMERICAN CENTURY VP INTERNATIONAL FUND
ASSETS:
Investments at market value (1)	$	9,314,352	$	13,902,314	$	5,748,940	$	6,666,608	$	3,913,181	$	6,748,408
Investment income due and accrued
Receivable for investments sold		10,135										971
Purchase payments receivable				112,185		2,019		4,621
Due from Great West Life & Annuity Insurance Company				110,922				584		521		12,702
Total assets		9,324,487		14,125,421		5,750,959		6,671,813		3,913,702		6,762,081
LIABILITIES:
Payable for investments purchased				112,025		2,019		4,411
Redemptions payable		10,135		160				210				971
Due to Great West Life & Annuity Insurance Company		1,035		800		644		411		228		434
Total liabilities		11,170		112,985		2,663		5,032		228		1,405
NET ASSETS	$	9,313,317	$	14,012,436	$	5,748,296	$	6,666,781	$	3,913,474	$	6,760,676
NET ASSETS REPRESENTED BY:
Accumulation units	$	9,292,118	$	13,623,286	$	5,742,868	$	6,664,524	$	3,911,462	$	6,664,283
Contracts in payout phase		21,199		389,150		5,428		2,257		2,012		96,393
NET ASSETS	$	9,313,317	$	14,012,436	$	5,748,296	$	6,666,781	$	3,913,474	$	6,760,676
ACCUMULATION UNITS OUTSTANDING		1,214,511		529,707		475,433		478,014		335,511		412,047
UNIT VALUE (ACCUMULATION)	$	7.65	$	25.72	$	12.08	$	13.94	$	11.66	$	16.17
(1)     Cost of investments:	$	10,306,133	$	11,824,261	$	5,160,921	$	6,237,486	$	4,056,229	$	6,721,098
Shares of investments:		625,124		1,156,599		339,170		1,058,192		646,807		788,365

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	AMERICAN CENTURY VP MID CAP VALUE FUND		AMERICAN CENTURY VP VALUE FUND		COLUMBIA VIT MARSICO 21ST CENTURY FUND		COLUMBIA VIT SMALL CAP VALUE FUND		DELAWARE VIP SMALL CAP VALUE SERIES		DELAWARE VIP SMID CAP GROWTH SERIES
ASSETS:
Investments at market value (1)	$	1,695,214	$	17,976,937	$	1,724,745	$	1,301,293	$	19,992,684	$	4,413,875
Investment income due and accrued
Receivable for investments sold						208
Purchase payments receivable				101,746						2,757		170,284
Due from Great West Life & Annuity Insurance Company				16,536						17,603
Total assets		1,695,214		18,095,219		1,724,953		1,301,293		20,013,044		4,584,159
LIABILITIES:
Payable for investments purchased				101,723						2,757		132,823
Redemptions payable				23		208						37,461
Due to Great West Life & Annuity Insurance Company		101		1,095		99		78		1,210		1,239
Total liabilities		101		102,841		307		78		3,967		171,523
NET ASSETS	$	1,695,113	$	17,992,378	$	1,724,646	$	1,301,215	$	20,009,077	$	4,412,636
NET ASSETS REPRESENTED BY:
Accumulation units	$	1,695,113	$	17,914,686	$	1,724,646	$	1,301,215	$	19,888,761	$	4,393,424
Contracts in payout phase				77,692						120,316		19,212
NET ASSETS	$	1,695,113	$	17,992,378	$	1,724,646	$	1,301,215	$	20,009,077	$	4,412,636
ACCUMULATION UNITS OUTSTANDING		109,494		1,216,022		111,366		82,000		886,260		301,495
UNIT VALUE (ACCUMULATION)	$	15.48	$	14.73	$	15.49	$	15.87	$	22.44	$	14.57
(1)     Cost of investments:	$	1,473,461	$	18,190,525	$	1,539,125	$	1,135,505	$	17,401,065	$	3,771,433
Shares of investments:		119,888		3,067,737		144,089		74,402		625,553		198,644

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	DREYFUS IP MIDCAP STOCK PORTFOLIO		DREYFUS VIF APPRECIATION PORTFOLIO		DREYFUS VIF GROWTH & INCOME PORTFOLIO		DREYFUS VIF OPPORTUNISTIC SMALL CAP PORTFOLIO		DWS BLUE CHIP VIP PORTFOLIO		DWS CAPITAL GROWTH VIP PORTFOLIO
ASSETS:
Investments at market value (1)	$	1,656,430	$	10,102,332	$	2,384,607	$	682,394	$	6,293,106	$	8,967,890
Investment income due and accrued						9,051
Receivable for investments sold		7						118,796
Purchase payments receivable				70,928						72,921		2,992
Due from Great West Life & Annuity Insurance Company				275						176		13,639
Total assets		1,656,437		10,173,535		2,393,658		801,190		6,366,203		8,984,521
LIABILITIES:
Payable for investments purchased				70,815						72,921		2,481
Redemptions payable		7		113				118,796				511
Due to Great West Life & Annuity Insurance Company		101		652		1,847		48		369		556
Total liabilities		108		71,580		1,847		118,844		73,290		3,548
NET ASSETS	$	1,656,329	$	10,101,955	$	2,391,811	$	682,346	$	6,292,913	$	8,980,973
NET ASSETS REPRESENTED BY:
Accumulation units	$	1,656,329	$	9,967,603	$	2,383,005	$	682,346	$	6,272,001	$	8,941,649
Contracts in payout phase				134,352		8,806				20,912		39,324
NET ASSETS	$	1,656,329	$	10,101,955	$	2,391,811	$	682,346	$	6,292,913	$	8,980,973
ACCUMULATION UNITS OUTSTANDING		106,628		822,456		221,904		60,886		544,532		783,497
UNIT VALUE (ACCUMULATION)	$	15.53	$	12.12	$	10.74	$	11.21	$	11.52	$	11.41
(1)     Cost of investments:	$	1,310,470	$	9,223,162	$	2,402,322	$	661,605	$	5,934,377	$	7,568,624
Shares of investments:		125,773		285,055		120,678		22,308		590,902		457,779

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO		DWS GROWTH & INCOME VIP PORTFOLIO		DWS HEALTH CARE VIP PORTFOLIO		DWS LARGE CAP VALUE VIP PORTFOLIO		DWS SMALL CAP GROWTH VIP PORTFOLIO		DWS SMALL CAP INDEX VIP PORTFOLIO
ASSETS:
Investments at market value (1)	$	7,494,399	$	417,009	$	3,414,220	$	9,562,831	$	639,121	$	13,911,407
Investment income due and accrued
Receivable for investments sold						73						121,450
Purchase payments receivable		27,116						82,921
Due from Great West Life & Annuity Insurance Company		496		3,901		603						23,422
Total assets		7,522,011		420,910		3,414,896		9,645,752		639,121		14,056,279
LIABILITIES:
Payable for investments purchased		26,580						82,185
Redemptions payable		536				73		736				121,450
Due to Great West Life & Annuity Insurance Company		455		29		209		577		1,086		888
Total liabilities		27,571		29		282		83,498		1,086		122,338
NET ASSETS	$	7,494,440	$	420,881	$	3,414,614	$	9,562,254	$	638,035	$	13,933,941
NET ASSETS REPRESENTED BY:
Accumulation units	$	7,472,373	$	415,757	$	3,371,766	$	9,562,254	$	633,134	$	13,864,716
Contracts in payout phase		22,067		5,124		42,848				4,901		69,225
NET ASSETS	$	7,494,440	$	420,881	$	3,414,614	$	9,562,254	$	638,035	$	13,933,941
ACCUMULATION UNITS OUTSTANDING		662,881		45,221		282,409		821,574		64,549		801,933
UNIT VALUE (ACCUMULATION)	$	11.27	$	9.19	$	11.94	$	11.64	$	9.81	$	17.29
(1)     Cost of investments:	$	5,774,361	$	351,649	$	3,069,296	$	8,461,139	$	624,755	$	12,182,633
Shares of investments:		613,792		55,160		301,078		810,409		46,146		1,120,984

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	DWS STRATEGIC VALUE VIP PORTFOLIO		FEDERATED CAPITAL APPRECIATION FUND II		FEDERATED CAPITAL INCOME FUND II		FEDERATED FUND FOR  U.S. GOVERNMENT SECURITIES II		FRANKLIN SMALL  CAP VALUE SECURITIES FUND		FRANKLIN TEMPLETON FOREIGN SECURITIES PORTFOLIO
ASSETS:
Investments at market value (1)	$	2,726,501	$	3,156,302	$	681,121	$	50,657,742	$	3,661,854	$	1,360,648
Investment income due and accrued
Receivable for investments sold				3,075				2,374
Purchase payments receivable								623		2,156		41,669
Due from Great West Life & Annuity Insurance Company												3,391
Total assets		2,726,501		3,159,377		681,121		50,660,739		3,664,010		1,405,708
LIABILITIES:
Payable for investments purchased										2,156		41,669
Redemptions payable				3,075				2,997
Due to Great West Life & Annuity Insurance Company		169		3,850		47		43,563		226		77
Total liabilities		169		6,925		47		46,560		2,382		41,746
NET ASSETS	$	2,726,332	$	3,152,452	$	681,074	$	50,614,179	$	3,661,628	$	1,363,962
NET ASSETS REPRESENTED BY:
Accumulation units	$	2,726,332	$	3,129,882	$	681,074	$	50,293,001	$	3,661,628	$	1,348,516
Contracts in payout phase				22,570				321,178				15,446
NET ASSETS	$	2,726,332	$	3,152,452	$	681,074	$	50,614,179	$	3,661,628	$	1,363,962
ACCUMULATION UNITS OUTSTANDING		295,541		195,262		45,452		3,225,280		341,747		124,712
UNIT VALUE (ACCUMULATION)	$	9.22	$	16.03	$	14.98	$	15.59	$	10.71	$	10.81
(1)     Cost of investments:	$	2,948,469	$	4,168,808	$	635,229	$	49,445,207	$	2,902,693	$	1,289,352
Shares of investments:		335,363		493,172		74,440		4,405,021		225,345		95,217

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	INVESCO V.I. CORE EQUITY FUND		INVESCO V.I. HIGH YIELD FUND		INVESCO V.I. INTERNATIONAL GROWTH FUND		INVESCO V.I. MID CAP CORE EQUITY FUND		INVESCO V.I. SMALL CAP EQUITY FUND		INVESCO V.I. TECHNOLOGY FUND
ASSETS:
Investments at market value (1)	$	5,053,050	$	3,577,428	$	10,800,851	$	1,581,805	$	834,823	$	2,336,293
Investment income due and accrued
Receivable for investments sold		647		12		245		97
Purchase payments receivable
Due from Great West Life & Annuity Insurance Company				2,994
Total assets		5,053,697		3,580,434		10,801,096		1,581,902		834,823		2,336,293
LIABILITIES:
Payable for investments purchased
Redemptions payable		647		12		245		97
Due to Great West Life & Annuity Insurance Company		353		245		1,429		94		53		1,815
Total liabilities		1,000		257		1,674		191		53		1,815
NET ASSETS	$	5,052,697	$	3,580,177	$	10,799,422	$	1,581,711	$	834,770	$	2,334,478
NET ASSETS REPRESENTED BY:
Accumulation units	$	5,052,697	$	3,561,519	$	10,784,055	$	1,581,711	$	834,770	$	2,328,535
Contracts in payout phase				18,658		15,367						5,943
NET ASSETS	$	5,052,697	$	3,580,177	$	10,799,422	$	1,581,711	$	834,770	$	2,334,478
ACCUMULATION UNITS OUTSTANDING		254,855		197,874		958,127		111,754		53,615		723,350
UNIT VALUE (ACCUMULATION)	$	19.83	$	18.00	$	11.26	$	14.15	$	15.57	$	3.22
(1)     Cost of investments:	$	4,360,054	$	3,589,447	$	9,352,888	$	1,426,061	$	740,089	$	2,029,284
Shares of investments:		186,942		668,678		376,467		127,668		50,504		146,018

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	INVESCO VAN KAMPEN VI COMSTOCK FUND		INVESCO VAN KAMPEN VI GROWTH & INCOME FUND		JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES		JANUS  ASPEN BALANCED PORTFOLIO SERVICE SHARES		JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES		JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES
ASSETS:
Investments at market value (1)	$	2,798,019	$	10,035,884	$	9,471,291	$	32,139,082	$	25,296,911	$	33,730,519
Investment income due and accrued
Receivable for investments sold				61								14,538
Purchase payments receivable		200						339				200
Due from Great West Life & Annuity Insurance Company				3,695						89,316		16,044
Total assets		2,798,219		10,039,640		9,471,291		32,139,421		25,386,227		33,761,301
LIABILITIES:
Payable for investments purchased		136						100
Redemptions payable		64		61				239				14,738
Due to Great West Life & Annuity Insurance Company		173		596		3,325		1,910		1,616		2,028
Total liabilities		373		657		3,325		2,249		1,616		16,766
NET ASSETS	$	2,797,846	$	10,038,983	$	9,467,966	$	32,137,172	$	25,384,611	$	33,744,535
NET ASSETS REPRESENTED BY:
Accumulation units	$	2,797,846	$	10,034,130	$	9,413,223	$	32,137,172	$	24,794,029	$	33,603,988
Contracts in payout phase				4,853		54,743				590,582		140,547
NET ASSETS	$	2,797,846	$	10,038,983	$	9,467,966	$	32,137,172	$	25,384,611	$	33,744,535
ACCUMULATION UNITS OUTSTANDING		250,022		830,563		570,337		2,763,264		1,385,746		2,561,015
UNIT VALUE (ACCUMULATION)	$	11.19	$	12.08	$	16.50	$	11.63	$	17.89	$	13.12
(1)     Cost of investments:	$	2,309,449	$	7,976,558	$	9,196,853	$	29,622,025	$	22,956,800	$	32,303,485
Shares of investments:		238,943		545,428		334,675		1,092,423		1,991,883		2,489,337

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	JANUS ASPEN JANUS PORTFOLIO		JANUS ASPEN OVERSEAS PORTFOLIO INSTITUTIONAL SHARES		JANUS ASPEN OVERSEAS PORTFOLIO SERVICE SHARES		JANUS  ASPEN WORLDWIDE PORTFOLIO		JPMORGAN INSURANCE TRUST SMALL CAP CORE PORTFOLIO		LAZARD RETIREMENT EMERGING MARKETS EQUITY SERIES PORTFOLIO
ASSETS:
Investments at market value (1)	$	7,841,516	$	16,235,912	$	7,085,431	$	8,786,374	$	975,215	$	14,399,747
Investment income due and accrued
Receivable for investments sold		9		2,770				2,563
Purchase payments receivable						38,678						216,777
Due from Great West Life & Annuity Insurance Company		9,820		16,020				10,068		1,412
Total assets		7,851,345		16,254,702		7,124,109		8,799,005		976,627		14,616,524
LIABILITIES:
Payable for investments purchased						38,625						216,520
Redemptions payable		9		2,770		53		2,563				257
Due to Great West Life & Annuity Insurance Company		549		1,135		491		607		56		872
Total liabilities		558		3,905		39,169		3,170		56		217,649
NET ASSETS	$	7,850,787	$	16,250,797	$	7,084,940	$	8,795,835	$	976,571	$	14,398,875
NET ASSETS REPRESENTED BY:
Accumulation units	$	7,820,091	$	16,217,977	$	7,084,940	$	8,736,677	$	966,701	$	14,398,875
Contracts in payout phase		30,696		32,820				59,158		9,870
NET ASSETS	$	7,850,787	$	16,250,797	$	7,084,940	$	8,795,835	$	976,571	$	14,398,875
ACCUMULATION UNITS OUTSTANDING		437,384		504,307		571,108		501,320		63,986		807,167
UNIT VALUE (ACCUMULATION)	$	17.88	$	32.16	$	12.41	$	17.43	$	15.11	$	17.84
(1)     Cost of investments:	$	7,772,611	$	14,264,711	$	5,783,885	$	6,807,280	$	1,092,716	$	13,053,255
Shares of investments:		323,228		284,392		126,435		291,615		65,232		617,220

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	LVIP BARON GROWTH OPPORTUNITIES FUND		MFS INTERNATIONAL VALUE FUND		MFS UTILITIES FUND		NEUBERGER BERMAN  AMT REGENCY PORTFOLIO		NVIT MID CAP INDEX FUND		OPPENHEIMER GLOBAL SECURITIES FUND/VA
ASSETS:
Investments at market value (1)	$	18,373,354	$	7,610,669	$	2,875,473	$	312,077	$	9,770,061	$	27,306,059
Investment income due and accrued
Receivable for investments sold						168,487				862
Purchase payments receivable		146,600		13,051								54,097
Due from Great West Life & Annuity Insurance Company				1,310						19,806		7,968
Total assets		18,519,954		7,625,030		3,043,960		312,077		9,790,729		27,368,124
LIABILITIES:
Payable for investments purchased		144,776		13,051								54,056
Redemptions payable		1,824				168,487				862		41
Due to Great West Life & Annuity Insurance Company		7,907		468		190		19		602		1,683
Total liabilities		154,507		13,519		168,677		19		1,464		55,780
NET ASSETS	$	18,365,447	$	7,611,511	$	2,875,283	$	312,058	$	9,789,265	$	27,312,344
NET ASSETS REPRESENTED BY:
Accumulation units	$	18,286,660	$	7,606,630	$	2,875,283	$	312,058	$	9,743,060	$	27,103,197
Contracts in payout phase		78,787		4,881						46,205		209,147
NET ASSETS	$	18,365,447	$	7,611,511	$	2,875,283	$	312,058	$	9,789,265	$	27,312,344
ACCUMULATION UNITS OUTSTANDING		936,974		537,209		306,337		30,660		518,540		1,507,361
UNIT VALUE (ACCUMULATION)	$	19.52	$	14.16	$	9.39	$	10.18	$	18.79	$	17.98
(1)     Cost of investments:	$	16,641,585	$	7,014,921	$	2,585,251	$	159,133	$	8,577,316	$	26,653,296
Shares of investments:		606,982		493,238		115,249		18,811		531,559		901,190

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	OPPENHEIMER INTERNATIONAL GROWTH FUND/VA		PIMCO VIT HIGH YIELD PORTFOLIO		PIMCO VIT LOW DURATION PORTFOLIO		PIMCO VIT TOTAL RETURN PORTFOLIO		PIONEER EMERGING MARKETS VCT PORTFOLIO		PIONEER FUND VCT PORTFOLIO
ASSETS:
Investments at market value (1)	$	8,822,612	$	31,076,189	$	70,307,701	$	141,475,959	$	2,217,347	$	4,487,149
Investment income due and accrued				204,763		130,835		335,280
Receivable for investments sold												766
Purchase payments receivable				1,669		110,854		463,251
Due from Great West Life & Annuity Insurance Company
Total assets		8,822,612		31,282,621		70,549,390		142,274,490		2,217,347		4,487,915
LIABILITIES:
Payable for investments purchased				1,375		39,491		462,243
Redemptions payable				294		71,363		1,008				766
Due to Great West Life & Annuity Insurance Company		500		5,884		14,508		65,299		126		284
Total liabilities		500		7,553		125,362		528,550		126		1,050
NET ASSETS	$	8,822,112	$	31,275,068	$	70,424,028	$	141,745,940	$	2,217,221	$	4,486,865
NET ASSETS REPRESENTED BY:
Accumulation units	$	8,822,112	$	31,174,131	$	69,894,286	$	141,083,591	$	2,217,221	$	4,486,865
Contracts in payout phase				100,937		529,742		662,349
NET ASSETS	$	8,822,112	$	31,275,068	$	70,424,028	$	141,745,940	$	2,217,221	$	4,486,865
ACCUMULATION UNITS OUTSTANDING		573,286		1,742,904		5,433,823		9,962,743		252,548		350,580
UNIT VALUE (ACCUMULATION)	$	15.39	$	17.89	$	12.86	$	14.16	$	8.78	$	12.80
(1)     Cost of investments:	$	7,649,713	$	28,665,007	$	68,824,346	$	137,544,943	$	1,852,797	$	3,992,569
Shares of investments:		4,717,974		4,009,831		6,734,454		12,768,588		71,435		200,051

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO		PIONEER MID CAP VALUE VCT PORTFOLIO		PRUDENTIAL SERIES FUND EQUITY PORTFOLIO		PRUDENTIAL SERIES FUND NATURAL RESOURCES PORTFOLIO		PUTNAM VT AMERICAN GOVERNMENT INCOME IB PORTFOLIO		PUTNAM VT EQUITY INCOME IB PORTFOLIO
ASSETS:
Investments at market value (1)	$	4,903,184	$	2,342,426	$	1,648,070	$	5,264,218	$	1,093,904	$	884,155
Investment income due and accrued
Receivable for investments sold		24
Purchase payments receivable				53,368				372,456
Due from Great West Life & Annuity Insurance Company		6,573		3,362
Total assets		4,909,781		2,399,156		1,648,070		5,636,674		1,093,904		884,155
LIABILITIES:
Payable for investments purchased				53,368				372,456
Redemptions payable		24
Due to Great West Life & Annuity Insurance Company		330		140		104		274		68		58
Total liabilities		354		53,508		104		372,730		68		58
NET ASSETS	$	4,909,427	$	2,345,648	$	1,647,966	$	5,263,944	$	1,093,836	$	884,097
NET ASSETS REPRESENTED BY:
Accumulation units	$	4,900,794	$	2,330,334	$	1,647,966	$	5,263,944	$	1,093,836	$	884,097
Contracts in payout phase		8,633		15,314
NET ASSETS	$	4,909,427	$	2,345,648	$	1,647,966	$	5,263,944	$	1,093,836	$	884,097
ACCUMULATION UNITS OUTSTANDING		353,003		219,043		121,047		288,975		106,809		83,328
UNIT VALUE (ACCUMULATION)	$	13.88	$	10.64	$	13.61	$	18.22	$	10.24	$	10.61
(1)     Cost of investments:	$	4,241,966	$	1,827,901	$	1,497,732	$	4,705,025	$	1,103,951	$	844,043
Shares of investments:		213,089		139,182		65,923		112,052		86,543		65,785

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	ROYCE SMALL- CAP PORTFOLIO		SCHWAB MARKETTRACK GROWTH PORTFOLIO II		SCHWAB MONEY MARKET PORTFOLIO		SCHWAB S&P 500 INDEX PORTFOLIO		SELIGMAN COMMUNICATIONS & INFORMATION PORTFOLIO		SENTINEL VARIABLE PRODUCTS BOND FUND
ASSETS:
Investments at market value (1)	$	5,140,712	$	28,613,908	$	127,204,234	$	116,882,805	$	4,689,825	$	2,327,807
Investment income due and accrued						1,579
Receivable for investments sold				7		1,117,252						10,000
Purchase payments receivable		38,864				161,264		172,440		8,467
Due from Great West Life & Annuity Insurance Company				21,959		85,376		94,445
Total assets		5,179,576		28,635,874		128,569,705		117,149,690		4,698,292		2,337,807
LIABILITIES:
Payable for investments purchased		38,804						168,324		8,467
Redemptions payable		60		7		1,278,516		4,116				10,000
Due to Great West Life & Annuity Insurance Company		312		1,777		8,005		7,362		294		137
Total liabilities		39,176		1,784		1,286,521		179,802		8,761		10,137
NET ASSETS	$	5,140,400	$	28,634,090	$	127,283,184	$	116,969,888	$	4,689,531	$	2,327,670
NET ASSETS REPRESENTED BY:
Accumulation units	$	5,140,400	$	28,408,468	$	126,691,972	$	116,395,333	$	4,689,531	$	2,327,670
Contracts in payout phase				225,622		591,212		574,555
NET ASSETS	$	5,140,400	$	28,634,090	$	127,283,184	$	116,969,888	$	4,689,531	$	2,327,670
ACCUMULATION UNITS OUTSTANDING		328,555		1,857,981		10,639,136		8,170,617		354,183		206,342
UNIT VALUE (ACCUMULATION)	$	15.65	$	15.29	$	11.91	$	14.25	$	13.24	$	11.28
(1)     Cost of investments:	$	4,518,561	$	29,137,681	$	127,204,234	$	110,507,189	$	3,993,455	$	2,520,884
Shares of investments:		495,252		1,921,686		127,204,234		6,397,526		209,087		237,774

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	SENTINEL VARIABLE PRODUCTS COMMON STOCK FUND		SENTINEL VARIABLE PRODUCTS SMALL COMPANY FUND		THIRD AVENUE VALUE PORTFOLIO		TOUCHSTONE MID CAP GROWTH FUND		UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO		VAN ECK VIP GLOBAL BOND FUND
ASSETS:
Investments at market value (1)	$	3,120,598	$	842,187	$	8,429,850	$	2,177,179	$	8,761,184	$	7,366,038
Investment income due and accrued
Receivable for investments sold
Purchase payments receivable		13,516		2,992				55,505		18,727
Due from Great West Life & Annuity Insurance Company								3,370
Total assets		3,134,114		845,179		8,429,850		2,236,054		8,779,911		7,366,038
LIABILITIES:
Payable for investments purchased		13,516		2,992				55,505		18,625
Redemptions payable										102
Due to Great West Life & Annuity Insurance Company		185		45		492		119		612		27,513
Total liabilities		13,701		3,037		492		55,624		19,339		27,513
NET ASSETS	$	3,120,413	$	842,142	$	8,429,358	$	2,180,430	$	8,760,572	$	7,338,525
NET ASSETS REPRESENTED BY:
Accumulation units	$	3,120,413	$	842,142	$	8,429,358	$	2,165,080	$	8,760,572	$	7,254,725
Contracts in payout phase								15,350				83,800
NET ASSETS	$	3,120,413	$	842,142	$	8,429,358	$	2,180,430	$	8,760,572	$	7,338,525
ACCUMULATION UNITS OUTSTANDING		214,852		54,270		945,003		136,437		298,689		631,823
UNIT VALUE (ACCUMULATION)	$	14.52	$	15.52	$	8.92	$	15.87	$	29.33	$	11.48
(1)     Cost of investments:	$	2,818,859	$	753,868	$	8,444,865	$	1,916,154	$	7,429,055	$	7,227,896
Shares of investments:		229,287		57,803		569,970		162,476		678,635		612,306

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	VAN ECK VIP GLOBAL HARD ASSETS FUND		WELLS FARGO ADVANTAGE VT DISCOVERY FUND		WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND		WELLS FARGO ADVANTAGE VT SMALL CAP VALUE FUND
ASSETS:
Investments at market value (1)	$	5,621,851	$	4,789,596	$	5,956,132	$	3,062,163
Investment income due and accrued
Receivable for investments sold
Purchase payments receivable		474,197		3,029		22,351
Due from Great West Life & Annuity Insurance Company						73,555
Total assets		6,096,048		4,792,625		6,052,038		3,062,163
LIABILITIES:
Payable for investments purchased		474,197		3,029		22,351
Redemptions payable
Due to Great West Life & Annuity Insurance Company		298		1,025		356		5,300
Total liabilities		474,495		4,054		22,707		5,300
NET ASSETS	$	5,621,553	$	4,788,571	$	6,029,331	$	3,056,863
NET ASSETS REPRESENTED BY:
Accumulation units	$	5,621,553	$	4,750,742	$	5,796,288	$	3,025,243
Contracts in payout phase				37,829		233,043		31,620
NET ASSETS	$	5,621,553	$	4,788,571	$	6,029,331	$	3,056,863
ACCUMULATION UNITS OUTSTANDING		325,746		351,467		404,900		197,744
UNIT VALUE (ACCUMULATION)	$	17.26	$	13.52	$	14.32	$	15.30
(1)     Cost of investments:	$	4,939,076	$	4,010,242	$	4,597,141	$	3,637,152
Shares of investments:		152,148		225,075		323,351		339,110

The accompanying notes are an integral part of these financial statements. (Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	ALGER BALANCED PORTFOLIO			ALGER LARGE CAP GROWTH PORTFOLIO			ALGER MID CAP GROWTH PORTFOLIO			ALLIANCE- BERNSTEIN VPS GROWTH & INCOME PORTFOLIO			ALLIANCE- BERNSTEIN VPS GROWTH PORTFOLIO			ALLIANCE- BERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO
INVESTMENT INCOME:
Dividends	$	28,117		$	151,983		$			$			$	6,720		$	451,340
EXPENSES:
Mortality and expense risk		7,694			157,881			58,829			48,712			16,981			160,231
NET INVESTMENT INCOME (LOSS)		20,423			(5,898	)		(58,829	)		(48,712	)		(10,261	)		291,109
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on sale of fund shares		(34,003	)		(440,232	)		(1,439,827	)		(1,256,277	)		(125,157	)		(5,127,636	)
Realized gain distributions
Net realized loss		(34,003	)		(440,232	)		(1,439,827	)		(1,256,277	)		(125,157	)		(5,127,636	)
Change in net unrealized appreciation (depreciation) on investments		114,559			2,730,482			2,740,960			2,059,103			430,149			7,148,106
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	100,979		$	2,284,352		$	1,242,304		$	754,114		$	294,731		$	2,311,579

The accompanying notes are an integral part of these financial statements.

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	ALLIANCE- BERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO			ALLIANCE- BERNSTEIN VPS REAL ESTATE INVESTMENT PORTFOLIO			ALLIANCE- BERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO			AMERICAN CENTURY VP BALANCED FUND			AMERICAN CENTURY VP INCOME & GROWTH FUND			AMERICAN CENTURY VP INTERNATIONAL FUND
INVESTMENT INCOME:
Dividends	$	310,822		$	161,630		$	32,487		$	120,715		$	59,954		$	165,320
EXPENSES:
Mortality and expense risk		78,710			84,169			43,785			47,809			28,446			53,070
NET INVESTMENT INCOME (LOSS)		232,112			77,461			(11,298	)		72,906			31,508			112,250
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		(3,850,453	)		(2,598,053	)		956,300			(286,841	)		(737,194	)		(25,295	)
Realized gain distributions
Net realized gain (loss)		(3,850,453	)		(2,598,053	)		956,300			(286,841	)		(737,194	)		(25,295	)
Change in net unrealized appreciation (depreciation) on investments		3,729,970			5,204,337			(26,096	)		863,536			1,182,076			653,702
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	111,629		$	2,683,745		$	918,906		$	649,601		$	476,390		$	740,657

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	AMERICAN CENTURY VP MID CAP VALUE FUND		AMERICAN CENTURY VP VALUE FUND			COLUMBIA VIT MARSICO 21ST CENTURY FUND			COLUMBIA VIT SMALL CAP VALUE FUND		DELAWARE VIP SMALL CAP VALUE SERIES			DELAWARE VIP SMID CAP GROWTH SERIES
INVESTMENT INCOME:
Dividends	$	28,520	$	351,499		$			$	6,470	$	111,434		$
EXPENSES:
Mortality and expense risk		8,808		114,896			8,501			4,810		123,736			15,710
NET INVESTMENT INCOME (LOSS)		19,712		236,603			(8,501	)		1,660		(12,302	)		(15,710	)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		54,829		(1,240,726	)		17,793			35,274		(874,169	)		394,109
Realized gain distributions
Net realized gain (loss)		54,829		(1,240,726	)		17,793			35,274		(874,169	)		394,109
Change in net unrealized appreciation (depreciation) on investments		157,221		2,929,630			175,005			142,596		5,547,660			352,764
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	231,762	$	1,925,507		$	184,297		$	179,530	$	4,661,189		$	731,163

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	DREYFUS IP MIDCAP STOCK PORTFOLIO			DREYFUS VIF APPRECIATION PORTFOLIO			DREYFUS VIF GROWTH & INCOME PORTFOLIO			DREYFUS VIF OPPORTUNISTIC SMALL CAP PORTFOLIO			DWS BLUE CHIP VIP PORTFOLIO			DWS CAPITAL GROWTH VIP PORTFOLIO
INVESTMENT INCOME:
Dividends	$	18,752		$	143,910		$	26,118		$	4,716		$	81,239		$	67,485
EXPENSES:
Mortality and expense risk		12,656			57,671			17,167			4,450			39,544			55,964
NET INVESTMENT INCOME		6,096			86,239			8,951			266			41,695			11,521
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on sale of fund shares		(117,694	)		(174,331	)		(124,431	)		(210,206	)		(487,755	)		(247,192	)
Realized gain distributions
Net realized loss		(117,694	)		(174,331	)		(124,431	)		(210,206	)		(487,755	)		(247,192	)
Change in net unrealized appreciation (depreciation) on investments		505,030			1,153,292			458,793			369,067			1,086,171			1,354,369
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	393,432		$	1,065,200		$	343,313		$	159,127		$	640,111		$	1,118,698

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO			DWS GROWTH & INCOME VIP PORTFOLIO			DWS HEALTH CARE VIP PORTFOLIO			DWS LARGE CAP VALUE VIP PORTFOLIO			DWS SMALL CAP GROWTH VIP PORTFOLIO			DWS SMALL CAP INDEX VIP PORTFOLIO
INVESTMENT INCOME:
Dividends	$	76,880		$	7,237		$			$	137,213		$			$	111,848
EXPENSES:
Mortality and expense risk		45,048			3,604			25,149			52,324			4,421			92,412
NET INVESTMENT INCOME (LOSS)		31,832			3,633			(25,149	)		84,889			(4,421	)		19,436
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on sale of fund shares		(30,588	)		(90,859	)		(64,217	)		(474,497	)		(30,824	)		(1,179,464	)
Realized gain distributions								239,568
Net realized gain (loss)		(30,588	)		(90,859	)		175,351			(474,497	)		(30,824	)		(1,179,464	)
Change in net unrealized appreciation on investments		1,290,126			136,428			49,599			1,129,302			178,221			3,975,951
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	1,291,370		$	49,202		$	199,801		$	739,694		$	142,976		$	2,815,923

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	DWS STRATEGIC VALUE VIP PORTFOLIO			FEDERATED CAPITAL APPRECIATION FUND II			FEDERATED CAPITAL INCOME FUND II		FEDERATED FUND FOR  U.S. GOVERNMENT SECURITIES II		FEDERATED INTERNATIONAL EQUITY FUND II			FRANKLIN SMALL  CAP VALUE SECURITIES FUND
											(1)
INVESTMENT INCOME:
Dividends	$	59,221		$	65,851		$	40,696	$	2,474,272	$	1,901		$	22,559
EXPENSES:
Mortality and expense risk		22,481			26,786			5,725		422,814		841			21,651
NET INVESTMENT INCOME		36,740			39,065			34,971		2,051,458		1,060			908
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		(583,648	)		(766,428	)		7,194		74,832		(102,995	)		211,404
Realized gain distributions
Net realized gain (loss)		(583,648	)		(766,428	)		7,194		74,832		(102,995	)		211,404
Change in net unrealized appreciation (depreciation) on investments		864,936			1,076,566			28,307		255,152		57,568			504,012
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	318,028		$	349,203		$	70,472	$	2,381,442	$	(44,367	)	$	716,324
(1)     For the period January 1, 2010 to March 15, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	FRANKLIN TEMPLETON FOREIGN SECURITIES PORTFOLIO			INVESCO V.I. CORE EQUITY FUND		INVESCO V.I. HIGH YIELD FUND			INVESCO V.I. INTERNATIONAL GROWTH FUND		INVESCO V.I. MID CAP CORE EQUITY FUND		INVESCO V.I. SMALL CAP EQUITY FUND
	(1)
INVESTMENT INCOME:
Dividends	$	603		$	47,613	$	356,265		$	200,936	$	6,855	$
EXPENSES:
Mortality and expense risk		1,880			41,799		31,826			61,079		6,745		2,981
NET INVESTMENT INCOME (LOSS)		(1,277	)		5,814		324,439			139,857		110		(2,981	)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		4,946			33,921		(210,722	)		102,563		25,795		16,913
Realized gain distributions
Net realized gain (loss)		4,946			33,921		(210,722	)		102,563		25,795		16,913
Change in net unrealized appreciation (depreciation) on investments		71,296			364,423		333,455			759,353		133,877		78,781
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	74,965		$	404,158	$	447,172		$	1,001,773	$	159,782	$	92,713
(1)     For the period May 13, 2010 to December 31, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	INVESCO V.I. TECHNOLOGY FUND			INVESCO VAN KAMPEN VI COMSTOCK FUND			INVESCO VAN KAMPEN VI GROWTH & INCOME FUND			JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES		JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES			JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES
INVESTMENT INCOME:
Dividends	$			$	3,081		$	11,432		$	260,361	$	762,938		$	1,613,423
EXPENSES:
Mortality and expense risk		17,157			18,264			82,265			68,928		207,416			208,169
NET INVESTMENT INCOME (LOSS)		(17,157	)		(15,183	)		(70,833	)		191,433		555,522			1,405,254
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		(12,106	)		(355,314	)		(810,512	)		40,585		(384,267	)		404,948
Realized gain distributions																84,749
Net realized gain (loss)		(12,106	)		(355,314	)		(810,512	)		40,585		(384,267	)		489,697
Change in net unrealized appreciation on investments		421,820			699,008			1,929,900			454,617		1,843,395			(29,585	)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	392,557		$	328,511		$	1,048,555		$	686,635	$	2,014,650		$	1,865,366

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	JANUS ASPEN FLEXIBLE  BOND PORTFOLIO SERVICE SHARES			JANUS ASPEN GROWTH & INCOME PORTFOLIO INSTITUTIONAL SHARES			JANUS ASPEN GROWTH & INCOME PORTFOLIO SERVICE SHARES			JANUS ASPEN JANUS PORTFOLIO			JANUS ASPEN OVERSEAS PORTFOLIO INSTITUTIONAL SHARES			JANUS ASPEN OVERSEAS PORTFOLIO SERVICE SHARES
				(1)			(2)
INVESTMENT INCOME:
Dividends	$	1,820,498		$	40,930		$	42,566		$	81,879		$	106,130		$	32,651
EXPENSES:
Mortality and expense risk		233,290			17,253			17,316			63,705			131,306			54,298
NET INVESTMENT INCOME (LOSS)		1,587,208			23,677			25,250			18,174			(25,176	)		(21,647	)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		740,111			(740,373	)		1,062,584			(169,145	)		121,981			1,536,136
Realized gain distributions		96,464
Net realized gain (loss)		836,575			(740,373	)		1,062,584			(169,145	)		121,981			1,536,136
Change in net unrealized appreciation on investments		(405,294	)		1,078,920			(730,390	)		1,099,265			3,278,882			(166,413	)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	2,018,489		$	362,224		$	357,444		$	948,294		$	3,375,687		$	1,348,076
(1)     For the period January 1, 2010 to May 3, 2010.
(2)     For the period January 1, 2010 to May 12, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	JANUS  ASPEN WORLDWIDE PORTFOLIO			JPMORGAN INSURANCE TRUST SMALL CAP CORE PORTFOLIO			LAZARD RETIREMENT EMERGING MARKETS EQUITY SERIES PORTFOLIO		LVIP BARON GROWTH OPPORTUNITIES FUND			MFS INTERNATIONAL VALUE FUND		MFS UTILITIES FUND
INVESTMENT INCOME:
Dividends	$	52,062		$			$	144,857	$			$	36,052	$	69,586
EXPENSES:
Mortality and expense risk		72,429			5,961			64,553		122,336			30,493		19,372
NET INVESTMENT INCOME (LOSS)		(20,367	)		(5,961	)		80,304		(122,336	)		5,559		50,214
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		268,107			(26,174	)		740,431		(600,573	)		16,947		313,441
Realized gain distributions
Net realized gain (loss)		268,107			(26,174	)		740,431		(600,573	)		16,947		313,441
Change in net unrealized appreciation (depreciation) on investments		919,514			241,035			997,210		4,376,137			549,891		(55,103	)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	1,167,254		$	208,900		$	1,817,945	$	3,653,228		$	572,397	$	308,552

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	NEUBERGER BERMAN AMT REGENCY PORTFOLIO			NVIT MID CAP INDEX FUND			OPPENHEIMER GLOBAL SECURITIES FUND/VA			OPPENHEIMER INTERNATIONAL GROWTH FUND/VA			PIMCO VIT HIGH YIELD PORTFOLIO			PIMCO VIT LOW DURATION PORTFOLIO
INVESTMENT INCOME:
Dividends	$	967		$	87,525		$	378,868		$	102,870		$	2,187,582		$	1,123,760
EXPENSES:
Mortality and expense risk		2,242			65,104			194,097			55,059			224,782			516,934
NET INVESTMENT INCOME (LOSS)		(1,275	)		22,421			184,771			47,811			1,962,800			606,826
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		25,918			(323,047	)		(1,545,051	)		(738,862	)		3,631,773			613,027
Realized gain distributions					9,979												227,378
Net realized gain (loss)		25,918			(313,068	)		(1,545,051	)		(738,862	)		3,631,773			840,405
Change in net unrealized appreciation on investments		46,212			2,272,364			4,887,209			1,712,872			(1,816,083	)		1,549,077
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	70,855		$	1,981,717		$	3,526,929		$	1,021,821		$	3,778,490		$	2,996,308

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	PIMCO VIT TOTAL RETURN PORTFOLIO		PIONEER EMERGING MARKETS VCT PORTFOLIO			PIONEER FUND VCT PORTFOLIO			PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO			PIONEER MID CAP VALUE VCT PORTFOLIO		PRUDENTIAL SERIES FUND EQUITY PORTFOLIO
INVESTMENT INCOME:
Dividends	$	3,385,081	$	7,705		$	57,267		$			$	18,628	$	1,516
EXPENSES:
Mortality and expense risk		1,036,808		19,792			32,055			39,104			16,072		7,837
NET INVESTMENT INCOME (LOSS)		2,348,273		(12,087	)		25,212			(39,104	)		2,556		(6,321	)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		2,682,530		632,069			(120,823	)		(236,388	)		24,465		(9,066	)
Realized gain distributions		4,360,905
Net realized gain (loss)		7,043,435		632,069			(120,823	)		(236,388	)		24,465		(9,066	)
Change in net unrealized appreciation on investments		100,171		(446,780	)		702,510			1,090,003			328,560		178,685
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	9,491,879	$	173,202		$	606,899		$	814,511		$	355,581	$	163,298

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	PRUDENTIAL SERIES FUND NATURAL RESOURCES PORTFOLIO			PUTNAM VT AMERICAN GOVERNMENT INCOME IB PORTFOLIO			PUTNAM VT EQUITY INCOME IB PORTFOLIO			ROYCE SMALL- CAP PORTFOLIO			SCHWAB MARKETTRACK GROWTH PORTFOLIO II			SCHWAB MONEY MARKET PORTFOLIO
					(1)			(2)
INVESTMENT INCOME:
Dividends	$	1,176		$			$			$	5,033		$	616,987		$	13,486
EXPENSES:
Mortality and expense risk		14,917			2,959			799			23,145			193,116			1,022,192
NET INVESTMENT INCOME (LOSS)		(13,741	)		(2,959	)		(799	)		(18,112	)		423,871			(1,008,706	)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		248,992			8,092			652			107,110			(777,449	)
Realized gain distributions																	50,090
Net realized gain (loss)		248,992			8,092			652			107,110			(777,449	)		50,090
Change in net unrealized appreciation (depreciation) on investments		505,628			(10,047	)		40,112			504,352			3,441,301
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	740,879		$	(4,914	)	$	39,965		$	593,350		$	3,087,723		$	(958,616	)

(1) For the period May 3, 2010 to December 31, 2010.

(2) For the period June 7, 2010 to December 31, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	SCHWAB S&P 500 INDEX PORTFOLIO			SELIGMAN COMMUNICATIONS & INFORMATION PORTFOLIO			SENTINEL VARIABLE PRODUCTS BOND FUND			SENTINEL VARIABLE PRODUCTS COMMON STOCK FUND		SENTINEL VARIABLE PRODUCTS SMALL COMPANY FUND			THIRD AVENUE VALUE PORTFOLIO
INVESTMENT INCOME:
Dividends	$	2,175,200		$			$	84,685		$	38,331	$	404		$	314,565
EXPENSES:
Mortality and expense risk		837,076			36,310			11,717			11,600		2,698			59,202
NET INVESTMENT INCOME (LOSS)		1,338,124			(36,310	)		72,968			26,731		(2,294	)		255,363
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		(1,416,453	)		751,922			(8,442	)		17,971		11,885			(1,806,306	)
Realized gain distributions								115,544
Net realized gain (loss)		(1,416,453	)		751,922			107,102			17,971		11,885			(1,806,306	)
Change in net unrealized appreciation (depreciation) on investments		14,186,586			(222,427	)		(114,258	)		240,055		78,679			2,528,408
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	14,108,257		$	493,185		$	65,812		$	284,757	$	88,270		$	977,465

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	TOUCHSTONE MID CAP GROWTH FUND			UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO			VAN ECK VIP GLOBAL BOND FUND		VAN ECK VIP GLOBAL HARD ASSETS FUND			WELLS FARGO ADVANTAGE VT DISCOVERY FUND			WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND
INVESTMENT INCOME:
Dividends	$	4,344		$	177,558		$	116,413	$	6,016		$			$	39,427
EXPENSES:
Mortality and expense risk		9,961			68,608			38,993		18,437			25,958			38,063
NET INVESTMENT INCOME (LOSS)		(5,617	)		108,950			77,420		(12,421	)		(25,958	)		1,364
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on sale of fund shares		19,450			(2,418,764	)		22,185		308,456			(95,432	)		(271,739	)
Realized gain distributions
Net realized gain (loss)		19,450			(2,418,764	)		22,185		308,456			(95,432	)		(271,739	)
Change in net unrealized appreciation on investments		246,730			4,248,133			148,326		529,007			1,227,618			1,376,440
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	260,563		$	1,938,319		$	247,931	$	825,042		$	1,106,228		$	1,106,065

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2010

	INVESTMENT DIVISIONS
	WELLS FARGO ADVANTAGE VT SMALL CAP VALUE FUND
INVESTMENT INCOME:
Dividends	$	42,809
EXPENSES:
Mortality and expense risk		24,515
NET INVESTMENT INCOME		18,294
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on sale of fund shares		(166,936	)
Realized gain distributions
Net realized loss		(166,936	)
Change in net unrealized appreciation (depreciation) on investments		588,230
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	439,588

The accompanying notes are an integral part of these financial statements. (Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	ALGER BALANCED PORTFOLIO						ALGER LARGE CAP GROWTH PORTFOLIO						ALGER MID CAP GROWTH PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	20,423		$	28,603		$	(5,898	)	$	(25,500	)	$	(58,829	)	$	(49,310	)
Net realized loss		(34,003	)		(144,741	)		(440,232	)		(2,050,574	)		(1,439,827	)		(3,640,473	)
Change in net unrealized appreciation (depreciation) on investments		114,559			386,924			2,730,482			8,316,283			2,740,960			6,265,114
Increase in net assets resulting from operations		100,979			270,786			2,284,352			6,240,209			1,242,304			2,575,331
CONTRACT TRANSACTIONS:
Purchase payments received								176,679			108,295			28,956			69,690
Transfers for contract benefits and terminations		(31,343	)		(122,861	)		(1,252,507	)		(1,643,679	)		(317,919	)		(522,509	)
Net transfers		(102,572	)		(199,838	)		(1,142,296	)		(21,356	)		(783,157	)		564,892
Contract maintenance charges								(2,640	)		(3,201	)		(277	)		(470	)
Adjustments to net assets allocated to contracts in payout phase		(3,368	)		(1,446	)		10,496			(5,635	)		562			(6,699	)
Increase (decrease) in net assets resulting from contract transactions		(137,283	)		(324,145	)		(2,210,268	)		(1,565,576	)		(1,071,835	)		104,904
Total increase (decrease) in net assets		(36,304	)		(53,359	)		74,084			4,674,633			170,469			2,680,235
NET ASSETS:
Beginning of period		1,160,932			1,214,291			20,536,884			15,862,251			8,023,475			5,343,240
End of period	$	1,124,628		$	1,160,932		$	20,610,968		$	20,536,884		$	8,193,944		$	8,023,475
CHANGES IN UNITS OUTSTANDING:
Units issued					120			240,677			299,456			95,700			221,730
Units redeemed		(13,281	)		(34,995	)		(357,953	)		(541,317	)		(180,910	)		(221,462	)
Net increase (decrease)		(13,281	)		(34,875	)		(117,276	)		(241,861	)		(85,210	)		268

The accompanying notes are an integral part of these financial statements.

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	ALLIANCEBERNSTEIN VPS GROWTH & INCOME PORTFOLIO						ALLIANCEBERNSTEIN VPS GROWTH PORTFOLIO						ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(48,712	)	$	247,287		$	(10,261	)	$	(18,313	)	$	291,109		$	790,383
Net realized loss		(1,256,277	)		(3,315,261	)		(125,157	)		(353,044	)		(5,127,636	)		(9,901,390	)
Change in net unrealized appreciation (depreciation) on investments		2,059,103			4,287,819			430,149			1,057,938			7,148,106			15,481,983
Increase in net assets resulting from operations		754,114			1,219,845			294,731			686,581			2,311,579			6,370,976
CONTRACT TRANSACTIONS:
Purchase payments received					15						6,488			345,710			156,059
Transfers for contract benefits and terminations		(451,978	)		(470,962	)		(81,811	)		(313,576	)		(1,523,232	)		(2,872,108	)
Net transfers		(1,162,372	)		(2,717,131	)		(473,210	)		(308,322	)		(1,778,153	)		(663,232	)
Contract maintenance charges		(75	)		(95	)		(7	)		(27	)		(500	)		(739	)
Adjustments to net assets allocated to contracts in payout phase		28,480			(103,066	)								5,693			(1,354	)
Decrease in net assets resulting from contract transactions		(1,585,945	)		(3,291,239	)		(555,028	)		(615,437	)		(2,950,482	)		(3,381,374	)
Total increase (decrease) in net assets		(831,831	)		(2,071,394	)		(260,297	)		71,144			(638,903	)		2,989,602
NET ASSETS:
Beginning of period		7,606,100			9,677,494			2,611,447			2,540,303			23,802,688			20,813,086
End of period	$	6,774,269		$	7,606,100		$	2,351,150		$	2,611,447		$	23,163,785		$	23,802,688
CHANGES IN UNITS OUTSTANDING:
Units issued		954			38,349						29,886			389,000			385,765
Units redeemed		(165,482	)		(421,457	)		(58,746	)		(107,306	)		(636,767	)		(781,300	)
Net decrease		(164,528	)		(383,108	)		(58,746	)		(77,420	)		(247,767	)		(395,535	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO						ALLIANCEBERNSTEIN VPS REAL ESTATE INVESTMENT PORTFOLIO						ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	232,112		$	73,894		$	77,461		$	170,618		$	(11,298	)	$	10,482
Net realized gain (loss)		(3,850,453	)		(6,263,466	)		(2,598,053	)		(4,562,417	)		956,300			(1,067,509	)
Change in net unrealized appreciation (depreciation) on investments		3,729,970			9,150,030			5,204,337			6,487,165			(26,096	)		2,180,508
Increase in net assets resulting from operations		111,629			2,960,458			2,683,745			2,095,366			918,906			1,123,481
CONTRACT TRANSACTIONS:
Purchase payments received		78,730			200,737			286,336			203,612			70,815			29,108
Transfers for contract benefits and terminations		(518,243	)		(736,228	)		(562,878	)		(398,758	)		(323,400	)		(197,087	)
Net transfers		(3,550,848	)		(1,195,792	)		720,553			504,768			516,274			1,009,513
Contract maintenance charges		(256	)		(342	)								(139	)		(90	)
Adjustments to net assets allocated to contracts in payout phase		(469	)		(9	)		60,680			(101,323	)		718			(1,008	)
Increase (decrease) in net assets resulting from contract transactions		(3,991,086	)		(1,731,634	)		504,691			208,299			264,268			840,436
Total increase (decrease) in net assets		(3,879,457	)		1,228,824			3,188,436			2,303,665			1,183,174			1,963,917
NET ASSETS:
Beginning of period		13,192,774			11,963,950			10,824,000			8,520,335			4,565,122			2,601,205
End of period	$	9,313,317		$	13,192,774		$	14,012,436		$	10,824,000		$	5,748,296		$	4,565,122
CHANGES IN UNITS OUTSTANDING:
Units issued		115,266			517,439			226,577			179,360			540,036			385,729
Units redeemed		(688,856	)		(901,035	)		(207,869	)		(182,750	)		(540,062	)		(295,084	)
Net increase (decrease)		(573,590	)		(383,596	)		18,708			(3,390	)		(26	)		90,645

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	ALLIANCE- BERNSTEIN VPS UTILITY INCOME PORTFOLIO			AMERICAN CENTURY VP BALANCED FUND						AMERICAN CENTURY VP INCOME & GROWTH FUND
	2009			2010			2009			2010			2009
		(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	177,945		$	72,906		$	250,448		$	31,508		$	153,509
Net realized loss		(2,950,653	)		(286,841	)		(671,809	)		(737,194	)		(629,670	)
Change in net unrealized appreciation (depreciation) on investments		3,026,376			863,536			1,186,531			1,182,076			1,063,666
Increase in net assets resulting from operations		253,668			649,601			765,170			476,390			587,505
CONTRACT TRANSACTIONS:
Purchase payments received					153,743			63,463			7,207			42,298
Transfers for contract benefits and terminations		(212,716	)		(468,082	)		(324,566	)		(273,592	)		(198,855	)
Net transfers		(5,824,801	)		201,642			(129,537	)		(717,849	)		28,059
Contract maintenance charges		(185	)		(285	)		(372	)
Adjustments to net assets allocated to contracts in payout phase		(2,694	)		305			(271	)		277			(225	)
Decrease in net assets resulting from contract transactions		(6,040,396	)		(112,677	)		(391,283	)		(983,957	)		(128,723	)
Total increase (decrease) in net assets		(5,786,728	)		536,924			373,887			(507,567	)		458,782
NET ASSETS:
Beginning of period		5,786,728			6,129,857			5,755,970			4,421,041			3,962,259
End of period	$	0		$	6,666,781		$	6,129,857		$	3,913,474		$	4,421,041
CHANGES IN UNITS OUTSTANDING:
Units issued		465			89,788			106,613			36,527			84,902
Units redeemed		(377,420	)		(98,804	)		(143,784	)		(127,379	)		(107,254	)
Net decrease		(376,955	)		(9,016	)		(37,171	)		(90,852	)		(22,352	)
(1)     For the period January 1, 2009 to September 28, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	AMERICAN CENTURY VP INTERNATIONAL FUND						AMERICAN CENTURY VP MID CAP VALUE FUND						AMERICAN CENTURY VP VALUE FUND
	2010			2009			2010			2009			2010			2009
										(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	112,250		$	91,839		$	19,712		$	2,632		$	236,603		$	629,280
Net realized gain (loss)		(25,295	)		(312,972	)		54,829			1,587			(1,240,726	)		(3,584,510	)
Change in net unrealized appreciation (depreciation) on investments		653,702			2,124,473			157,221			64,532			2,929,630			4,947,633
Increase in net assets resulting from operations		740,657			1,903,340			231,762			68,751			1,925,507			1,992,403
CONTRACT TRANSACTIONS:
Purchase payments received								110,445			17,991			437,707			135,651
Transfers for contract benefits and terminations		(461,783	)		(429,608	)		(79,912	)		(9,746	)		(773,035	)		(1,157,545	)
Net transfers		(1,057,641	)		(900,645	)		779,850			575,989			2,040,577			(209,142	)
Contract maintenance charges		(436	)		(545	)		(17	)					(328	)		(523	)
Adjustments to net assets allocated to contracts in payout phase		12,092			(35,230	)								7,379			(7,804	)
Increase (decrease) in net assets resulting from contract transactions		(1,507,768	)		(1,366,028	)		810,366			584,234			1,712,300			(1,239,363	)
Total increase (decrease) in net assets		(767,111	)		537,312			1,042,128			652,985			3,637,807			753,040
NET ASSETS:
Beginning of period		7,527,787			6,990,475			652,985			0			14,354,571			13,601,531
End of period	$	6,760,676		$	7,527,787		$	1,695,113		$	652,985		$	17,992,378		$	14,354,571
CHANGES IN UNITS OUTSTANDING:
Units issued		1,770			529			87,533			50,899			312,486			241,084
Units redeemed		(109,243	)		(115,148	)		(27,863	)		(1,075	)		(187,805	)		(379,245	)
Net increase (decrease)		(107,473	)		(114,619	)		59,670			49,824			124,681			(138,161	)

(1) For the period May 5, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	COLUMBIA VIT MARSICO 21ST CENTURY FUND						COLUMBIA VIT SMALL CAP VALUE FUND						DELAWARE VIP SMALL CAP VALUE SERIES
	2010			2009			2010			2009			2010			2009
				(1)						(2)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(8,501	)	$	(600	)	$	1,660		$	86		$	(12,302	)	$	32,124
Net realized gain (loss)		17,793			6,435			35,274			19,823			(874,169	)		(2,061,047	)
Change in net unrealized appreciation (depreciation) on investments		175,005			10,615			142,596			23,192			5,547,660			5,791,111
Increase in net assets resulting from operations		184,297			16,450			179,530			43,101			4,661,189			3,762,188
CONTRACT TRANSACTIONS:
Purchase payments received		121,365			150,991			36,605			79,541			55,985			171,740
Transfers for contract benefits and terminations		(23,079	)		(41	)		(4,454	)		0			(923,263	)		(1,017,791	)
Net transfers		940,101			334,598			671,250			295,657			(53,524	)		(381,093	)
Contract maintenance charges		(36	)					(15	)					(428	)		(565	)
Adjustments to net assets allocated to contracts in payout phase														17,301			(468	)
Increase (decrease) in net assets resulting from contract transactions		1,038,351			485,548			703,386			375,198			(903,929	)		(1,228,177	)
Total increase in net assets		1,222,648			501,998			882,916			418,299			3,757,260			2,534,011
NET ASSETS:
Beginning of period		501,998			0			418,299			0			16,251,817			13,717,806
End of period	$	1,724,646		$	501,998		$	1,301,215		$	418,299		$	20,009,077		$	16,251,817
CHANGES IN UNITS OUTSTANDING:
Units issued		116,518			47,349			75,528			43,728			146,390			168,587
Units redeemed		(42,862	)		(9,639	)		(26,608	)		(10,648	)		(210,521	)		(269,511	)
Net increase (decrease)		73,656			37,710			48,920			33,080			(64,131	)		(100,924	)

(1) For the period May 4, 2009 to December 31, 2009.

(2) For the period May 11, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	DELAWARE VIP SMID CAP GROWTH SERIES						DREYFUS IP MIDCAP STOCK PORTFOLIO						DREYFUS VIF APPRECIATION PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(15,710	)	$	(7,945	)	$	6,096		$	16,940		$	86,239		$	101,297
Net realized gain (loss)		394,109			(204,219	)		(117,694	)		(932,045	)		(174,331	)		(398,542	)
Change in net unrealized appreciation (depreciation) on investments		352,764			599,667			505,030			1,419,622			1,153,292			1,327,629
Increase in net assets resulting from operations		731,163			387,503			393,432			504,517			1,065,200			1,030,384
CONTRACT TRANSACTIONS:
Purchase payments received		30,456			1,110						21,199			65,332			14,264
Transfers for contract benefits and terminations		(126,750	)		(44,252	)		(122,122	)		(151,130	)		(186,373	)		(334,473	)
Net transfers		2,209,278			801,498			(451,951	)		(387,071	)		2,790,166			(242,158	)
Contract maintenance charges		(58	)		(53	)		(39	)		(80	)		(443	)		(536	)
Adjustments to net assets allocated to contracts in payout phase		(965	)											11,677			(32,051	)
Increase (decrease) in net assets resulting from contract transactions		2,111,961			758,303			(574,112	)		(517,082	)		2,680,359			(594,954	)
Total increase (decrease) in net assets		2,843,124			1,145,806			(180,680	)		(12,565	)		3,745,559			435,430
NET ASSETS:
Beginning of period		1,569,512			423,706			1,837,009			1,849,574			6,356,396			5,920,966
End of period	$	4,412,636		$	1,569,512		$	1,656,329		$	1,837,009		$	10,101,955		$	6,356,396
CHANGES IN UNITS OUTSTANDING:
Units issued		256,088			153,293						44,051			316,237			193,911
Units redeemed		(97,030	)		(64,351	)		(42,651	)		(96,897	)		(93,492	)		(275,490	)
Net increase (decrease)		159,058			88,942			(42,651	)		(52,846	)		222,745			(81,579	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	DREYFUS VIF GROWTH & INCOME PORTFOLIO						DREYFUS VIF OPPORTUNISTIC SMALL CAP PORTFOLIO						DWS BLUE CHIP VIP PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	8,951		$	10,416		$	266		$	6,028		$	41,695		$	46,920
Net realized loss		(124,431	)		(255,048	)		(210,206	)		(75,232	)		(487,755	)		(1,497,312	)
Change in net unrealized appreciation (depreciation) on investments		458,793			725,908			369,067			200,428			1,086,171			2,590,756
Increase in net assets resulting from operations		343,313			481,276			159,127			131,224			640,111			1,140,364
CONTRACT TRANSACTIONS:
Purchase payments received		300			300									81,384			150,707
Transfers for contract benefits and terminations		(242,698	)		(188,129	)		(89,946	)		(46,238	)		(128,360	)		(787,735	)
Net transfers		44,031			(105,642	)		(57,141	)		(38,792	)		438,273			650,721
Contract maintenance charges		(226	)		(261	)		(18	)		(18	)		(48	)		(62	)
Adjustments to net assets allocated to contracts in payout phase		(1,691	)											3,698			6,139
Increase (decrease) in net assets resulting from contract transactions		(200,284	)		(293,732	)		(147,105	)		(85,048	)		394,947			19,770
Total increase in net assets		143,029			187,544			12,022			46,176			1,035,058			1,160,134
NET ASSETS:
Beginning of period		2,248,782			2,061,238			670,324			624,148			5,257,855			4,097,721
End of period	$	2,391,811		$	2,248,782		$	682,346		$	670,324		$	6,292,913		$	5,257,855
CHANGES IN UNITS OUTSTANDING:
Units issued		31,157			23,686			45,525			925			132,598			172,719
Units redeemed		(58,679	)		(66,968	)		(62,658	)		(13,961	)		(103,703	)		(179,400	)
Net increase (decrease)		(27,522	)		(43,282	)		(17,133	)		(13,036	)		28,895			(6,681	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	DWS CAPITAL GROWTH VIP PORTFOLIO						DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO						DWS GROWTH & INCOME VIP PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	11,521		$	34,592		$	31,832		$	46,813		$	3,633		$	6,923
Net realized loss		(247,192	)		(395,667	)		(30,588	)		(1,602,753	)		(90,859	)		(118,541	)
Change in net unrealized appreciation (depreciation) on investments		1,354,369			1,900,288			1,290,126			2,788,310			136,428			256,512
Increase in net assets resulting from operations		1,118,698			1,539,213			1,291,370			1,232,370			49,202			144,894
CONTRACT TRANSACTIONS:
Purchase payments received		102,641			133,784			93,028			103,641						35
Transfers for contract benefits and terminations		(543,139	)		(413,947	)		(307,264	)		(324,944	)		(51,332	)		(12,695	)
Net transfers		834,267			560,744			712,380			593,543			(112,650	)		(26,082	)
Contract maintenance charges		(213	)		(238	)		(139	)		(146	)		(64	)		(76	)
Adjustments to net assets allocated to contracts in payout phase		7,414			(11,658	)		34			(788	)		986			(28	)
Increase (decrease) in net assets resulting from contract transactions		400,970			268,685			498,039			371,306			(163,060	)		(38,846	)
Total increase (decrease) in net assets		1,519,668			1,807,898			1,789,409			1,603,676			(113,858	)		106,048
NET ASSETS:
Beginning of period		7,461,305			5,653,407			5,705,031			4,101,355			534,739			428,691
End of period	$	8,980,973		$	7,461,305		$	7,494,440		$	5,705,031		$	420,881		$	534,739
CHANGES IN UNITS OUTSTANDING:
Units issued		233,757			277,517			214,409			250,796			84			18,806
Units redeemed		(218,832	)		(235,822	)		(168,961	)		(204,812	)		(20,259	)		(22,974	)
Net increase (decrease)		14,925			41,695			45,448			45,984			(20,175	)		(4,168	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	DWS HEALTH CARE VIP PORTFOLIO						DWS LARGE CAP VALUE VIP PORTFOLIO						DWS SMALL CAP GROWTH VIP PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(25,149	)	$	21,266		$	84,889		$	81,093		$	(4,421	)	$	(4,148	)
Net realized gain (loss)		175,351			(758,459	)		(474,497	)		(1,464,489	)		(30,824	)		(39,756	)
Change in net unrealized appreciation (depreciation) on investments		49,599			1,350,697			1,129,302			2,540,752			178,221			238,741
Increase in net assets resulting from operations		199,801			613,504			739,694			1,157,356			142,976			194,837
CONTRACT TRANSACTIONS:
Purchase payments received		19,380			10,506			195,269			228,933
Transfers for contract benefits and terminations		(162,386	)		(497,785	)		(370,313	)		(346,072	)		(6,038	)		(16,479	)
Net transfers		(286,827	)		21,330			2,295,141			132,177			(149,435	)		(59,451	)
Contract maintenance charges		(77	)		(172	)		(62	)		(80	)
Adjustments to net assets allocated to contracts in payout phase		593			10									(1,047	)
Increase (decrease) in net assets resulting from contract transactions		(429,317	)		(466,111	)		2,120,035			14,958			(156,520	)		(75,930	)
Total increase (decrease) in net assets		(229,516	)		147,393			2,859,729			1,172,314			(13,544	)		118,907
NET ASSETS:
Beginning of period		3,644,130			3,496,737			6,702,525			5,530,211			651,579			532,672
End of period	$	3,414,614		$	3,644,130		$	9,562,254		$	6,702,525		$	638,035		$	651,579
CHANGES IN UNITS OUTSTANDING:
Units issued		127,849			168,968			407,948			281,742			4,316			0
Units redeemed		(170,678	)		(225,131	)		(219,386	)		(299,089	)		(21,105	)		(13,429	)
Net increase (decrease)		(42,829	)		(56,163	)		188,562			(17,347	)		(16,789	)		(13,429	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	DWS SMALL CAP INDEX VIP PORTFOLIO						DWS STRATEGIC VALUE VIP PORTFOLIO						FEDERATED CAPITAL APPRECIATION FUND II
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	19,436		$	105,065		$	36,740		$	166,582		$	39,065		$	68,880
Net realized loss		(1,179,464	)		(1,944,076	)		(583,648	)		(4,039,303	)		(766,428	)		(2,505,883	)
Change in net unrealized appreciation (depreciation) on investments		3,975,951			4,216,654			864,936			4,499,644			1,076,566			2,685,753
Increase in net assets resulting from operations		2,815,923			2,377,643			318,028			626,923			349,203			248,750
CONTRACT TRANSACTIONS:
Purchase payments received		150,344			171,324						75						1,198
Transfers for contract benefits and terminations		(779,680	)		(935,826	)		(98,937	)		(749,875	)		(276,774	)		(299,079	)
Net transfers		80,759			(881,912	)		(742,667	)		(1,998,624	)		(400,125	)		(1,194,229	)
Contract maintenance charges		(491	)		(634	)		(116	)		(162	)		(684	)		(858	)
Adjustments to net assets allocated to contracts in payout phase		10,616			10,176									2,177			(5,651	)
Decrease in net assets resulting from contract transactions		(538,452	)		(1,636,872	)		(841,720	)		(2,748,586	)		(675,406	)		(1,498,619	)
Total increase (decrease) in net assets		2,277,471			740,771			(523,692	)		(2,121,663	)		(326,203	)		(1,249,869	)
NET ASSETS:
Beginning of period		11,656,470			10,915,699			3,250,024			5,371,687			3,478,655			4,728,524
End of period	$	13,933,941		$	11,656,470		$	2,726,332		$	3,250,024		$	3,152,452		$	3,478,655
CHANGES IN UNITS OUTSTANDING:
Units issued		191,724			170,903						20,145			195			284
Units redeemed		(232,676	)		(319,298	)		(97,976	)		(434,874	)		(46,735	)		(132,529	)
Net decrease		(40,952	)		(148,395	)		(97,976	)		(414,729	)		(46,540	)		(132,245	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	FEDERATED CAPITAL INCOME FUND II						FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II						FEDERATED INTERNATIONAL EQUITY FUND II
	2010			2009			2010			2009			2010			2009
													(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	34,971		$	33,900		$	2,051,458		$	2,583,850		$	1,060		$	15,249
Net realized gain (loss)		7,194			(842	)		74,832			1,286			(102,995	)		(98,233	)
Change in net unrealized appreciation (depreciation) on investments		28,307			117,887			255,152			54,949			57,568			279,840
Increase (decrease) in net assets resulting from operations		70,472			150,945			2,381,442			2,640,085			(44,367	)		196,856
CONTRACT TRANSACTIONS:
Purchase payments received								293,293			337,918
Transfers for contract benefits and terminations		(46,975	)		(32,161	)		(5,907,179	)		(5,664,386	)		(406	)		(99,777	)
Net transfers		(23,332	)		(20,388	)		(2,563,191	)		(977,632	)		(597,874	)		(105,901	)
Contract maintenance charges		(122	)		(148	)		(1,512	)		(2,084	)
Adjustments to net assets allocated to contracts in payout phase								30,012			(73,203	)		(333	)		(1,423	)
Decrease in net assets resulting from contract transactions		(70,429	)		(52,697	)		(8,148,577	)		(6,379,387	)		(598,613	)		(207,101	)
Total increase (decrease) in net assets		43			98,248			(5,767,135	)		(3,739,302	)		(642,980	)		(10,245	)
NET ASSETS:
Beginning of period		681,031			582,783			56,381,314			60,120,616			642,980			653,225
End of period	$	681,074		$	681,031		$	50,614,179		$	56,381,314		$	0		$	642,980
CHANGES IN UNITS OUTSTANDING:
Units issued								385,607			1,056,903			691			82
Units redeemed		(5,058	)		(4,467	)		(907,549	)		(1,480,902	)		(61,619	)		(27,362	)
Net decrease		(5,058	)		(4,467	)		(521,942	)		(423,999	)		(60,928	)		(27,280	)

(1) For the period January 1, 2010 to March 15, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	FRANKLIN SMALL CAP VALUE SECURITIES FUND						FRANKLIN TEMPLETON FOREIGN SECURITIES PORTFOLIO			INVESCO V.I. CORE EQUITY FUND
	2010			2009			2010			2010			2009
								(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	908		$	14,852		$	(1,277	)	$	5,814		$	42,243
Net realized gain (loss)		211,404			(264,766	)		4,946			33,921			(80,718	)
Change in net unrealized appreciation on investments		504,012			705,828			71,296			364,423			1,204,175
Increase in net assets resulting from operations		716,324			455,914			74,965			404,158			1,165,700
CONTRACT TRANSACTIONS:
Purchase payments received		19,474			117,188			93,425
Transfers for contract benefits and terminations		(304,357	)		(32,239	)		(3,362	)		(265,908	)		(525,270	)
Net transfers		910,269			826,145			1,195,543			(166,419	)		(434,971	)
Contract maintenance charges		(34	)		(18	)					(864	)		(1,158	)
Adjustments to net assets allocated to contracts in payout phase								3,391
Increase (decrease) in net assets resulting from contract transactions		625,352			911,076			1,288,997			(433,191	)		(961,399	)
Total increase (decrease) in net assets		1,341,676			1,366,990			1,363,962			(29,033	)		204,301
NET ASSETS:
Beginning of period		2,319,952			952,962			0			5,081,730			4,877,429
End of period	$	3,661,628		$	2,319,952		$	1,363,962		$	5,052,697		$	5,081,730
CHANGES IN UNITS OUTSTANDING:
Units issued		200,733			217,059			130,539			1			1
Units redeemed		(134,589	)		(86,615	)		(5,827	)		(23,582	)		(61,530	)
Net increase (decrease)		66,144			130,444			124,712			(23,581	)		(61,529	)

(1) For the period May 13, 2010 to December 31, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	INVESCO V.I. HIGH YIELD FUND						INVESCO V.I. INTERNATIONAL GROWTH FUND						INVESCO V.I. MID CAP CORE EQUITY FUND
	2010			2009			2010			2009			2010			2009
																	(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	324,439		$	281,458		$	139,857		$	72,692		$	110		$	3,284
Net realized gain (loss)		(210,722	)		(415,775	)		102,563			(933,925	)		25,795			14,871
Change in net unrealized appreciation (depreciation) on investments		333,455			1,718,249			759,353			2,493,274			133,877			21,867
Increase in net assets resulting from operations		447,172			1,583,932			1,001,773			1,632,041			159,782			40,022
CONTRACT TRANSACTIONS:
Purchase payments received								72,936			174,834			45,559			73,391
Transfers for contract benefits and terminations		(350,004	)		(692,858	)		(349,377	)		(352,682	)		(13,173	)		(1,991	)
Net transfers		(731,194	)		(184,713	)		2,349,102			2,176,367			1,016,841			261,290
Contract maintenance charges		(386	)		(493	)		(128	)		(198	)		(10	)
Adjustments to net assets allocated to contracts in payout phase		2,522			(4,740	)		(772	)
Increase (decrease) in net assets resulting from contract transactions		(1,079,062	)		(882,804	)		2,071,761			1,998,321			1,049,217			332,690
Total increase (decrease) in net assets		(631,890	)		701,128			3,073,534			3,630,362			1,208,999			372,712
NET ASSETS:
Beginning of period		4,212,067			3,510,939			7,725,888			4,095,526			372,712			0
End of period	$	3,580,177		$	4,212,067		$	10,799,422		$	7,725,888		$	1,581,711		$	372,712
CHANGES IN UNITS OUTSTANDING:
Units issued		2,212			1,182			507,988			493,573			103,870			40,441
Units redeemed		(68,761	)		(70,701	)		(318,614	)		(271,769	)		(21,957	)		(10,600	)
Net increase (decrease)		(66,549	)		(69,519	)		189,374			221,804			81,913			29,841

(1) For the period May 12, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	INVESCO V.I. SMALL CAP EQUITY FUND						INVESCO V.I. TECHNOLOGY FUND						INVESCO VAN KAMPEN VI COMSTOCK FUND
	2010			2009			2010			2009			2010			2009
				(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(2,981	)	$	(265	)	$	(17,157	)	$	(15,536	)	$	(15,183	)	$	75,145
Net realized gain (loss)		16,913			2,483			(12,106	)		(224,987	)		(355,314	)		(461,384	)
Change in net unrealized appreciation (depreciation) on investments		78,781			15,953			421,820			1,074,411			699,008			873,420
Increase in net assets resulting from operations		92,713			18,171			392,557			833,888			328,511			487,181
CONTRACT TRANSACTIONS:
Purchase payments received		5,139			16,880									244,980			34,707
Transfers for contract benefits and terminations								(79,181	)		(94,248	)		(150,111	)		(95,157	)
Net transfers		459,530			242,403			(154,347	)		(372,724	)		55,084			208,319
Contract maintenance charges		(66	)					(789	)		(996	)		(71	)		(74	)
Adjustments to net assets allocated to contracts in payout phase								385			(3,355	)		146			173
Increase (decrease) in net assets resulting from contract transactions		464,603			259,283			(233,932	)		(471,323	)		150,028			147,968
Total increase in net assets		557,316			277,454			158,625			362,565			478,539			635,149
NET ASSETS:
Beginning of period		277,454			0			2,175,853			1,813,288			2,319,307			1,684,158
End of period	$	834,770		$	277,454		$	2,334,478		$	2,175,853		$	2,797,846		$	2,319,307
CHANGES IN UNITS OUTSTANDING:
Units issued		45,550			26,449			7,919			288			123,049			97,309
Units redeemed		(14,661	)		(3,723	)		(90,966	)		(236,556	)		(111,300	)		(80,149	)
Net increase (decrease)		30,889			22,726			(83,047	)		(236,268	)		11,749			17,160

(1) For the period June 1, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	INVESCO VAN KAMPEN VI GROWTH & INCOME FUND						JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES						JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(70,833	)	$	295,636		$	191,433		$	206,443		$	555,522		$	386,314
Net realized gain (loss)		(810,512	)		(1,834,215	)		40,585			186,770			(384,267	)		(156,414	)
Change in net unrealized appreciation (depreciation) on investments		1,929,900			3,545,118			454,617			1,647,749			1,843,395			3,742,390
Increase in net assets resulting from operations		1,048,555			2,006,539			686,635			2,040,962			2,014,650			3,972,290
CONTRACT TRANSACTIONS:
Purchase payments received		217,318			75,647									2,400,194			533,608
Transfers for contract benefits and terminations		(467,878	)		(1,298,529	)		(554,701	)		(425,868	)		(1,625,315	)		(996,074	)
Net transfers		(1,355,718	)		2,065,538			(453,858	)		(1,181,368	)		5,529,336			5,757,575
Contract maintenance charges		(136	)		(187	)		(276	)		(342	)		(476	)		(451	)
Adjustments to net assets allocated to contracts in payout phase		919			(245	)		(2,749	)
Increase (decrease) in net assets resulting from contract transactions		(1,605,495	)		842,224			(1,011,584	)		(1,607,578	)		6,303,739			5,294,658
Total increase (decrease) in net assets		(556,940	)		2,848,763			(324,949	)		433,384			8,318,389			9,266,948
NET ASSETS:
Beginning of period		10,595,923			7,747,160			9,792,915			9,359,531			23,818,783			14,551,835
End of period	$	10,038,983		$	10,595,923		$	9,467,966		$	9,792,915		$	32,137,172		$	23,818,783
CHANGES IN UNITS OUTSTANDING:
Units issued		316,503			452,904									1,079,879			929,135
Units redeemed		(466,039	)		(356,682	)		(67,951	)		(123,864	)		(514,848	)		(405,333	)
Net increase (decrease)		(149,536	)		96,222			(67,951	)		(123,864	)		565,031			523,802

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	JANUS ASPEN FLEXIBLE  BOND PORTFOLIO INSTITUTIONAL SHARES						JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES						JANUS ASPEN GROWTH & INCOME PORTFOLIO INSTITUTIONAL SHARES
	2010			2009			2010			2009			2010			2009
														(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	1,405,254		$	1,016,414		$	1,587,208		$	857,895		$	23,677		$	1,657
Net realized gain (loss)		489,697			(88,315	)		836,575			347,935			(740,373	)		(829,608	)
Change in net unrealized appreciation (depreciation) on investments		(29,585	)		2,360,441			(405,294	)		1,622,150			1,078,920			3,292,711
Increase in net assets resulting from operations		1,865,366			3,288,540			2,018,489			2,827,980			362,224			2,464,760
CONTRACT TRANSACTIONS:
Purchase payments received								1,619,040			698,243
Transfers for contract benefits and terminations		(1,778,613	)		(2,808,219	)		(1,545,689	)		(1,660,523	)		(64,586	)		(559,647	)
Net transfers		(2,948,906	)		(2,402,215	)		3,040,575			11,570,600			(8,595,380	)		(1,260,774	)
Contract maintenance charges		(709	)		(987	)		(312	)		(312	)		(16	)		(154	)
Adjustments to net assets allocated to contracts in payout phase		95,799			11,298			16,453			(15,601	)		(327	)		(578	)
Increase (decrease) in net assets resulting from contract transactions		(4,632,429	)		(5,200,123	)		3,130,067			10,592,407			(8,660,309	)		(1,821,153	)
Total increase (decrease) in net assets		(2,767,063	)		(1,911,583	)		5,148,556			13,420,387			(8,298,085	)		643,607
NET ASSETS:
Beginning of period		28,151,674			30,063,257			28,595,979			15,175,592			8,298,085			7,654,478
End of period	$	25,384,611		$	28,151,674		$	33,744,535		$	28,595,979		$	0		$	8,298,085
CHANGES IN UNITS OUTSTANDING:
Units issued		2,285			6,390			826,590			1,439,530			538			273
Units redeemed		(284,003	)		(343,394	)		(587,610	)		(499,857	)		(816,147	)		(224,018	)
Net increase (decrease)		(281,718	)		(337,004	)		238,980			939,673			(815,609	)		(223,745	)

(1) For the period January 1, 2010 to May 3, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	JANUS ASPEN GROWTH & INCOME PORTFOLIO SERVICE SHARES						JANUS ASPEN JANUS PORTFOLIO						JANUS ASPEN OVERSEAS PORTFOLIO INSTITUTIONAL SHARES
	2010			2009			2010			2009			2010			2009
		(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	25,250		$	(1,674	)	$	18,174		$	(21,557	)	$	(25,176	)	$	(37,038	)
Net realized gain (loss)		1,062,584			(1,723,201	)		(169,145	)		(564,506	)		121,981			(247,931	)
Change in net unrealized appreciation (depreciation) on investments		(730,390	)		3,495,317			1,099,265			2,686,763			3,278,882			7,467,486
Increase in net assets resulting from operations		357,444			1,770,442			948,294			2,100,700			3,375,687			7,182,517
CONTRACT TRANSACTIONS:
Purchase payments received		12,463			37,819
Transfers for contract benefits and terminations		(105,398	)		(937,770	)		(601,645	)		(702,542	)		(812,173	)		(810,119	)
Net transfers		(8,196,450	)		2,303,319			(348,536	)		(330,856	)		(1,522,071	)		(1,351,846	)
Contract maintenance charges		(27	)		(220	)		(2,328	)		(2,832	)		(2,122	)		(2,654	)
Adjustments to net assets allocated to contracts in payout phase								6,178			(5,381	)		9,011			(1,609	)
Increase (decrease) in net assets resulting from contract transactions		(8,289,412	)		1,403,148			(946,331	)		(1,041,611	)		(2,327,355	)		(2,166,228	)
Total increase (decrease) in net assets		(7,931,968	)		3,173,590			1,963			1,059,089			1,048,332			5,016,289
NET ASSETS:
Beginning of period		7,931,968			4,758,378			7,848,824			6,789,735			15,202,465			10,186,176
End of period	$	0		$	7,931,968		$	7,850,787		$	7,848,824		$	16,250,797		$	15,202,465
CHANGES IN UNITS OUTSTANDING:
Units issued		54,653			703,448			369						247			290
Units redeemed		(1,020,735	)		(535,794	)		(59,687	)		(84,134	)		(82,262	)		(113,097	)
Net increase (decrease)		(966,082	)		167,654			(59,318	)		(84,134	)		(82,015	)		(112,807	)

(1) For the period January 1, 2010 to May 12, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	JANUS ASPEN OVERSEAS PORTFOLIO SERVICE SHARES						JANUS ASPEN WORLDWIDE PORTFOLIO						JPMORGAN INSURANCE TRUST SMALL CAP CORE PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(21,647	)	$	(16,442	)	$	(20,367	)	$	45,522		$	(5,961	)	$	748
Net realized gain (loss)		1,536,136			(703,011	)		268,107			(16,795	)		(26,174	)		(67,557	)
Change in net unrealized appreciation (depreciation) on investments		(166,413	)		2,752,431			919,514			2,545,406			241,035			213,461
Increase in net assets resulting from operations		1,348,076			2,032,978			1,167,254			2,574,133			208,900			146,652
CONTRACT TRANSACTIONS:
Purchase payments received		66,906			42,053
Transfers for contract benefits and terminations		(205,584	)		(120,574	)		(725,013	)		(805,650	)		(23,220	)		(67,210	)
Net transfers		(734,999	)		2,722,145			(849,303	)		(234,910	)		(57,909	)		(50,466	)
Contract maintenance charges		(724	)		(642	)		(2,499	)		(3,112	)
Adjustments to net assets allocated to contracts in payout phase		2,067			(2,067	)		10,971			(18,896	)		1,337			(3,194	)
Increase (decrease) in net assets resulting from contract transactions		(872,334	)		2,640,915			(1,565,844	)		(1,062,568	)		(79,792	)		(120,870	)
Total increase (decrease) in net assets		475,742			4,673,893			(398,590	)		1,511,565			129,108			25,782
NET ASSETS:
Beginning of period		6,609,198			1,935,305			9,194,425			7,682,860			847,463			821,681
End of period	$	7,084,940		$	6,609,198		$	8,795,835		$	9,194,425		$	976,571		$	847,463
CHANGES IN UNITS OUTSTANDING:
Units issued		322,814			620,183			631						52			51
Units redeemed		(411,829	)		(303,425	)		(107,501	)		(82,031	)		(6,195	)		(12,481	)
Net increase (decrease)		(89,015	)		316,758			(106,870	)		(82,031	)		(6,143	)		(12,430	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	LAZARD RETIREMENT EMERGING MARKETS EQUITY SERIES PORTFOLIO						LVIP BARON GROWTH OPPORTUNITIES FUND						MFS INTERNATIONAL VALUE FUND
	2010			2009			2010			2009			2010			2009
				(1)												(2)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	80,304		$	103,701		$	(122,336	)	$	(106,575	)	$	5,559		$	(3,403	)
Net realized gain (loss)		740,431			78,504			(600,573	)		(1,205,218	)		16,947			26,684
Change in net unrealized appreciation (depreciation) on investments		997,210			349,282			4,376,137			5,636,921			549,891			45,857
Increase in net assets resulting from operations		1,817,945			531,487			3,653,228			4,325,128			572,397			69,138
CONTRACT TRANSACTIONS:
Purchase payments received		625,089			226,987			200,884			158,962			416,336			162,698
Transfers for contract benefits and terminations		(506,803	)		(10,350	)		(943,141	)		(993,968	)		(154,186	)		(260	)
Net transfers		7,459,756			4,255,037			(481,162	)		(462,053	)		5,154,815			1,389,294
Contract maintenance charges		(230	)		(43	)		(993	)		(1,226	)		(27	)		(4	)
Adjustments to net assets allocated to contracts in payout phase		2,067			(2,067	)		1,110			(11,874	)		1,310			0
Increase (decrease) in net assets resulting from contract transactions		7,579,879			4,469,564			(1,223,302	)		(1,310,159	)		5,418,248			1,551,728
Total increase in net assets		9,397,824			5,001,051			2,429,926			3,014,969			5,990,645			1,620,866
NET ASSETS:
Beginning of period		5,001,051			0			15,935,521			12,920,552			1,620,866			0
End of period	$	14,398,875		$	5,001,051		$	18,365,447		$	15,935,521		$	7,611,511		$	1,620,866
CHANGES IN UNITS OUTSTANDING:
Units issued		817,688			368,573			146,588			157,765			480,810			136,070
Units redeemed		(351,736	)		(27,358	)		(231,085	)		(265,935	)		(67,190	)		(12,481	)
Net increase (decrease)		465,952			341,215			(84,497	)		(108,170	)		413,620			123,589
(1)     For the period May 6, 2009 to December 31, 2009.
(2)     For the period June 16, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	MFS UTILITIES FUND						NEUBERGER BERMAN AMT REGENCY PORTFOLIO						NVIT MID CAP INDEX FUND
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	50,214		$	33,746		$	(1,275	)	$	(296	)	$	22,421		$	(584	)
Net realized gain (loss)		313,441			(9,043	)		25,918			(308,252	)		(313,068	)		(1,020,901	)
Change in net unrealized appreciation (depreciation) on investments		(55,103	)		346,593			46,212			417,212			2,272,364			3,254,449
Increase in net assets resulting from operations		308,552			371,296			70,855			108,664			1,981,717			2,232,964
CONTRACT TRANSACTIONS:
Purchase payments received		71,625			1,471,181						801			124,613			167,093
Transfers for contract benefits and terminations		(1,523,299	)		(67,489	)		(10,611	)		(8,675	)		(580,823	)		(595,513	)
Net transfers		266,723			1,440,927			(76,947	)		(385,770	)		(228,676	)		(695,184	)
Contract maintenance charges		(69	)		(86	)					(10	)		(196	)		(233	)
Adjustments to net assets allocated to contracts in payout phase														9,345			10,530
Increase (decrease) in net assets resulting from contract transactions		(1,185,020	)		2,844,533			(87,558	)		(393,654	)		(675,737	)		(1,113,307	)
Total increase (decrease) in net assets		(876,468	)		3,215,829			(16,703	)		(284,990	)		1,305,980			1,119,657
NET ASSETS:
Beginning of period		3,751,751			535,922			328,761			613,751			8,483,285			7,363,628
End of period	$	2,875,283		$	3,751,751		$	312,058		$	328,761		$	9,789,265		$	8,483,285
CHANGES IN UNITS OUTSTANDING:
Units issued		185,066			509,776			0			25,916			95,829			102,267
Units redeemed		(329,351	)		(143,968	)		(9,723	)		(94,947	)		(140,369	)		(202,290	)
Net increase (decrease)		(144,285	)		365,808			(9,723	)		(69,031	)		(44,540	)		(100,023	)

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	OPPENHEIMER GLOBAL  SECURITIES FUND/VA						OPPENHEIMER INTERNATIONAL GROWTH FUND/VA						PIMCO VIT HIGH YIELD PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income	$	184,771		$	331,443		$	47,811		$	42,785		$	1,962,800		$	1,881,809
Net realized gain (loss)		(1,545,051	)		(2,757,346	)		(738,862	)		(1,686,682	)		3,631,773			(4,535,890	)
Change in net unrealized appreciation (depreciation) on investments		4,887,209			9,627,662			1,712,872			3,539,216			(1,816,083	)		10,705,952
Increase in net assets resulting from operations		3,526,929			7,201,759			1,021,821			1,895,319			3,778,490			8,051,871
CONTRACT TRANSACTIONS:
Purchase payments received		175,999			421,906			156,788			324,500			1,143,236			459,150
Transfers for contract benefits and terminations		(1,679,214	)		(1,959,641	)		(652,060	)		(1,135,381	)		(2,126,176	)		(2,562,513	)
Net transfers		(1,105,798	)		(831,326	)		(757,169	)		1,935,412			(773,681	)		5,903,644
Contract maintenance charges		(1,088	)		(1,610	)		0			0			(215	)		(312	)
Adjustments to net assets allocated to contracts in payout phase		16,996			(31,634	)		(353	)		353			4,307			4,092
Increase (decrease) in net assets resulting from contract transactions		(2,593,105	)		(2,402,305	)		(1,252,794	)		1,124,884			(1,752,529	)		3,804,061
Total increase (decrease) in net assets		933,824			4,799,454			(230,973	)		3,020,203			2,025,961			11,855,932
NET ASSETS:
Beginning of period		26,378,520			21,579,066			9,053,085			6,032,882			29,249,107			17,393,175
End of period	$	27,312,344		$	26,378,520		$	8,822,112		$	9,053,085		$	31,275,068		$	29,249,107
CHANGES IN UNITS OUTSTANDING:
Units issued		220,627			291,657			159,862			287,589			1,091,410			1,511,700
Units redeemed		(388,698	)		(509,850	)		(255,677	)		(236,254	)		(1,198,381	)		(1,181,952	)
Net increase (decrease)		(168,071	)		(218,193	)		(95,815	)		51,335			(106,971	)		329,748

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	PIMCO VIT LOW  DURATION PORTFOLIO						PIMCO VIT TOTAL RETURN PORTFOLIO						PIONEER EMERGING MARKETS  VCT PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	606,826		$	1,385,559		$	2,348,273		$	4,803,079		$	(12,087	)	$	3,812
Net realized gain		840,405			2,446,480			7,043,435			4,841,089			632,069			224,645
Change in net unrealized appreciation (depreciation) on investments		1,549,077			1,915,191			100,171			3,539,785			(446,780	)		1,006,393
Increase in net assets resulting from operations		2,996,308			5,747,230			9,491,879			13,183,953			173,202			1,234,850
CONTRACT TRANSACTIONS:
Purchase payments received		2,179,727			1,105,004			5,499,092			3,128,151			17,981			24,696
Transfers for contract benefits and terminations		(5,363,281	)		(3,588,973	)		(9,043,478	)		(11,726,649	)		(175,569	)		(92,967	)
Net transfers		9,269,798			12,324,394			12,163,510			27,764,569			(2,111,878	)		2,462,804
Contract maintenance charges		(792	)		(890	)		(1,219	)		(1,279	)
Adjustments to net assets allocated to contracts in payout phase		38,752			(74,214	)		31,791			(46,702	)
Increase (decrease) in net assets resulting from contract transactions		6,124,204			9,765,321			8,649,696			19,118,090			(2,269,466	)		2,394,533
Total increase (decrease) in net assets		9,120,512			15,512,551			18,141,575			32,302,043			(2,096,264	)		3,629,383
NET ASSETS:
Beginning of period		61,303,516			45,790,965			123,604,365			91,302,322			4,313,485			684,102
End of period	$	70,424,028		$	61,303,516		$	141,745,940		$	123,604,365		$	2,217,221		$	4,313,485
CHANGES IN UNITS OUTSTANDING:
Units issued		2,038,363			1,798,281			2,950,555			3,739,843			107,054			751,994
Units redeemed		(1,551,404	)		(1,005,179	)		(2,326,650	)		(2,214,947	)		(418,779	)		(342,365	)
Net increase (decrease)		486,959			793,102			623,905			1,524,896			(311,725	)		409,629

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	PIONEER FUND VCT PORTFOLIO						PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO						PIONEER MID CAP VALUE VCT PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	25,212		$	40,135		$	(39,104	)	$	(30,889	)	$	2,556		$	8,419
Net realized loss		(120,823	)		(858,609	)		(236,388	)		(487,635	)		24,465			(392,786	)
Change in net unrealized appreciation (depreciation) on investments		702,510			1,662,833			1,090,003			1,858,491			328,560			734,396
Increase in net assets resulting from operations		606,899			844,359			814,511			1,339,967			355,581			350,029
CONTRACT TRANSACTIONS:
Purchase payments received		111,703			16,937			30,289			21,195			145,718			40,639
Transfers for contract benefits and terminations		(301,446	)		(258,218	)		(392,391	)		(485,771	)		(32,849	)		(109,677	)
Net transfers		(197,625	)		(805,298	)		(365,000	)		1,009,000			(268,400	)		663,655
Contract maintenance charges		(468	)		(620	)		(525	)		(665	)		(26	)		(34	)
Adjustments to net assets allocated to contracts in payout phase								1,955			295			1,443			1,919
Increase (decrease) in net assets resulting from contract transactions		(387,836	)		(1,047,199	)		(725,672	)		544,054			(154,114	)		596,502
Total increase (decrease) in net assets		219,063			(202,840	)		88,839			1,884,021			201,467			946,531
NET ASSETS:
Beginning of period		4,267,802			4,470,642			4,820,588			2,936,567			2,144,181			1,197,650
End of period	$	4,486,865		$	4,267,802		$	4,909,427		$	4,820,588		$	2,345,648		$	2,144,181
CHANGES IN UNITS OUTSTANDING:
Units issued		48,587			80,615			99,014			253,883			54,390			169,685
Units redeemed		(79,411	)		(199,873	)		(150,399	)		(187,700	)		(69,675	)		(99,149	)
Net increase (decrease)		(30,824	)		(119,258	)		(51,385	)		66,183			(15,285	)		70,536

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	PIONEER SMALL CAP VALUE VCT PORTFOLIO			PRUDENTIAL SERIES FUND EQUITY PORTFOLIO						PRUDENTIAL SERIES FUND NATURAL RESOURCES PORTFOLIO						PUTNAM VT AMERICAN GOVERNMENT INCOME IB PORTFOLIO
	2009			2010			2009			2010			2009			2010
		(1)												(2)			(3)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	29,238		$	(6,321	)	$	(13	)	$	(13,741	)	$	(1,567	)	$	(2,959	)
Net realized gain (loss)		(3,965,434	)		(9,066	)		(51,426	)		248,992			28,672			8,092
Change in net unrealized appreciation (depreciation) on investments		3,710,956			178,685			142,628			505,628			53,565			(10,047	)
Increase (decrease) in net assets resulting from operations		(225,240	)		163,298			91,189			740,879			80,670			(4,914	)
CONTRACT TRANSACTIONS:
Purchase payments received		7,933			19,560			1,750			58,434			118,258			88,666
Transfers for contract benefits and terminations		(538,413	)		(39,503	)		(41,559	)		(144,259	)		(4,344	)
Net transfers		(2,947,602	)		1,152,183			(6,959	)		3,369,963			1,044,343			1,010,088
Contract maintenance charges		(94	)		(53	)		(81	)								(4	)
Adjustments to net assets allocated to contracts in payout phase		(7,967	)
Increase (decrease) in net assets resulting from contract transactions		(3,486,143	)		1,132,187			(46,849	)		3,284,138			1,158,257			1,098,750
Total increase (decrease) in net assets		(3,711,383	)		1,295,485			44,340			4,025,017			1,238,927			1,093,836
NET ASSETS:
Beginning of period		3,711,383			352,481			308,141			1,238,927			0			0
End of period	$	0		$	1,647,966		$	352,481		$	5,263,944		$	1,238,927		$	1,093,836
CHANGES IN UNITS OUTSTANDING:
Units issued		19,360			100,922			7,965			345,643			104,880			193,238
Units redeemed		(363,737	)		(13,058	)		(14,796	)		(142,788	)		(18,760	)		(86,429	)
Net increase (decrease)		(344,377	)		87,864			(6,831	)		202,855			86,120			106,809
(1)     For the period January 1, 2009 to April 29, 2009.
(2)     For the period May 11, 2009 to December 31, 2009.
(3)     For the period May 3, 2010 to December 31, 2010.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	PUTNAM VT EQUITY INCOME IB PORTFOLIO			ROYCE SMALL-CAP PORTFOLIO						SCHWAB MARKETTRACK GROWTH PORTFOLIO II
	2010			2010			2009			2010			2009
		(1)						(2)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(799	)	$	(18,112	)	$	(3,489	)	$	423,871		$	475,895
Net realized gain (loss)		652			107,110			25,966			(777,449	)		(1,873,081	)
Change in net unrealized appreciation (depreciation) on investments		40,112			504,352			117,799			3,441,301			6,001,607
Increase in net assets resulting from operations		39,965			593,350			140,276			3,087,723			4,604,421
CONTRACT TRANSACTIONS:
Purchase payments received		47,291			370,833			46,405			586,567			159,718
Transfers for contract benefits and terminations		(6,152	)		(49,553	)		(1,124	)		(1,152,148	)		(2,439,689	)
Net transfers		802,993			2,823,192			1,217,099			800,730			1,104,184
Contract maintenance charges					(73	)		(5	)		(1,489	)		(1,773	)
Adjustments to net assets allocated to contracts in payout phase											20,733			6,163
Increase (decrease) in net assets resulting from contract transactions		844,132			3,144,399			1,262,375			254,393			(1,171,397	)
Total increase in net assets		884,097			3,737,749			1,402,651			3,342,116			3,433,024
NET ASSETS:
Beginning of period		0			1,402,651			0			25,291,974			21,858,950
End of period	$	884,097		$	5,140,400		$	1,402,651		$	28,634,090		$	25,291,974
CHANGES IN UNITS OUTSTANDING:
Units issued		84,746			282,269			119,937			286,950			361,990
Units redeemed		(1,418	)		(60,736	)		(12,915	)		(275,461	)		(465,992	)
Net increase (decrease)		83,328			221,533			107,022			11,489			(104,002	)
(1)     For the period June 7, 2010 to December 31, 2010.
(2)     For the period May 4, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	SCHWAB MONEY MARKET PORTFOLIO						SCHWAB S&P 500 INDEX PORTFOLIO						SELIGMAN COMMUNICATIONS & INFORMATION PORTFOLIO
	2010			2009			2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	(1,008,706	)	$	(1,132,446	)	$	1,338,124		$	1,847,012		$	(36,310	)	$	(22,877	)
Net realized gain (loss)		50,090						(1,416,453	)		(4,335,847	)		751,922			(88,870	)
Change in net unrealized appreciation (depreciation) on investments								14,186,586			24,831,613			(222,427	)		1,418,232
Increase (decrease) in net assets resulting from operations		(958,616	)		(1,132,446	)		14,108,257			22,342,778			493,185			1,306,485
CONTRACT TRANSACTIONS:
Purchase payments received		54,204,252			35,818,202			1,815,694			1,970,591			34,938			25,737
Transfers for contract benefits and terminations		(35,462,275	)		(56,668,806	)		(7,623,957	)		(7,800,138	)		(198,489	)		(161,761	)
Net transfers		(28,827,679	)		(66,507,202	)		(2,510,396	)		990,473			(321,995	)		2,433,202
Contract maintenance charges		(18,884	)		(20,262	)		(9,656	)		(11,756	)		(99	)		(83	)
Adjustments to net assets allocated to contracts in payout phase		14,511			35,957			39,738			(81,700	)
Increase (decrease) in net assets resulting from contract transactions		(10,090,075	)		(87,342,111	)		(8,288,577	)		(4,932,530	)		(485,645	)		2,297,095
Total increase (decrease) in net assets		(11,048,691	)		(88,474,557	)		5,819,680			17,410,248			7,540			3,603,580
NET ASSETS:
Beginning of period		138,331,875			226,806,432			111,150,208			93,739,960			4,681,991			1,078,411
End of period	$	127,283,184		$	138,331,875		$	116,969,888		$	111,150,208		$	4,689,531		$	4,681,991
CHANGES IN UNITS OUTSTANDING:
Units issued		10,453,918			7,161,317			1,529,188			1,930,138			266,507			493,452
Units redeemed		(11,293,660	)		(14,498,996	)		(2,166,974	)		(2,249,738	)		(316,964	)		(233,304	)
Net increase (decrease)		(839,742	)		(7,337,679	)		(637,786	)		(319,600	)		(50,457	)		260,148

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	SENTINEL VARIABLE PRODUCTS BOND FUND						SENTINEL VARIABLE PRODUCTS COMMON STOCK FUND						SENTINEL VARIABLE PRODUCTS SMALL COMPANY FUND
	2010			2009			2010			2009			2010			2009
					(1)						(1)						(2)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	72,968		$	39,049		$	26,731		$	6,333		$	(2,294	)	$	414
Net realized gain		107,102			37,883			17,971			3,408			11,885			247
Change in net unrealized appreciation (depreciation) on investments		(114,258	)		(78,819	)		240,055			61,684			78,679			9,640
Increase (decrease) in net assets resulting from operations		65,812			(1,887	)		284,757			71,425			88,270			10,301
CONTRACT TRANSACTIONS:
Purchase payments received		107,351						78,841			4,952			81,492			20,566
Transfers for contract benefits and terminations		(77,850	)		(1,988	)		(36,268	)					(15,861	)		(2	)
Net transfers		1,409,157			827,078			2,184,735			531,984			504,519			152,861
Contract maintenance charges		(3	)					(10	)		(3	)					(4	)
Adjustments to net assets allocated to contracts in payout phase
Increase in net assets resulting from contract transactions		1,438,655			825,090			2,227,298			536,933			570,150			173,421
Total increase in net assets		1,504,467			823,203			2,512,055			608,358			658,420			183,722
NET ASSETS:
Beginning of period		823,203			0			608,358			0			183,722			0
End of period	$	2,327,670		$	823,203		$	3,120,413		$	608,358		$	842,142		$	183,722
CHANGES IN UNITS OUTSTANDING:
Units issued		258,261			102,228			179,554			51,980			49,027			14,688
Units redeemed		(129,664	)		(24,483	)		(12,874	)		(3,808	)		(9,305	)		(140	)
Net increase		128,597			77,745			166,680			48,172			39,722			14,548
(1)     For the period June 16, 2009 to December 31, 2009.
(2)     For the period May 4, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	THIRD AVENUE VALUE PORTFOLIO						TOUCHSTONE MID CAP GROWTH FUND					UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO
	2010			2009			2010			2009		2010			2009
											(1)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	255,363		$	(61,629	)	$	(5,617	)	$	317	$	108,950		$	130,814
Net realized gain (loss)		(1,806,306	)		(2,501,817	)		19,450			46		(2,418,764	)		(4,291,486	)
Change in net unrealized appreciation (depreciation) on investments		2,528,408			5,797,695			246,730			14,295		4,248,133			5,488,666
Increase in net assets resulting from operations		977,465			3,234,249			260,563			14,658		1,938,319			1,327,994
CONTRACT TRANSACTIONS:
Purchase payments received					5,759			113,176			592,852		4,244			2,614
Transfers for contract benefits and terminations		(322,637	)		(505,860	)		(19,848	)				(294,762	)		(312,540	)
Net transfers		(1,523,217	)		(1,772,852	)		1,093,021			122,656		112,935			(80,299	)
Contract maintenance charges		(257	)		(298	)		(18	)				(788	)		(974	)
Adjustments to net assets allocated to contracts in payout phase								3,370					(1,355	)		(2,588	)
Increase (decrease) in net assets resulting from contract transactions		(1,846,111	)		(2,273,251	)		1,189,701			715,508		(179,726	)		(393,787	)
Total increase (decrease) in net assets		(868,646	)		960,998			1,450,264			730,166		1,758,593			934,207
NET ASSETS:
Beginning of period		9,298,004			8,337,006			730,166			0		7,001,979			6,067,772
End of period	$	8,429,358		$	9,298,004		$	2,180,430		$	730,166	$	8,760,572		$	7,001,979
CHANGES IN UNITS OUTSTANDING:
Units issued					177,881			110,949			55,555		91,257			72,820
Units redeemed		(235,444	)		(525,032	)		(30,067	)				(100,128	)		(104,255	)
Net increase (decrease)		(235,444	)		(347,151	)		80,882			55,555		(8,871	)		(31,435	)
(1)     For the period July 6, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	VAN ECK VIP GLOBAL BOND FUND						VAN ECK VIP GLOBAL HARD ASSETS FUND						WELLS FARGO ADVANTAGE VT DISCOVERY FUND
	2010			2009			2010			2009			2010			2009
					(1)						(2)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	77,420		$	(7,469	)	$	(12,421	)	$	(4,565	)	$	(25,958	)	$	(19,747	)
Net realized gain (loss)		22,185			18,854			308,456			28,592			(95,432	)		(429,415	)
Change in net unrealized appreciation (depreciation) on investments		148,326			(10,184	)		529,007			153,768			1,227,618			1,382,895
Increase in net assets resulting from operations		247,931			1,201			825,042			177,795			1,106,228			933,733
CONTRACT TRANSACTIONS:
Purchase payments received		164,768			43,172			113,113			202,247			35,373			43,880
Transfers for contract benefits and terminations		(79,656	)		(9,394	)		(91,349	)		(2,681	)		(165,974	)		(254,475	)
Net transfers		4,030,652			2,966,953			2,812,883			1,584,503			606,501			(296,208	)
Contract maintenance charges		(18	)		(26	)
Adjustments to net assets allocated to contracts in payout phase		4,372			(31,430	)								(744	)
Increase (decrease) in net assets resulting from contract transactions		4,120,118			2,969,275			2,834,647			1,784,069			475,156			(506,803	)
Total increase in net assets		4,368,049			2,970,476			3,659,689			1,961,864			1,581,384			426,930
NET ASSETS:
Beginning of period		2,970,476			0			1,961,864			0			3,207,187			2,780,257
End of period	$	7,338,525		$	2,970,476		$	5,621,553		$	1,961,864		$	4,788,571		$	3,207,187
CHANGES IN UNITS OUTSTANDING:
Units issued		547,456			298,151			398,130			164,875			117,111			48,618
Units redeemed		(180,634	)		(33,150	)		(217,626	)		(19,633	)		(92,042	)		(116,656	)
Net increase (decrease)		366,822			265,001			180,504			145,242			25,069			(68,038	)
(1)     For the period May 13, 2009 to December 31, 2009.
(2)     For the period May 4, 2009 to December 31, 2009.

The accompanying notes are an integral part of these financial statements. (Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2010 AND 2009

	INVESTMENT DIVISIONS
	WELLS FARGO ADVANTAGE  VT OPPORTUNITY FUND						WELLS FARGO ADVANTAGE VT  SMALL CAP VALUE FUND
	2010			2009			2010			2009
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)	$	1,364		$	(27,920	)	$	18,294		$	9,244
Net realized loss		(271,739	)		(1,457,865	)		(166,936	)		(432,946	)
Change in net unrealized appreciation (depreciation) on investments		1,376,440			2,959,700			588,230			1,597,505
Increase in net assets resulting from operations		1,106,065			1,473,915			439,588			1,173,803
CONTRACT TRANSACTIONS:
Purchase payments received		32,390			9,005			0			0
Transfers for contract benefits and terminations		(254,141	)		(171,640	)		(273,050	)		(165,072	)
Net transfers		89,719			593,364			(77,676	)		(412,763	)
Contract maintenance charges		(88	)		(102	)		(377	)		(510	)
Adjustments to net assets allocated to contracts in payout phase		38,318			(48,337	)		5,519			(10,221	)
Increase (decrease) in net assets resulting from contract transactions		(93,802	)		382,290			(345,584	)		(588,566	)
Total increase in net assets		1,012,263			1,856,205			94,004			585,237
NET ASSETS:
Beginning of period		5,017,068			3,160,863			2,962,859			2,377,622
End of period	$	6,029,331		$	5,017,068		$	3,056,863		$	2,962,859
CHANGES IN UNITS OUTSTANDING:
Units issued		123,845			281,585			782			442
Units redeemed		(132,996	)		(236,018	)		(25,819	)		(61,051	)
Net increase (decrease)		(9,151	)		45,567			(25,037	)		(60,609	)

The accompanying notes are an integral part of these financial statements. (Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2010

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

The Variable Annuity-1 Series Account (the Series Account), a separate account of Great-West Life & Annuity Insurance Company (the Company), is registered as a unit investment trust under the Investment Company Act of 1940, as amended, and exists in accordance with regulations of the Colorado Division of Insurance. The Series Account is a funding vehicle for both group and individual variable annuity contracts. The Series Account consists of numerous investment divisions (Investment Divisions), each being treated as an individual accounting entity for financial reporting purposes, and each investing all of its investible assets in the named underlying mutual fund.

Under applicable insurance law, the assets and liabilities of each of the Investment Divisions of the Series Account are clearly identified and distinguished from the Company's other assets and liabilities. The portion of the Series Account's assets applicable to the reserves and other contract liabilities with respect to the Series Account is not chargeable with liabilities arising out of any other business the Company may conduct.

The preparation of financial statements and financial highlights of each of the Investment Divisions in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and financial highlights and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Security Valuation

Mutual fund investments held by the Investment Divisions are valued at the reported net asset values of such underlying mutual funds, which value their investment securities at fair value.

The Series Account classifies its valuations into three levels based upon the transparency of inputs to the valuation of the Series Account’s investments. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. The three levels are defined as follows:

Level 1 – Valuations based on unadjusted quoted prices for identical securities in active markets.

Level 2 – Valuations based on either directly or indirectly observable inputs. These may include quoted prices for similar assets in active markets.

Level 3 – Valuations based on inputs that are unobservable and significant to the fair value measurement and may include prices obtained from single broker quotes. Unobservable inputs reflect the reporting entity’s own assumptions and would be based on the best information available under the circumstances.

As of December 31, 2010, the only investments of each of the Investment Divisions of the Series Account were in underlying registered investment companies that are actively traded, therefore 100% of the investments are valued using Level 1 inputs. The Series Account recognizes transfers between the levels as of the beginning of the quarter in which the transfer occurred. There were no transfers between Levels 1 and 2 during the year.

Risk Factors

Investing in the Series Account may involve certain risks including, but not limited to, those described below.

Unforeseen developments in market conditions may result in the decline of prices of, and the income generated by, the securities held by the Investment Divisions. These events may have adverse effects on the Investment Divisions such as a decline in the value and liquidity of many securities held by the Investment Divisions, and a decrease in net asset value.

The Investment Divisions investing in stocks may involve larger price fluctuation and greater potential for loss than other types of investments. This may cause the Investment Divisions to be subject to larger short-term declines in value.

The Investment Divisions may have elements of risk due to concentrated investments in foreign issuers located in a specific country. Such concentrations may subject the Investment Divisions to additional risks resulting from future political or economic conditions and/or possible impositions of adverse foreign governmental laws or currency exchange restrictions. Investments in securities of non-U.S. issuers have unique risks not present in securities of U.S. issuers, such as greater price volatility and less liquidity.

The Series Account may have Investment Divisions that primarily invest in bonds. Fixed income securities are subject to credit risk, which is the possibility that a security could have its credit rating downgraded or that the issuer of the security could fail to make timely payments or default on payments of interest or principal. Additionally, fixed income securities are subject to interest rate risk, meaning the decline in the price of debt securities that accompanies a rise in interest rates. Bonds with longer maturities are subject to greater price fluctuations than bonds with shorter maturities.

The Investment Divisions may be invested in bonds which are rated below investment grade. These high yield bonds may be more susceptible than higher grade bonds to real or perceived adverse economic or industry conditions. The secondary market, on which high yield bonds are traded, may also be less liquid than the market for higher grade bonds.

The Investment Divisions may invest in securities of governmental agencies. Investments in securities of governmental agencies may only be guaranteed by the respective agency’s limited authority to borrow from the U.S. Government and may not be guaranteed by the full faith and credit of the U.S. Government.

Security Transactions and Investment Income

Transactions are recorded on the trade date. Realized gains and losses on sales of investments are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date and the amounts distributed to the Investment Division for its share of dividends are reinvested in additional full and fractional shares of the related mutual funds.

Contracts in the Payout Phase

Net assets of each Investment Division allocated to contracts in the payout phase are computed according to the 2000 Individual Annuitant Mortality Table. The assumed investment return is 5 percent. The mortality risk is fully borne by the Company and may result in additional amounts being transferred into the variable annuity account by the Company to cover greater longevity of annuitants than expected. Conversely, if amounts allocated exceed amounts required, transfers may be made to the Company. Any adjustments to these amounts are reflected in Adjustments to net assets allocated to contracts in payout phase on the Statement of Changes in Net Assets of the applicable Investment Divisions.

Federal Income Taxes

The operations of each of the Investment Divisions of the Series Account are included in the federal income tax return of the Company, which is taxed as a life insurance company under the provisions of the Internal Revenue Code (IRC). Under the current provisions of the IRC, the Company does not expect to incur federal income taxes on the earnings of each of the Investment Divisions of the Series Account to the extent the earnings are credited under the contracts. Based on this, no charge is being made currently to the Series Account for federal income taxes. The Company will review periodically the status of the federal income taxes policy in the event of changes in the tax law. A charge may be made in future years for any federal income taxes that would be attributable to the contracts.

Purchase Payments Received

Purchase payments received from contract owners by the Company are credited as accumulation units, and are reported as Contract Transactions on the Statement of Changes in Net Assets of the applicable Investment Divisions.

Net Transfers

Net transfers include transfers between Investment Divisions of the Series Account as well as transfers between other investment options of the Company, not included in the Series Account.

Application of Recent Accounting Pronouncements

In January 2010, the FASB issued ASU No. 2010-06 “Fair Value Measurements and Disclosures: Improving Disclosures about Fair Value Measurements” (ASU No. 2010-06). ASU No. 2010-06 provides for disclosure of significant transfers in and out of the fair value hierarchy Levels 1 and 2, and the reasons for these transfers. In addition, ASU No. 2010-06 provides for separate disclosure about purchases, sales, issuances and settlements in the Level 3 hierarchy roll forward activity. ASU No. 2010-06 is effective for interim and annual periods beginning after December 31, 2009 except for the provisions relating to purchases, sales, issuances and settlements of Level 3 investments, which are effective for fiscal years beginning after December 15, 2010. The Series Account adopted the disclosure provisions of ASU 2010-06 for its fiscal year beginning January 1, 2010 and will adopt the Level 3 purchase, sales, issuances and settlement provisions for its fiscal year beginning January 1, 2011. The adoption of ASC No. 2010-06 did not have an impact on the Series Account’s financial position or the results of its operations.

2. PURCHASES AND SALES OF INVESTMENTS

The cost of purchases and proceeds from sales of investments for the year ended December 31, 2010 were as follows:

		00000000000000		00000000000000
Investment Division	Purchases		Sales
Alger Balanced Portfolio	$	28,117	$	141,612
Alger Large Cap Growth Portfolio		2,695,399		4,965,443
Alger Mid Cap Growth Portfolio		1,257,701		2,404,281
AllianceBernstein VPS Growth & Income Portfolio		0		1,663,960
AllianceBernstein VPS Growth Portfolio		6,721		572,027
AllianceBernstein VPS International Growth Portfolio		4,841,981		7,518,035
AllianceBernstein VPS International Value Portfolio		964,517		4,734,784
AllianceBernstein VPS Real Estate Investment Portfolio		4,872,434		4,399,524
AllianceBernstein VPS Small/Midcap Value Portfolio		5,545,786		5,293,466
American Century VP Balanced Fund		1,275,590		1,290,932
American Century VP Income & Growth Fund		388,582		1,341,344

	00000000000000	00000000000000
American Century VP International Fund	187,517	1,595,178
American Century VP Mid Cap Value Fund	1,196,913	366,773
American Century VP Value Fund	4,217,526	2,279,698
Columbia VIT Marsico 21st Century Fund	1,616,070	586,151
Columbia VIT Small Cap Value Fund	1,063,929	358,828
Delaware VIP Small Cap Value Series	2,749,913	3,675,554
Delaware VIP Smid Cap Growth Series	3,202,123	1,104,732
Dreyfus IP Midcap Stock Portfolio	18,753	586,782
Dreyfus VIF Appreciation Portfolio	3,757,420	1,011,971
Dreyfus VIF Growth & Income Portfolio	344,598	538,249
Dreyfus VIF Opportunistic Small Cap Portfolio	489,698	636,528
DWS Blue Chip VIP Portfolio	1,460,697	1,027,706
DWS Capital Growth VIP Portfolio	2,505,356	2,130,949
DWS Dreman Small Mid Cap Value VIP Portfolio	2,068,146	1,539,454
DWS Growth & Income VIP Portfolio	7,237	167,659
DWS Health Care VIP Portfolio	1,652,145	1,875,667
DWS Large Cap Value VIP Portfolio	4,341,277	2,160,333
DWS Small Cap Growth VIP Portfolio	50,611	210,507
DWS Small Cap Index VIP Portfolio	2,737,758	3,313,666
DWS Strategic Value VIP Portfolio	59,222	864,238
Federated Capital Appreciation Fund II	65,848	704,391
Federated Capital Income Fund II	40,696	76,155
Federated Fund for U.S. Government Securities II	7,420,220	13,529,756
Federated International Equity Fund II	1,901	599,159
Franklin Small Cap Value Securities Fund	1,751,254	1,124,913
Franklin Templeton Foreign Securities Portfolio	1,343,346	58,940
Invesco V.I. Core Equity Fund	47,612	474,993
Invesco V.I. High Yield Fund	391,437	1,148,625
Invesco V.I. International Growth Fund	5,312,359	3,129,767
Invesco V.I. Mid Cap Core Equity Fund	1,319,012	269,615
Invesco V.I. Small Cap Equity Fund	648,623	185,818
Invesco V.I. Technology Fund	20,046	271,509
Invesco Van Kampen VI Comstock Fund	1,236,062	1,101,333
Invesco Van Kampen VI Growth & Income Fund	3,294,565	4,947,214
Janus Aspen Balanced Portfolio Institutional Shares	260,362	1,077,787
Janus Aspen Balanced Portfolio Service Shares	12,065,611	5,202,115
Janus Aspen Flexible Bond Portfolio Institutional Shares	1,716,684	4,955,203
Janus Aspen Flexible Bond Portfolio Service Shares	11,943,202	7,100,262
Janus Aspen Growth & Income Portfolio Institutional Shares	40,930	8,677,760
Janus Aspen Growth & Income Portfolio Service Shares	453,535	8,721,882
Janus Aspen Janus Portfolio	81,880	1,016,434
Janus Aspen Overseas Portfolio Institutional Shares	106,130	2,467,694
Janus Aspen Overseas Portfolio Service Shares	3,452,296	4,406,481
Janus Aspen Worldwide Portfolio	52,061	1,649,646
JPMorgan Insurance Trust Small Cap Core Portfolio	207	87,083
Lazard Retirement Emerging Markets Equity Series Portfolio	12,712,256	5,075,674
LVIP Baron Growth Opportunities Fund	2,179,131	3,562,029
MFS International Value Fund	6,189,351	766,485
MFS Utilities Fund	1,593,040	2,728,443
Neuberger Berman AMT Regency Portfolio	968	89,802
NVIT Mid Cap Index Fund	1,611,903	2,268,676
Oppenheimer Global Securities Fund/VA	3,481,269	5,920,468
Oppenheimer International Growth Fund/VA	1,983,099	3,197,139

	00000000000000	00000000000000
Pimco VIT High Yield Portfolio	18,793,353	18,366,014
Pimco VIT Low Duration Portfolio	24,274,340	17,300,214
Pimco VIT Total Return Portfolio	42,493,931	27,328,690
Pioneer Emerging Markets VCT Portfolio	700,011	2,981,691
Pioneer Fund VCT Portfolio	565,517	937,396
Pioneer Growth Opportunities VCT Portfolio	965,305	1,742,789
Pioneer Mid Cap Value VCT Portfolio	520,061	682,596
Prudential Series Fund Equity Portfolio	1,278,412	152,561
Prudential Series Fund Natural Resources Portfolio	5,494,186	2,224,054
Putnam VT American Government Income IB Portfolio	1,972,880	877,021
Putnam VT Equity Income IB Portfolio	852,535	9,144
Royce Small-Cap Portfolio	3,893,332	772,256
Schwab Markettrack Growth Portfolio II	4,558,788	3,900,124
Schwab Money Market Portfolio	82,492,330	91,735,047
Schwab S&P 500 Index Portfolio	16,219,002	23,171,999
Seligman Communications & Information Portfolio	3,100,292	3,622,248
Sentinel Variable Products Bond Fund	3,072,064	1,444,806
Sentinel Variable Products Common Stock Fund	2,422,221	168,046
Sentinel Variable Products Small Company Fund	689,578	121,687
Third Avenue Value Portfolio	314,565	1,905,363
Touchstone Mid Cap Growth Fund	1,593,930	412,503
Universal Institutional Fund U.S. Real Estate Portfolio	2,602,083	2,600,224
Van Eck VIP Global Bond Fund	6,053,927	1,828,510
Van Eck VIP Global Hard Assets Fund	5,680,414	2,858,006
Wells Fargo Advantage VT Discovery Fund	1,311,552	861,516
Wells Fargo Advantage VT Opportunity Fund	1,383,635	1,514,334
Wells Fargo Advantage VT Small Cap Value Fund	42,810	390,614

3. EXPENSES AND RELATED PARTY TRANSACTIONS

Contract Maintenance Charges

The Company deducts from each participant account in the Schwab Select Annuity contract, a $25 annual maintenance charge on accounts under $50,000 as of each contract's anniversary date. This charge is recorded as Contract maintenance charges on the Statement of Changes in Net Assets of the applicable Investment Divisions.

Transfer Fees

The Company charges $10 in the Schwab Select Annuity contract for each transfer between Investment Divisions in excess of 12 transfers in any calendar year. This charge is recorded as Transfers for contract benefits and terminations on the Statement of Changes in Net Assets of the applicable Investment Divisions.

Deductions for Premium Taxes

The Company deducts from each contribution in both the Schwab Select Annuity contract and Schwab OneSource Annuity contract any applicable state premium tax or retaliatory tax, which currently range from 0% to 3.5%. This charge is netted with Purchase payments received on the Statement of Changes in Net Assets of the applicable Investment Divisions.

Deductions for Assumption of Mortality and Expense Risks

The Company deducts an amount, computed and accrued daily, from the unit value of each Investment Division of the Schwab Select Annuity contract, equal to an annual rate of 0.85%, and an amount, computed and accrued daily, from the unit value of each Investment Division of the Schwab OneSource Annuity contract, equal to an annual rate of 0.65% to 0.85%, depending on the benefit option chosen. These charges compensate the Company for its assumption of certain mortality, death benefit, and expense risks. The charges are recorded as Mortality and expense risk in the Statement of Operations of the applicable Investment Divisions.

If the above charges prove insufficient to cover actual costs and assumed risks, the loss will be borne by the Company; conversely, if the amounts deducted prove more than sufficient, the excess will be a profit to the Company.

4. FINANCIAL HIGHLIGHTS

The financial highlights for the Series Account are presented by contract by Investment Division. For each Investment Division available to Schwab Select Annuity contracts, the accumulation units outstanding, net assets, investment income ratio, expense ratio (excluding expenses of the underlying funds), total return and accumulation unit fair values for each year or period ended December 31 are included on the following pages. The unit values in the Financial Highlights are calculated based on the net assets and accumulation units outstanding as of December 31 of each year presented and may differ from the unit value reflected on the Statement of Assets and Liabilities due to rounding. For each Investment Division available to Schwab OneSource Annuity contracts, the accumulation units outstanding, net assets, investment income ratio, and the range of the lowest to highest expense ratio (excluding expenses of the underlying funds), total return and accumulation unit fair values for each year or period ended December 31 are included on the following pages. In certain instances the lowest unit fair value and total return exceed the highest due to the impact of contracts which were not in force for the full year.

The Expense Ratios represent the annualized contract expenses of the respective Investment Divisions of the Series Account, consisting of mortality and expense 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 have been excluded.

The Total Return amounts represent the total return for the periods indicated, including changes in the value of the underlying fund, and expenses assessed through the reduction of unit values. These returns do not include any expenses assessed through the redemption of units. Investment Divisions with a date notation indicate the effective date that the investment option was available in the Series Account. The total return is calculated for each period indicated or from the effective date through the end of the reporting period and are not annualized for periods less than one year. As the total returns for the Investment Divisions of the Schwab OneSource Annuity contract are presented as a range of minimum to maximum values, based on the product grouping representing the minimum and maximum expense ratio amounts, some individual contract total returns are not within the ranges presented.

The Investment Income Ratio represents the dividends, excluding distributions of capital gains, received by the Investment Division from the underlying mutual fund divided by average net assets during the period. It is not annualized for periods less than one year. The ratio excludes those expenses, such as mortality and expense charges, that result in direct reductions in the unit values. The recognition of investment income by the Investment Division is affected by the timing of the declaration of dividends by the underlying fund in which the Investment Division invests.

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
ALGER LARGE CAP GROWTH PORTFOLIO
2010		595	$	20.68	$	12,357		0.75 %		0.85 %		12.43 %
2009		691	$	18.39	$	12,760		0.66 %		0.85 %		46.30 %
2008		759	$	12.57	$	9,580		0.23 %		0.85 %		(46.62)%
2007		881	$	23.55	$	20,797		0.33 %		0.85 %		18.94 %
2006		882	$	19.80	$	17,453		0.13 %		0.85 %		4.27 %
ALGER MID CAP GROWTH PORTFOLIO
2010		178	$	15.73	$	2,792		0.00 %		0.85 %		18.37 %
2009		221	$	13.29	$	2,939		0.00 %		0.85 %		50.51 %
2008		223	$	8.83	$	1,968		0.17 %		0.85 %		(58.46)%
2007		314	$	21.40	$	6,717		0.00 %		0.85 %		30.49 %
2006		180	$	16.40	$	2,954		0.00 %		0.85 %		9.19 %
ALLIANCEBERNSTEIN VPS GROWTH & INCOME PORTFOLIO (Effective date 05/01/2006)
2010		60	$	9.18	$	551		0.00 %		0.85 %		12.08 %
2009		66	$	8.19	$	544		4.10 %		0.85 %		19.74 %
2008		85	$	6.84	$	580		2.15 %		0.85 %		(41.09)%
2007		114	$	11.61	$	1,319		1.70 %		0.85 %		4.22 %
2006		41	$	11.14	$	457		0.90 %		0.85 %		11.40 %
ALLIANCEBERNSTEIN VPS GROWTH PORTFOLIO (Effective date 05/01/2006)
2010		59	$	9.55	$	561		0.27 %		0.85 %		14.07 %
2009		60	$	8.37	$	504		0.00 %		0.85 %		32.02 %
2008		72	$	6.34	$	458		0.00 %		0.85 %		(42.93)%
2007		81	$	11.11	$	899		0.00 %		0.85 %		12.11 %
2006		62	$	9.91	$	612		0.00 %		0.85 %		(0.90)%
ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO
2010		350	$	14.13	$	4,977		2.06 %		0.85 %		11.92 %
2009		412	$	12.63	$	5,224		4.62 %		0.85 %		38.49 %
2008		539	$	9.12	$	4,922		0.00 %		0.85 %		(49.31)%
2007		630	$	17.99	$	11,324		1.84 %		0.85 %		17.12 %
2006		573	$	15.36	$	8,804		0.94 %		0.85 %		26.11 %
ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO (Effective date 05/01/2006)
2010		309	$	7.61	$	2,353		2.88 %		0.85 %		3.73 %
2009		472	$	7.34	$	3,464		1.45 %		0.85 %		33.70 %
2008		570	$	5.49	$	3,129		1.18 %		0.85 %		(53.63)%
2007		643	$	11.84	$	7,607		1.19 %		0.85 %		4.96 %
2006		550	$	11.28	$	6,201		0.59 %		0.85 %		12.80 %

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO (Effective date 05/01/2006)
2010		160	$	12.02	$	1,929		0.61 %		0.85 %		25.82 %
2009		173	$	9.55	$	1,650		1.01 %		0.85 %		41.69 %
2008		135	$	6.74	$	913		0.59 %		0.85 %		(36.17)%
2007		114	$	10.56	$	1,199		1.30 %		0.85 %		0.86 %
2006		47	$	10.47	$	496		0.00 %		0.85 %		4.70 %
AMERICAN CENTURY VP BALANCED FUND
2010		160	$	13.99	$	2,237		1.89 %		0.85 %		10.71 %
2009		161	$	12.64	$	2,035		5.01 %		0.85 %		14.49 %
2008		152	$	11.04	$	1,682		2.60 %		0.85 %		(20.97)%
2007		167	$	13.97	$	2,327		2.08 %		0.85 %		4.02 %
2006		207	$	13.43	$	2,773		1.90 %		0.85 %		8.74 %
AMERICAN CENTURY VP INTERNATIONAL FUND
2010		178	$	20.21	$	3,685		2.39 %		0.85 %		12.31 %
2009		218	$	17.99	$	4,005		2.16 %		0.85 %		32.57 %
2008		273	$	13.57	$	3,792		0.86 %		0.85 %		(45.28)%
2007		370	$	24.80	$	9,178		0.70 %		0.85 %		17.04 %
2006		452	$	21.19	$	9,572		1.85 %		0.85 %		23.99 %
AMERICAN CENTURY VP MID CAP VALUE FUND (Effective date 05/01/2009)
2010		16	$	15.45	$	243		2.30 %		0.85 %		17.99 %
2009		8	$	13.09	$	105		1.33 %		0.85 %		30.90 %
AMERICAN CENTURY VP VALUE FUND
2010		298	$	14.71	$	4,395		2.23 %		0.85 %		12.44 %
2009		323	$	13.08	$	4,239		5.91 %		0.85 %		18.80 %
2008		395	$	11.01	$	4,352		2.56 %		0.85 %		(27.37)%
2007		548	$	15.16	$	8,314		1.59 %		0.85 %		(5.96)%
2006		594	$	16.12	$	9,578		1.38 %		0.85 %		17.66 %
COLUMBIA VIT MARSICO 21ST CENTURY FUND (Effective date 05/01/2009)
2010		7	$	15.45	$	107		0.00 %		0.85 %		16.15 %
2009		12	$	13.30	$	158		0.00 %		0.85 %		33.00 %
COLUMBIA VIT SMALL CAP VALUE FUND (Effective date 05/01/2009)
2010		31	$	15.84	$	495		0.57 %		0.85 %		25.39 %
2009		2	$	12.63	$	26		0.38 %		0.85 %		26.30 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
DELAWARE VIP SMALL CAP VALUE SERIES
2010		190	$	20.57	$	3,936		0.64 %		0.85 %		31.15 %
2009		200	$	15.68	$	3,144		0.97 %		0.85 %		30.67 %
2008		217	$	12.00	$	2,606		0.82 %		0.85 %		(30.48)%
2007		279	$	17.26	$	4,808		0.52 %		0.85 %		(7.40)%
2006		371	$	18.64	$	6,923		0.26 %		0.85 %		15.20 %
DELAWARE VIP SMID CAP GROWTH SERIES (Effective date 05/01/2006)
2010		145	$	12.58	$	1,842		0.00 %		0.85 %		35.16 %
2009		56	$	9.31	$	522		0.00 %		0.85 %		44.12 %
2008		13	$	6.46	$	86		0.00 %		0.85 %		(41.00)%
2007		25	$	10.95	$	272		0.00 %		0.85 %		11.96 %
2006		2	$	9.78	$	21		0.00 %		0.85 %		(2.20)%
DREYFUS IP MIDCAP STOCK PORTFOLIO
2010		34	$	15.47	$	521		1.08 %		0.85 %		26.03 %
2009		48	$	12.28	$	583		1.65 %		0.85 %		34.35 %
2008		70	$	9.14	$	636		0.91 %		0.85 %		(40.88)%
2007		75	$	15.46	$	1,167		0.43 %		0.85 %		0.59 %
2006		97	$	15.37	$	1,497		0.40 %		0.85 %		6.88 %
DREYFUS VIF APPRECIATION PORTFOLIO
2010		427	$	11.55	$	5,071		2.13 %		0.85 %		14.30 %
2009		403	$	10.10	$	4,164		2.70 %		0.85 %		21.39 %
2008		501	$	8.32	$	4,271		2.05 %		0.85 %		(30.08)%
2007		625	$	11.90	$	7,591		1.58 %		0.85 %		6.16 %
2006		749	$	11.21	$	8,388		1.59 %		0.85 %		15.57 %
DREYFUS VIF GROWTH & INCOME PORTFOLIO
2010		124	$	10.51	$	1,303		1.17 %		0.85 %		17.63 %
2009		157	$	8.93	$	1,402		1.32 %		0.85 %		27.57 %
2008		187	$	7.00	$	1,311		0.65 %		0.85 %		(40.88)%
2007		213	$	11.84	$	2,527		0.74 %		0.85 %		7.54 %
2006		284	$	11.01	$	3,129		0.76 %		0.85 %		13.51 %
DREYFUS VIF OPPORTUNISTIC SMALL CAP PORTFOLIO
2010		4	$	12.61	$	47		0.80 %		0.85 %		30.00 %
2009		5	$	9.70	$	48		1.67 %		0.85 %		25.00 %
2008		6	$	7.76	$	45		0.96 %		0.85 %		(38.12)%
2007		11	$	12.54	$	140		0.79 %		0.85 %		(11.81)%
2006		16	$	14.22	$	226		0.48 %		0.85 %		2.89 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
DWS BLUE CHIP VIP PORTFOLIO (Effective date 05/01/2006)
2010		170	$	10.11	$	1,717		1.55 %		0.85 %		12.85 %
2009		171	$	8.96	$	1,530		1.85 %		0.85 %		32.94 %
2008		103	$	6.74	$	692		1.79 %		0.85 %		(39.06)%
2007		102	$	11.06	$	1,133		0.98 %		0.85 %		2.60 %
2006		66	$	10.78	$	710		0.00 %		0.85 %		7.80 %
DWS CAPITAL GROWTH VIP PORTFOLIO
2010		225	$	10.73	$	2,440		0.87 %		0.85 %		15.77 %
2009		258	$	9.27	$	2,410		1.41 %		0.85 %		25.78 %
2008		295	$	7.37	$	2,205		1.05 %		0.85 %		(33.54)%
2007		228	$	11.09	$	2,573		0.63 %		0.85 %		11.68 %
2006		253	$	9.93	$	2,509		0.58 %		0.85 %		7.58 %
DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO (Effective date 05/01/2006)
2010		150	$	11.22	$	1,708		1.29 %		0.85 %		22.06 %
2009		146	$	9.19	$	1,345		1.91 %		0.85 %		28.53 %
2008		160	$	7.15	$	1,151		1.66 %		0.85 %		(33.98)%
2007		124	$	10.83	$	1,341		1.15 %		0.85 %		2.27 %
2006		173	$	10.59	$	1,829		0.00 %		0.85 %		5.90 %
DWS GROWTH & INCOME VIP PORTFOLIO
2010		45	$	9.19	$	421		1.71 %		0.85 %		13.38 %
2009		65	$	8.11	$	535		2.28 %		0.85 %		33.17 %
2008		70	$	6.09	$	429		1.98 %		0.85 %		(38.86)%
2007		74	$	9.96	$	735		1.20 %		0.85 %		0.50 %
2006		103	$	9.91	$	1,017		1.02 %		0.85 %		12.61 %
DWS HEALTH CARE VIP PORTFOLIO (Effective date 05/01/2006)
2010		75	$	11.88	$	916		0.00 %		0.85 %		7.25 %
2009		108	$	11.08	$	1,205		1.39 %		0.85 %		21.23 %
2008		104	$	9.14	$	949		0.27 %		0.85 %		(23.90)%
2007		95	$	12.01	$	1,138		0.00 %		0.85 %		12.24 %
2006		55	$	10.70	$	591		0.00 %		0.85 %		7.00 %
DWS LARGE CAP VALUE VIP PORTFOLIO
2010		97	$	11.57	$	1,125		1.93 %		0.85 %		9.83 %
2009		98	$	10.53	$	1,036		2.46 %		0.85 %		24.32 %
2008		146	$	8.47	$	1,235		1.87 %		0.85 %		(36.98)%
2007		64	$	13.44	$	857		1.75 %		0.85 %		12.19 %
2006		36	$	11.98	$	433		1.07 %		0.85 %		14.42 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
DWS SMALL CAP INDEX VIP PORTFOLIO
2010		368	$	18.05	$	6,675		0.92 %		0.85 %		25.32 %
2009		389	$	14.40	$	5,626		1.81 %		0.85 %		25.44 %
2008		456	$	11.48	$	5,237		1.64 %		0.85 %		(34.66)%
2007		523	$	17.57	$	9,193		0.90 %		0.85 %		(2.71)%
2006		655	$	18.06	$	11,839		0.68 %		0.85 %		16.44 %
DWS STRATEGIC VALUE VIP PORTFOLIO
2010		122	$	9.18	$	1,117		2.01 %		0.85 %		11.62 %
2009		172	$	8.22	$	1,417		5.06 %		0.85 %		24.17 %
2008		270	$	6.62	$	1,786		3.30 %		0.85 %		(46.44)%
2007		355	$	12.36	$	4,386		1.47 %		0.85 %		(2.68)%
2006		393	$	12.70	$	4,996		1.56 %		0.85 %		17.70 %
FEDERATED CAPITAL APPRECIATION FUND II
2010		195	$	16.03	$	3,152		2.09 %		0.85 %		12.08 %
2009		242	$	14.30	$	3,479		2.78 %		0.85 %		13.76 %
2008		374	$	12.57	$	4,729		1.93 %		0.85 %		(34.36)%
2007		459	$	19.15	$	8,839		1.52 %		0.85 %		(10.43)%
2006		595	$	21.38	$	12,721		1.59 %		0.85 %		15.82 %
FEDERATED CAPITAL INCOME FUND II
2010		45	$	14.98	$	681		6.04 %		0.85 %		11.10 %
2009		51	$	13.48	$	681		6.27 %		0.85 %		27.17 %
2008		55	$	10.60	$	583		5.72 %		0.85 %		(21.07)%
2007		61	$	13.43	$	815		4.98 %		0.85 %		3.15 %
2006		85	$	13.02	$	1,105		6.13 %		0.85 %		14.71 %
FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II
2010		1,324	$	18.37	$	24,387		4.51 %		0.85 %		4.30 %
2009		1,554	$	17.61	$	27,428		5.14 %		0.85 %		4.32 %
2008		1,772	$	16.88	$	29,978		4.92 %		0.85 %		3.37 %
2007		1,881	$	16.33	$	30,802		4.40 %		0.85 %		5.42 %
2006		2,127	$	15.49	$	32,952		4.30 %		0.85 %		3.20 %
FRANKLIN SMALL CAP VALUE SECURITIES FUND (Effective date 05/01/2006)
2010		103	$	10.66	$	1,100		0.77 %		0.85 %		27.10 %
2009		94	$	8.39	$	790		1.64 %		0.85 %		28.09 %
2008		54	$	6.55	$	355		1.14 %		0.85 %		(33.57)%
2007		52	$	9.86	$	515		0.62 %		0.85 %		(3.24)%
2006		47	$	10.19	$	475		0.10 %		0.85 %		1.90 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
FRANKLIN TEMPLETON FOREIGN SECURITIES PORTFOLIO (Effective date 04/30/2010)
2010		17	$	10.80	$	184		0.34 %		0.85 %		8.00 %
INVESCO V.I. CORE EQUITY FUND
2010		255	$	19.83	$	5,053		0.97 %		0.85 %		8.65 %
2009		278	$	18.25	$	5,082		1.73 %		0.85 %		27.18 %
2008		340	$	14.35	$	4,877		2.08 %		0.85 %		(30.71)%
2007		396	$	20.71	$	8,202		1.03 %		0.85 %		7.19 %
2006		491	$	19.32	$	9,483		1.66 %		0.85 %		15.34 %
INVESCO V.I. HIGH YIELD FUND
2010		172	$	18.27	$	3,133		9.74 %		0.85 %		12.64 %
2009		207	$	16.22	$	3,357		8.14 %		0.85 %		51.45 %
2008		261	$	10.71	$	2,799		8.75 %		0.85 %		(26.29)%
2007		351	$	14.53	$	5,105		6.46 %		0.85 %		0.35 %
2006		462	$	14.48	$	6,681		7.83 %		0.85 %		9.86 %
INVESCO V.I. INTERNATIONAL GROWTH FUND (Effective date 05/01/2006)
2010		197	$	11.20	$	2,220		2.47 %		0.85 %		11.92 %
2009		195	$	10.01	$	1,947		1.88 %		0.85 %		34.18 %
2008		149	$	7.46	$	1,110		0.44 %		0.85 %		(40.89)%
2007		230	$	12.62	$	2,909		0.50 %		0.85 %		13.69 %
2006		114	$	11.10	$	1,269		1.77 %		0.85 %		11.00 %
INVESCO V.I. MID CAP CORE EQUITY FUND (Effective date 05/01/2009)
2010		16	$	14.12	$	225		0.66 %		0.85 %		13.12 %
2009		11	$	12.48	$	135		1.95 %		0.85 %		24.80 %
INVESCO V.I. SMALL CAP EQUITY FUND (Effective date 05/01/2009)
2010		22	$	15.55	$	344		0.00 %		0.85 %		27.49 %
2009		6	$	12.20	$	73		0.13 %		0.85 %		22.00 %
INVESCO V.I. TECHNOLOGY FUND
2010		674	$	2.90	$	1,959		0.00 %		0.85 %		20.35 %
2009		750	$	2.41	$	1,811		0.00 %		0.85 %		56.49 %
2008		966	$	1.54	$	1,498		0.00 %		0.85 %		(45.20)%
2007		1,575	$	2.81	$	4,429		0.00 %		0.85 %		6.84 %
2006		1,902	$	2.63	$	4,997		0.00 %		0.85 %		9.58 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio			Expense Ratio			Total Return
INVESTMENT DIVISIONS
INVESCO VAN KAMPEN VI COMSTOCK FUND
2010		82	$	11.13	$	911		0.13	%		0.85	%		15.01 %
2009		77	$	9.68	$	743		4.61	%		0.85	%		27.70 %
2008		56	$	7.58	$	427		2.69	%		0.85	%		(36.20)%
2007		75	$	11.88	$	892		1.84	%		0.85	%		(2.86)%
2006		92	$	12.23	$	1,128		1.30	%		0.85	%		15.27 %
INVESCO VAN KAMPEN VI GROWTH & INCOME FUND
2010		159	$	12.00	$	1,909		0.10	%		0.85	%		11.59 %
2009		190	$	10.75	$	2,052		4.02	%		0.85	%		23.28 %
2008		185	$	8.72	$	1,621		2.45	%		0.85	%		(32.61)%
2007		190	$	12.94	$	2,462		1.39	%		0.85	%		1.89 %
2006		171	$	12.70	$	2,165		0.75	%		0.85	%		15.25 %
JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES
2010		143	$	16.56	$	2,426		2.78	%		0.85	%		7.45 %
2009		167	$	15.41	$	2,569		2.91	%		0.85	%		24.78 %
2008		226	$	12.35	$	2,791		2.64	%		0.85	%		(16.55)%
2007		290	$	14.80	$	4,289		2.41	%		0.85	%		9.63 %
2006		330	$	13.50	$	4,460		2.37	%		0.85	%		9.76 %
JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES (Effective date 05/01/2007)
2010		455	$	11.58	$	5,263		2.66	%		0.85	%		7.23 %
2009		436	$	10.80	$	4,713		2.83	%		0.85	%		24.57 %
2008		318	$	8.67	$	2,754		2.78	%		0.85	%		(16.79)%
2007		140	$	10.42	$	1,457		2.34	%		0.85	%		4.20 %
JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES
2010		716	$	18.71	$	13,471		6.13	%		0.85	%		7.08 %
2009		836	$	17.47	$	14,655		4.36	%		0.85	%		12.28 %
2008		997	$	15.56	$	15,582		4.22	%		0.85	%		5.06 %
2007		1,239	$	14.81	$	18,413		4.62	%		0.85	%		6.16 %
2006		1,492	$	13.95	$	20,817		4.69	%		0.85	%		3.33 %
JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES (Effective date 05/01/2007)
2010		581	$	13.07	$	7,586		5.56	%		0.85	%		6.85 %
2009		522	$	12.23	$	6,391		4.33	%		0.85	%		12.00 %
2008		311	$	10.92	$	3,395		3.97	%		0.85	%		4.80 %
2007		245	$	10.42	$	2,551		4.38	%		0.85	%		4.20 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
JANUS ASPEN JANUS PORTFOLIO
2010		437	$	17.88	$	7,851		1.09 %		0.85 %		13.55 %
2009		497	$	15.75	$	7,849		0.54 %		0.85 %		35.19 %
2008		581	$	11.65	$	6,790		0.74 %		0.85 %		(40.23)%
2007		664	$	19.49	$	12,976		0.70 %		0.85 %		14.11 %
2006		813	$	17.08	$	13,884		0.46 %		0.85 %		10.48 %
JANUS ASPEN OVERSEAS PORTFOLIO INSTITUTIONAL SHARES
2010		504	$	32.16	$	16,251		0.69 %		0.85 %		24.25 %
2009		586	$	25.88	$	15,202		0.56 %		0.85 %		77.99 %
2008		699	$	14.54	$	10,186		2.81 %		0.85 %		(52.51)%
2007		941	$	30.62	$	28,860		0.63 %		0.85 %		27.27 %
2006		1,181	$	24.06	$	28,409		1.83 %		0.85 %		45.73 %
JANUS ASPEN OVERSEAS PORTFOLIO SERVICE SHARES (Effective date 05/01/2007)
2010		571	$	12.41	$	7,085		0.51 %		0.85 %		23.95 %
2009		660	$	10.01	$	6,609		0.46 %		0.85 %		77.48 %
2008		343	$	5.64	$	1,935		2.90 %		0.85 %		(52.61)%
2007		491	$	11.90	$	5,841		0.26 %		0.85 %		19.00 %
JANUS ASPEN WORLDWIDE PORTFOLIO
2010		446	$	18.36	$	8,248		0.61 %		0.85 %		14.85 %
2009		522	$	15.99	$	8,403		1.40 %		0.85 %		36.55 %
2008		599	$	11.71	$	7,070		1.19 %		0.85 %		(45.13)%
2007		677	$	21.34	$	14,544		0.74 %		0.85 %		8.71 %
2006		795	$	19.63	$	15,616		1.69 %		0.85 %		17.19 %
LAZARD RETIREMENT EMERGING MARKETS EQUITY SERIES PORTFOLIO (Effective date 05/01/2009)
2010		226	$	17.81	$	4,018		1.49 %		0.85 %		21.65 %
2009		149	$	14.64	$	2,188		4.36 %		0.85 %		46.40 %
LVIP BARON GROWTH OPPORTUNITIES FUND
2010		426	$	20.90	$	8,953		0.00 %		0.85 %		25.29 %
2009		461	$	16.68	$	7,717		0.00 %		0.85 %		37.17 %
2008		555	$	12.16	$	6,785		0.00 %		0.85 %		(39.65)%
2007		679	$	20.15	$	13,749		0.00 %		0.85 %		2.54 %
2006		939	$	19.65	$	18,447		0.00 %		0.85 %		14.51 %
MFS INTERNATIONAL VALUE FUND
2010		93	$	14.14	$	1,313		0.98 %		0.85 %		7.89 %
2009		28	$	13.11	$	365		0.00 %		0.85 %		31.10 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
MFS UTILITIES FUND (Effective date 05/01/2008)
2010		117	$	9.36	$	1,097		2.83 %		0.85 %		12.51 %
2009		297	$	8.32	$	2,468		1.92 %		0.85 %		31.85 %
2008		31	$	6.31	$	195		0.00 %		0.85 %		(36.90)%
NEUBERGER BERMAN AMT REGENCY PORTFOLIO (Effective date 05/01/2006)
2010		8	$	10.12	$	85		0.32 %		0.85 %		24.87 %
2009		9	$	8.10	$	73		0.62 %		0.85 %		44.90 %
2008		34	$	5.59	$	189		0.59 %		0.85 %		(46.40)%
2007		23	$	10.43	$	237		0.33 %		0.85 %		2.15 %
2006		15	$	10.21	$	153		0.08 %		0.85 %		2.10 %
NVIT MID CAP INDEX FUND
2010		132	$	18.83	$	2,514		1.00 %		0.85 %		24.80 %
2009		133	$	15.09	$	2,017		0.73 %		0.85 %		35.34 %
2008		160	$	11.15	$	1,780		1.06 %		0.85 %		(37.15)%
2007		200	$	17.74	$	3,544		1.20 %		0.85 %		6.48 %
2006		274	$	16.66	$	4,569		0.96 %		0.85 %		8.82 %
OPPENHEIMER GLOBAL SECURITIES FUND/VA
2010		478	$	20.14	$	9,701		1.44 %		0.85 %		14.97 %
2009		514	$	17.52	$	9,061		2.30 %		0.85 %		38.61 %
2008		596	$	12.64	$	7,598		1.63 %		0.85 %		(40.69)%
2007		750	$	21.31	$	16,096		1.38 %		0.85 %		5.39 %
2006		862	$	20.22	$	17,423		1.06 %		0.85 %		16.68 %
PIMCO VIT HIGH YIELD PORTFOLIO
2010		483	$	16.14	$	7,814		7.24 %		0.85 %		13.48 %
2009		577	$	14.22	$	8,222		8.67 %		0.85 %		39.00 %
2008		349	$	10.23	$	3,576		7.70 %		0.85 %		(24.11)%
2007		451	$	13.48	$	6,084		6.99 %		0.85 %		2.67 %
2006		640	$	13.13	$	8,410		6.83 %		0.85 %		8.07 %
PIMCO VIT LOW DURATION PORTFOLIO
2010		1,368	$	12.80	$	17,653		1.63 %		0.85 %		4.41 %
2009		1,272	$	12.26	$	15,741		3.54 %		0.85 %		12.37 %
2008		1,186	$	10.91	$	13,061		4.08 %		0.85 %		(1.27)%
2007		1,428	$	11.05	$	15,891		4.77 %		0.85 %		6.45 %
2006		1,574	$	10.38	$	16,335		4.16 %		0.85 %		3.08 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
PIMCO VIT TOTAL RETURN PORTFOLIO
2010		2,103	$	14.07	$	29,633		2.41 %		0.85 %		7.18 %
2009		2,209	$	13.13	$	29,048		5.17 %		0.85 %		13.09 %
2008		1,691	$	11.61	$	19,691		4.46 %		0.85 %		3.94 %
2007		1,373	$	11.17	$	15,341		4.82 %		0.85 %		7.82 %
2006		1,069	$	10.36	$	11,075		4.44 %		0.85 %		2.98 %
PIONEER FUND VCT PORTFOLIO
2010		164	$	14.45	$	2,364		1.37 %		0.85 %		15.06 %
2009		190	$	12.56	$	2,386		1.78 %		0.85 %		24.11 %
2008		234	$	10.12	$	2,370		5.96 %		0.85 %		(34.79)%
2007		280	$	15.52	$	4,351		1.20 %		0.85 %		4.09 %
2006		340	$	14.91	$	5,065		1.36 %		0.85 %		15.67 %
PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO
2010		249	$	15.41	$	3,851		0.00 %		0.85 %		19.20 %
2009		310	$	12.93	$	4,009		0.00 %		0.85 %		43.35 %
2008		299	$	9.02	$	2,701		0.00 %		0.85 %		(36.03)%
2007		352	$	14.10	$	4,972		0.00 %		0.85 %		(4.67)%
2006		482	$	14.79	$	7,146		0.00 %		0.85 %		4.67 %
PIONEER MID CAP VALUE VCT PORTFOLIO (Effective date 05/01/2006)
2010		61	$	10.58	$	643		0.91 %		0.85 %		16.85 %
2009		68	$	9.05	$	614		1.42 %		0.85 %		24.14 %
2008		34	$	7.29	$	251		0.89 %		0.85 %		(34.32)%
2007		24	$	11.10	$	269		0.98 %		0.85 %		4.42 %
2006		2	$	10.63	$	21		0.00 %		0.85 %		6.30 %
PRUDENTIAL SERIES FUND EQUITY PORTFOLIO
2010		40	$	11.61	$	468		0.17 %		0.85 %		10.51 %
2009		32	$	10.51	$	333		0.85 %		0.85 %		36.49 %
2008		40	$	7.70	$	308		0.82 %		0.85 %		(38.94)%
2007		88	$	12.61	$	1,106		0.57 %		0.85 %		7.96 %
2006		93	$	11.68	$	1,084		0.48 %		0.85 %		11.24 %
PUTNAM VT AMERICAN GOVERNMENT INCOME IB PORTFOLIO (Effective date 04/30/2010)
2010		40	$	10.23	$	411		0.00 %		0.85 %		2.30 %
PUTNAM VT EQUITY INCOME IB PORTFOLIO (Effective date 04/30/2010)
2010		8	$	10.61	$	81		0.00 %		0.85 %		6.10 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio		Expense Ratio		Total Return
INVESTMENT DIVISIONS
ROYCE SMALL-CAP PORTFOLIO (Effective date 05/01/2009)
2010		85	$	15.62	$	1,322		0.17 %		0.85 %		19.27 %
2009		24	$	13.10	$	318		0.00 %		0.85 %		31.00 %
SCHWAB MARKETTRACK GROWTH PORTFOLIO II
2010		475	$	20.11	$	9,585		2.46 %		0.85 %		12.67 %
2009		491	$	17.85	$	8,790		2.79 %		0.85 %		22.93 %
2008		562	$	14.52	$	8,156		2.32 %		0.85 %		(31.89)%
2007		674	$	21.32	$	14,375		2.28 %		0.85 %		4.72 %
2006		768	$	20.36	$	15,638		1.33 %		0.85 %		14.06 %
SCHWAB MONEY MARKET PORTFOLIO
2010		3,213	$	13.47	$	43,313		0.01 %		0.85 %		(0.82)%
2009		3,521	$	13.58	$	47,858		0.12 %		0.85 %		(0.73)%
2008		5,003	$	13.68	$	68,637		2.11 %		0.85 %		1.26 %
2007		4,866	$	13.51	$	65,967		4.62 %		0.85 %		3.84 %
2006		4,680	$	13.01	$	60,970		4.51 %		0.85 %		3.67 %
SCHWAB S&P 500 INDEX PORTFOLIO
2010		2,692	$	19.56	$	52,929		2.02 %		0.85 %		13.72 %
2009		2,900	$	17.20	$	50,105		2.57 %		0.85 %		25.09 %
2008		3,334	$	13.75	$	46,082		1.98 %		0.85 %		(37.10)%
2007		3,628	$	21.86	$	79,551		1.44 %		0.85 %		4.49 %
2006		4,215	$	20.92	$	88,285		1.52 %		0.85 %		14.57 %
SELIGMAN COMMUNICATIONS & INFORMATION PORTFOLIO (Effective date 05/01/2008)
2010		118	$	12.07	$	1,427		0.00 %		0.85 %		13.78 %
2009		149	$	10.61	$	1,580		0.00 %		0.85 %		58.12 %
2008		31	$	6.71	$	210		0.00 %		0.85 %		(32.90)%
SENTINEL VARIABLE PRODUCTS BOND FUND (Effective date 05/01/2009)
2010		61	$	11.26	$	688		5.43 %		0.85 %		6.46 %
2009		7	$	10.58	$	77		8.41 %		0.85 %		5.80 %
SENTINEL VARIABLE PRODUCTS COMMON STOCK FUND (Effective date 05/01/2009)
2010		6	$	14.49	$	94		1.46 %		0.85 %		14.80 %
2009		6	$	12.62	$	71		5.07 %		0.85 %		26.20 %
SENTINEL VARIABLE PRODUCTS SMALL COMPANY FUND (Effective date 05/01/2009)
2010		8	$	15.48	$	117		0.14 %		0.85 %		22.74 %
2009		2	$	12.61	$	29		1.14 %		0.85 %		26.10 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31						For the year or period ended December 31
Schwab Select Annuity:	Units (000s)		Unit Fair Value		Net Assets (000s)		Investment Income Ratio			Expense Ratio			Total Return
INVESTMENT DIVISIONS
THIRD AVENUE VALUE PORTFOLIO (Effective date 05/01/2006)
2010		183	$	8.86	$	1,625		3.84	%		0.85	%		13.06	%
2009		222	$	7.84	$	1,741		0.00	%		0.85	%		44.12	%
2008		283	$	5.44	$	1,539		0.85	%		0.85	%		(44.09	)%
2007		363	$	9.73	$	3,531		2.29	%		0.85	%		(5.63	)%
2006		301	$	10.31	$	3,104		1.11	%		0.85	%		3.10	%
TOUCHSTONE MID CAP GROWTH FUND (Effective date 05/01/2009)
2010		25	$	15.83	$	388		0.34	%		0.85	%		20.60	%
2009		4	$	13.13	$	51		0.20	%		0.85	%		31.30	%
UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO
2010		299	$	29.33	$	8,761		2.20	%		0.85	%		28.86	%
2009		308	$	22.76	$	7,002		3.28	%		0.85	%		27.29	%
2008		339	$	17.88	$	6,068		3.44	%		0.85	%		(38.43	)%
2007		401	$	29.04	$	11,659		1.06	%		0.85	%		(17.78	)%
2006		670	$	35.32	$	23,695		1.05	%		0.85	%		36.90	%
VAN ECK VIP GLOBAL BOND FUND (Effective date 05/01/2009)
2010		131	$	11.47	$	1,499		2.20	%		0.85	%		5.34	%
2009		47	$	10.89	$	507		0.00	%		0.85	%		8.90	%
WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND (Effective date 05/01/2006)
2010		126	$	11.75	$	1,509		0.76	%		0.85	%		22.69	%
2009		118	$	9.58	$	1,142		0.00	%		0.85	%		46.48	%
2008		91	$	6.54	$	593		2.13	%		0.85	%		(40.60	)%
2007		53	$	11.01	$	584		0.63	%		0.85	%		5.76	%
2006		45	$	10.41	$	466		0.00	%		0.85	%		4.10	%
WELLS FARGO ADVANTAGE VT SMALL CAP VALUE FUND
2010		198	$	15.30	$	3,057		1.48	%		0.85	%		16.27	%
2009		223	$	13.16	$	2,963		1.22	%		0.85	%		58.75	%
2008		283	$	8.29	$	2,378		0.00	%		0.85	%		(44.99	)%
2007		362	$	15.07	$	5,544		0.02	%		0.85	%		(1.50	)%
2006		487	$	15.30	$	7,450		0.00	%		0.85	%		14.69	%

(Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
ALGER BALANCED PORTFOLIO
2010		88	$	12.93	to	$	12.40	$	1,125		2.53 %		0.65 %	to	0.85 %		9.39 %	to	9.64 %
2009		101	$	11.82	to	$	11.31	$	1,161		3.26 %		0.65 %	to	0.85 %		28.20 %	to	28.38 %
2008		136	$	9.22	to	$	8.81	$	1,214		2.64 %		0.65 %	to	0.85 %		(32.36)%	to	(32.23)%
2007		167	$	13.63	to	$	13.00	$	2,185		2.18 %		0.65 %	to	0.85 %		11.36 %	to	11.68 %
2006		201	$	12.24	to	$	11.64	$	2,346		1.58 %		0.65 %	to	0.85 %		3.90 %	to	4.02 %
ALGER LARGE CAP GROWTH PORTFOLIO
2010		752	$	14.45	to	$	10.21	$	8,254		0.79 %		0.65 %	to	0.85 %		12.45 %	to	12.69 %
2009		773	$	12.85	to	$	9.06	$	7,777		0.63 %		0.65 %	to	0.85 %		46.36 %	to	46.60 %
2008		947	$	8.78	to	$	6.18	$	6,282		0.23 %		0.65 %	to	0.85 %		(46.63)%	to	(46.49)%
2007		1,021	$	16.45	to	$	11.55	$	12,798		0.29 %		0.65 %	to	0.85 %		18.94 %	to	19.20 %
2006		541	$	13.83	to	$	9.69	$	5,619		0.13 %		0.65 %	to	0.85 %		4.22 %	to	4.42 %
ALGER MID CAP GROWTH PORTFOLIO
2010		346	$	15.34	to	$	15.58	$	5,402		0.00 %		0.65 %	to	0.85 %		18.36 %	to	18.66 %
2009		388	$	12.96	to	$	13.13	$	5,085		0.00 %		0.65 %	to	0.85 %		50.35 %	to	50.75 %
2008		386	$	8.62	to	$	8.71	$	3,375		0.17 %		0.65 %	to	0.85 %		(58.70)%	to	(58.64)%
2007		447	$	20.87	to	$	21.06	$	9,415		0.00 %		0.65 %	to	0.85 %		30.44 %	to	30.73 %
2006		289	$	16.00	to	$	16.11	$	4,643		0.00 %		0.65 %	to	0.85 %		9.22 %	to	9.44 %
ALLIANCEBERNSTEIN VPS GROWTH & INCOME PORTFOLIO
2010		538	$	12.35	to	$	10.70	$	6,223		0.00 %		0.65 %	to	0.85 %		12.17 %	to	12.39 %
2009		696	$	11.01	to	$	9.52	$	7,062		4.01 %		0.65 %	to	0.85 %		19.80 %	to	20.05 %
2008		1,061	$	9.19	to	$	7.93	$	9,098		2.12 %		0.65 %	to	0.85 %		(41.09)%	to	(41.00)%
2007		1,111	$	15.60	to	$	13.44	$	15,825		1.43 %		0.65 %	to	0.85 %		4.21 %	to	4.43 %
2006		1,062	$	14.97	to	$	12.87	$	14,450		1.49 %		0.65 %	to	0.85 %		16.32 %	to	16.58 %
ALLIANCEBERNSTEIN VPS GROWTH PORTFOLIO
2010		167	$	13.67	to	$	9.96	$	1,790		0.30 %		0.65 %	to	0.85 %		14.11 %	to	14.35 %
2009		224	$	11.98	to	$	8.71	$	2,107		0.00 %		0.65 %	to	0.85 %		32.08 %	to	32.37 %
2008		290	$	9.07	to	$	6.58	$	2,082		0.00 %		0.65 %	to	0.85 %		(42.96)%	to	(42.83)%
2007		367	$	15.90	to	$	11.51	$	4,572		0.00 %		0.65 %	to	0.85 %		12.05 %	to	12.29 %
2006		314	$	14.19	to	$	10.25	$	3,442		0.00 %		0.65 %	to	0.85 %		(1.94)%	to	(1.73)%
ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO
2010		1,275	$	14.13	to	$	14.29	$	18,187		2.08 %		0.65 %	to	0.85 %		11.97 %	to	12.17 %
2009		1,461	$	12.62	to	$	12.74	$	18,579		4.61 %		0.65 %	to	0.85 %		38.38 %	to	38.63 %
2008		1,730	$	9.12	to	$	9.19	$	15,891		0.00 %		0.65 %	to	0.85 %		(49.31)%	to	(49.17)%
2007		1,800	$	17.99	to	$	18.08	$	32,534		1.84 %		0.65 %	to	0.85 %		17.12 %	to	17.33 %
2006		1,354	$	15.36	to	$	15.41	$	20,840		0.96 %		0.65 %	to	0.85 %		26.00 %	to	26.21 %
ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO (Effective date 05/01/2006)
2010		905	$	7.61	to	$	7.68	$	6,961		2.89 %		0.65 %	to	0.85 %		3.68 %	to	3.92 %
2009		1,316	$	7.34	to	$	7.39	$	9,729		1.36 %		0.65 %	to	0.85 %		33.70 %	to	33.88 %
2008		1,602	$	5.49	to	$	5.52	$	8,835		1.16 %		0.65 %	to	0.85 %		(53.63)%	to	(53.50)%
2007		1,644	$	11.84	to	$	11.87	$	19,502		1.14 %		0.65 %	to	0.85 %		4.96 %	to	5.14 %
2006		930	$	11.28	to	$	11.29	$	10,496		0.27 %		0.65 %	to	0.85 %		12.80 %	to	12.90 %

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
ALLIANCEBERNSTEIN VPS REAL ESTATE INVESTMENT PORTFOLIO
2010		530	$	21.13	to	$	27.44	$	14,012		1.34 %		0.65 %	to	0.85 %		25.33 %	to	25.53 %
2009		511	$	16.86	to	$	21.86	$	10,824		2.86 %		0.65 %	to	0.85 %		28.31 %	to	28.66 %
2008		514	$	13.14	to	$	16.99	$	8,520		1.76 %		0.65 %	to	0.85 %		(36.21)%	to	(36.13)%
2007		557	$	20.60	to	$	26.60	$	14,252		1.34 %		0.65 %	to	0.85 %		(15.26)%	to	(15.07)%
2006		732	$	24.31	to	$	31.32	$	22,045		1.94 %		0.65 %	to	0.85 %		34.09 %	to	34.36 %
ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO (Effective date 05/01/2006)
2010		315	$	12.02	to	$	12.13	$	3,819		0.53 %		0.65 %	to	0.85 %		25.86 %	to	26.09 %
2009		303	$	9.55	to	$	9.62	$	2,915		1.10 %		0.65 %	to	0.85 %		41.69 %	to	41.89 %
2008		250	$	6.74	to	$	6.78	$	1,689		0.63 %		0.65 %	to	0.85 %		(36.17)%	to	(35.98)%
2007		239	$	10.56	to	$	10.59	$	2,528		1.09 %		0.65 %	to	0.85 %		0.86 %	to	1.05 %
2006		161	$	10.47	to	$	10.48	$	1,685		0.06 %		0.65 %	to	0.85 %		4.70 %	to	4.80 %
AMERICAN CENTURY VP BALANCED FUND
2010		318	$	13.77	to	$	13.97	$	4,430		1.90 %		0.65 %	to	0.85 %		10.69 %	to	10.87 %
2009		326	$	12.44	to	$	12.60	$	4,094		5.24 %		0.65 %	to	0.85 %		14.55 %	to	14.75 %
2008		372	$	10.86	to	$	10.98	$	4,074		2.56 %		0.65 %	to	0.85 %		(21.02)%	to	(20.84)%
2007		397	$	13.75	to	$	13.87	$	5,497		1.71 %		0.65 %	to	0.85 %		4.09 %	to	4.21 %
2006		244	$	13.21	to	$	13.31	$	3,236		2.02 %		0.65 %	to	0.85 %		8.63 %	to	8.92 %
AMERICAN CENTURY VP INCOME & GROWTH FUND
2010		336	$	13.07	to	$	11.23	$	3,913		1.50 %		0.65 %	to	0.85 %		13.16 %	to	13.43 %
2009		426	$	11.55	to	$	9.90	$	4,421		4.73 %		0.65 %	to	0.85 %		17.14 %	to	17.30 %
2008		449	$	9.86	to	$	8.44	$	3,962		2.01 %		0.65 %	to	0.85 %		(35.17)%	to	(35.03)%
2007		516	$	15.21	to	$	12.99	$	7,019		1.83 %		0.65 %	to	0.85 %		(0.91)%	to	(0.69)%
2006		589	$	15.35	to	$	13.08	$	8,103		1.92 %		0.65 %	to	0.85 %		16.11 %	to	16.27 %
AMERICAN CENTURY VP INTERNATIONAL FUND
2010		234	$	17.55	to	$	12.43	$	3,076		2.49 %		0.65 %	to	0.85 %		12.36 %	to	12.59 %
2009		301	$	15.62	to	$	11.04	$	3,523		2.10 %		0.65 %	to	0.85 %		32.60 %	to	32.85 %
2008		361	$	11.78	to	$	8.31	$	3,198		0.85 %		0.65 %	to	0.85 %		(45.29)%	to	(45.18)%
2007		463	$	21.53	to	$	15.16	$	7,478		0.70 %		0.65 %	to	0.85 %		17.07 %	to	17.34 %
2006		575	$	18.39	to	$	12.92	$	7,896		1.74 %		0.65 %	to	0.85 %		23.92 %	to	24.23 %
AMERICAN CENTURY VP MID CAP VALUE FUND (Effective date 05/01/2009)
2010		94	$	15.45	to	$	15.50	$	1,452		2.35 %		0.65 %	to	0.85 %		18.03 %	to	18.23 %
2009		42	$	13.09	to	$	13.11	$	548		1.26 %		0.65 %	to	0.85 %		30.90 %	to	31.10 %
AMERICAN CENTURY VP VALUE FUND
2010		918	$	14.59	to	$	14.81	$	13,598		2.30 %		0.65 %	to	0.85 %		12.49 %	to	12.71 %
2009		768	$	12.97	to	$	13.14	$	10,116		5.80 %		0.65 %	to	0.85 %		18.88 %	to	19.13 %
2008		835	$	10.91	to	$	11.03	$	9,249		2.43 %		0.65 %	to	0.85 %		(27.41)%	to	(27.29)%
2007		922	$	15.03	to	$	15.17	$	14,043		1.50 %		0.65 %	to	0.85 %		(5.94)%	to	(5.72)%
2006		820	$	15.98	to	$	16.09	$	13,163		1.23 %		0.65 %	to	0.85 %		17.67 %	to	17.88 %
COLUMBIA VIT MARSICO 21ST CENTURY FUND (Effective date 05/01/2009)
2010		104	$	15.45	to	$	15.50	$	1,617		0.00 %		0.65 %	to	0.85 %		16.17 %	to	16.37 %
2009		26	$	13.30	to	$	13.32	$	344		0.00 %		0.65 %	to	0.85 %		33.00 %	to	33.20 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to  highest
INVESTMENT DIVISIONS
COLUMBIA VIT SMALL CAP VALUE FUND (Effective date 05/01/2009)
2010		51	$	15.84	to	$	15.89	$	807		1.00 %		0.65 %	to	0.85 %		25.42 %	to	25.61 %
2009		31	$	12.63	to	$	12.65	$	393		0.47 %		0.65 %	to	0.85 %		26.30 %	to	26.50 %
DELAWARE VIP SMALL CAP VALUE SERIES
2010		697	$	20.12	to	$	23.84	$	16,073		0.66 %		0.65 %	to	0.85 %		31.16 %	to	31.42 %
2009		750	$	15.34	to	$	18.14	$	13,108		0.97 %		0.65 %	to	0.85 %		30.78 %	to	30.97 %
2008		834	$	11.73	to	$	13.85	$	11,112		0.77 %		0.65 %	to	0.85 %		(30.51)%	to	(30.33)%
2007		969	$	16.88	to	$	19.88	$	18,578		0.51 %		0.65 %	to	0.85 %		(7.41)%	to	(7.23)%
2006		1,133	$	18.23	to	$	21.43	$	23,449		0.24 %		0.65 %	to	0.85 %		15.23 %	to	15.40 %
DELAWARE VIP SMID CAP GROWTH SERIES
2010		157	$	16.29	to	$	16.47	$	2,570		0.00 %		0.65 %	to	0.85 %		35.19 %	to	35.44 %
2009		86	$	12.05	to	$	12.16	$	1,048		0.00 %		0.65 %	to	0.85 %		44.14 %	to	44.42 %
2008		40	$	8.36	to	$	8.42	$	338		0.00 %		0.65 %	to	0.85 %		(41.04)%	to	(40.91)%
2007		42	$	14.18	to	$	14.25	$	603		0.00 %		0.65 %	to	0.85 %		12.01 %	to	12.20 %
2006		31	$	12.66	to	$	12.70	$	389		0.00 %		0.65 %	to	0.85 %		5.50 %	to	5.66 %
DREYFUS IP MIDCAP STOCK PORTFOLIO
2010		73	$	15.37	to	$	15.61	$	1,135		1.11 %		0.65 %	to	0.85 %		25.98 %	to	26.29 %
2009		102	$	12.20	to	$	12.36	$	1,254		1.67 %		0.65 %	to	0.85 %		34.36 %	to	34.64 %
2008		133	$	9.08	to	$	9.18	$	1,214		0.91 %		0.65 %	to	0.85 %		(40.92)%	to	(40.81)%
2007		135	$	15.37	to	$	15.51	$	2,096		0.41 %		0.65 %	to	0.85 %		0.65 %	to	0.85 %
2006		134	$	15.27	to	$	15.38	$	2,049		0.37 %		0.65 %	to	0.85 %		6.86 %	to	7.03 %
DREYFUS VIF APPRECIATION PORTFOLIO
2010		395	$	12.63	to	$	12.80	$	5,031		1.75 %		0.65 %	to	0.85 %		14.40 %	to	14.59 %
2009		197	$	11.04	to	$	11.17	$	2,192		2.37 %		0.65 %	to	0.85 %		21.45 %	to	21.81 %
2008		180	$	9.09	to	$	9.17	$	1,650		1.84 %		0.65 %	to	0.85 %		(30.13)%	to	(30.05)%
2007		124	$	13.01	to	$	13.11	$	1,621		1.36 %		0.65 %	to	0.85 %		6.20 %	to	6.50 %
2006		88	$	12.25	to	$	12.31	$	1,081		0.53 %		0.65 %	to	0.85 %		15.46 %	to	15.70 %
DREYFUS VIF GROWTH & INCOME PORTFOLIO
2010		98	$	13.25	to	$	10.44	$	1,088		1.27 %		0.65 %	to	0.85 %		17.57 %	to	17.83 %
2009		93	$	11.27	to	$	8.86	$	847		1.32 %		0.65 %	to	0.85 %		27.78 %	to	27.85 %
2008		105	$	8.82	to	$	6.93	$	750		0.65 %		0.65 %	to	0.85 %		(40.96)%	to	(40.77)%
2007		121	$	14.94	to	$	11.70	$	1,455		0.74 %		0.65 %	to	0.85 %		7.56 %	to	7.73 %
2006		155	$	13.89	to	$	10.86	$	1,740		0.77 %		0.65 %	to	0.85 %		13.57 %	to	13.84 %
DREYFUS VIF OPPORTUNISTIC SMALL CAP PORTFOLIO
2010		57	$	12.50	to	$	11.03	$	635		0.73 %		0.65 %	to	0.85 %		30.07 %	to	30.22 %
2009		73	$	9.61	to	$	8.47	$	622		1.73 %		0.65 %	to	0.85 %		24.97 %	to	25.30 %
2008		85	$	7.69	to	$	6.76	$	579		0.96 %		0.65 %	to	0.85 %		(38.13)%	to	(37.98)%
2007		100	$	12.43	to	$	10.90	$	1,096		0.77 %		0.65 %	to	0.85 %		(11.78)%	to	(11.67)%
2006		127	$	14.09	to	$	12.34	$	1,574		0.43 %		0.65 %	to	0.85 %		2.85 %	to	3.09 %
DWS BLUE CHIP VIP PORTFOLIO
2010		375	$	12.05	to	$	12.18	$	4,576		1.48 %		0.65 %	to	0.85 %		12.83 %	to	12.99 %
2009		345	$	10.68	to	$	10.78	$	3,728		1.90 %		0.65 %	to	0.85 %		32.84 %	to	33.09 %
2008		420	$	8.04	to	$	8.10	$	3,406		1.92 %		0.65 %	to	0.85 %		(39.00)%	to	(38.87)%
2007		549	$	13.18	to	$	13.25	$	7,281		0.94 %		0.65 %	to	0.85 %		2.65 %	to	2.79 %
2006		280	$	12.84	to	$	12.89	$	3,604		0.28 %		0.65 %	to	0.85 %		14.64 %	to	14.88 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
DWS CAPITAL GROWTH VIP PORTFOLIO
2010		558	$	14.95	to	$	10.58	$	6,541		0.91 %		0.65 %	to	0.85 %		15.71 %	to	16.01 %
2009		511	$	12.92	to	$	9.12	$	5,051		1.24 %		0.65 %	to	0.85 %		25.80 %	to	25.97 %
2008		432	$	10.27	to	$	7.24	$	3,449		0.93 %		0.65 %	to	0.85 %		(33.53)%	to	(33.39)%
2007		267	$	15.45	to	$	10.87	$	3,182		0.58 %		0.65 %	to	0.85 %		11.63 %	to	11.83 %
2006		215	$	13.84	to	$	9.72	$	2,261		0.54 %		0.65 %	to	0.85 %		7.62 %	to	7.88 %
DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO
(Effective date 05/01/2006)
2010		513	$	11.22	to	$	11.32	$	5,787		1.25 %		0.65 %	to	0.85 %		22.09 %	to	22.25 %
2009		472	$	9.19	to	$	9.26	$	4,360		1.72 %		0.65 %	to	0.85 %		28.53 %	to	28.79 %
2008		411	$	7.15	to	$	7.19	$	2,951		1.56 %		0.65 %	to	0.85 %		(33.98)%	to	(33.79)%
2007		294	$	10.83	to	$	10.86	$	3,190		0.80 %		0.65 %	to	0.85 %		2.27 %	to	2.36 %
2006		181	$	10.59	to	$	10.61	$	1,925		0.00 %		0.65 %	to	0.85 %		5.90 %	to	6.10 %
DWS HEALTH CARE VIP PORTFOLIO
(Effective date 05/01/2006)
2010		207	$	11.88	to	$	11.99	$	2,499		0.00 %		0.65 %	to	0.85 %		7.22 %	to	7.44 %
2009		217	$	11.08	to	$	11.16	$	2,440		1.34 %		0.65 %	to	0.85 %		21.23 %	to	21.44 %
2008		278	$	9.14	to	$	9.19	$	2,548		0.28 %		0.65 %	to	0.85 %		(23.90)%	to	(23.73)%
2007		228	$	12.01	to	$	12.05	$	2,747		0.00 %		0.65 %	to	0.85 %		12.24 %	to	12.51 %
2006		94	$	10.70	to	$	10.71	$	1,009		0.00 %		0.65 %	to	0.85 %		7.00 %	to	7.10 %
DWS LARGE CAP VALUE VIP PORTFOLIO
2010		724	$	11.57	to	$	11.70	$	8,438		1.94 %		0.65 %	to	0.85 %		9.88 %	to	10.07 %
2009		535	$	10.53	to	$	10.63	$	5,666		2.08 %		0.65 %	to	0.85 %		24.32 %	to	24.47 %
2008		505	$	8.47	to	$	8.54	$	4,295		1.37 %		0.65 %	to	0.85 %		(36.98)%	to	(36.79)%
2007		253	$	13.44	to	$	13.51	$	3,407		1.50 %		0.65 %	to	0.85 %		12.19 %	to	12.40 %
2006		121	$	11.98	to	$	12.02	$	1,457		1.62 %		0.65 %	to	0.85 %		14.42 %	to	14.69 %
DWS SMALL CAP GROWTH VIP PORTFOLIO
2010		65	$	13.12	to	$	8.74	$	638		0.00 %		0.65 %	to	0.85 %		28.38 %	to	28.72 %
2009		81	$	10.22	to	$	6.79	$	652		0.00 %		0.65 %	to	0.85 %		39.43 %	to	39.71 %
2008		95	$	7.33	to	$	4.86	$	533		0.00 %		0.65 %	to	0.85 %		(49.97)%	to	(49.85)%
2007		112	$	14.65	to	$	9.69	$	1,248		0.00 %		0.65 %	to	0.85 %		5.32 %	to	5.44 %
2006		145	$	13.91	to	$	9.19	$	1,493		0.00 %		0.65 %	to	0.85 %		4.43 %	to	4.67 %
DWS SMALL CAP INDEX VIP PORTFOLIO
2010		434	$	17.41	to	$	16.54	$	7,259		0.93 %		0.65 %	to	0.85 %		25.25 %	to	25.59 %
2009		453	$	13.90	to	$	13.17	$	6,030		1.77 %		0.65 %	to	0.85 %		25.56 %	to	25.79 %
2008		535	$	11.07	to	$	10.47	$	5,679		1.60 %		0.65 %	to	0.85 %		(34.69)%	to	(34.56)%
2007		492	$	16.95	to	$	16.00	$	7,965		0.84 %		0.65 %	to	0.85 %		(2.75)%	to	(2.56)%
2006		441	$	17.43	to	$	16.42	$	7,299		0.66 %		0.65 %	to	0.85 %		16.51 %	to	16.79 %
DWS STRATEGIC VALUE VIP PORTFOLIO
2010		174	$	9.18	to	$	9.28	$	1,609		2.00 %		0.65 %	to	0.85 %		11.68 %	to	11.81 %
2009		221	$	8.22	to	$	8.30	$	1,833		5.31 %		0.65 %	to	0.85 %		24.17 %	to	24.44 %
2008		538	$	6.62	to	$	6.67	$	3,585		3.16 %		0.65 %	to	0.85 %		(46.44)%	to	(46.34)%
2007		617	$	12.36	to	$	12.43	$	7,661		1.33 %		0.65 %	to	0.85 %		(2.68)%	to	(2.43)%
2006		706	$	12.70	to	$	12.74	$	8,987		1.02 %		0.65 %	to	0.85 %		17.70 %	to	17.96 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II
2010		1,902	$	12.63	to	$	14.02	$	26,227		4.57 %		0.65 %	to	0.85 %		4.29 %	to	4.47 %
2009		2,194	$	12.11	to	$	13.42	$	28,953		4.98 %		0.65 %	to	0.85 %		4.31 %	to	4.52 %
2008		2,400	$	11.61	to	$	12.84	$	30,142		4.38 %		0.65 %	to	0.85 %		3.38 %	to	3.63 %
2007		1,677	$	11.23	to	$	12.39	$	20,544		4.23 %		0.65 %	to	0.85 %		5.45 %	to	5.63 %
2006		1,603	$	10.65	to	$	11.73	$	18,539		4.32 %		0.65 %	to	0.85 %		3.20 %	to	3.44 %
FRANKLIN SMALL CAP VALUE SECURITIES FUND (Effective date 05/01/2006)
2010		239	$	10.66	to	$	10.76	$	2,561		0.78 %		0.65 %	to	0.85 %		27.06 %	to	27.34 %
2009		181	$	8.39	to	$	8.45	$	1,530		1.77 %		0.65 %	to	0.85 %		28.09 %	to	28.42 %
2008		91	$	6.55	to	$	6.58	$	598		1.13 %		0.65 %	to	0.85 %		(33.57)%	to	(33.47)%
2007		62	$	9.86	to	$	9.89	$	612		0.64 %		0.65 %	to	0.85 %		(3.24)%	to	(3.04)%
2006		28	$	10.19	to	$	10.20	$	285		0.23 %		0.65 %	to	0.85 %		1.90 %	to	2.00 %
FRANKLIN TEMPLETON FOREIGN SECURITIES PORTFOLIO (Effective date 04/30/2010)
2010		108	$	10.80	to	$	10.82	$	1,180		0.10 %		0.65 %	to	0.85 %		8.00 %	to	8.20 %
INVESCO V.I. HIGH YIELD FUND
2010		26	$	17.05	to	$	16.03	$	447		7.12 %		0.65 %	to	0.85 %		12.62 %	to	12.89 %
2009		57	$	15.14	to	$	14.20	$	855		8.25 %		0.65 %	to	0.85 %		51.40 %	to	51.71 %
2008		73	$	10.00	to	$	9.36	$	712		9.68 %		0.65 %	to	0.85 %		(26.31)%	to	(26.12)%
2007		81	$	13.57	to	$	12.67	$	1,073		6.54 %		0.65 %	to	0.85 %		0.44 %	to	0.56 %
2006		103	$	13.51	to	$	12.60	$	1,325		7.45 %		0.65 %	to	0.85 %		9.75 %	to	10.04 %
INVESCO V.I. INTERNATIONAL GROWTH FUND (Effective date 05/01/2006)
2010		761	$	11.20	to	$	11.30	$	8,580		2.38 %		0.65 %	to	0.85 %		11.89 %	to	12.10 %
2009		574	$	10.01	to	$	10.08	$	5,779		2.13 %		0.65 %	to	0.85 %		34.18 %	to	34.40 %
2008		398	$	7.46	to	$	7.50	$	2,986		0.46 %		0.65 %	to	0.85 %		(40.89)%	to	(40.81)%
2007		573	$	12.62	to	$	12.67	$	7,250		0.76 %		0.65 %	to	0.85 %		13.69 %	to	14.04 %
2006		164	$	11.10	to	$	11.11	$	1,824		2.23 %		0.65 %	to	0.85 %		11.00 %	to	11.10 %
INVESCO V.I. MID CAP CORE EQUITY FUND (Effective date 05/01/2009)
2010		96	$	14.12	to	$	14.17	$	1,357		0.74 %		0.65 %	to	0.85 %		13.14 %	to	13.36 %
2009		19	$	12.48	to	$	12.50	$	238		2.02 %		0.65 %	to	0.85 %		24.80 %	to	25.00 %
INVESCO V.I. SMALL CAP EQUITY FUND (Effective date 05/01/2009)
2010		31	$	15.55	to	$	15.60	$	491		0.00 %		0.65 %	to	0.85 %		27.46 %	to	27.76 %
2009		17	$	12.20	to	$	12.21	$	204		0.26 %		0.65 %	to	0.85 %		22.00 %	to	22.10 %
INVESCO V.I. TECHNOLOGY FUND
2010		49	$	15.38	to	$	7.06	$	376		0.00 %		0.65 %	to	0.85 %		20.34 %	to	20.48 %
2009		57	$	12.78	to	$	5.86	$	365		0.00 %		0.65 %	to	0.85 %		56.04 %	to	56.27 %
2008		76	$	8.19	to	$	3.75	$	315		0.00 %		0.65 %	to	0.85 %		(45.00)%	to	(44.85)%
2007		90	$	14.89	to	$	6.80	$	679		0.00 %		0.65 %	to	0.85 %		6.81 %	to	7.09 %
2006		116	$	13.94	to	$	6.35	$	809		0.00 %		0.65 %	to	0.85 %		9.59 %	to	9.67 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
INVESCO VAN KAMPEN VI COMSTOCK FUND
2010		168	$	11.13	to	$	11.26	$	1,887		0.12 %		0.65 %	to	0.85 %		14.98  %	to	15.25 %
2009		162	$	9.68	to	$	9.77	$	1,577		4.79 %		0.65 %	to	0.85 %		27.70  %	to	28.05 %
2008		165	$	7.58	to	$	7.63	$	1,258		2.39 %		0.65 %	to	0.85 %		(36.20)%	to	(36.15)%
2007		160	$	11.88	to	$	11.95	$	1,903		1.96 %		0.65 %	to	0.85 %		(2.86)%	to	(2.61)%
2006		148	$	12.23	to	$	12.27	$	1,814		0.95 %		0.65 %	to	0.85 %		15.27  %	to	15.54 %
INVESCO VAN KAMPEN VI GROWTH & INCOME FUND
2010		672	$	11.99	to	$	12.13	$	8,130		0.10 %		0.65 %	to	0.85 %		11.53  %	to	11.80  %
2009		790	$	10.75	to	$	10.85	$	8,544		4.11 %		0.65 %	to	0.85 %		23.28  %	to	23.58  %
2008		699	$	8.72	to	$	8.78	$	6,126		2.08 %		0.65 %	to	0.85 %		(32.61)%	to	(32.51)%
2007		521	$	12.94	to	$	13.01	$	6,765		1.32 %		0.65 %	to	0.85 %		1.97  %	to	2.12  %
2006		385	$	12.69	to	$	12.74	$	4,894		0.51 %		0.65 %	to	0.85 %		15.26  %	to	15.50  %
JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES
2010		427	$	16.30	to	$	16.55	$	7,042		2.81 %		0.65 %	to	0.85 %		7.45  %	to	7.68  %
2009		472	$	15.17	to	$	15.37	$	7,224		2.99 %		0.65 %	to	0.85 %		24.86  %	to	25.06  %
2008		536	$	12.15	to	$	12.29	$	6,568		2.57 %		0.65 %	to	0.85 %		(16.55)%	to	(16.39)%
2007		730	$	14.56	to	$	14.70	$	10,701		2.57 %		0.65 %	to	0.85 %		9.56  %	to	9.87  %
2006		683	$	13.29	to	$	13.38	$	9,120		2.55 %		0.65 %	to	0.85 %		9.74  %	to	9.94  %
JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES (Effective date 05/01/2007)
2010		2,309	$	11.58	to	$	11.66	$	26,875		2.68 %		0.65 %	to	0.85 %		7.22  %	to	7.37  %
2009		1,762	$	10.80	to	$	10.86	$	19,106		2.89 %		0.65 %	to	0.85 %		24.57  %	to	24.83  %
2008		1,357	$	8.67	to	$	8.70	$	11,798		2.81 %		0.65 %	to	0.85 %		(16.79)%	to	(16.59)%
2007		628	$	10.42	to	$	10.43	$	6,549		2.62 %		0.65 %	to	0.85 %		4.20  %	to	4.30  %
JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES
2010		670	$	14.25	to	$	17.69	$	11,914		5.96 %		0.65 %	to	0.85 %		7.06  %	to	7.28  %
2009		832	$	13.31	to	$	16.49	$	13,496		4.35 %		0.65 %	to	0.85 %		12.32  %	to	12.48  %
2008		1,007	$	11.85	to	$	14.66	$	14,482		4.20 %		0.65 %	to	0.85 %		5.15  %	to	5.32  %
2007		1,372	$	11.27	to	$	13.92	$	18,229		4.72 %		0.65 %	to	0.85 %		6.12  %	to	6.34  %
2006		1,519	$	10.62	to	$	13.09	$	19,011		4.91 %		0.65 %	to	0.85 %		3.31  %	to	3.56  %
JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES (Effective date 05/01/2007)
2010		1,980	$	13.07	to	$	13.16	$	26,158		5.79 %		0.65 %	to	0.85 %		6.87  %	to	6.99  %
2009		1,800	$	12.23	to	$	12.30	$	22,205		4.33 %		0.65 %	to	0.85 %		12.00  %	to	12.23  %
2008		1,071	$	10.92	to	$	10.96	$	11,781		4.37 %		0.65 %	to	0.85 %		4.80  %	to	5.08  %
2007		589	$	10.42	to	$	10.43	$	6,193		4.64 %		0.65 %	to	0.85 %		4.20  %	to	4.30  %
JANUS ASPEN WORLDWIDE PORTFOLIO
2010		55	$	13.67	to	$	9.36	$	548		0.53 %		0.65 %	to	0.85 %		14.87  %	to	15.13  %
2009		86	$	11.90	to	$	8.13	$	791		1.42 %		0.65 %	to	0.85 %		36.47  %	to	36.87  %
2008		91	$	8.72	to	$	5.94	$	613		1.19 %		0.65 %	to	0.85 %		(45.12)%	to	(45.05)%
2007		103	$	15.89	to	$	10.81	$	1,249		0.72 %		0.65 %	to	0.85 %		8.76  %	to	8.86  %
2006		152	$	14.61	to	$	9.93	$	1,650		1.72 %		0.65 %	to	0.85 %		17.16  %	to	17.51  %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
JPMORGAN INSURANCE TRUST SMALL CAP CORE PORTFOLIO
2010		64	$	17.45	to	$	14.88	$	977		0.00 %		0.65 %	to	0.85 %		26.08 %	to	26.32 %
2009		70	$	13.84	to	$	11.78	$	847		0.79 %		0.65 %	to	0.85 %		21.51 %	to	21.82 %
2008		83	$	11.39	to	$	9.67	$	822		0.19 %		0.65 %	to	0.85 %		(32.56)%	to	(32.47)%
2007		124	$	16.89	to	$	14.32	$	1,823		0.01 %		0.65 %	to	0.85 %		(6.43)%	to	(6.28)%
2006		171	$	18.05	to	$	15.28	$	2,655		0.00 %		0.65 %	to	0.85 %		14.02 %	to	14.29 %
LAZARD RETIREMENT EMERGING MARKETS EQUITY SERIES PORTFOLIO (Effective date 05/01/2009)
2010		582	$	17.81	to	$	17.87	$	10,381		1.80 %		0.65 %	to	0.85 %		21.65 %	to	21.90 %
2009		192	$	14.64	to	$	14.66	$	2,814		5.33 %		0.65 %	to	0.85 %		46.40 %	to	46.60 %
LVIP BARON GROWTH OPPORTUNITIES FUND
2010		511	$	18.17	to	$	18.44	$	9,413		0.00 %		0.65 %	to	0.85 %		25.31 %	to	25.53 %
2009		561	$	14.50	to	$	14.69	$	8,219		0.00 %		0.65 %	to	0.85 %		37.18 %	to	37.42 %
2008		575	$	10.57	to	$	10.69	$	6,136		0.00 %		0.65 %	to	0.85 %		(39.63)%	to	(39.50)%
2007		642	$	17.51	to	$	17.67	$	11,306		0.00 %		0.65 %	to	0.85 %		2.52 %	to	2.73 %
2006		558	$	17.08	to	$	17.20	$	9,573		0.00 %		0.65 %	to	0.85 %		14.55 %	to	14.74 %
MFS INTERNATIONAL VALUE FUND (Effective date 05/01/2009)
2010		444	$	14.14	to	$	14.18	$	6,298		0.86 %		0.65 %	to	0.85 %		7.86 %	to	8.08 %
2009		96	$	13.11	to	$	13.12	$	1,256		0.00 %		0.65 %	to	0.85 %		31.10 %	to	31.20 %
MFS UTILITIES FUND (Effective date 05/01/2008)
2010		189	$	9.36	to	$	9.41	$	1,778		2.66 %		0.65 %	to	0.85 %		12.50 %	to	12.69 %
2009		154	$	8.32	to	$	8.35	$	1,284		3.64 %		0.65 %	to	0.85 %		(16.80)%	to	(16.50)%
2008		54	$	6.31	to	$	6.32	$	341		0.00 %		0.65 %	to	0.85 %		(36.90)%	to	(36.80)%
NEUBERGER BERMAN AMT REGENCY PORTFOLIO (Effective date 05/01/2006)
2010		22	$	10.12	to	$	10.22	$	227		0.31 %		0.65 %	to	0.85 %		24.94 %	to	25.25 %
2009		31	$	8.10	to	$	8.16	$	256		0.66 %		0.65 %	to	0.85 %		44.90 %	to	45.20 %
2008		76	$	5.59	to	$	5.62	$	425		1.15 %		0.65 %	to	0.85 %		(46.40)%	to	(46.32)%
2007		64	$	10.43	to	$	10.47	$	667		0.40 %		0.65 %	to	0.85 %		2.15 %	to	2.45 %
2006		42	$	10.21	to	$	10.22	$	429		0.43 %		0.65 %	to	0.85 %		2.10 %	to	2.20 %
NVIT MID CAP INDEX FUND
2010		386	$	18.58	to	$	18.86	$	7,275		0.99 %		0.65 %	to	0.85 %		24.78 %	to	25.07 %
2009		430	$	14.89	to	$	15.08	$	6,466		0.73 %		0.65 %	to	0.85 %		35.36 %	to	35.61 %
2008		503	$	11.00	to	$	11.12	$	5,583		1.10 %		0.65 %	to	0.85 %		(37.14)%	to	(37.03)%
2007		512	$	17.50	to	$	17.66	$	9,034		1.21 %		0.65 %	to	0.85 %		6.45 %	to	6.71 %
2006		467	$	16.44	to	$	16.55	$	7,713		0.98 %		0.65 %	to	0.85 %		8.80 %	to	9.03 %
OPPENHEIMER GLOBAL SECURITIES FUND/VA
2010		1,029	$	19.59	to	$	16.45	$	17,611		1.48 %		0.65 %	to	0.85 %		14.96 %	to	15.20 %
2009		1,162	$	17.04	to	$	14.28	$	17,317		2.21 %		0.65 %	to	0.85 %		38.65 %	to	38.91 %
2008		1,297	$	12.29	to	$	10.28	$	13,981		1.60 %		0.65 %	to	0.85 %		(40.71)%	to	(40.58)%
2007		1,589	$	20.73	to	$	17.30	$	28,844		1.26 %		0.65 %	to	0.85 %		5.44 %	to	5.62 %
2006		1,499	$	19.66	to	$	16.38	$	25,484		0.99 %		0.65 %	to	0.85 %		16.68 %	to	16.92 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to  highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
OPPENHEIMER INTERNATIONAL GROWTH FUND/VA
2010		573	$	15.25	to	$	15.43	$	8,822		1.29 %		0.65 %	to	0.85 %		13.81 %	to	14.04 %
2009		669	$	13.40	to	$	13.53	$	9,053		1.38 %		0.65 %	to	0.85 %		38.00 %	to	38.34 %
2008		618	$	9.71	to	$	9.78	$	6,033		1.14 %		0.65 %	to	0.85 %		(43.12)%	to	(43.01)%
2007		820	$	17.07	to	$	17.16	$	14,056		0.80 %		0.65 %	to	0.85 %		11.64 %	to	11.86 %
2006		542	$	15.29	to	$	15.34	$	8,313		0.40 %		0.65 %	to	0.85 %		29.69 %	to	30.00 %
PIMCO VIT HIGH YIELD PORTFOLIO
2010		1,260	$	15.81	to	$	20.03	$	23,461		7.25 %		0.65 %	to	0.85 %		13.50 %	to	13.74 %
2009		1,273	$	13.93	to	$	17.61	$	21,027		8.70 %		0.65 %	to	0.85 %		39.02 %	to	39.32 %
2008		1,171	$	10.02	to	$	12.64	$	13,817		7.84 %		0.65 %	to	0.85 %		(24.09)%	to	(23.99)%
2007		1,301	$	13.20	to	$	16.63	$	20,373		7.00 %		0.65 %	to	0.85 %		2.64 %	to	2.91 %
2006		1,062	$	12.86	to	$	16.16	$	16,161		6.82 %		0.65 %	to	0.85 %		8.16 %	to	8.31 %
PIMCO VIT LOW DURATION PORTFOLIO
2010		4,066	$	12.75	to	$	12.94	$	52,772		1.62 %		0.65 %	to	0.85 %		4.42 %	to	4.61 %
2009		3,675	$	12.21	to	$	12.37	$	45,562		3.49 %		0.65 %	to	0.85 %		12.33 %	to	12.56 %
2008		2,968	$	10.87	to	$	10.99	$	32,729		4.08 %		0.65 %	to	0.85 %		(1.18)%	to	(1.08)%
2007		2,813	$	11.00	to	$	11.11	$	31,297		4.76 %		0.65 %	to	0.85 %		6.38 %	to	6.72 %
2006		2,548	$	10.34	to	$	10.41	$	26,461		4.19 %		0.65 %	to	0.85 %		3.09 %	to	3.27 %
PIMCO VIT TOTAL RETURN PORTFOLIO
2010		7,860	$	14.07	to	$	14.23	$	112,113		2.41 %		0.65 %	to	0.85 %		7.16 %	to	7.40 %
2009		7,130	$	13.13	to	$	13.25	$	94,556		5.20 %		0.65 %	to	0.85 %		13.09 %	to	13.34 %
2008		6,123	$	11.61	to	$	11.69	$	71,611		4.46 %		0.65 %	to	0.85 %		3.94 %	to	4.10 %
2007		4,609	$	11.17	to	$	11.23	$	51,766		4.82 %		0.65 %	to	0.85 %		7.82 %	to	8.08 %
2006		3,350	$	10.36	to	$	10.39	$	34,792		4.47 %		0.65 %	to	0.85 %		2.98 %	to	3.08 %
PIONEER EMERGING MARKETS VCT PORTFOLIO (Effective date 05/01/2008)
2010		253	$	8.74	to	$	8.79	$	2,217		0.28 %		0.65 %	to	S585 %		14.55 %	to	14.90 %
2009		564	$	7.63	to	$	7.65	$	4,313		0.87 %		0.65 %	to	0.85 %		72.62 %	to	72.69 %
2008		155	$	4.42	to	$	4.43	$	684		0.01 %		0.65 %	to	0.85 %		(55.80)%	to	(55.70)%
PIONEER FUND VCT PORTFOLIO
2010		187	$	13.93	to	$	11.01	$	2,123		1.38 %		0.65 %	to	0.85 %		15.03 %	to	15.29 %
2009		191	$	12.11	to	$	9.55	$	1,882		1.74 %		0.65 %	to	0.85 %		24.21 %	to	24.35 %
2008		266	$	9.75	to	$	7.68	$	2,101		1.94 %		0.65 %	to	0.85 %		(34.83)%	to	(34.69)%
2007		197	$	14.96	to	$	11.76	$	2,473		1.29 %		0.65 %	to	0.85 %		4.11 %	to	4.35 %
2006		125	$	14.37	to	$	11.27	$	1,488		1.43 %		0.65 %	to	0.85 %		15.61 %	to	15.83 %
PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO (Effective date 05/01/2006)
2010		104	$	10.14	to	$	10.24	$	1,059		0.00 %		0.65 %	to	0.85 %		19.15 %	to	19.49 %
2009		95	$	8.51	to	$	8.57	$	812		0.00 %		0.65 %	to	0.85 %		43.51 %	to	43.55 %
2008		39	$	5.93	to	$	5.97	$	235		0.00 %		0.65 %	to	0.85 %		(36.10)%	to	(35.88)%
2007		36	$	9.28	to	$	9.31	$	331		0.00 %		0.65 %	to	0.85 %		(4.62)%	to	(4.51)%
2006		32	$	9.73	to	$	9.75	$	308		0.00 %		0.65 %	to	0.85 %		(2.70)%	to	(2.50)%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
PIONEER MID CAP VALUE VCT PORTFOLIO (Effective date 05/01/2006)
2010		158	$	10.58	to	$	10.68	$	1,703		0.84 %		0.65 %	to	0.85 %		16.91 %	to	17.11 %
2009		166	$	9.05	to	$	9.12	$	1,530		1.24 %		0.65 %	to	0.85 %		24.14 %	to	24.42 %
2008		129	$	7.29	to	$	7.33	$	947		0.97 %		0.65 %	to	0.85 %		(34.32)%	to	(34.20)%
2007		113	$	11.10	to	$	11.14	$	1,253		0.78 %		0.65 %	to	0.85 %		4.42 %	to	4.70 %
2006		17	$	10.63	to	$	10.64	$	176		0.00 %		0.65 %	to	0.85 %		6.30 %	to	6.40 %
PRUDENTIAL SERIES FUND EQUITY PORTFOLIO (Effective date 05/01/2009)
2010		81	$	14.59	to	$	14.63	$	1,180		0.13 %		0.65 %	to	0.85 %		10.61 %	to	10.75 %
2009		1	$	13.19	to	$	13.21	$	19		0.00 %		0.65 %	to	0.85 %		31.90 %	to	32.10 %
PRUDENTIAL SERIES FUND NATURAL RESOURCES PORTFOLIO (Effective date 05/01/2009)
2010		289	$	18.17	to	$	18.23	$	5,264		0.05 %		0.65 %	to	0.85 %		26.44 %	to	26.69 %
2009		86	$	14.37	to	$	14.39	$	1,239		0.07 %		0.65 %	to	0.85 %		43.70 %	to	43.90 %
PUTNAM VT AMERICAN GOVERNMENT INCOME IB PORTFOLIO (Effective date 04/30/2010)
2010		67	$	10.23	to	$	10.25	$	683		0.00 %		0.65 %	to	0.85 %		2.30 %	to	2.50 %
PUTNAM VT EQUITY INCOME IB PORTFOLIO (Effective date 04/30/2010)
2010		76	$	10.61	to	$	10.62	$	803		0.00 %		0.65 %	to	0.85 %		6.10 %	to	6.20 %
ROYCE SMALL-CAP PORTFOLIO (Effective date 05/01/2009)
2010		244	$	15.62	to	$	15.67	$	3,819		0.16 %		0.65 %	to	0.85 %		19.24 %	to	19.53 %
2009		83	$	13.10	to	$	13.11	$	1,085		0.00 %		0.65 %	to	0.85 %		31.00 %	to	31.10 %
SCHWAB MARKETTRACK GROWTH PORTFOLIO II
2010		1,383	$	14.80	to	$	13.30	$	19,049		2.38 %		0.65 %	to	0.85 %		12.72 %	to	12.90 %
2009		1,355	$	13.13	to	$	11.78	$	16,502		2.98 %		0.65 %	to	0.85 %		22.94 %	to	23.22 %
2008		1,389	$	10.68	to	$	9.56	$	13,703		2.54 %		0.65 %	to	0.85 %		(31.93)%	to	(31.81)%
2007		1,461	$	15.69	to	$	14.02	$	21,017		2.61 %		0.65 %	to	0.85 %		4.74 %	to	5.02 %
2006		1,284	$	14.98	to	$	13.35	$	17,781		1.61 %		0.65 %	to	0.85 %		14.00 %	to	14.20 %
SCHWAB MONEY MARKET PORTFOLIO
2010		7,426	$	10.93	to	$	11.35	$	83,971		0.01 %		0.65 %	to	0.85 %		(0.82)%	to	(0.61)%
2009		7,958	$	11.02	to	$	11.42	$	90,474		0.12 %		0.65 %	to	0.85 %		(0.72)%	to	(0.52)%
2008		13,814	$	11.10	to	$	11.48	$	158,169		2.04 %		0.65 %	to	0.85 %		1.19 %	to	1.41 %
2007		10,419	$	10.97	to	$	11.32	$	117,373		4.59 %		0.65 %	to	0.85 %		3.88 %	to	4.04 %
2006		6,805	$	10.56	to	$	10.88	$	73,495		4.56 %		0.65 %	to	0.85 %		3.73 %	to	3.92 %
SCHWAB S&P 500 INDEX PORTFOLIO
2010		5,479	$	13.76	to	$	11.20	$	64,041		1.98 %		0.65 %	to	0.85 %		13.72 %	to	13.94 %
2009		5,908	$	12.10	to	$	9.83	$	61,045		2.80 %		0.65 %	to	0.85 %		25.13 %	to	25.38 %
2008		5,794	$	9.67	to	$	7.84	$	47,658		2.20 %		0.65 %	to	0.85 %		(37.13)%	to	(36.98)%
2007		5,398	$	15.38	to	$	12.44	$	70,526		1.57 %		0.65 %	to	0.85 %		4.48 %	to	4.63 %
2006		4,932	$	14.72	to	$	11.89	$	61,351		1.73 %		0.65 %	to	0.85 %		14.64 %	to	14.88 %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to  highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
SELIGMAN COMMUNICATIONS & INFORMATION PORTFOLIO (Effective date 05/01/2006)
2010		236	$	13.74	to	$	13.87	$	3,263		0.00 %		0.65 %	to	0.85 %		13.84  %	to	14.06  %
2009		256	$	12.07	to	$	12.16	$	3,102		0.00 %		0.65 %	to	0.85 %		57.98  %	to	58.33  %
2008		113	$	7.64	to	$	7.68	$	868		0.00 %		0.65 %	to	0.85 %		(36.91)%	to	(36.79)%
2007		148	$	12.11	to	$	12.15	$	1,799		0.00 %		0.65 %	to	0.85 %		14.14  %	to	14.41  %
2006		72	$	10.61	to	$	10.62	$	767		0.00 %		0.65 %	to	0.85 %		6.10  %	to	6.20  %
SENTINEL VARIABLE PRODUCTS BOND FUND (Effective date 05/01/2009)
2010		145	$	11.25	to	$	11.29	$	1,639		4.99 %		0.65 %	to	0.85 %		6.33  %	to	6.61  %
2009		70	$	10.58	to	$	10.59	$	746		9.85 %		0.65 %	to	0.85 %		5.80  %	to	5.90  %
SENTINEL VARIABLE PRODUCTS COMMON STOCK FUND (Effective date 05/01/2009)
2010		208	$	14.49	to	$	14.54	$	3,026		2.41 %		0.65 %	to	0.85 %		14.82  %	to	15.03  %
2009		43	$	12.62	to	$	12.64	$	537		1.78 %		0.65 %	to	0.85 %		26.20  %	to	26.40  %
SENTINEL VARIABLE PRODUCTS SMALL COMPANY FUND (Effective date 05/01/2009)
2010		47	$	15.48	to	$	15.53	$	725		0.10 %		0.65 %	to	0.85 %		22.66  %	to	22.96  %
2009		12	$	12.62	to	$	12.63	$	155		0.83 %		0.65 %	to	0.85 %		26.20  %	to	26.30  %
THIRD AVENUE VALUE PORTFOLIO (Effective date 05/01/2006)
2010		762	$	8.86	to	$	8.95	$	6,804		3.77 %		0.65 %	to	0.85 %		13.01  %	to	13.43  %
2009		958	$	7.84	to	$	7.89	$	7,557		0.00 %		0.65 %	to	0.85 %		44.12  %	to	44.24  %
2008		1,245	$	5.44	to	$	5.47	$	6,798		0.90 %		0.65 %	to	0.85 %		(44.09)%	to	(44.01)%
2007		1,109	$	9.73	to	$	9.77	$	10,827		2.41 %		0.65 %	to	0.85 %		(5.63)%	to	(5.42)%
2006		621	$	10.31	to	$	10.33	$	6,411		1.11 %		0.65 %	to	0.85 %		3.10  %	to	3.30  %
TOUCHSTONE MID CAP GROWTH FUND (Effective date 05/01/2009)
2010		112	$	15.83	to	$	15.88	$	1,792		0.30 %		0.65 %	to	0.85 %		20.56  %	to	20.85  %
2009		52	$	13.13	to	$	13.14	$	679		0.69 %		0.65 %	to	0.85 %		31.30  %	to	31.40  %
VAN ECK VIP GLOBAL BOND FUND (Effective date 05/01/2009)
2010		501	$	11.47	to	$	11.50	$	5,839		2.31 %		0.65 %	to	0.85 %		5.33  %	to	5.50  %
2009		218	$	10.89	to	$	10.90	$	2,463		0.00 %		0.65 %	to	0.85 %		8.90  %	to	9.00  %
VAN ECK VIP GLOBAL HARD ASSETS FUND (Effective date 05/01/2009)
2010		326	$	17.22	to	$	17.28	$	5,622		0.23 %		0.65 %	to	0.85 %		27.56  %	to	27.91  %
2009		145	$	13.50	to	$	13.51	$	1,962		0.00 %		0.65 %	to	0.85 %		35.00  %	to	35.10  %
WELLS FARGO ADVANTAGE VT DISCOVERY FUND
2010		351	$	19.97	to	$	12.31	$	4,789		0.00 %		0.65 %	to	0.85 %		34.39  %	to	34.68  %
2009		326	$	14.86	to	$	9.14	$	3,207		0.00 %		0.65 %	to	0.85 %		39.14  %	to	39.33  %
2008		394	$	10.68	to	$	6.56	$	2,780		0.00 %		0.65 %	to	0.85 %		(44.83)%	to	(44.69)%
2007		431	$	19.36	to	$	11.86	$	5,492		0.00 %		0.65 %	to	0.85 %		21.30  %	to	21.52  %
2006		334	$	15.96	to	$	9.76	$	3,445		0.00 %		0.65 %	to	0.85 %		13.76  %	to	13.89  %

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	At December 31									For the year or period ended December 31
Schwab OneSource Annuity:	Units (000s)		Unit Fair Value lowest to  highest					Net Assets (000s)		Investment Income Ratio		Expense Ratio lowest to highest				Total Return lowest to highest
INVESTMENT DIVISIONS
WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND
2010		279	$	18.31	to	$	15.02	$	4,521		0.76 %		0.65 %	to	0.85 %		22.72  %	to	22.91  %
2009		296	$	14.92	to	$	12.22	$	3,875		0.00 %		0.65 %	to	0.85 %		46.42  %	to	46.88  %
2008		278	$	10.19	to	$	8.32	$	2,568		1.95 %		0.65 %	to	0.85 %		(40.58)%	to	(40.53)%
2007		281	$	17.15	to	$	13.99	$	4,270		0.62 %		0.65 %	to	0.85 %		5.73  %	to	5.98  %
2006		279	$	16.22	to	$	13.20	$	3,939		0.00 %		0.65 %	to	0.85 %		11.25  %	to	11.49  %

(Concluded)

PART C

OTHER INFORMATION

Item 24. Financial Statements and Exhibits

(a)	Financial Statements The consolidated balance sheets of Great-West Life & Annuity Insurance Company (“GWL&A”) as of December 31, 2010 and 2009, and the related consolidated statements of income, stockholder’s equity and cash flows for each of the three years in the period ended December 31, 2010, and the statements of assets and liabilities of each of the investment divisions which comprise Variable Annuity-1 Series Account of GWL&A (the “Series Account”) as of December 31, 2010, and the related statements of operations and changes in net assets, and the financial highlights for each of the periods presented, are filed herewith in the Statement of Additional Information.
(b)	Exhibits
	(1)	Certified copy of resolution of Board of Directors of Depositor establishing Registrant is incorporated by reference to Registrant’s Initial Registration Statement on Form N-4, filed on February 22, 1996 (File No. 333-01153).
	(2)	Not applicable.
	(3)	Underwriting agreement between Depositor and GWFS Equities, Inc. (formerly, BenefitsCorp Equities, Inc.) is incorporated by reference to Registrant’s Post-Effective Amendment No. 8 on Form N-4, filed on April 21, 2003 (File No. 333-52956).
	(4)(a)	Forms of the variable annuity contracts are incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on August 2, 1996 (File No. 333-01153).
	(4)(b)	Form of IRA Endorsement is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on August 2, 1996 (File No. 333-01153).
	(4)(c)	Form of MVA Endorsement is incorporated by reference to Registrant’s Post-Effective Amendment No. 19 on Form N-4, filed on February 29, 2008 (File No. 333-01153).
	(5)	Form of application to be used with the variable annuity contract is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on August 2, 1996 (File No. 333-01153).
	(6)(a)	Articles of Incorporation of Depositor are incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549).
	(6)(b)	Bylaws of Depositor are incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4 filed on October 30, 1996 (File No. 811-07549); Amended Bylaws of Depositor are incorporated by reference to Post-Effective Amendment No. 38 to the Registration Statement of FutureFunds Series Account on Form N-4, filed on April 24, 2006 (File No. 2-89550).
	(7)	Variable Annuity Guaranteed Death Benefit Reinsurance Agreement with Connecticut General Life Insurance Company is filed herewith. Form of Amendment to Variable Annuity Guaranteed Death Benefit Reinsurance Agreement is filed herewith.
	(8)(a)	Participation Agreement with Alger American Fund is incorporated by reference to

	Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549); amendments to Participation Agreement with Alger American Fund are incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 24, 2001 (File No. 333-52956), Registrant’s Post-Effective Amendment No. 8, filed on April 12, 2002 (File No. 333-01153) and Registrant’s Post-Effective Amendment No. 10, filed on May 29, 2003 (File No. 333-52956).
(8)(b)	Form of Participation Agreement with AllianceBernstein Variable Products Series Fund, Inc. is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956); amendment to Participation Agreement with AllianceBernstein Variable Products Series Fund, Inc., is incorporated by reference to Registrant’s Post-Effective Amendment No. 10, filed on May 29, 2003 (File No. 333-52956). Form of amendment to Participation Agreement with AllianceBernstein Variable Products Series Fund, Inc. is incorporated by reference to Registrant’s Post-Effective Amendment No. 16, filed on April 29, 2005 (File No. 333-52956). Amendment to Participation Agreement with AllianceBernstein Variable Products Series Fund, Inc., is incorporated by reference to Registrant’s Post-Effective Amendment No. 20, filed April 17, 2009 (File No. 333-52956).
(8)(c)	Participation Agreement with American Century Variable Portfolios (formerly, TCI Portfolios, Inc.) is incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549); amendments to Participation Agreement with American Century Variable Portfolios is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956), Registrant’s Post-Effective Amendment No. 8 on Form N-4, filed April 12, 2002 (File No. 333-01153) and Registrant’s Post-Effective Amendment No. 10, filed on May 29, 2003 (File No. 333-52956); amendment to American Century Variable Portfolios is incorporated by reference to Registrant’s Post-Effective Amendment No. 20, filed April 17, 2009 (File No. 333-52956).
(8)(d)	Participation Agreement with Lincoln Variable Insurance Products Trust Portfolio (formerly Baron Capital Asset Fund) is incorporated by reference to Registrant’s Post-Effective Amendment No. 9, filed April 18, 2003 (File No. 333-01153); Amendment to Participation Agreement with Lincoln Variable Insurance Products Trust Portfolios is incorporated by reference to Registrant’s Post-Effective Amendment No. 10, filed May 29, 2003 (File No. 333-52956).
(8)(e)	Form of Participation Agreement with Delaware VIP Trust (formerly, Delaware Premium Fund, Inc., is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956) amendment to Participation Agreement with Delaware VIP Trust are incorporated by reference to Registrant’s Post-Effective Amendment No. 10, filed on May 29, 2003 (File No. 333-52956), and Registrant’s Post-Effective Amendment No. 16, filed on April 29, 2005 (File No. 333-01153).
(8)(f)	Form of Participation Agreement with Dreyfus Variable Investment Fund, is incorporated by reference to Registrant’s Post-Effective Amendment No. 9 on Form N-4, filed on April 18, 2003 (File No. 333-01153); amendments to Participation Agreement with Dreyfus Variable Investment Fund is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956), and Registrant’s Post-Effective Amendment No. 10 on Form N-4, filed on May 29, 2003 (File No. 333-52956).
(8)(g)	Participation Agreement with Federated Insurance Series is incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549); amendment to Participation Agreement with Federated

	Insurance Series is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956).
(8)(h)	Participation Agreement with Franklin Templeton Insurance Products Trust is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 24, 2008 (File No. 333-147743); amendment to Participation Agreement with Franklin Templeton Insurance Products Trust is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 24, 2008 (File No. 333-147743).
(8)(i)	Participation Agreement with Nationwide Variable Insurance Trust (formerly Gartmore Variable Insurance Trust) is incorporated by reference to Registrant’s Post-Effective Amendment No. 13, filed on March 31, 2004 (File No. 333-01153).
(8)(j)	Form of Participation Agreement with AIM Variable Insurance Fund is incorporated by reference to Registrant’s Post-Effective Amendment No. 18, filed April 26, 2007 (File No. 333-01153).
(8)(k)	Participation Agreement with Janus Aspen Series is incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549); amendments to Participation Agreement with Janus Aspen Series are incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 26, 2001 (File No. 333-52956) and Registrant’s Post-Effective Amendment No. 10 on Form N-4, filed on May 29, 2003 (File No. 333-52956).
(8)(l)	Form of Participation Agreement with Oppenheimer Variable Account Funds is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956); Forms of amendments to Participation Agreement with Oppenheimer Variable Account Funds are incorporated by reference to Registrant’s Post-Effective Amendment No. 10 on Form N-4, filed on May 29, 2003 (File No. 333-52956), and Registrant’s Post-Effective Amendment No. 16, filed on April 28, 2005 (File No. 333-01153).
(8)(m)	Form of Participation Agreement with PIMCO Variable Insurance Trust and amendment thereto are incorporated by reference to Registrant’s to Registrant’s Post-Effective Amendment No. 10 on Form N-4, filed on May 29, 2003 (File No. 333-52956). Form of amendment to Participation Agreement with PIMCO Variable Insurance Trust is incorporated by reference to Registrant’s Post-Effective Amendment No. 16, filed on April 28, 2005 (File No. 333-01153).
(8)(n)	Form of Participation Agreement with Prudential Series Fund, Inc., is incorporated by reference to Registrant’s Post-Effective Amendment No. 9 on Form N-4, filed on April 18, 2003 (File No. 333-01153). Amendment to Participation Agreement between Registrant and Prudential Series Fund, Inc. is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(o)	Form of Participation Agreement with Pioneer Variable Contracts Trust (formerly, SAFECO Resource Trust) is incorporated by reference to Registrant’s Post-Effective Amendment No. 9 on Form N-4, filed on April 18, 2003 (File No. 333-01153). Amendments to Participation Agreement with Pioneer Fund are incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 24, 2001 (File No. 333-52956) and Registrant’s Post-Effective Amendment No. 10 on Form N-4, filed on May 29, 2003 (File No. 333-52956). Form of amendment to Participation Agreement with Pioneer Fund dated December 2003 is incorporated by reference to Registrant’s Post-Effective Amendment No. 13 on Form N-4, filed on

	March 31, 2004 (File No. 333-01153).
(8)(p)	Participation Agreement with Schwab Annuity Portfolios is incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549); amendments to Participation Agreement with Schwab Annuity Portfolios is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956) and Post-Effective Amendment No. 8 on Form N-4, filed on April 12, 2002 (File No. 333-01153).
(8)(q)	Form of Participation Agreement with DWS Variable Series (formerly Scudder Variable Series I), is incorporated by reference to Registrant’s Post-Effective Amendment No. 3 on Form N-4, filed on April 16, 2002 (File No. 333-52956); amendment to Participation Agreement with Scudder Variable Life Investment Fund is incorporated by reference to Registrant’s Pre-Effective Amendment No. 1 on Form N-4, filed on April 25, 2001 (File No. 333-52956). Form of amendment to Participation Agreement with DWS Variable Series I and DWS Variable Series II are incorporated by reference to Registrant’s Post-Effective Amendment No. 16, filed on April 28, 2005 (File No. 333-52956).
(8)(r)	Participation Agreement with Wells Fargo Variable Trust is incorporated by reference to Initial Registration of Variable Annuity I Series Account of First Great-West Life & Annuity Company (“First Great-West”) on Form N-4, filed on November 30, 2007 (File No. 333-147743).
(8)(s)	Form of Participation Agreement with The Universal Institutional Funds, Inc., (formerly, Van Kampen American Capital Life Investment Trust) is incorporated by reference to Registrant’s Post-Effective Amendment No. 2, filed on April 17, 1998 (File No. 333-01153). Form of amendment to Participation Agreement with The Universal Institutional Funds is incorporated by reference to Registrant’s Post-Effective Amendment No. 16, filed on April 28, 2005 (File No. 333-52956).
(8)(t)	Form of Participation Agreement with Neuberger Berman Advisers Management Trust is incorporated by reference to Registrant’s Post-Effective Amendment No. 17 on Form N-4, filed on April 26, 2006 (File No. 333-01153).
(8)(u)	Participation Agreement with Seligman Portfolios, Inc. is incorporated by reference to Pre-Effective Amendment No. 1 to the Registration Statement on Form N-4 for Variable Annuity 1 Series Account of First Great-West, filed on April 24, 2008 (File No. 333-147743). Amendment to Participation Agreement is incorporated by reference to Post-Effective Amendment No. 20, filed April 17, 2009 (File No. 333-52956).
(8)(v)	Form of Participation Agreement with Third Avenue Funds is incorporated by reference to Registrant’s Post-Effective Amendment No. 17 on Form N-4, filed on April 26, 2006 (File No. 333-01153).
(8)(w)	Participation Agreement with Van Eck Worldwide Insurance Trust, is incorporated by reference to Registrant’s Pre-Effective Amendment No. 2 on Form N-4, filed on October 30, 1996 (File No. 811-07549). Amendment to Participation Agreement between Registrant and Van Eck Worldwide Insurance Trust is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(x)	Form of Participation Agreement with Van Kampen Life Insurance Trust, Van Kampen Funds, Inc. and Van Kampen Asset Management is incorporated by reference to Registrant’s Post-Effective Amendment No. 18, filed on April 26, 2007 (File No. 333-

	01153).
(8)(y)	Participation Agreement between Registrant, Royce Capital Fund, & Royce & Associates, LLC dated September 30, 2005 is incorporated by reference to Registrant’s Post-Effective Amendment No. 15 to the Registration Statement filed by COLI VUL 2 Series Account on Form N-6 on April 26, 2007 (File No. 333-70963).
(8)(z)	Participation Agreement between Registrant and MFS Variable Insurance Trust is incorporated by reference to Post-Effective Amendment No. 20, filed April 17, 2009 (File No. 333-52956). Amended and Restated Participation Agreement among Registrant, MFS Variable Insurance Trust and MFS Variable Insurance Trust II is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(aa)	Participation Agreement between Registrant and J.P. Morgan Series Trust II is incorporated by reference to Pre-Effective Amendment No. 1 to Registrant’s Registration Statement on Form N-4, filed April 24, 2001 (File No. 333-52956). Participation Agreement between Registrant and J.P. Morgan Insurance Trust is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(bb)	Participation Agreement between Registrant and Sentinel Variable Products Trust is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(cc)	Participation Agreement between Registrant and Touchstone Variable Series Trust is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(dd)	Participation Agreement with Columbia Funds Variable Insurance Trust is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956). Participation Agreement with Columbia Variable Insurance Trust I is incorporated by reference to Post-Effective Amendment No. 21, filed on April 16, 2010 (File No. 333-52956).
(8)(ee)	Form of Rule 22c-2 Shareholder Information Agreement is incorporated by reference to Registrant’s Post-Effective Amendment No. 18, filed on April 26, 2007 (File No. 333-01153).
(9)	Opinion of counsel and consent of Ruth B. Lurie, Vice President, Counsel and Associate Secretary incorporated by reference to Registrant’s Initial Registration Statement on Form N-4 filed on February 22, 1996 (File No. 333-01153).
(10)(a)	Written Consent of Jorden Burt LLP is filed herewith.
(10)(b)	Written Consent of Deloitte & Touche LLP is filed herewith.
(11)	Not Applicable.
(12)	Not Applicable.
(13)(a)	Powers of Attorney for Messrs. Mackness, Orr, and Ryan are incorporated by reference to Registrant’s Post-Effective Amendment No. 20, filed on April 29, 2008 (File No. 333-01153).
(13)(b)	Powers of Attorney for Messrs. Balog, Bernbach, Dackow, A. Desmarais, P. Desmarais,

	Jr., Gratton, Kavanagh, Louvel, Nickerson, Nield, Plessis-Bélair and Walsh are incorporated by reference to Registrant’s Post-Effective Amendment No. 18, filed on April 26, 2007 (File No. 333-01153).
(13)(c)	Power of Attorney for Mr. McFeetors is incorporated by reference to Registrant’s Post-Effective Amendment No. 21, filed on April 27, 2009 (File No. 333-01153).
(13)(d)	Power of Attorney for Messrs. Rousseau, Royer and Ryan are incorporated by reference to Registrant’s Post-Effective Amendment No. 22, filed on April 23, 2010 (File No. 333-01153).

Item 25. Directors and Officers of the Depositor

Name	Principal Business Address	Positions and Offices with Depositor
R. L. McFeetors	(1)	Chairman of the Board
J. Balog	785 St. Anne’s Lane Vero Beach, Florida 32967	Director
J.L. Bernbach	32 East 57th Street, 10th Floor New York, NY 10022	Director
A. Desmarais	(4)	Director
P. Desmarais, Jr.	(4)	Director
M.T.G. Graye	(2)	Director, President and Chief Executive Officer
A. Louvel	930 Fifth Avenue, Apt. 17D New York, NY 10021	Director
J.E.A. Nickerson	H.B. Nickerson & Sons Limited P.O. Box 130 North Sydney, Nova Scotia, Canada B2A 3M2	Director
R.J. Orr	(4)	Director
M. Plessis-Bélair	(4)	Director
H.P. Rousseau	(4)	Director
R.Royer	(4)	Director
P.K Ryan	(4)	Director
T.T. Ryan, Jr.	SIFMA 120 Broadway, 35th Floor New York, NY 10271-0080	Director

B.E. Walsh	Saguenay Capital, LLC The Centre at Purchase Two Manhattanville Road, Suite 403 Purchase, NY 10577	Director
S.M. Corbett	(2)	Executive Vice President and Chief Investment Officer
R.K. Shaw	(2)	Executive Vice President, Individual Markets
C.P. Nelson	(2)	President, Great-West Retirement Services
J.L. McCallen	(2)	Senior Vice President and Chief Financial Officer
C.H. Cumming	(2)	Senior Vice President, Defined Contribution Markets
G.R. Derback	(2)	Senior Vice President and Controller
M.R. Edwards	(2)	Senior Vice President, FASCore Operations
E.P. Friesen	(2)	Senior Vice President, Investments
R.J. Laeyendecker	(2)	Senior Vice President, Executive Benefits Markets
G.R. McDonald	(2)	Senior Vice President, Corporate Resources
S.A. Miller	(3)	Senior Vice President and Chief Information Officer
G.E. Seller	18111 Von Karman Avenue, #560 Irvine, CA 92612	Senior Vice President, Government Markets
R.G. Schultz	(3)	Senior Vice President, General Counsel and Secretary
C.S. Toucher	(2)	Senior Vice President, Investments

(1) 100 Osborne Street North, Winnipeg, Manitoba, Canada R3C 3A5.

(2) 8515 East Orchard Road, Greenwood Village, Colorado 80111.

(3) 8525 East Orchard Road, Greenwood Village, Colorado 80111.

(4) Power Financial Corporation, 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3.

Item 26. Persons controlled by or under common control with the Depositor or Registrant as of 12/31/10

I.               OWNERSHIP OF POWER CORPORATION OF CANADA

The following sets out the ownership, based on votes attached to the outstanding voting shares, of Power Corporation of Canada:

Paul G. Desmarais

99.999% - Pansolo Holding Inc.

100% - 3876357 Canada Inc.

100% - 3439496 Canada Inc.

100% - Capucines Investments Corporation

  32% - Nordex Inc. (68% also owned directly by Paul G. Desmarais)

  94.9% - Gelco Enterprises Ltd. (5.1% also owned directly by Paul G. Desmarais)

53.70% - Power Corporation of Canada

The total voting rights of Power Corporation of Canada (PCC) controlled directly and indirectly by Mr. Paul G. Desmarais is as follows. There are issued and outstanding as of December 31, 2010 409,776,632 Subordinate Voting Shares (SVS) of PCC carrying one vote per share and 48,854,772 Participating Preferred Shares (PPS) carrying 10 votes per share; hence the total voting rights are 898,324,352.

Pansolo Holding Inc. owns directly 15,216,033 SVS and 367,692 PPS, entitling Pansolo Holding Inc. directly to an aggregate percentage of voting rights of 18,892,953 or 2.1 % of the total voting rights attached to the shares of PCC. Pansolo Holding Inc. wholly owns 3876357 Canada Inc., 3439496 Canada Inc. and Capucines Investments Corporation which respectively own 40,686,080 SVS, 3,236,279 SVS, 3,125,000 SVS of PCC, representing respectively 4.53 %, 0.36%, 0.35 % of the aggregate voting rights of PCC.

Gelco Entreprises Ltd owns directly 48,235,700 PPS, representing 53.70% of the aggregate voting rights of PCC (PPS (10 votes) and SVS (1 vote)). Hence, the total voting rights of PCC under the direct and indirect control of Mr. Paul G. Desmarais is approximately 61.21%; note that this is not the equity percentage.

Mr. Paul G. Desmarais also owns personally 1,561,750 SVS of PCC.

II.              OWNERSHIP BY POWER CORPORATION OF CANADA

Power Corporation of Canada has a 10% or greater voting interest in the following entities:

A.              Great-West Life & Annuity Insurance Company Group of Companies (U.S. insurance)

Power Corporation of Canada

100.0% - 171263 Canada Inc.

66.08% - Power Financial Corporation

68.34% - Great-West Lifeco Inc.

100.0% - Great-West Financial (Canada) Inc.

100.0% - Great-West Financial (Nova Scotia) Co.

 100.0% - Great-West Lifeco U.S. Inc.

100.0% - GWL&A Financial Inc.

60.0% - Great-West Life & Annuity Insurance Capital (Nova Scotia) Co.

60.0% - Great-West Life & Annuity Insurance Capital (Nova Scotia) Co. II

60.0% - Great-West Life & Annuity Insurance Capital, LLC

60.0% - Great-West Life & Annuity Insurance Capital, LLC II

100.0% - Great-West Life & Annuity Insurance Company

  100.0% - First Great-West Life & Annuity Insurance Company

  100.0% - Advised Assets Group, LLC

 100.0% - GWFS Equities, Inc.

100.0% - Great-West Life & Annuity Insurance Company of South Carolina

100.0% - Emjay Corporation

100.0% - FASCore, LLC

  50.0% - Westkin Properties Ltd.

  73.30% - Maxim Series Fund, Inc.

100.0% - GW Capital Management, LLC

100.0% - Orchard Trust Company, LLC

100.0% - Lottery Receivable Company One LLC

100.0% - LR Company II, L.L.C.

100.0% - Singer Collateral Trust IV

100.0% - Singer Collateral Trust V

B.              Putnam Investments Group of Companies (Mutual Funds)

Power Corporation of Canada

100.0% - 171263 Canada Inc.

66.08% - Power Financial Corporation

68.34% - Great-West Lifeco Inc.

100.0% - Great-West Financial (Canada) Inc.

100.0% - Great-West Financial (Nova Scotia) Co.

100% - Great-West Lifeco U.S., Inc.

100% - Putnam Investments, LLC

100.0% - Putnam Acquisition Financing Inc.

100.0% - Putnam Acquisition Financing LLC

  100.0% - Putnam U.S. Holdings, LLC

100.0% - The Putnam Advisory Company, LLC

100.0% - Putnam Investment Management, LLC

100.0% - Putnam Fiduciary Trust Company (NH)

100.0% - Putnam Investor Services, Inc.

100.0% - Putnam U.S. Holdings I, LLC

100.0% - Putnam Retail Management GP, Inc.

99.0% - Putnam Retail Management Limited Partnership (1% owned by Putnam

            Retail Management GP, Inc.)

80.0% - PanAgora Asset Management, Inc.

100.0% -Putnam GP Inc.

100.0% - PII Holdings, Inc.

99.0% - TH Lee Putnam Equity Managers LP (1% owned by Putnam GP Inc.)

100.0% - Putnam Investment Holdings, LLC

100.0% - Savings Investments, LLC

100.0% - Putnam Aviation Holdings, LLC

100.0% - Putnam Capital, LLC

80.0% - TH Lee Putnam Capital Management, LLC

100.0% - Putnam International Holdings LLC

  100.0% - Putnam Investments Inc. (Canada)

  100.0% - Putnam Investments (Ireland) Limited

  100.0% - Putnam Investments Australia Pty Limited

  100.0% - Putnam Investments Securities Co., Ltd. (Japan)

  100.0% - Putnam International Distributors, Ltd. (Cayman)

  100.0% - Putnam Investments Argentina S.A.

100.0% - Putnam Investments (Asia) Limited

 100.0% - Putnam Investments Limited (U.K.)

 100.0% - New Flag UK Holdings Limited

  100.0% - New Flag Asset Management Limited (UK)

C.              The Great-West Life Assurance Company Group of Companies (Canadian insurance)

Power Corporation of Canada

100.0% - 171263 Canada Inc.

66.08% - Power Financial Corporation

 68.34% - Great-West Lifeco Inc.

100.0% - 2142540 Ontario Inc.

100.0% - Great-West Lifeco Finance (Delaware) LP

100.0% - Great-West Lifeco Finance (Delaware) LLC

   100.0% - 2023308 Ontario Inc.

  100.0% - Great-West Life & Annuity Insurance Capital, LP

 40.0% - Great-West Life & Annuity Insurance Capital (Nova Scotia) Co.

  40.0% - Great-West Life & Annuity Insurance Capital, LLC

  100.0% - Great-West Life & Annuity Insurance Capital, LP II

 40.0% - Great-West Life & Annuity Insurance Capital (Nova Scotia) Co. II

  40.0% - Great-West Life & Annuity Insurance Capital, LLC II

100.0% - 2171866 Ontario Inc

100.0% - Great-West Lifeco Finance (Delaware) LP II

100.0% - Great-West Lifeco Finance (Delaware) LLC II

100.0% - 2023310 Ontario Inc.

100.0% - 2023311 Ontario Inc.

100.0% - 6109756 Canada Inc.

100.0% - 6922023 Canada Inc.

100.0% - The Great-West Life Assurance Company

  71.4% - GWL THL Private Equity I Inc. (28.6% owned by The Canada Life Assurance Company)

100.0% - GWL THL Private Equity II Inc.

100.0% - Great-West Investors Holdco Inc.

100.0% - Great-West Investors LLC

100.0% - Great-West Investors LP Inc.

100.0% - Great-West Investors GP Inc.

100.0% - Great-West Investors LP

100.0% - T.H. Lee Interests

  100.0% - GWL Realty Advisors Inc.

100.0% - GWL Realty Advisors U.S., Inc.

100.0% - RA Real Estate Inc.

0.1% RMA Real Estate LP

100.0% - Vertica Resident Services Inc.

  100.0% - GWL Investment Management Ltd.

100.0% - London Capital Management Ltd.

100.0% - Laketon Investment Management Ltd.

  100.0% - 801611 Ontario Limited

  100.0% - 118050 Canada Inc.

  100.0% - 1213763 Ontario Inc.

  99.9% - Riverside II Limited Partnership

    70.0% - Kings Cross Shopping Centre Ltd.

  100.0% - 681348 Alberta Ltd.

100.0% - The Owner: Condominium Plan No 8510578

    50.0% - 3352200 Canada Inc.

  100.0% - 1420731 Ontario Limited

  100.0% - 1455250 Ontario Limited

  100.0% - CGWLL Inc.

    65.0% - The Walmer Road Limited Partnership

    50.0% - Laurier House Apartments Limited

  100.0% - 2024071 Ontario Limited

100.0 % - 431687 Ontario Limited

0.1% - Riverside II Limited Partnership

  100.0% - High Park Bayview Inc.

    75.0% - High Park Bayview Limited Partnership

      5.6% - MAM Holdings Inc. (94.4% owned by The Canada Life Insurance Company of Canada)

  100.0% - 647679 B.C. Ltd.

  100.0% - Red Mile Acquisitions Inc.

    70.0% - TGS North American Real Estate Investment Trust

  100.0% - TGS Trust

    70.0% - RMA Investment Company (Formerly TGS Investment Company)

 100.0% - RMA Property Management Ltd. (Formerly TGS REIT Property Management

                Ltd.)

 100.0% - RMA Property Management 2004 Ltd. (Formerly TGS REIT Property

                Management 2004 Ltd.)

 100.0% - RMA Realty Holdings Corporation Ltd. (Formerly TGS Realty Holdings

                Corporation Ltd.)

 100.0% - RMA (U.S.) Realty LLC (Delaware) [(special shares held by each of

                1218023 Alberta Ltd.

 (50%) and 1214931 Alberta Ltd. (50%)]

 100.0% - RMA American Realty Corp.

1% - RMA American Realty Limited Partnership [(99% owned by

        RMA (U.S.) Realty LLC (Delaware)]

 99.0% - RMA American Realty Limited Partnership (1% owned by RMA

              American Realty Corp.)

 100.0% - 1218023 Alberta Ltd.

 50% - special shares in RMA (U.S.) Realty LLC (Delaware)

 100.0% - 1214931 Alberta Ltd.

 50% - special shares in RMA (U.S.) Realty LLC (Delaware)

    70.0% - RMA Real Estate LP

 100.0% - RMA Properties Ltd. (Formerly TGS REIT Properties Ltd.)

 100.0% - S-8025 Holdings Ltd.

 100.0% - RMA Properties (Riverside) Ltd. (Formerly TGS REIT Properties (Riverside) Ltd.

    70.0% - KS Village (Millstream) Inc.

    70.0% - 0726861 B.C. Ltd.

    70.0% - Trop Beau Developments Limited

    70.0% - Kelowna Central Park Properties Ltd.

    70.0% - Kelowna Central Park Phase II Properties Ltd.

    40.0% - PVS Preferred Vision Services

  100.0% - London Insurance Group Inc.

 100.0% - Trivest Insurance Network Limited

 100.0% - London Life Insurance Company

  100.00% - 1542775 Alberta Ltd.

  100.0% - 0813212 B.C. Ltd.

    30.0% - Kings Cross Shopping Centre Ltd.

    30.0% - 0726861 B.C. Ltd.

    30.0% - TGS North American Real Estate Investment Trust

100.0% - TGS Trust

    30.0% - RMA Investment Company (Formerly TGS Investment Company)

100.0% - RMA Property Management Ltd. (Formerly TGS REIT

              Property Management Ltd.)

100.0% - RMAProperty Management 2004 Ltd. (Formerly TGS

              REIT Property Management 2004 Ltd.)

100.0% - RMA Realty Holdings Corporation Ltd. (Formerly TGS

              Realty Holdings Corporation Ltd.)

100.0% - RMA (U.S.) Realty LLC (Delaware)

              [(special shares held by each of 1218023 Alberta Ltd.

              (50%) and 1214931 Alberta Ltd. 50%)]

100.0% - RMA American Realty Corp.

1% - RMA American Realty Limited

        Partnership [(99% owned by RMA

        (U.S.) Realty LLC (Delaware)]

99.0% - RMA American Realty Limited

            Partnership (1% owned by RMA American

            Realty Corp.)

100.0% - 1218023 Alberta Ltd.

50% - special shares in RMA (U.S.) Realty LLC

          (Delaware)

100.0% - 1214931 Alberta Ltd.

50% - special shares in RMA (U.S.) Realty LLC

          (Delaware)

    30.0% - RMA Real Estate LP

100.0% - RMA Properties Ltd. (Formerly TGS REIT Properties

              Ltd.)

100.0% - S-8025 Holdings Ltd.

100.0% - RMA Properties (Riverside) Ltd. (Formerly TGS REIT

              Properties (Riverside) Ltd.

  100.0% - 1319399 Ontario Inc.

  100.0% - 3853071 Canada Limited

    50.0% - Laurier House Apartments Limited

    30.0% - Kelowna Central Park Properties Ltd.

    30.0% - Kelowna Central Park Phase II Properties Ltd.

    30.0% - Trop Beau Developments Limited

  100.0% - 42969098 Canada Inc.

  100.0% - 389288 B.C. Ltd.

  100.0% - Quadrus Investment Services Ltd.

   35.0% - The Walmer Road Limited Partnership

  100.0% - 177545 Canada Limited

  100.0% - Lonlife Financial Services Limited

  88.0% - Neighborhood Dental Services Ltd.

  100.0% - Toronto College Park Ltd.

    25.0% - High Park Bayview Limited Partnership

  30.0% - KS Village (Millstream) Inc.

  100.0% - London Life Financial Corporation

89.4% - London Reinsurance Group, Inc. (10.6%

              owned by London Life Insurance Company)

100.0% - London Life & General Reinsurance

              Co. Ltd. (1 share held by London Life &

              Casualty Reinsurance Corporation and 20,099,999

              shares held by London Reinsurance Group Inc.)

100.0% - London Life & Casualty Reinsurance Corporation

100.0% - Trabaja Reinsurance Company Ltd.

100.0% - London Life and Casualty (Barbados) Corporation

100.0% - LRG (US), Inc.

100.0% - London Life International Reinsurance Corporation

100.0% - London Life Reinsurance Company

  100.0% - Canada Life Financial Corporation

100.0% - The Canada Life Assurance Company

100.0% - Canada Life Brasil LTDA

100.0% - Canada Life Capital Corporation, Inc.

100.0% - Canada Life International Holdings, Limited

100.0% - Canada Life International Services Limited

100.0% - Canada Life International, Limited

100.0% - CLI Institutional Limited

100.0% - Canada Life Irish Holding Company, Limited

100.0% - Lifescape Limited

100.0% - Setanta Asset Management Limited

100.0% - Canada Life Group Services Limited

100.0% - Canada Life Europe Investment Limited

78.67% - Canada Life Assurance Europe Limited

100.0% - Canada Life Europe Management Services, Limited

21.33% - Canada Life Assurance Europe Limited

100.0% - Canada Life Assurance (Ireland), Limited

100.0% - F.S.D. Investments, Limited

100.0% - Canada Life International Re, Limited

100.0% - Canada Life Reinsurance International, Ltd.

100.0% - Canada Life Reinsurance, Ltd.

100.0% - The Canada Life Group (U.K.), Limited

100.0% - Canada Life Pension Managers & Trustees, Limited

100.0% - Canada Life Asset Management Limited

100.0% - Canada Life European Real Estate Limited

100% - Hotel Operations (Walsall) Limited

100.0% - Canada Life Trustee Services (U.K.), Limited

100.0% - CLFIS (U.K.), Limited

100.0% - Canada Life, Limited

100.0% - Canada Life (U.K.), Limited

100.0% - Albany Life Assurance Company, Limited

100.0% - Canada Life Management (U.K.), Limited

100.0% - Canada Life Services (U.K.), Limited

100.0% - Canada Life Fund Managers (U.K.), Limited

100.0% - Canada Life Group Services (U.K.), Limited

100.0% - Canada Life Holdings (U.K.), Limited

100.0% - Canada Life Irish Operations, Limited

100.0% - Canada Life Ireland Holdings, Limited.

100.0% - 4073649 Canada, Inc. (1 common share owned by 587443 Ontario, Inc.)

100.0% - Canada Life Finance (U.K.), Limited

100.0% - CLH International Capital Management Hungary, Limited Liability Company

100.0% - The Canada Life Insurance Company of Canada

94.4% - MAM Holdings Inc. (5.6% owned by GWL)

100.0% - Mountain Asset Management LLC

100.0% - Quadrus Distribution Services Ltd.

100.0% - CL Capital Management (Canada), Inc.

100.0% - GRS Securities, Inc.

100.0% - 587443 Ontario, Inc.

100.0% - Canada Life Mortgage Services, Ltd.

100.0% - Adason Properties, Limited

100.0% - Adason Realty, Ltd.

100.0% - Crown Life Insurance Company

D.         IGM Financial Inc. Group of Companies (Canadian mutual funds)

Power Corporation of Canada

100.0% - 171263 Canada Inc.

66.08% - Power Financial Corporation

56.96% - IGM Financial Inc.

100.0% - Investors Group Inc.

100.0% - Investors Group Financial Services Inc.

100.0% - I.G. International Management Limited

100.0% - I.G. Investment Management (Hong Kong) Limited

100.0% - Investors Group Trust Co. Ltd.

100.0% - 391102 B.C. Ltd.

100.0% - I.G. Insurance Services Inc.

100.0% - Investors Syndicate Limited

100.0% - Investors Group Securities Inc.

100.0% - I.G. Investment Management, Ltd.

100% - Investors Group Corporate Class Inc.

100.0% - Investors Syndicate Property Corp.

19.63% - I.G. (Rockies) Corp.

100.0% - I.G. Investment Corp.

80.37% - I.G. (Rockies) Corp. (19.63% owned by I.G. Investment Management, Ltd.)

100.0% - Mackenzie Inc.

100.0% - Mackenzie Financial Corporation

100.0% - Mackenzie Financial Charitable Foundation

100.0% - Strategic Charitable Giving Foundation

100.0% - M.R.S. Inc.

100.0% - M.R.S. Correspondent Corporation

100.0% - M.R.S. Securities Services Inc.

100.0% - Execuhold Investment Limited

100.0% - Winfund Software Corp.

100.0% - M.R.S. Trust Company

100.0% - Anacle I Corporation

100.0% - Mackenzie M.E.F. Management Inc.

100.0% - Canterbury Common Inc.

100.0% - Mackenzie Cundill Investment (Bermuda) Ltd.

100.0% - Mackenzie Financial Capital Corporation

100.0% - Multi-Class Investment Corp.

100.0% - MSP 2007 GP Inc.

100.0% - MSP 2008 GP Inc.

100.0% - MSP 2009 GP Inc.

100.0% - MSP 2010 GP Inc.

100.0% - MMLP GP Inc.

94.21% - Investment Planning Counsel Inc.

100.0% - Investment Planning Counsel of Canada Limited

100.0% - IPC Investment Corporation

100.0% - 9132-2155 Quebec Inc.

100.0% - Alpha I Financial Inc.

100.0% - IPC Save Inc.

100.0% - 1275279 Ontario Inc.

50.0% - IPC Estate Services Inc.

50.0% - IPC Estate Services Inc.

100.0% - IPC Securities Corporation

91.36% - IPC Portfolio Services Inc.

100.0% - Counsel Portfolio Services Inc.

100% - Titan Funds Incorporated

100% - Partners in Planning Financial Group Ltd.

100% - Partners in Planning Financial Services Ltd.

100% - Partners in Planning Insurance Services Ltd.

E.         Pargesa Holding SA Group of Companies (European investments)

Power Corporation of Canada

100.0% - 171263 Canada Inc.

66.08% - Power Financial Corporation

100.0% - Power Financial Europe B.V.

50.0% - Parjointco N.V.

54.1% - Pargesa Holding SA

100.0% - Pargesa Netherlands B.V.

25.6% - Imerys

50.0% - Groupe Bruxelles Lambert

Capital

7.1% - Suez Environment Company (1)

21.1% - Lafarge (1)

9.9% - Pernod Ricard (1)

0.6% - Iberdrola (1)

5.0% - Arkema (1)

100.0% - Belgian Securities BV

Capital

30.7% - Imerys (1)

100.0% - Brussels Securities

Capital

100.0% - Sagerpar

3.8% - Groupe Bruxelles Lambert

100.0% - GBL Overseas Finance NV

100.0% - GBL Treasury Center

Capital

100.0% - GBL Energy Sárl

Capital

4.0% - Total (1)

100.0% - GBL Verwaltung GmbH

100.0% - Immobilière Rue de Namur Sárl

100.0% - GBL Verwaltung Sàrl

Capital

100.0% - GBL Investments Limited

100.0% - GBL R

5.2% - GDF SUEZ (1)

43.0% - ECP 1

42.4% - ECP 2

100.0% - ECP3

100.0% - Pargesa Compagnie S.A..

100.0% - Pargesa Netherlands BV

100.0% - SFPG

(1) Based on Company’s published capital as of November 30, 2010

F.         Square Victoria Communications Group Inc. Group of Companies (Canadian communications)

Power Corporation of Canada

100.0% - Square Victoria Communications Group Inc.

100.0% - Gesca Ltée

100.0% - La Presse ltée

100.0% - Gesca Ventes Média Ltée

100.0% - Gesca Numérique Ltée

100.0% - 3855082 Canada Inc.

100.0% - Cyberpresse inc.

100.0% - 6645119 Canada Inc.

100.0% - Les Éditions La Presse II Inc.

100.0% - 3819787 Canada Inc.

100.0% - 3834310 Canada Inc.

20.0% - 3859282 Canada Inc.

100.0% - Square Victoria Digital Properties inc.

100.0% - 4400046 Canada Inc.

66.77% - 9059-2114 Québec Inc.

97.5% - DuProprio Inc.

100% - VR Estates Inc.

100% - 0757075 B.C. Ltd.

0.1% - Lower Mainland Comfree LP

99.9% - Lower Mainland Comfree LP

100% - Comfree Commission Free Realty Inc.

100.0% - Les Productions La Presse Télé Ltée

100.0% - La Presse Télé Ltée

100.0% - La Presse Télé II Ltée

100.0% - La Presse Télé III Ltée

100.0% - Les Éditions Gesca Ltée

100.0% - Groupe Espaces Inc.

100.0% - Les Éditions La Presse Ltée

100.0% - (W.illi.am) 6657443 Canada Inc.

9.0% - Acquisio Inc.

50.0% - Workopolis Canada

25.0% - Olive Média

G.        Power Corporation (International) Limited Group of Companies (Asian investments)

Power Corporation of Canada

100.0% - Power Corporation (International) Limited

99.9% - Power Pacific Corporation Limited

25.0% - Barrick Power Gold Corporation of China Limited

100.0% - Power Pacific Mauritius Limited

7.6% - Vimicro

0.1% - Power Pacific Equities Limited

99.9% - Power Pacific Equities Limited

4.3% - CITIC Pacific Limited

5.8% - Yaolan Limited

100.0% - Power Communications Inc.

0.1% - Power Pacific Corporation Limited

H.         Other PCC Companies

Power Corporation of Canada

100.0% - 152245 Canada Inc.

100.0% - Power Tek, LLC

100% - 3540529 Canada Inc.

100.0% - Gelprim Inc.

100.0% - 3121011 Canada Inc.

100.0% - 171263 Canada Inc.

100.0% - Victoria Square Ventures Inc.

20.59% - Bellus Health Inc.

100.0% - Power Communications Inc.

100.0% - Brazeau River Resources Investments Inc.

100.0% - Communications BP S.A.R.L

100.0% - PCC Industrial (1993) Corporation

100.0% - Power Corporation International

100.0% - 3249531 Canada Inc.

100% - Sagard Capital Partners GP, Inc.

100.0% - Sagard Capital Partners, L.P.

100.0% - Power Corporation of Canada Inc.

100.0% - Square Victoria Real Estate Inc.

100.0% - PL S.A.

100.0% - 4190297 Canada Inc.

100% Sagard Capital Partners Management Corp.

82.0% - Sagard S.A.S.

100.0% - Marquette Communications (1997) Corporation

3.62% - Mitel Networks Corporation

100.0% - 4507037 Canada Inc.

100.0% - 4524781 Canada Inc.

100.0% - 4524799 Canada Inc.

100.0% - 4524802 Canada Inc.

I.          Other PFC Companies

Power Financial Corporation

100.0% - 4400003 Canada Inc.

100.0% - 3411893 Canada Inc.

100.0% - 3439453 Canada Inc.

100.0% - 4400020 Canada Inc.

100.0% - 4507045 Canada Inc.

100.0% - 4507088 Canada Inc.

100.0% - Power Financial Capital Corporation

Item 27. Number of Contract Owners

As of March 31, 2011, there were 4,331 total contract owners; 4,305 were in non-qualified accounts and 26 were in qualified accounts.

Item 28. Indemnification

Provisions exist under the Colorado Business Corporation Act and the Bylaws of Great-West whereby Great-West may indemnify a director, officer, or controlling person of Great-West against liabilities arising under the Securities Act of 1933. The following excerpts contain the substance of these provisions:

Colorado Business Corporation Act

Article 109 – INDEMNIFICATION
Section 7-109-101. Definitions.
	As used in this Article:
	(1) “Corporation” includes any domestic or foreign entity that is a predecessor of the corporation by reason of a merger, consolidation, or other transaction in which the predecessor’s existence ceased upon consummation of the transaction.
	(2) “Director” means an individual who is or was a director of a corporation or an individual who, while a director of a corporation, is or was serving at the corporation’s request as a director, an officer, an agent, an associate, an employee, a fiduciary, a manager, a member, a partner, a promoter, or a trustee of or to hold a similar position with, another domestic or foreign entity or employee benefit plan. A director is considered to be serving an employee benefit plan at the corporation’s request if the director’s duties to the corporation also impose duties on, or otherwise involve services by, the director to the plan or to participants in or beneficiaries of the plan. “Director” includes, unless the context requires otherwise, the estate or personal representative of a director.
	(3) “Expenses” includes counsel fees.
	(4) “Liability” means the obligation incurred with respect to a proceeding to pay a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses.
	(5) “Official capacity” means, when used with respect to a director, the office of director in the corporation and, when used with respect to a person other than a director as contemplated in Section 7-109-107, the office in a corporation held by the officer or the employment, fiduciary, or agency relationship undertaken by the employee, fiduciary, or agent on behalf of the corporation. “Official capacity” does not include service for any other domestic or foreign corporation or other person or employee benefit plan.
	(6) “Party” includes a person who was, is, or is threatened to be made a named defendant or respondent in a proceeding.
	(7) “Proceeding” means any threatened, pending, or completed action, suit,

	or proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal.
Section 7-109-102. Authority to indemnify directors.
	(1) Except as provided in subsection (4) of this section, a corporation may indemnify a person made a party to the proceeding because the person is or was a director against liability incurred in the proceeding if:
		(a) The person conducted himself or herself in good faith; and
		(b) The person reasonably believed:
			(I) In the case of conduct in an official capacity with the corporation, that his or her conduct was in the corporation’s best interests; and
			(II) In all other cases, that his or her conduct was at least not opposed to the corporation’s best interests; and
		(c) In the case of any criminal proceeding, the person had no reasonable cause to believe his or her conduct was unlawful.
	(2) A director’s conduct with respect to an employee benefit plan for a purpose the director reasonably believed to be in the interests of the participants in or beneficiaries of the plan is conduct that satisfies the requirements of subparagraph (II) of paragraph (b) of subsection (1) of this section. A director’s conduct with respect to an employee benefit plan for a purpose that the director did not reasonably believe to be in the interests of the participants in or beneficiaries of the plan shall be deemed not to satisfy the requirements of subparagraph (a) of subsection (1) of this section.
	(3) The termination of any proceeding by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, is not, of itself, determinative that the director did not meet the standard of conduct described in this section.
	(4) A corporation may not indemnify a director under this section:
		(a) In connection with a proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation; or
		(b) In connection with any proceeding charging that the director derived an improper personal benefit, whether or not involving action in an official capacity, in which proceeding the director was adjudged liable on the basis that he or she derived an improper personal benefit.
	(5) Indemnification permitted under this section in connection with a proceeding by or in the right of a corporation is limited to reasonable expenses incurred in connection with the proceeding.
Section 7-109-103. Mandatory Indemnification of Directors.
	Unless limited by the articles of incorporation, a corporation shall indemnify a person who was wholly successful, on the merits or otherwise, in defense of any

		proceeding to which the person was a party because the person is or was a director, against reasonable expenses incurred by him or her in connection with the proceeding.
Section 7-109-104. Advance of Expenses to Directors.
	(1) A corporation may pay for or reimburse the reasonable expenses incurred by a director who is a party to a proceeding in advance of the final disposition of the proceeding if:
		(a) The director furnishes the corporation a written affirmation of the director’s good-faith belief that he or she has met the standard of conduct described in Section 7-109-102;
		(b) The director furnishes the corporation a written undertaking, executed personally or on the director’s behalf, to repay the advance if it is ultimately determined that he or she did not meet such standard of conduct; and
		(c) A determination is made that the facts then know to those making the determination would not preclude indemnification under this article.
	(2) The undertaking required by paragraph (b) of subsection (1) of this section shall be an unlimited general obligation of the director, but need not be secured and may be accepted without reference to financial ability to make repayment.
	(3) Determinations and authorizations of payments under this section shall be made in the manner specified in Section 7-109-106.
Section 7-109-105. Court-Ordered Indemnification of Directors.
	(1) Unless otherwise provided in the articles of incorporation, a director who is or was a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. On receipt of an application, the court, after giving any notice the court considers necessary, may order indemnification in the following manner
		(a) If it determines the director is entitled to mandatory indemnification under section 7-109-103, the court shall order indemnification, in which case the court shall also order the corporation to pay the director’s reasonable expenses incurred to obtain court-ordered indemnification.
		(b) If it determines that the director is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the director met the standard of conduct set forth in section 7-109-102 (1) or was adjudged liable in the circumstances described in Section 7-109-102 (4), the court may order such indemnification as the court deems proper; except that the indemnification with respect to any proceeding in which liability shall have been adjudged in the circumstances described Section 7-109-102 (4) is limited to reasonable expenses incurred in connection with the proceeding and reasonable expenses incurred to obtain court-ordered indemnification.

Section 7-109-106. Determination and Authorization of Indemnification of Directors.

(1) A corporation may not indemnify a director under Section 7-109-102 unless authorized in the specific case after a determination has been made that indemnification of the director is permissible in the circumstances because he has met the standard of conduct set forth in Section 7-109-102. A corporation shall not advance expenses to a director under Section 7-109-104 unless authorized in the specific case after the written affirmation and undertaking required by Section 7-109-104(1)(a) and (1)(b) are received and the determination required by Section 7-109-104(1)(c) has been made.

(2) The determinations required by subsection (1) of this section shall be made:

(a) By the board of directors by a majority vote of those present at a meeting at which a quorum is present, and only those directors not parties to the proceeding shall be counted in satisfying the quorum; or

(b) If a quorum cannot be obtained, by a majority vote of a committee of the board of directors designated by the board of directors, which committee shall consist of two or more directors not parties to the proceeding; except that directors who are parties to the proceeding may participate in the designation of directors for the committee.

(3) If a quorum cannot be obtained as contemplated in paragraph (a) of subsection (2) of this section, and the committee cannot be established under paragraph (b) of subsection (2) of this section, or even if a quorum is obtained or a committee designated, if a majority of the directors constituting such quorum or such committee so directs, the determination required to be made by subsection (1) of this section shall be made:

(a) By independent legal counsel selected by a vote of the board of directors or the committee in the manner specified in paragraph (a) or (b) of subsection (2) of this section or, if a quorum of the full board cannot be obtained and a committee cannot be established, by independent legal counsel selected by a majority vote of the full board of directors; or

(b) By the shareholders.

(4) Authorization of indemnification and advance of expenses shall be made in the same manner as the determination that indemnification or advance of expenses is permissible; except that, if the determination that indemnification or advance of expenses is permissible is made by independent legal counsel, authorization of indemnification and advance of expenses shall be made by the body that selected such counsel.

Section 7-109-107. Indemnification of Officers, Employees, Fiduciaries, and Agents.

(1) Unless otherwise provided in the articles of incorporation:

(a) An officer is entitled to mandatory indemnification under section 7-109-103, and is entitled to apply for court-ordered indemnification under section 7-109-105, in each case to the same extent as a director;

(b) A corporation may indemnify and advance expenses to an

officer, employee, fiduciary, or agent of the corporation to the same extent as a director; and

(c) A corporation may indemnify and advance expenses to an officer, employee, fiduciary, or agent who is not a director to a greater extent, if not inconsistent with public policy, and if provided for by its bylaws, general or specific action of its board of directors or shareholders, or contract.

Section 7-109-108. Insurance.

A corporation may purchase and maintain insurance on behalf of a person who is or was a director, officer, employee, fiduciary, or agent of the corporation and who, while a director, officer, employee, fiduciary, or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, fiduciary, or agent of any other domestic or entity or of an employee benefit plan against any liability asserted against or incurred by the person in that capacity or arising from the person’s status as a director, officer, employee, fiduciary, or agent whether or not the corporation would have the power to indemnify the person against such liability under the Section 7-109-102, 7-109-103 or 7-109-107. Any such insurance may be procured from any insurance company designated by the board of directors, whether such insurance company is formed under the law of this state or any other jurisdiction of the United States or elsewhere, including any insurance company in which the corporation has an equity or any other interest through stock ownership or otherwise.

Section 7-109-109. Limitation of Indemnification of Directors.

(1) A provision treating a corporation’s indemnification of, or advance of expenses to, directors that is contained in its articles of incorporation or bylaws, in a resolution of its shareholders or board of directors, or in a contract, except for an insurance policy or otherwise, is valid only to the extent the provision is not inconsistent with Sections 7-109-101 to 7-109-108. If the articles of incorporation limit indemnification or advance of expenses, indemnification or advance of expenses are valid only to the extent not inconsistent with the articles of incorporation.

(2) Sections 7-109-101 to 7-109-108 do not limit a corporation’s power to pay or reimburse expenses incurred by a director in connection with an appearance as a witness in a proceeding at a time when he or she has not been made a named defendant or respondent in the proceeding.

Section 7-109-110. Notice to Shareholders of Indemnification of Director.

If a corporation indemnifies or advances expenses to a director under this article in connection with a proceeding by or in the right of the corporation, the corporation shall give written notice of the indemnification or advance to the shareholders with or before the notice of the next shareholders’ meeting. If the next shareholder action is taken without a meeting at the instigation of the board of directors, such notice shall be given to the shareholders at or before the time the first shareholder signs a writing consenting to such action.

Bylaws of Great-West

Article IV. Indemnification

SECTION 1. In this Article, the following terms shall have the following meanings:

(a) “expenses” means reasonable expenses incurred in a proceeding, including expenses of investigation and preparation, expenses in connection with an appearance as a witness, and fees and disbursement of counsel, accountants or other experts;

(b) “liability” means an obligation incurred with respect to a proceeding to pay a judgment, settlement, penalty or fine;

(c) “party” includes a person who was, is, or is threatened to be made a named defendant or respondent in a proceeding;

(d) “proceeding” means any threatened, pending or completed action, suit, or proceeding whether civil, criminal, administrative or investigative, and whether formal or informal.

SECTION 2. Subject to applicable law, if any person who is or was a director, officer or employee of the corporation is made a party to a proceeding because the person is or was a director, officer or employee of the corporation, the corporation shall indemnify the person, or the estate or personal representative of the person, from and against all liability and expenses incurred by the person in the proceeding (and advance to the person expenses incurred in the proceeding) if, with respect to the matter(s) giving rise to the proceeding:

(a) the person conducted himself or herself in good faith; and

(b) the person reasonably believed that his or her conduct was in the corporation’s best interests; and

(c) in the case of any criminal proceeding, the person had no reasonable cause to believe that his or her conduct was unlawful; and

(d) if the person is or was an employee of the corporation, the person acted in the ordinary course of the person’s employment with the corporation.

SECTION 3. Subject to applicable law, if any person who is or was serving as a director, officer, trustee or employee of another company or entity at the request of the corporation is made a party to a proceeding because the person is or was serving as a director, officer, trustee or employee of the other company or entity, the corporation shall indemnify the person, or the estate or personal representative of the person, from and against all liability and expenses incurred by the person in the proceeding (and advance to the person expenses incurred in the proceeding) if:

(a) the person is or was appointed to serve at the request of the corporation as a director, officer, trustee or employee of the other company or entity in accordance with Indemnification Procedures approved by the Board of Directors of the corporation; and

(b) with respect to the matter(s) giving rise to the proceeding:

(i) the person conducted himself or herself in good faith; and

(ii) the person reasonably believed that his or her conduct was at least not opposed to the corporation’s best interests (in the case of a trustee of one of the corporation’s staff benefits plans, this means that the person’s conduct was for a purpose the person reasonably believed to be in the interests of the plan participants); and

(iii) in the case of any criminal proceeding, the person had no reasonable cause to believe that his or her conduct was unlawful; and

if the person is or was an employee of the other company or entity, the person acted in the ordinary course of the person’s employment with the other company or entity.

Item 29. Principal Underwriter

(a)    GWFS Equities, Inc. (formerly, BenefitsCorp Equities, Inc) (“GWFS”) is the distributor of securities of the Registrant. GWFS also serves as distributor or principal underwriter for Maxim Series Fund, Inc., an open-end management investment company; Maxim Series Account of Great-West, FutureFunds Series Account of Great-West, COLI VUL-2 Series Account of Great-West, COLI VUL-4 Series Account of Great-West, Varifund Variable Annuity Account of Great-West, Trillium Variable Annuity Account of Great-West, Prestige Variable Life Account of Great-West, COLI VUL-2 Series Account of First Great-West Life & Annuity Insurance Company (“First Great-West”), COLI VUL-4 Series Account of First Great-West and Variable Annuity-1 Series Account of First Great-West.

(b) Directors and Officers of GWFS

Name	Principal Business Address	Position and Office with Underwriter
C.P. Nelson	8515 East Orchard Road Greenwood Village, CO 80111	Chairman, President and Chief Executive Officer
R.K. Shaw	8515 East Orchard Road Greenwood Village, CO 80111	Director
G.E. Seller	18111 Von Karman Ave., Suite 560 Irvine, CA 92715	Director and Senior Vice President
S.A. Bendrick	8515 East Orchard Road Greenwood Village, CO 80111	Director and Vice President
W.S. Harmon	8515 East Orchard Road Greenwood Village, CO 80111	Director and Vice President
G.R. Derback	8515 East Orchard Road Greenwood Village, CO 80111	Treasurer
C.H. Cumming	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President
M.R. Edwards	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President
J.G. Gibbs	8515 East Orchard Road Greenwood Village, CO 80111	Vice President, Trading Operations
J.C. Luttges	8515 East Orchard Road Greenwood Village, CO 80111	Vice President
M.C. Maiers	8515 East Orchard Road	Vice President and Investments Compliance

	Greenwood Village, CO 80111	Officer
B.A. Byrne	8515 East Orchard Road Greenwood Village, CO 80111	Secretary and Chief Compliance Officer
T.L. Luiz	8515 East Orchard Road Greenwood Village, CO 80111	Compliance Officer

(c) Commissions and other compensation received by Principal Underwriter during registrant’s last fiscal year:

Name of Principal Underwriter	Net Under writing Discounts and Commissions	Compensation on Redemption	Brokerage Commissions	Compensation
GWFS	-0-	-0-	-0-	-0-

Item 30. Location of Accounts and Records

All accounts, books, or other documents required to be maintained by Section 31(a) of the 1940 Act and the rules promulgated thereunder are maintained by the registrant through GWL&A, 8515 E. Orchard Road, Greenwood Village, Colorado 80111.

Item 31. Management Services

Not Applicable.

Item 32. Undertakings

(a) Registrant undertakes to file a post-effective amendment to this Registration Statement as frequently as is necessary to ensure that the audited financial statements 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) Registrant undertakes to include either (1) as part of any application to purchase a contract offered by the Prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a postcard or similar written communication affixed to or included in the Prospectus that the applicant can remove to send for a Statement of Additional Information.

(c) Registrant undertakes to deliver any Statement of Additional Information and any financial statements required to be made available under this form promptly upon written or oral request.

(e) Great-West represents the fees and charges deducted under the Contracts, in the aggregate, are reasonable in relation to the services rendered, the expenses to be incurred and the risks assumed by Great-West.

SIGNATURES

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets the requirements of Securities Act Rule 485(b) for effectiveness of this Post-Effective Amendment No. 23 to the Registration Statement and has duly caused this Post-Effective Amendment No. 23 to the Registration Statement to be signed on its behalf, in the City of Greenwood Village, State of Colorado, on this 20th day of April 2011.

	VARIABLE ANNUITY-1 SERIES ACCOUNT
	(Registrant)
BY:	/s/ M.T.G. Graye
	M.T.G. Graye, President and Chief Executive Officer of
	Great-West Life & Annuity Insurance Company
BY:	GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
	(Depositor)
BY:	/s/ M.T.G. Graye
	M.T.G. Graye
	President and Chief Executive Officer

As required by the Securities Act of 1933, this Post-Effective Amendment No. 23 to the Registration Statement has been signed below by the following persons in the capacities and on the dates indicated:

Signature	Title	Date
/s/ R.L. McFeetors	Chairman of the Board	April 20, 2010
R.L. McFeetors*
/s/ M.T.G. Graye	Director, President and	April 20, 2010
M.T.G. Graye	Chief Executive Officer
/s/ J.L. McCallen	Chief Financial Officer and	April 20, 2010
J.L. McCallen	Senior Vice President
/s/ J. Balog
J. Balog*	Director	April 20, 2010
/s/ J.L. Bernbach
J. L. Bernbach*	Director	April 20, 2010
/s/ A. Desmarais
A. Desmarais*	Director	April 20, 2010

/s/ P. Desmarais
P. Desmarais, Jr.*	Director	April 20, 2010
/s/ A. Louvel
A. Louvel*	Director	April 20, 2010
/s/ J.E.A. Nickerson
J.E.A. Nickerson*	Director	April 20, 2010
/s/ R.J. Orr
R. J. Orr*	Director	April 20, 2010
/s/ M. Plessis-Bélair
M. Plessis-Bélair*	Director	April 20, 2010
/s/ H.P Rousseau
H.P. Rousseau*	Director	April 20, 2010
/s/ R. Royer
R Royer*	Director	April 20, 2010
/s/ P.K. Ryan
P. K. Ryan*	Director	April 20, 2010
/s/ T.T. Ryan
T. T. Ryan*	Director	April 20, 2010
/s/ B.E. Walsh
B. E. Walsh*	Director	April 20, 2010

*By:	/s/ R.G. Schultz	April 20, 2011
	R.G. Schultz Attorney in Fact pursuant to Powers of Attorney