N-CSR 1 dncsr.htm ALLSTATE ASSURANCE COMPANY SEPARATE ACCOUNT B ALLSTATE ASSURANCE COMPANY SEPARATE ACCOUNT B

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM N-CSR

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

 

Investment Company Act file number: 811-01525

 

ALLSTATE ASSURANCE COMPANY

SEPARATE ACCOUNT B

(Exact name of Registrant as specified in charter)

3100 Sanders Road, Suite J5B

Northbrook, IL 60062

(Address of principal executive offices)

Director of Illinois

Department of Insurance

320 West Washington Street

Springfield, IL 62767

(Name and address of agent for service)

 

Registrant’s telephone number, including area code: (847) 402-5000

 

Date of fiscal year end: December 31

 

Date of reporting period: January 31, 2006 - December 31, 2006


Item 1. Reports to Stockholders.

Annual Report

December 31, 2006

Board of Managers

Separate Account B:

David G. Fussell, Chairman

H. Grant Law, Jr.

Henry E. Blaine

PRINCIPAL OFFICERS OF

ALLSTATE ASSURANCE COMPANY

Casey J. Sylla, Chairman of the Board and President

Anson J. Glacy, Jr., Vice President

Michael J. Velotta, Secretary and General Counsel

John C. Lounds, Senior Vice President

John C. Pintozzi, Senior Vice President and Chief Financial Officer

Steven C. Verney, Treasurer

Samuel H. Pilch, Group Vice President and Controller

Karen C. Gardner, Vice President-Tax

Eric A. Simonson, Senior Vice President and Chief Investment Officer

Joseph P. Rath, Assistant General Counsel and Secretary

Thomas W. Evans, Senior Vice President

Susan N. Roth, Chief Compliance Officer

ALLSTATE ASSURANCE COMPANY

SEPARATE ACCOUNT B

A separate account of

Allstate Assurance Company

This report and the financial statements attached are submitted solely for the general information of contractowners of Allstate Assurance Company Separate Account B and are not authorized for other use.


MESSAGE TO PARTICIPANTS IN

ALLSTATE ASSURANCE COMPANY

VARIABLE ANNUITY CONRACTS

This annual report of Separate Account B contains the financial statements and portfolio information of Separate Account B for the year ended December 31, 2006. Comparative figures that relate to Separate Account B’s activities during the year of 2006 are provided below.

The accumulation value for Separate Account B increased 9.04% for the year 2006 from $15.37 at year-end 2005 to $16.76 on December 31, 2006. During this same period, the S&P 500 index increased by a total return of 15.79%. Reflecting transfers to the fixed-dollar account, as well as withdrawals and retirements, the number of accumulation units outstanding on December 31, 2006 was 120,312, down from 155,903 at year-end 2005. As a result of withdrawals and changes in the accumulation unit value, total contractowners’ equity on December 31, 2006 was $2,503,950 compared to $2,951,319 on December 31, 2005.

The major U.S. and global equity indexes finished strong for the second half of 2006, including the aforementioned increase in the S&P 500 index, the NASDAQ up over 10% and the Russell 2000 index, which was up 18.37%. As the fourth quarter wound down, the Federal Reserve maintained Fed Funds rates at 5.25% and left future rate changes with a continued “data dependant” stance. The consumer sector remains weak, while business spending has continued to support the economy. While the outlook for equities remains favorable, the risks of the market include continued high oil prices, uncertain Federal Reserve movements and the weak housing market. We continue to believe your portfolio is positioned properly with leading companies in their respective sectors.

Thank you for your continued support.

 

/s/ David G. Fussell
David G. Fussell
Chairman, Board of Managers
Allstate Assurance Company
Separate Account B


Additional Information.

REMUNERATION OF MEMBERS OF THE BOARD OF MANAGERS

Unum Group paid all expenses relative to the operation of the Separate Account including Board of Managers’ fees. Accordingly, no member of the Board of Managers receives any remuneration from the Separate Account. Each Board member, other than David G. Fussell, receives an annual retainer of $4,500.00 for serving on the Board. Mr. Fussell received no remuneration from the Company based on his membership on the Board.

PROXY VOTING POLICIES

A description of the Separate Account’s proxy voting policy and procedures is available without charge, upon written request, from the Secretary of the Board of Managers. Please send a written request to the Secretary of the Board of Managers, c/o Unum Group at 1 Fountain Square, Chattanooga, Tennessee 37402. You may also view a description of the Separate Account’s proxy voting policy and procedures on the SEC’s (Securities and Exchange Commission) website, www.sec.gov.

Information regarding how the Separate Account voted proxies relating to portfolio securities during the most recent 12-month period ended is available via the methods noted above.

QUARTERLY FILING REQUIREMENTS

In November 2004, the Separate Account began filing its complete schedule of investments with the Securities and Exchange Commission for the first and third quarter of each fiscal year on Form N-Q, which when filed, is available without charge, upon written request, from the Secretary of the Board of Managers. Please send a written request to the Secretary of the Board of Managers, c/o Unum Group at 1 Fountain Square, Chattanooga, Tennessee 37402. You may also view its complete schedule of investments on Form N-Q on the SEC’s (Securities and Exchange Commission) website, www.sec.gov.

STATEMENT OF ADDITIONAL INFORMATION

The Statement of Additional Information (SAI) includes additional information about members of the board of managers of the Registrant, and is available, without charge, upon request, toll-free at (800) 718-8824 for Contractowners who call to request the SAI.


INFORMATION CONCERNING MEMBERS OF THE BOARD OF MANAGERS

 

(1)

  

(2)

  

(3)

  

(4)

  

(5)

  

(6)

Name, Address,

and Age

  

Position(s) Held with
the Separate Account

  

Term of Office and
Length of Time Served

  

Principal
Occupation(s) During
Past 5 Years

  

Number of
Portfolios in

Separate Account
Overseen by Director
or Nominee for
Director

  

Other Directorships
Held by Director or
Nominee For Director

Henry E. Blaine (77)

403 Country Club View Drive

Edwardsville, IL 62025

  

Member,

Board of Managers

  

2006-2007

29 years of service

   B&B Enterprises, Partner    1    None

H. Grant Law, Jr. (60)

P.O. Box 1367

Chattanooga, TN 37401

  

Member,

Board of Managers

  

2006-2007

15 years of service

   President, Newton Chevrolet, Inc.; President, Newton Oldsmobile – GMC Trucks Mitsubishi, Inc.    1    None

The member of the Board of Managers listed below is an “interested person” of the Separate Account within the meaning of section 2(a)(19) of the Investment Company Act of 1940.

 

Name, Address,

and Age

  

Position(s) Held with
Separate Account

  

Term of Office and
Length of Time Served

  

Principal
Occupation(s) During
Past 5 Years

  

Number of
Portfolios in

Separate Account
Overseen by Director
or Nominee for
Director

  

Other Directorships
Held by Director or
Nominee For Director

David G. Fussell* (59)

1 Fountain Square

Chattanooga, TN 37402

  

Chairman

Board of Managers

  

2006-2007

12 years of service

   Senior Vice President of Unum Group, Chattanooga, Tennessee    1    None

 

* Officer of PRIMCO (the investment sub-advisor of the Separate Account) and other subsidiaries within the Unum Group holding company system.

None of the members of the Board of Managers who are not “interested persons” of the Separate Account within the meaning of section 2(a)(19) of the Investment Company Act of 1940 owns beneficially or of record securities of the Company or any of its affiliates.


AUDITED FINANCIAL STATEMENTS

Allstate Assurance Company Separate Account B

As of December 31, 2006 and

For the Years Ended December 31, 2006 and 2005


Allstate Assurance Company Separate Account B

Audited Financial Statements

December 31, 2006

 

Reports of Independent Registered Public Accounting Firms

   1

Statement of Assets and Liabilities

   2

Statement of Operations

   3

Statements of Changes in Variable Annuity Contract Owners’ Equity

   4

Schedule of Investments

   5

Financial Highlights

   8

Notes to Financial Statements

   9

Accumulation Unit Value Table (Unaudited)

   11


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Managers and Contract Owners

Allstate Assurance Company Separate Account B,

And Board of Directors of Allstate Assurance Company

We have audited the accompanying statement of assets and liabilities of Allstate Assurance Company Separate Account B (the “Separate Account”), including the schedule of investments, as of December 31, 2006, and the related statements of operations, for the year then ended, the statement of changes in variable annuity contract owners’ equity for the two years in the period then ended, and the financial highlights for each of the two years in the period then ended. These financial statements and financial highlights are the responsibility of the Separate Account’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. The financial highlights fro the years ended prior to December 31, 2005 were audited by other auditors whose report dated February 9, 2005, expressed an unqualified opinion on those financial highlights.

We conducted our audit 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 Separate Account is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Separate Account’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2006, by correspondence with the custodian and brokers. We believe that our audit provides 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 Allstate Assurance Company Separate Account B as of December 31, 2006, and the results of its operations for the year then ended, the changes in its variable annuity contract owners’ equity for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

LOGO

Chicago, Illionis

February 28, 2007

 

1


STATEMENT OF ASSETS AND LIABILITIES

Allstate Assurance Company Separate Account B

 

     December 31, 2006

ASSETS

  

Common stocks—at market value
(Cost: $1,204,784)

   $ 2,503,747

Cash

     15,542

Accrued dividends

     2,900
      

TOTAL ASSETS

   $ 2,522,189
      

LIABILITIES AND CONTRACT OWNERS’ EQUITY

  

Amounts payable for terminations and variable annuity benefits

   $ 17,075

Management fee and other amounts due Allstate Assurance Company

     1,164
      

TOTAL LIABILITIES

     18,239
      

Contract owners’ equity:

  

Deferred annuity contracts terminable by owners—(accumulation units outstanding: 120,312.428; unit value: $16.756791)

     2,016,050

Annuity contracts in pay-out period —(annuitization units outstanding: 29,116.517; unit value: $16.756791)

     487,900
      

TOTAL CONTRACT OWNERS’ EQUITY

   $ 2,503,950
      

See accompanying notes to financial statements.

 

2


STATEMENT OF OPERATIONS

Allstate Assurance Company Separate Account B

 

     Year Ended
December 31, 2006

INVESTMENT INCOME

  

Income:

  

Dividends

   $ 40,591

Expenses — Note C:

  

Investment advisory services

     12,957

Mortality and expense assurances

     18,139
      
     31,096
      

NET INVESTMENT INCOME

     9,495
      

REALIZED AND UNREALIZED GAIN ON INVESTMENTS—NOTE A

  

Net realized gain from investment transactions (excluding short-term securities):

  

Proceeds from sales

     730,799

Cost of investments sold

     543,182
      

Net realized gain

     187,617
      

Net unrealized appreciation of investments:

  

At end of year

     1,298,963

At beginning of year

     1,261,934
      

Increase in net unrealized appreciation of investments

     37,029
      

NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS

     224,646
      

INCREASE IN CONTRACT OWNERS’ EQUITY FROM INVESTMENT ACTIVITIES

   $ 234,141
      

See accompanying notes to financial statements.

 

3


STATEMENTS OF CHANGES IN VARIABLE ANNUITY CONTRACT OWNERS’ EQUITY

Allstate Assurance Company Separate Account B

 

     Year Ended December 31  
     2006     2005  

BALANCE AT BEGINNING OF PERIOD

   $ 2,951,319     $ 3,362,150  

FROM INVESTMENT ACTIVITIES:

    

Net investment income

     9,495       2,080  

Net realized gain (loss) on investments

     187,617       (29,263 )

Increase in net unrealized appreciation of investments

     37,029       66,393  
                

Increase in contract owners’ equity from investment activities

     234,141       39,210  
                

FROM VARIABLE ANNUITY CONTRACT TRANSACTIONS:

    

Terminations and death benefits (Units terminated):

    

2006— 35,590.556;

     (570,560 )     (339,789 )

2005— 23,210.710;

    

Variable annuity benefits paid (Number of units):

    

2006— 6,989.938;

     (110,950 )     (110,252 )
                

2005— 7,521.621;

    

Decrease in contract owners’ equity from variable annuity contract transactions

     (681,510 )     (450,041 )
                

NET DECREASE IN CONTRACT OWNERS’ EQUITY

     (447,369 )     (410,831 )
                

BALANCE AT END OF PERIOD

   $ 2,503,950     $ 2,951,319  
                

See accompanying notes to financial statements.

 

4


SCHEDULE OF INVESTMENTS

Allstate Assurance Company Separate Account B

December 31, 2006

 

     Number of
Shares
   Market
Value

COMMON STOCKS

     

CAPITAL GOODS (17.2%)

     

Emerson Electric Company

   1,600    $ 70,512

General Electric Company

   3,400      126,514

Textron, Inc.

   1,150      107,836

Tyco International, Ltd.

   4,100      124,640
         
        429,502

CONSUMER GOODS (11.3%)

     

Lowe’s Companies, Inc.

   3,600      112,140

Masco Corporation

   3,000      89,610

PepsiCo, Inc.

   1,300      81,315
         
        283,065

CONSUMER SERVICES (5.2%)

     

Comcast Corporation, Class A *

   1,350      56,538

Wal-Mart Stores, Inc.

   1,600      73,888
         
        130,426

ENERGY (17.5%)

     

Dominion Resources, Inc.

   1,250      104,800

Grant Prideco, Inc. *

   2,400      95,448

Schlumberger, Ltd.

   1,800      113,688

Weatherford International, Inc. *

   3,000      125,370
         
        439,306

See accompanying notes to financial statements.

 

5


SCHEDULE OF INVESTMENTS - Continued

Allstate Assurance Company Separate Account B

December 31, 2006

 

     Number of
Shares
   Market
Value

COMMON STOCKS - Continued

     

FINANCIAL (18.9%)

     

American Express Company

   2,600    $ 157,742

Bank of America Corporation

   2,000      106,780

Citigroup, Inc.

   1,500      83,550

J.P. Morgan Chase and Co.

   1,650      79,695

Western Union Company

   2,000      44,840
         
        472,607

HEALTH CARE (3.5%)

     

Johnson & Johnson

   764      50,439

Medtronic, Inc.

   700      37,457
         
        87,896

TECHNOLOGY - HARDWARE (8.8%)

     

Cisco Systems, Inc. *

   5,500      150,315

Intel Corporation

   3,400      68,850
         
        219,165

TECHNOLOGY - SOFTWARE & SERVICES (10.1%)

     

First Data Corporation

   2,800      71,456

Microsoft Corporation

   3,200      95,552

Yahoo!, Inc. *

   3,400      86,836
         
        253,844

See accompanying notes to financial statements.

 

6


SCHEDULE OF INVESTMENTS - Continued

Allstate Assurance Company Separate Account B

December 31, 2006

 

     Number of
Shares
   Market
Value

COMMON STOCKS - Continued

     

TELECOMMUNICATIONS (7.5%)

     

Corning, Inc. *

   3,400    $ 63,614

Motorola, Inc.

   2,500      51,400

Vodafone Airtouch, PLC - ADR

   2,625      72,922
         
        187,936
         

TOTAL COMMON STOCK (100.0%)
(Cost: $1,204,784)

        2,503,747
         

TOTAL INVESTMENTS (100.0%)
(Cost: $1,204,784)

        2,503,747

CASH AND RECEIVABLES LESS LIABILITIES (0.0%)

        203
         

TOTAL CONTRACT OWNERS’ EQUITY (100.0%)

      $ 2,503,950
         

 

* Non-income producing security

ADR – American Depository Receipt

See accompanying notes to financial statements.

 

7


FINANCIAL HIGHLIGHTS

Allstate Assurance Company Separate Account B

Selected data for an accumulation unit outstanding (including both deferred annuity contracts terminable by owners and annuity contracts in pay-out period) throughout each period excluding sales loads:

 

     Year Ended December 31  
     2006     2005     2004     2003     2002  

Investment income

   $ 0.25     $ 0.19     $ 0.23     $ 0.11     $ 0.11  

Expenses

     0.19       0.18       0.18       0.14       0.15  
                                        

Net investment income (loss)

     0.06       0.01       0.05       (0.03 )     (0.04 )

Net realized and unrealized gain (loss) on investments

     1.33       .27       1.16       3.72       (5.07 )
                                        

Net increase (decrease) in contract owners’ equity

     1.39       .28       1.21       3.69       (5.11 )

Net contract owners’ equity:

          

Beginning of year

     15.37       15.09       13.88       10.19       15.30  
                                        

End of year

   $ 16.76     $ 15.37     $ 15.09     $ 13.88     $ 10.19  
                                        

Total Return

     9.04 %     1.86 %     8.72 %     36.21 %     (33.40 %)

Ratio of expenses to average contract owners’ equity

     1.20 %     1.20 %     1.20 %     1.21 %     1.19 %

Ratio of net investment income (loss) to average contract owners’ equity

     0.37 %     0.07 %     0.38 %     (0.25 %)     (0.34 %)

Portfolio turnover

     2 %     6 %     5 %     0 %     1 %

Number of deferred annuity contracts terminable by owners accumulation units outstanding at end of year

     120,312       155,903       179,114       205,266       211,880  

See accompanying notes to financial statements.

 

8


NOTES TO FINANCIAL STATEMENTS

Allstate Assurance Company Separate Account B

December 31, 2006

NOTE A—INVESTMENTS AND ACCOUNTING POLICIES

Allstate Assurance Company Separate Account B (“Separate Account B”) is a segregated investment account of Allstate Assurance Company (formerly Provident National Assurance Company) and is registered under the Investment Company Act of 1940, as amended, as an open-end diversified management investment company. Certain administrative services of Separate Account B are provided by The Variable Annuity Life Insurance Company (“VALIC”) under a contract dated May 15, 1998. These services include processing of unit transactions and daily unit value calculations subsequent to December 1, 1998 as well as accounting and other services. On February 1, 2001 UnumProvident Corporation sold the Provident National Assurance Company corporate shell, including the Separate Account B assets and liabilities, to Allstate Life Insurance Company. This transaction had no impact on the contract owners of Separate Account B.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in those statements and accompanying notes. Actual results may differ from such estimates.

Common stocks are valued at published market quotations which represent the closing sales price for securities traded on a national stock exchange or the mean between the quoted bid and asked prices for those traded over-the-counter.

Realized and unrealized gains and losses are credited to, or charged to, contract owners’ equity. The identified cost basis has been used in determining realized gains and losses on sales of investments. There were gross unrealized gains of $1,298,963 and no gross unrealized losses at December 31, 2006. Security transactions are recorded on a trade date basis. Dividends are taken into income on an accrual basis as of the ex-dividend date.

A summary of the cost of investments purchased and proceeds from investments sold for the year ended December 31, 2006 is shown below.

 

     Year Ended
December 31, 2006

Cost of investments purchased

   $ 46,038
      

Proceeds from investments sold

   $ 730,799
      

The aggregate cost of investments for federal income tax purposes is the same as that presented in the Statements of Assets and Liabilities.

 

9


NOTES TO FINANCIAL STATEMENTS - Continued

Allstate Assurance Company Separate Account B

December 31, 2006

NOTE B—FEDERAL INCOME TAXES

Operations of Separate Account B will form a part of the income tax return of Allstate Assurance Company, which is taxed as a “life insurance company” under the Internal Revenue Code.

Under current law, no federal income taxes are payable with respect to Separate Account B.

NOTE C—EXPENSES

Deductions are made by Allstate Assurance Company at the end of each valuation period for investment advisory services and for mortality and expense assurances, which on an annual basis are approximately .50% and .70%, respectively, of the net assets of Separate Account B.

 

10


ACCUMULATION UNIT VALUE TABLE (Unaudited)

Allstate Assurance Company Separate Account B

 

End of Month

   Accumulation
Unit Value

December 1968

   1.036279

December 1969

   1.080379

December 1970

   1.030039

December 1971

   1.178612

December 1972

   1.403795

December 1973

   1.126624

December 1974

   0.863269

December 1975

   1.022844

December 1976

   1.156853

December 1977

   1.064425

December 1978

   1.094150

December 1979

   1.219189

December 1980

   1.555258

December 1981

   1.473246

December 1982

   1.812441

December 1983

   2.132092

December 1984

   2.029912

December 1985

   2.480050

December 1986

   2.743444

December 1987

   2.734169

December 1988

   3.087892

December 1989

   3.812606

December 1990

   3.736441

December 1991

   5.036212

December 1992

   5.028547

December 1993

   5.646864

December 1994

   5.410722

December 1995

   6.908158

March 1996

   7.309625

June

   7.593667

September

   7.851947

December

   8.435567

March 1997

   8.468896

June

   10.238554

September

   11.146167

December

   11.384926

March 1998

   12.975484

June

   13.465013

September

   11.758633

December

   15.192155
March 1999    15.889579
June    17.218781
September    15.844714
December    19.180992
March 2000    19.749348
June    19.048870
September    17.707495
December    16.659801
March 2001    14.835643
June    16.233254
September    13.226137
December    15.297123
March 2002    14.625826
June    12.053638
September    9.364676
December    10.188983
March 2003    9.728625
June    11.721042
September    12.329500
December    13.879698
March 2004    14.120048
June    14.422906
September    13.795096
December    15.094382
March 2005    14.304578
June    14.363421
September    14.795618
December    15.370699
January 2006    15.795189
February    15.592784
March    15.914824
April    16.375420
May    15.976772
June    15.781618
July    15.366242
August    15.590613
September    15.949882
October    16.306886
November    16.771694
December    16.756791

Initial contributions to Separate Account B were received on February 1, 1968, prior to which time the unit value was set at 1.000000

The above indicates the accumulation unit value on the last valuation day of each year from December 1968 through December 1995, on the last valuation day of each quarter from March 1996 through December 2005, and on the last valuation day of each month beginning January 2006. The results shown should not be considered as a representation of the results which may be realized in the future.

 

11


Item 2. Code of Ethics.

(a) The Registrant has adopted a Code of Ethics that applies to its principal executive officer, principal financial officer and principal accounting officer. A copy of the Registrant’s Code of Ethics is filed herewith as Exhibit 10(a)(1).

(b) During the period covered by this report, no amendments were made to the provisions of the Code of Ethics described in 2(a) above.

(c) During the period covered by this report, no implicit or explicit waivers of the provisions of the Code of Ethics described in 2(a) above were granted.

 

Item 3. Audit Committee Financial Expert.

The Separate Account has assets of under $3 million. It has an audit committee, but does not have an audit committee financial expert. The Audit Committee of the Separate Account consists of independent directors that control 2/3 of the Board. The Committee receives quarterly reports on the transactions in the Separate Account. Because of the nature of the Separate Account’s business there are no sensitive accounting statements used in preparation of the financial statements of the Separate Account.

 

Item 4. Principal Accountant Fees and Services.

All fees relating to audit services performed for the Separate Account are paid by Unum Group.

Audit Fees – The aggregate fees Deloitte & Touche LLP billed Unum Group for the audit of the financial statements of the Separate Account for 2006 and 2005 were $30,000.00 and $30,000.00.

Audit-Related Fees –The aggregate fees for audit-related services rendered by Deloitte & Touche LLP to the Separate Account, PRIMCO, or to the investment advisor or any entity controlling, controlled by or under common control with the investment advisor in 2006 and 2005 were $0.00 and $0.00.

Tax Fees – The aggregate fees related to tax compliance, tax advice and tax planning services to the Separate Account for fiscal years ended December 31, 2006 and December 31, 2005, were $0.00 and $0.00.

All Other Fees – The aggregate fees rendered by Deloitte & Touche LLP to the Separate Account, PRIMCO, or to the investment advisor or any entity controlling, controlled by or under common control with the investment advisor for such services to the Separate Account in 2006 and 2005 were $0.00 and $0.00.


Item 5. Audit Committee of Listed Registrants.

The members of the Audit Committee are Henry E. Blaine and H. Grant Law, Jr. Each member of the Audit Committee is “independent” as determined under Rule 10A-3 of the Securities Exchange Act of 1934.

 

Item 6. Schedule of Investments.

Schedule of investments is included as of the close of the reporting period as part of the report to shareholders filed under Item 1 of this Form.

 

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

 

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.


Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

REGISTRANT PURCHASES OF EQUITY SECURITIES

 

     (a)    (b)    (c)    (d)

Period

   Total
Number
of Shares
(or Units)
Purchased
   Average
Price Paid
per Share
(or Unit)
   Total Number of
Shares (or Units)
Purchased as Part
of Publicly
Announced Plans
or Programs
  

Maximum Number

(or Approximate Dollar
Value) of Shares (or Units)
that May Yet Be Purchased
Under the Plans or
Programs

Month #1

(identify beginning and ending dates)

           

Month #2

(identify beginning and ending dates)

           

Month #3

(identify beginning and ending dates)

           

Month #4

(identify beginning and ending dates)

           

Month #5

(identify beginning and ending dates)

           

Month #6

(identify beginning and ending dates)

           

Total

           


Item 10. Submission of Matters to a Vote of Security Holders.

Not applicable.

 

Item 11. Controls and Procedures.

(a) Within the 90-day period prior to the filing of this report, the Registrant’s management, including the person serving as both the Registrant’s Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures as defined in Investment Company Act Rule 30a-3(c). Based on that evaluation, the Chief Executive Officer/Chief Financial Officer concluded that the Registrant’s disclosure controls and procedures were effective as of the date of this evaluation.

(b) No change in the Registrant’s internal control over financial reporting that materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting, occurred during the Registrant’s most recent second fiscal half-year.

 

Item 12. Exhibits.

The following exhibits are attached to this Form N-CSR:

(1) Code of Ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, attached hereto as Exhibit 10(a)(1).

(2) Certification for each principal executive and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 C.F.R. 270.30a-2(a)), attached hereto as Exhibit 31.

(3) Certification for each principal executive and principal financial officer of the registrant as required by Rule 30a-2(b) under the Act (17 C.F.R. 270.30a-2(b)), attached hereto as Exhibit 32.


SIGNATURES

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

 

Allstate Assurance Company
Separate Account B
By (Signature and Title):   /s/ David G. Fussell
 

David G. Fussell, Chairman, Board of Managers

Signing in the capacity of Chief Executive

Officer and Chief Financial Officer

Date: March 1, 2007.

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

 

By (Signature and Title):   /s/ David G. Fussell
 

David G. Fussell, Chairman, Board of Managers

Signing in the capacity of Chief Executive

Officer and Chief Financial Officer

Date: March 1, 2007.