ABOUT THIS REPORT

This report is a presentation of the National Security Variable Account N. Please note the variable account may offer more than one variable product. Some products may have different underlying mutual funds from those available in your contract. Therefore, not all funds listed in this report may be available in your contract. Please refer to your most recent account statement for specific information about your investment in National Security Variable Account N.

This Annual Report has four major sections:

Statements of Assets and Contract Owners’ Equity

These statements list all the underlying funds of the variable account, the number of shares owned, cost of shares, investments at fair value, contracts in accumulation period, annuity reserves for contracts in payment period and total contract owners’ equity. The fair value of the assets changes as the underlying mutual funds change in value. As contract owners transfer among the funds, the number of shares increases or decreases accordingly. When money is deposited or withdrawn by a contract owner, shares are correspondingly purchased or redeemed.

Statements of Operations

The Statements of Operations show income and expenses to the variable account from investment activity for reinvested dividends and risk and administrative expenses. Risk and administrative expenses are assessed through the daily unit value calculation and represent an expense to the variable account and its contract owners. These statements also show reinvested capital gains, the realized gain (loss) resulting from units being sold, and unrealized gain (loss).

Statements of Changes in Contract Owners’ Equity

The Statements of Changes in Contract Owners’ Equity include the increase or decrease in contract owners’ equity from operations for income and expenses shown on the statements of operations. In addition, the equity transactions section of this statement illustrates contract purchase payments, extra credit fund deposits, transfers to and from fixed dollar contracts and other subaccounts, withdrawals and surrenders, surrender charges, annual contract charges, and annuity and death benefit payments. The sum of these two sections represents the net change in contract owners’ equity which, when added to the beginning contracts owners’ equity, equals contract owners’ equity at the end of the reporting period. The change in units section illustrates the number of units purchased and redeemed for each subaccount during the period reported.

Notes to Financial Statements

The Notes to Financial Statements provide further disclosures about the variable account and its underlying contract provisions.

The following includes fund trust abbreviations that occur throughout this report:

Fund Trust Abbreviations -

AVIP - AuguStar℠ Variable Insurance Products Fund, Inc.

FIDS - Fidelity® Variable Insurance Products Fund - Service Class

FID2 - Fidelity® Variable Insurance Products Fund - Service Class 2

JASS - Janus Aspen Series - Service Shares

LEGI - Legg Mason Partners Variable Equity Trust - Class I

LEG2 - Legg Mason Partners Variable Income Trust - Class II

ASVT – Allspring Variable Trust

MSV2 - Morgan Stanley Variable Insurance Fund, Inc. - Class II

GSVI - Goldman Sachs Variable Insurance Trust - Institutional Shares

GSVS - Goldman Sachs Variable Insurance Trust - Service Shares

LAZS - Lazard Retirement Series, Inc. - Service Shares

PRS2 - The Prudential Series Fund, Inc. - Class II

LINC - Lincoln Variable Insurance Products Trust - Standard Class

ABVB - AB Variable Products Series Fund, Inc. - Class B

MFSI - MFS® Variable Insurance Trust - Service Class

MFS2 - MFS® Variable Insurance Trust II - Service Class

PVIA - PIMCO Variable Insurance Trust - Administrative Shares

BNYS - BNY Mellon Variable Investment Fund - Service Shares

ROYI - Royce Capital Fund - Investment Class

AIMI - AIM Variable Insurance Funds (Invesco Variable Insurance Funds)

NBAS - Neuberger Berman Advisers Management Trust - S Class

FRT2 - Franklin Templeton Variable Insurance Products Trust - Class 2

FRT5 - Franklin Templeton Variable Insurance Products Trust - Class 5

FRT4 - Franklin Templeton Variable Insurance Products Trust - Class 4

FEDS - Federated Hermes Insurance Series

IVYV - Ivy Variable Insurance Portfolios

NLV2 - Northern Lights Variable Trust - Class 2

NLV3 - Northern Lights Variable Trust - Class 3

National Security Variable Account N

Statements of Assets and Contract Owners’ Equity

December 31, 2023

					Assets		Contract owners’ equity
	Shares		Cost		Investments, at fair value		Contracts in accumulation period (note 6)		Annuity reserves for contracts in payment period		Total contract owners’ equity
AVIP - AVIP Bond Subaccount (d)		62,380	$	1,033,583	$	1,057,332	$	1,057,332	$	0	$	1,057,332
AVIP - AVIP BlackRock Balanced Allocation Subaccount (d)		459,589		14,947,137		14,968,798		14,912,721		56,077		14,968,798
AVIP - AVIP BlackRock Advantage International Equity Subaccount (d)		141,874		1,791,325		2,166,409		2,166,409		0		2,166,409
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount (b)(d)		1,260,759		2,089,310		1,891,139		1,891,139		0		1,891,139
AVIP - AVIP AB Small Cap Subaccount (d)		197,138		3,316,693		2,456,339		2,448,628		7,711		2,456,339
AVIP - AVIP AB Mid Cap Core Subaccount (d)		9,101		229,368		266,739		266,739		0		266,739
AVIP - AVIP S&P 500® Index Subaccount (d)		459,293		15,089,979		17,838,949		17,771,248		67,701		17,838,949
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount (d)		349,527		5,221,756		6,270,522		6,225,267		45,255		6,270,522
AVIP - AVIP Federated High Income Bond Subaccount (d)		208,559		3,556,758		3,975,131		3,946,816		28,315		3,975,131
AVIP - AVIP Nasdaq-100® Index Subaccount (d)		216,170		3,463,534		3,798,102		3,798,102		0		3,798,102
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount (d)		355,218		9,839,423		11,374,078		11,284,325		89,753		11,374,078
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount (d)		194,223		4,694,936		4,319,512		4,289,783		29,729		4,319,512
AVIP - AVIP S&P MidCap 400® Index Subaccount (d)		151,120		2,818,934		3,108,540		3,108,540		0		3,108,540
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount (d)		796,986		6,233,478		7,316,332		7,310,132		6,200		7,316,332
AVIP - AVIP AB Risk Managed Balanced Subaccount (d)		3,093,100		42,361,977		43,891,086		43,891,086		0		43,891,086
AVIP - AVIP Federated Core Plus Bond Subaccount (d)		2,031,516		19,541,334		18,425,848		18,346,623		79,225		18,425,848
AVIP - AVIP Intech U.S. Low Volatility Subaccount (d)		1,721,634		17,234,312		18,094,376		18,094,376		0		18,094,376
AVIP - AVIP iShares Managed Risk Balanced Subaccount (d)		1,688,967		15,834,346		16,214,083		16,214,083		0		16,214,083
AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount (d)		842,655		8,446,709		10,364,651		10,364,651		0		10,364,651
AVIP - AVIP iShares Managed Risk Growth Subaccount (d)		335,894		3,374,866		4,259,136		4,259,136		0		4,259,136
AVIP - AVIP Moderately Conservative Model Subaccount (d)		205,771		2,477,448		2,191,460		2,191,460		0		2,191,460
AVIP - AVIP Balanced Model Subaccount (d)		155,458		1,683,752		1,664,950		1,664,950		0		1,664,950
AVIP - AVIP Moderate Growth Model Subaccount (d)		212,265		2,388,656		2,305,193		2,305,193		0		2,305,193
AVIP - AVIP Growth Model Subaccount (d)		102,227		1,124,030		1,124,501		1,124,501		0		1,124,501
FIDS - VIP Government Money Market Subaccount		2,857,960		2,857,960		2,857,960		2,358,510		499,450		2,857,960
FID2 - VIP Mid Cap Subaccount		150,054		4,875,789		5,205,357		5,184,508		20,849		5,205,357
FID2 - VIP Growth Subaccount		11,170		856,429		1,004,422		1,004,422		0		1,004,422
FID2 - VIP Equity-Income Subaccount		78,048		1,743,661		1,866,129		1,866,129		0		1,866,129
FID2 - VIP Real Estate Subaccount		169,536		2,801,928		2,861,764		2,850,588		11,176		2,861,764
FID2 - VIP Target Volatility Subaccount		501,914		5,820,583		5,802,122		5,802,122		0		5,802,122
JASS - Janus Henderson Research Subaccount		5,252		174,709		226,133		226,133		0		226,133
JASS - Janus Henderson Global Research Subaccount		2,269		100,515		133,913		133,913		0		133,913
JASS - Janus Henderson Balanced Subaccount		99,562		3,891,823		4,783,932		4,783,932		0		4,783,932
JASS - Janus Henderson Overseas Subaccount		57,002		1,970,796		2,284,639		2,284,639		0		2,284,639
JASS - Janus Henderson Flexible Bond Subaccount		9,071		111,712		101,237		101,237		0		101,237
LEGI - ClearBridge Variable Dividend Strategy Subaccount		41,020		816,125		838,453		838,453		0		838,453

National Security Variable Account N

Statements of Assets and Contract Owners’ Equity (continued)

December 31, 2023

					Assets		Contract owners’ equity
	Shares		Cost		Investments, at fair value		Contracts in accumulation period (note 6)		Annuity reserves for contracts in payment period		Total contract owners’ equity
LEGI - ClearBridge Variable Large Cap Value Subaccount		9,188	$	184,993	$	194,868	$	194,868	$	0	$	194,868
ASVT - VT Opportunity Subaccount		1,334		29,895		34,666		34,666		0		34,666
MSV2 - VIF Growth Subaccount		86,891		1,545,144		880,208		880,208		0		880,208
GSVI - U.S. Equity Insights Subaccount		22,054		354,719		430,708		430,708		0		430,708
GSVI - Strategic Growth Subaccount		37,138		465,024		465,708		465,708		0		465,708
GSVS - U.S. Equity Insights Subaccount		10,931		207,790		215,442		215,442		0		215,442
GSVS - Strategic Growth Subaccount		110,171		1,442,212		1,366,117		1,366,117		0		1,366,117
GSVS - Trend Driven Allocation Subaccount		499,462		5,787,086		5,668,897		5,668,897		0		5,668,897
LAZS - Emerging Markets Equity Subaccount		250,595		4,879,268		5,219,886		5,196,822		23,064		5,219,886
LAZS - U.S. Small Cap Equity Select Subaccount (c)		60,462		929,063		816,233		816,233		0		816,233
LAZS - International Equity Subaccount		997,025		9,887,276		9,062,958		8,998,772		64,186		9,062,958
LAZS - Global Dynamic Multi-Asset Subaccount		667,425		8,169,086		7,995,747		7,995,747		0		7,995,747
LINC - LVIP JPMorgan Small Cap Core Subaccount		34,992		764,127		694,550		694,550		0		694,550
ABVB - VPS Relative Value Subaccount (a)		14,673		431,473		422,294		422,294		0		422,294
ABVB - VPS Small Cap Growth Subaccount		31,855		444,105		253,888		253,888		0		253,888
ABVB - VPS Global Risk Allocation-Moderate Subaccount		2,346,380		27,087,122		26,889,512		26,889,512		0		26,889,512
MFSI - New Discovery Subaccount		43,270		620,226		437,022		436,881		141		437,022
MFSI - Mid Cap Growth Subaccount		73,652		635,897		546,499		546,499		0		546,499
MFSI - Total Return Subaccount		89,423		2,070,113		2,028,106		2,028,106		0		2,028,106
MFS2 - Massachusetts Investors Growth Stock Subaccount		5,425		111,121		119,897		119,897		0		119,897
PVIA - Real Return Subaccount		608,505		7,817,879		7,040,402		7,002,454		37,948		7,040,402
PVIA - Global Bond Opportunities Subaccount		69,630		820,766		669,840		669,840		0		669,840
PVIA - CommodityRealReturn® Strategy Subaccount		220,793		1,662,431		1,181,244		1,181,244		0		1,181,244
PVIA - Short-Term Subaccount		47,131		486,504		482,150		482,150		0		482,150
PVIA - Low Duration Subaccount		253,996		2,549,378		2,438,365		2,415,663		22,702		2,438,365
BNYS - Appreciation Subaccount		22,498		846,162		771,246		771,246		0		771,246
ROYI - Small-Cap Subaccount		234,243		2,053,462		2,246,391		2,246,391		0		2,246,391
ROYI - Micro-Cap Subaccount		78,979		754,077		724,241		724,241		0		724,241
AIMI - Invesco V.I. EQV International Equity Series II Subaccount		38,751		1,316,639		1,297,005		1,297,005		0		1,297,005
NBAS - AMT Mid Cap Intrinsic Value Subaccount		39,510		656,818		763,337		763,337		0		763,337
FRT2 - Franklin Income VIP Subaccount		44,756		667,971		635,539		635,539		0		635,539
FRT2 - Franklin DynaTech VIP Subaccount		27,874		148,691		119,023		119,023		0		119,023
FRT2 - Templeton Foreign VIP Subaccount		99,991		1,307,631		1,423,876		1,406,282		17,594		1,423,876
FRT5 - Franklin VolSmart Allocation VIP Subaccount		231,913		2,924,717		2,882,684		2,882,684		0		2,882,684
FRT4 - Franklin Income VIP Subaccount		83,467		1,273,427		1,224,460		1,224,460		0		1,224,460
FRT4 - Franklin DynaTech VIP Subaccount		292,325		1,352,553		1,090,371		1,090,371		0		1,090,371
FRT4 - Templeton Foreign VIP Subaccount		534,946		7,082,030		7,783,459		7,744,870		38,589		7,783,459
FRT4 - Franklin Allocation VIP Subaccount		109,927		676,837		560,628		560,628		0		560,628
FEDS - Kaufmann Fund II Service Shares Subaccount		42,468		725,753		669,722		669,722		0		669,722
IVYV - Delaware Ivy VIP Asset Strategy Subaccount		289,486		2,745,700		2,535,894		2,535,894		0		2,535,894
IVYV - Delaware Ivy VIP Natural Resources Subaccount		54,183		244,772		255,745		255,715		30		255,745
IVYV - Delaware Ivy VIP Science and Technology Subaccount		30,431		779,889		698,997		698,997		0		698,997

National Security Variable Account N

Statements of Assets and Contract Owners’ Equity (continued)

December 31, 2023

(a)

Name change effective on May 1, 2023:

ABVB - AB VPS Relative Value Subaccount formerly known as ABVB - VPS Growth & Income Subaccount

(b)

Name change effective on July 28, 2023:

ONFI - ON Fidelity Institutional AM® Equity Growth Subaccount formerly known as ONFI - ON Janus Henderson Forty Subaccount

(c)

Name change effective on September 8, 2023:

LAZS - US Small Cap Equity Select Subaccount formerly known as LAZS - U.S. Small-Mid Cap Equity Subaccount

(d)

Name change effective on December 4, 2023:

AVIP - AVIP Bond Subaccount formerly known as ONFI - ON Bond Subaccount

AVIP - AVIP BlackRock Balanced Allocation Subaccount formerly known as ONFI - ON BlackRock Balanced Allocation Subaccount

AVIP - AVIP BlackRock Advantage International Equity Subaccount formerly known as ONFI - ON BlackRock Advantage International Equity Subaccount

AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount formerly known as ONFI - ON Fidelity Institutional AM® Equity Growth Subaccount

AVIP - AVIP AB Small Cap Subaccount formerly known as ONFI - ON AB Small Cap Subaccount

AVIP - AVIP AB Mid Cap Core Subaccount formerly known as ONFI - ON AB Mid Cap Core Subaccount

AVIP - AVIP S&P 500® Index Subaccount formerly known as ONFI - ON S&P 500® Index Subaccount

AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount formerly known as ONFI - ON BlackRock Advantage Large Cap Value Subaccount

AVIP - AVIP Federated High Income Bond Subaccount formerly known as ONFI - ON Federated High Income Bond Subaccount

AVIP - AVIP Nasdaq-100® Index Subaccount formerly known as ONFI - ON Nasdaq-100® Index Subaccount

AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount formerly known as ONFI - ON BlackRock Advantage Large Cap Core Subaccount

AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount formerly known as ONFI - ON BlackRock Advantage Small Cap Growth Subaccount

AVIP - AVIP S&P MidCap 400® Index Subaccount formerly known as ONFI - ON S&P MidCap 400® Index Subaccount

AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount formerly known as ONFI - ON BlackRock Advantage Large Cap Growth Subaccount

AVIP - AVIP AB Risk Managed Balanced Subaccount formerly known as ONFI - ON Risk Managed Balanced Subaccount

AVIP - AVIP Federated Core Plus Bond Subaccount formerly known as ONFI - ON Federated Core Plus Bond Subaccount

AVIP - AVIP Intech U.S. Low Volatility Subaccount formerly known as ONFI - ON U.S. Low Volatility Subaccount

AVIP - AVIP iShares Managed Risk Balanced Subaccount formerly known as ONFI - ON iShares Managed Risk Balanced Subaccount

AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount formerly known as ONFI - ON iShares Managed Risk Moderate Growth Subaccount

AVIP - AVIP iShares Managed Risk Growth Subaccount formerly known as ONFI - ON iShares Managed Risk Growth Subaccount

AVIP - AVIP Moderately Conservative Model Subaccount formerly known as ONFI - ON Moderately Conservative Model Subaccount

AVIP - AVIP Balanced Model Subaccount formerly known as ONFI - ON Balanced Model Subaccount

AVIP - AVIP Moderate Growth Model Subaccount formerly known as ONFI - ON Moderate Growth Model Subaccount

AVIP - AVIP Growth Model Subaccount formerly known as ONFI - ON Growth Model Subaccount

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Operations

For the Period Ended December 31, 2023

	Investment Activity:										Realized and unrealized gain (loss) on investments:
	Reinvested Dividends		Risk and administrative expense (note 2)			Net investment activity			Reinvested capital gains		Realized gain (loss)			Unrealized gain (loss)			Net gain (loss) on investments			Net increase (decrease) in contract owners’ equity from operations
AVIP - AVIP Bond Subaccount	$	35,579	$	(14,255	)	$	21,324		$	0	$	(5,419	)	$	52,765		$	47,346		$	68,670
AVIP - AVIP BlackRock Balanced Allocation Subaccount		254,708		(194,504	)		60,204			0		(256,190	)		2,817,903			2,561,713			2,621,917
AVIP - AVIP BlackRock Advantage International Equity Subaccount		84,993		(31,761	)		53,232			0		72,442			230,933			303,375			356,607
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount		0		(13,894	)		(13,894	)		171,056		(160,945	)		323,977			163,032			320,194
AVIP - AVIP AB Small Cap Subaccount		0		(31,438	)		(31,438	)		0		(222,449	)		607,428			384,979			353,541
AVIP - AVIP AB Mid Cap Core Subaccount		1,233		(4,240	)		(3,007	)		0		5,548			37,443			42,991			39,984
AVIP - AVIP S&P 500® Index Subaccount		201,785		(160,542	)		41,243			705,985		385,057			1,654,409			2,039,466			2,786,694
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount		120,909		(75,933	)		44,976			66,255		96,375			476,429			572,804			684,035
AVIP - AVIP Federated High Income Bond Subaccount		234,423		(48,030	)		186,393			0		39,885			190,011			229,896			416,289
AVIP - AVIP Nasdaq-100® Index Subaccount		16,791		(46,653	)		(29,862	)		294,336		52,678			1,167,501			1,220,179			1,484,653
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount		114,215		(138,647	)		(24,432	)		38,165		99,899			2,329,501			2,429,400			2,443,133
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount		0		(52,010	)		(52,010	)		0		(146,718	)		921,134			774,416			722,406
AVIP - AVIP S&P MidCap 400® Index Subaccount		22,919		(21,293	)		1,626			120,611		17,422			124,300			141,722			263,959
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount		9,108		(87,994	)		(78,886	)		43,452		25,049			2,169,856			2,194,905			2,159,471
AVIP - AVIP AB Risk Managed Balanced Subaccount		401,343		(539,956	)		(138,613	)		0		(252,434	)		4,756,111			4,503,677			4,365,064
AVIP - AVIP Federated Core Plus Bond Subaccount		420,881		(171,217	)		249,664			0		(163,589	)		628,532			464,943			714,607
AVIP - AVIP Intech U.S. Low Volatility Subaccount		216,568		(257,766	)		(41,198	)		0		33,485			906,144			939,629			898,431
AVIP - AVIP iShares Managed Risk Balanced Subaccount		169,248		(226,572	)		(57,324	)		0		(97,951	)		2,010,482			1,912,531			1,855,207
AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount (note 4)		0		(143,333	)		(143,333	)		0		222,168			1,335,167			1,557,335			1,414,002
AVIP - AVIP iShares Managed Risk Growth Subaccount (note 4)		0		(59,696	)		(59,696	)		0		95,925			650,666			746,591			686,895
AVIP - AVIP Moderately Conservative Model Subaccount		88,690		(29,096	)		59,594			77,802		(16,184	)		84,512			68,328			205,724
AVIP - AVIP Balanced Model Subaccount		81,086		(18,634	)		62,452			104,744		(4,198	)		34,834			30,636			197,832
AVIP - AVIP Moderate Growth Model Subaccount		128,135		(29,325	)		98,810			184,831		(791	)		21,325			20,534			304,175
AVIP - AVIP Growth Model Subaccount		75,498		(11,055	)		64,443			115,015		(2,196	)		(2,201	)		(4,397	)		175,061
FIDS - VIP Government Money Market Subaccount		130,647		(58,322	)		72,325			0		12,476			0			12,476			84,801
FID2 - VIP Mid Cap Subaccount		19,009		(65,946	)		(46,937	)		143,043		12,491			549,372			561,863			657,969
FID2 - VIP Growth Subaccount		35		(11,069	)		(11,034	)		43,698		6,271			229,564			235,835			268,499
FID2 - VIP Equity-Income Subaccount		31,260		(22,723	)		8,537			53,642		11,560			82,088			93,648			155,827
FID2 - VIP Real Estate Subaccount		59,181		(27,568	)		31,613			82,183		(25,397	)		173,071			147,674			261,470
FID2 - VIP Target Volatility Subaccount		114,205		(77,030	)		37,175			0		(46,531	)		671,267			624,736			661,911
JASS - Janus Henderson Research Subaccount		211		(3,748	)		(3,537	)		0		28,553			82,814			111,367			107,830
JASS - Janus Henderson Global Research Subaccount		961		(1,749	)		(788	)		3,636		2,171			22,624			24,795			27,643
JASS - Janus Henderson Balanced Subaccount		81,439		(62,828	)		18,611			0		97,690			473,303			570,993			589,604
JASS - Janus Henderson Overseas Subaccount		32,602		(30,393	)		2,209			0		63,683			145,583			209,266			211,475
JASS - Janus Henderson Flexible Bond Subaccount		5,560		(1,972	)		3,588			0		(21,218	)		21,694			476			4,064
LEGI - ClearBridge Variable Dividend Strategy Subaccount		17,136		(9,601	)		7,535			115,994		5,667			(29,242	)		(23,575	)		99,954
LEGI - ClearBridge Variable Large Cap Value Subaccount		2,361		(2,054	)		307			13,891		1,364			9,615			10,979			25,177
ASVT - VT Opportunity Subaccount		0		(429	)		(429	)		2,634		43			4,641			4,684			6,889
MSV2 - VIF Growth Subaccount		0		(9,242	)		(9,242	)		0		(132,688	)		440,151			307,463			298,221
GSVI - U.S. Equity Insights Subaccount		2,754		(6,611	)		(3,857	)		0		13,963			81,535			95,498			91,641
GSVI - Strategic Growth Subaccount		0		(5,862	)		(5,862	)		17,613		(7,305	)		137,906			130,601			142,352
GSVS - U.S. Equity Insights Subaccount		927		(2,745	)		(1,818	)		0		(902	)		42,641			41,739			39,921
GSVS - Strategic Growth Subaccount		0		(10,309	)		(10,309	)		52,455		(13,226	)		294,445			281,219			323,365
GSVS - Trend Driven Allocation Subaccount		92,912		(78,604	)		14,308			0		(69,587	)		797,456			727,869			742,177
LAZS - Emerging Markets Equity Subaccount		245,181		(65,384	)		179,797			0		(9,619	)		790,803			781,184			960,981
LAZS - U.S. Small Cap Equity Select Subaccount		0		(9,592	)		(9,592	)		0		(15,717	)		93,720			78,003			68,411
LAZS - International Equity Subaccount		115,107		(112,075	)		3,032			0		(314,014	)		1,528,879			1,214,865			1,217,897

National Security Variable Account N

Statements of Operations (continued)

For the Period Ended December 31, 2023

	Investment Activity:										Realized and unrealized gain (loss) on investments:
	Reinvested Dividends		Risk and administrative expense (note 2)			Net investment activity			Reinvested capital gains		Realized gain (loss)			Unrealized gain (loss)			Net gain (loss) on investments			Net increase (decrease) in contract owners’ equity from operations
LAZS - Global Dynamic Multi-Asset Subaccount	$	0	$	(110,139	)	$	(110,139	)	$	423,003	$	(47,831	)	$	428,909		$	381,078		$	693,942
LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)		8,940		(8,770	)		170			5,715		(15,845	)		83,031			67,186			73,071
ABVB - VPS Relative Value Subaccount		5,174		(5,844	)		(670	)		32,682		(2,179	)		9,226			7,047			39,059
ABVB - VPS Small Cap Growth Subaccount		0		(3,136	)		(3,136	)		0		(24,632	)		64,362			39,730			36,594
ABVB - VPS Global Risk Allocation-Moderate Subaccount		570,153		(370,367	)		199,786			0		(213,802	)		3,292,222			3,078,420			3,278,206
MFSI - New Discovery Subaccount		0		(5,609	)		(5,609	)		0		(70,490	)		138,002			67,512			61,903
MFSI - Mid Cap Growth Subaccount		0		(6,400	)		(6,400	)		7,800		(14,016	)		103,948			89,932			91,332
MFSI - Total Return Subaccount		35,953		(25,969	)		9,984			85,811		(10,773	)		74,985			64,212			160,007
MFS2 - Massachusetts Investors Growth Stock Subaccount		54		(1,086	)		(1,032	)		5,821		180			18,297			18,477			23,266
PVIA - Real Return Subaccount		217,585		(94,063	)		123,522			0		(137,500	)		166,693			29,193			152,715
PVIA - Global Bond Opportunities Subaccount		14,165		(7,823	)		6,342			6,809		(9,601	)		21,551			11,950			25,101
PVIA - CommodityRealReturn® Strategy Subaccount		191,133		(17,897	)		173,236			0		(34,726	)		(248,916	)		(283,642	)		(110,406	)
PVIA - Short-Term Subaccount		22,251		(6,147	)		16,104			0		(2,316	)		8,580			6,264			22,368
PVIA - Low Duration Subaccount		89,089		(29,132	)		59,957			0		(21,639	)		52,453			30,814			90,771
BNYS - Appreciation Subaccount		3,497		(9,033	)		(5,536	)		62,952		(9,013	)		78,457			69,444			126,860
ROYI - Small-Cap Subaccount		17,371		(27,994	)		(10,623	)		180,407		14,157			283,811			297,968			467,752
ROYI - Micro-Cap Subaccount		0		(8,918	)		(8,918	)		0		(34,413	)		153,955			119,542			110,624
AIMI - Invesco V.I. EQV International Equity Series II Subaccount		0		(15,480	)		(15,480	)		931		(12,769	)		216,939			204,170			189,621
NBAS - AMT Mid Cap Intrinsic Value Subaccount		3,737		(10,445	)		(6,708	)		32,074		7,482			32,347			39,829			65,195
FRT2 - Franklin Income VIP Subaccount		30,472		(8,156	)		22,316			36,942		(1,773	)		(13,488	)		(15,261	)		43,997
FRT2 - Franklin DynaTech VIP Subaccount		0		(1,523	)		(1,523	)		0		(9,067	)		49,333			40,266			38,743
FRT2 - Templeton Foreign VIP Subaccount		44,416		(16,803	)		27,613			0		(634	)		219,737			219,103			246,716
FRT5 - Franklin VolSmart Allocation VIP Subaccount		53,626		(39,513	)		14,113			190,826		(28,247	)		96,230			67,983			272,922
FRT4 - Franklin Income VIP Subaccount		58,211		(16,124	)		42,087			71,723		(3,913	)		(27,084	)		(30,997	)		82,813
FRT4 - Franklin DynaTech VIP Subaccount		0		(14,702	)		(14,702	)		0		(108,860	)		497,923			389,063			374,361
FRT4 - Templeton Foreign VIP Subaccount		228,780		(96,773	)		132,007			0		(2,923	)		1,211,117			1,208,194			1,340,201
FRT4 - Franklin Allocation VIP Subaccount		6,969		(6,735	)		234			8,651		(19,034	)		79,078			60,044			68,929
FEDS - Kaufmann Fund II Service Shares Subaccount		0		(8,925	)		(8,925	)		0		(19,251	)		119,676			100,425			91,500
IVYV - Delaware Ivy VIP Asset Strategy Subaccount		51,375		(32,451	)		18,924			0		(43,312	)		323,090			279,778			298,702
IVYV - Delaware Ivy VIP Natural Resources Subaccount		7,102		(3,185	)		3,917			0		1,384			(4,311	)		(2,927	)		990
IVYV - Delaware Ivy VIP Science and Technology Subaccount		0		(8,176	)		(8,176	)		34,466		(18,032	)		187,508			169,476			195,766

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP Bond Subaccount			AVIP - AVIP Bond Subaccount			AVIP - AVIP BlackRock Balanced Allocation Subaccount			AVIP - AVIP BlackRock Balanced Allocation Subaccount			AVIP - AVIP BlackRock Advantage International Equity Subaccount			AVIP - AVIP BlackRock Advantage International Equity Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	21,324		$	23,921		$	60,204		$	10,675		$	53,232		$	31,323
Reinvested capital gains		0			7,174			0			2,963,934			0			306,195
Realized gain (loss)		(5,419	)		4,891			(256,190	)		55,142			72,442			31,529
Unrealized gain (loss)		52,765			(267,859	)		2,817,903			(6,715,536	)		230,933			(784,426	)
Net increase (decrease) in contract owners’ equity from operations		68,670			(231,873	)		2,621,917			(3,685,785	)		356,607			(415,379	)
Equity transactions:
Contract purchase payments (note 1)		0			150			16,396			72,046			0			0
Extra credit fund deposit (note 1)		0			6			0			0			0			0
Transfers (to) and from other subaccounts		55,765			(42,933	)		(578,265	)		449,098			(185,282	)		119,634
Transfers (to) and from fixed dollar contract		0			0			130			918			0			0
Withdrawals and surrenders		(96,109	)		(9,081	)		(774,996	)		(605,192	)		(341,026	)		(23,605	)
Surrender charges (note 2)		(7	)		(5	)		(16	)		(81	)		(20	)		(7	)
Annual contract charges (note 2)		(11,547	)		(11,530	)		(187,431	)		(188,066	)		(21,009	)		(19,466	)
Annuity and death benefit payments		(65,596	)		(39,614	)		(669,986	)		(844,181	)		(96,074	)		(102,872	)
Net equity transactions		(117,494	)		(103,007	)		(2,194,168	)		(1,115,458	)		(643,411	)		(26,316	)
Net change in contract owners’ equity		(48,824	)		(334,880	)		427,749			(4,801,243	)		(286,804	)		(441,695	)
Contract owners’ equity:
Beginning of period		1,106,156			1,441,036			14,541,049			19,342,292			2,453,213			2,894,908
End of period	$	1,057,332		$	1,106,156		$	14,968,798		$	14,541,049		$	2,166,409		$	2,453,213

Change in units:
Beginning units		64,706			70,551			605,585			650,108			198,179			199,553
Units purchased		5,173			1,264			10,085			24,291			3,036			11,252
Units redeemed		(11,453	)		(7,109	)		(93,224	)		(68,814	)		(52,371	)		(12,626	)
Ending units		58,426			64,706			522,446			605,585			148,844			198,179

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount			AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount			AVIP - AVIP AB Small Cap Subaccount			AVIP - AVIP AB Small Cap Subaccount			AVIP - AVIP AB Mid Cap Core Subaccount			AVIP - AVIP AB Mid Cap Core Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(13,894	)	$	(10,906	)	$	(31,438	)	$	(32,491	)	$	(3,007	)	$	(4,979	)
Reinvested capital gains		171,056			675,799			0			1,624,170			0			206,878
Realized gain (loss)		(160,945	)		13,510			(222,449	)		(29,581	)		5,548			4,961
Unrealized gain (loss)		323,977			(1,044,469	)		607,428			(2,537,275	)		37,443			(340,681	)
Net increase (decrease) in contract owners’ equity from operations		320,194			(366,066	)		353,541			(975,177	)		39,984			(133,821	)
Equity transactions:
Contract purchase payments (note 1)		0			0			5,469			416			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		993,168			40,610			(2,864	)		186,325			(150,822	)		11,876
Transfers (to) and from fixed dollar contract		0			0			66			513			0			0
Withdrawals and surrenders		(72,260	)		(7,825	)		(148,990	)		(63,554	)		(16,765	)		(19,659	)
Surrender charges (note 2)		0			0			(11	)		(30	)		(1	)		(1	)
Annual contract charges (note 2)		(12,515	)		(7,311	)		(22,544	)		(23,494	)		(2,238	)		(4,177	)
Annuity and death benefit payments		(20,883	)		(16,938	)		(45,260	)		(45,523	)		(6,098	)		(2,495	)
Net equity transactions		887,510			8,536			(214,134	)		54,653			(175,924	)		(14,456	)
Net change in contract owners’ equity		1,207,704			(357,530	)		139,407			(920,524	)		(135,940	)		(148,277	)
Contract owners’ equity:
Beginning of period		683,435			1,040,965			2,316,932			3,237,456			402,679			550,956
End of period	$	1,891,139		$	683,435		$	2,456,339		$	2,316,932		$	266,739		$	402,679

Change in units:
Beginning units		29,122			28,912			104,479			102,666			10,907			11,294
Units purchased		46,134			2,627			8,674			12,265			200			335
Units redeemed		(13,417	)		(2,417	)		(17,550	)		(10,452	)		(4,894	)		(722	)
Ending units		61,839			29,122			95,603			104,479			6,213			10,907

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP S&P 500® Index Subaccount			AVIP - AVIP S&P 500® Index Subaccount			AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount			AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount			AVIP - AVIP Federated High Income Bond Subaccount			AVIP - AVIP Federated High Income Bond Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	41,243		$	(6,225	)	$	44,976		$	13,869		$	186,393		$	186,990
Reinvested capital gains		705,985			1,277,076			66,255			1,391,983			0			0
Realized gain (loss)		385,057			346,111			96,375			286,921			39,885			74,354
Unrealized gain (loss)		1,654,409			(3,990,123	)		476,429			(2,435,314	)		190,011			(875,007	)
Net increase (decrease) in contract owners’ equity from operations		2,786,694			(2,373,161	)		684,035			(742,541	)		416,289			(613,663	)
Equity transactions:
Contract purchase payments (note 1)		7,554			37,262			9,266			59,059			3,118			36,737
Extra credit fund deposit (note 1)		0			0			0			6			0			6
Transfers (to) and from other subaccounts		6,759,016			(11,713	)		22,661			(245,925	)		111,828			(247,807	)
Transfers (to) and from fixed dollar contract		117			836			135			990			50			358
Withdrawals and surrenders		(678,804	)		(197,984	)		(275,362	)		(217,004	)		(123,266	)		(113,026	)
Surrender charges (note 2)		(28	)		(73	)		(12	)		(11	)		(7	)		(7	)
Annual contract charges (note 2)		(112,534	)		(86,654	)		(64,593	)		(65,583	)		(39,848	)		(40,467	)
Annuity and death benefit payments		(405,488	)		(269,473	)		(246,359	)		(182,575	)		(208,279	)		(138,009	)
Net equity transactions		5,569,833			(527,799	)		(554,264	)		(651,043	)		(256,404	)		(502,215	)
Net change in contract owners’ equity		8,356,527			(2,900,960	)		129,771			(1,393,584	)		159,885			(1,115,878	)
Contract owners’ equity:
Beginning of period		9,482,422			12,383,382			6,140,751			7,534,335			3,815,246			4,931,124
End of period	$	17,838,949		$	9,482,422		$	6,270,522		$	6,140,751		$	3,975,131		$	3,815,246

Change in units:
Beginning units		255,053			268,895			243,114			269,081			163,685			186,243
Units purchased		183,725			18,007			9,781			5,682			9,667			1,237
Units redeemed		(49,954	)		(31,849	)		(31,178	)		(31,649	)		(19,729	)		(23,795	)
Ending units		388,824			255,053			221,717			243,114			153,623			163,685

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP Nasdaq-100® Index Subaccount			AVIP - AVIP Nasdaq-100® Index Subaccount			AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount			AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount			AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount			AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(29,862	)	$	(32,363	)	$	(24,432	)	$	(61,299	)	$	(52,010	)	$	(57,098	)
Reinvested capital gains		294,336			1,079,323			38,165			3,126,019			0			1,488,380
Realized gain (loss)		52,678			55,241			99,899			220,615			(146,718	)		(50,234	)
Unrealized gain (loss)		1,167,501			(2,727,681	)		2,329,501			(6,123,074	)		921,134			(2,832,095	)
Net increase (decrease) in contract owners’ equity from operations		1,484,653			(1,625,480	)		2,443,133			(2,837,739	)		722,406			(1,451,047	)
Equity transactions:
Contract purchase payments (note 1)		0			0			16,516			89,347			7,624			29,823
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		522,210			(364,658	)		(531,072	)		264,803			131,012			417,266
Transfers (to) and from fixed dollar contract		0			0			185			1,489			84			667
Withdrawals and surrenders		(804,790	)		(30,333	)		(786,984	)		(334,149	)		(285,854	)		(154,603	)
Surrender charges (note 2)		(3	)		0			(54	)		(102	)		(21	)		(64	)
Annual contract charges (note 2)		(29,573	)		(24,238	)		(112,624	)		(110,126	)		(42,857	)		(42,121	)
Annuity and death benefit payments		(141,232	)		(89,838	)		(453,224	)		(308,152	)		(160,342	)		(118,259	)
Net equity transactions		(453,388	)		(509,067	)		(1,867,257	)		(396,890	)		(350,354	)		132,709
Net change in contract owners’ equity		1,031,265			(2,134,547	)		575,876			(3,234,629	)		372,052			(1,318,338	)
Contract owners’ equity:
Beginning of period		2,766,837			4,901,384			10,798,202			14,032,831			3,947,460			5,265,798
End of period	$	3,798,102		$	2,766,837		$	11,374,078		$	10,798,202		$	4,319,512		$	3,947,460

Change in units:
Beginning units		114,066			136,429			299,702			310,732			155,489			151,710
Units purchased		27,122			4,638			6,406			12,524			10,555			23,061
Units redeemed		(37,537	)		(27,001	)		(52,221	)		(23,554	)		(22,849	)		(19,282	)
Ending units		103,651			114,066			253,887			299,702			143,195			155,489

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP S&P MidCap 400® Index Subaccount			AVIP - AVIP S&P MidCap 400® Index Subaccount			AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount			AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount			AVIP - AVIP AB Risk Managed Balanced Subaccount			AVIP - AVIP AB Risk Managed Balanced Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	1,626		$	(2,951	)	$	(78,886	)	$	(36,603	)	$	(138,613	)	$	(304,378	)
Reinvested capital gains		120,611			149,277			43,452			1,308,573			0			1,582,343
Realized gain (loss)		17,422			57,324			25,049			(13,602	)		(252,434	)		56,830
Unrealized gain (loss)		124,300			(369,659	)		2,169,856			(2,022,319	)		4,756,111			(5,250,794	)
Net increase (decrease) in contract owners’ equity from operations		263,959			(166,009	)		2,159,471			(763,951	)		4,365,064			(3,915,999	)
Equity transactions:
Contract purchase payments (note 1)		360			1,100			3,315			286			4,750			0
Extra credit fund deposit (note 1)		0			12			0			0			0			0
Transfers (to) and from other subaccounts		2,210,246			(18,791	)		42,328			4,379,701			7,790,382			33,548,020
Transfers (to) and from fixed dollar contract		0			0			50			358			851			4,189
Withdrawals and surrenders		(134,957	)		(52,629	)		(386,720	)		(73,874	)		(1,757,066	)		(1,995,883	)
Surrender charges (note 2)		(5	)		(30	)		(26	)		(4	)		(80	)		(100	)
Annual contract charges (note 2)		(19,217	)		(17,284	)		(54,280	)		(26,500	)		(607,303	)		(357,514	)
Annuity and death benefit payments		(84,840	)		(50,445	)		(140,314	)		(107,902	)		(1,900,977	)		(751,090	)
Net equity transactions		1,971,587			(138,067	)		(535,647	)		4,172,065			3,530,557			30,447,622
Net change in contract owners’ equity		2,235,546			(304,076	)		1,623,824			3,408,114			7,895,621			26,531,623
Contract owners’ equity:
Beginning of period		872,994			1,177,070			5,692,508			2,284,394			35,995,465			9,463,842
End of period	$	3,108,540		$	872,994		$	7,316,332		$	5,692,508		$	43,891,086		$	35,995,465

Change in units:
Beginning units		41,265			47,619			199,062			52,574			2,313,126			460,745
Units purchased		96,034			710			20,904			154,694			517,180			2,098,310
Units redeemed		(11,535	)		(7,064	)		(36,629	)		(8,206	)		(297,178	)		(245,929	)
Ending units		125,764			41,265			183,337			199,062			2,533,128			2,313,126

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP Federated Core Plus Bond Subaccount			AVIP - AVIP Federated Core Plus Bond Subaccount			AVIP - AVIP Intech U.S. Low Volatility Subaccount			AVIP - AVIP Intech U.S. Low Volatility Subaccount			AVIP - AVIP iShares Managed Risk Balanced Subaccount			AVIP - AVIP iShares Managed Risk Balanced Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	249,664		$	23,516		$	(41,198	)	$	(179,768	)	$	(57,324	)	$	(100,690	)
Reinvested capital gains		0			5,793			0			499,222			0			32,469
Realized gain (loss)		(163,589	)		(194,671	)		33,485			127,475			(97,951	)		(116,360	)
Unrealized gain (loss)		628,532			(1,690,960	)		906,144			(2,449,982	)		2,010,482			(1,940,422	)
Net increase (decrease) in contract owners’ equity from operations		714,607			(1,856,322	)		898,431			(2,003,053	)		1,855,207			(2,125,003	)
Equity transactions:
Contract purchase payments (note 1)		353			115,654			0			0			0			0
Extra credit fund deposit (note 1)		0			30			0			0			0			0
Transfers (to) and from other subaccounts		7,982,783			(357,766	)		366,991			(1,852,849	)		(85,057	)		5,325,132
Transfers (to) and from fixed dollar contract		0			(81,542	)		407			3,144			4			0
Withdrawals and surrenders		(417,554	)		(263,374	)		(644,741	)		(849,679	)		(710,183	)		(445,374	)
Surrender charges (note 2)		(20	)		(11	)		(109	)		(438	)		(18	)		(307	)
Annual contract charges (note 2)		(139,803	)		(118,327	)		(262,594	)		(278,446	)		(251,546	)		(194,296	)
Annuity and death benefit payments		(536,822	)		(262,989	)		(889,083	)		(485,211	)		(706,079	)		(333,617	)
Net equity transactions		6,888,937			(968,325	)		(1,429,129	)		(3,463,479	)		(1,752,879	)		4,351,538
Net change in contract owners’ equity		7,603,544			(2,824,647	)		(530,698	)		(5,466,532	)		102,328			2,226,535
Contract owners’ equity:
Beginning of period		10,822,304			13,646,951			18,625,074			24,091,606			16,111,755			13,885,220
End of period	$	18,425,848		$	10,822,304		$	18,094,376		$	18,625,074		$	16,214,083		$	16,111,755

Change in units:
Beginning units		1,276,899			1,392,969			1,846,512			2,182,418			1,911,883			1,367,435
Units purchased		956,506			68,102			72,078			8,387			15,120			662,480
Units redeemed		(136,679	)		(184,172	)		(211,626	)		(344,293	)		(213,679	)		(118,032	)
Ending units		2,096,726			1,276,899			1,706,964			1,846,512			1,713,324			1,911,883

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount (note 4)			AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount (note 4)			AVIP - AVIP iShares Managed Risk Growth Subaccount (note 4)			AVIP - AVIP iShares Managed Risk Growth Subaccount (note 4)			AVIP - AVIP Moderately Conservative Model Subaccount			AVIP - AVIP Moderately Conservative Model Subaccount
	2023			10-14-2022 to 12-31-2022			2023			10-14-2022 to 12-31-2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(143,333	)	$	(30,947	)	$	(59,696	)	$	(12,894	)	$	59,594		$	10,311
Reinvested capital gains		0			0			0			0			77,802			136,516
Realized gain (loss)		222,168			21,723			95,925			10,102			(16,184	)		(13,247	)
Unrealized gain (loss)		1,335,167			582,776			650,666			233,603			84,512			(554,544	)
Net increase (decrease) in contract owners’ equity from operations		1,414,002			573,552			686,895			230,811			205,724			(420,964	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(122,036	)		10,063,336			(97,483	)		3,990,923			(55,954	)		0
Transfers (to) and from fixed dollar contract		0			0			627			1,254			0			0
Withdrawals and surrenders		(624,713	)		(66,299	)		(200,573	)		(50,879	)		0			(99,824	)
Surrender charges (note 2)		(20	)		0			(56	)		0			0			0
Annual contract charges (note 2)		(162,355	)		(47,904	)		(64,022	)		(15,000	)		(17,713	)		(17,232	)
Annuity and death benefit payments		(601,915	)		(60,997	)		(194,444	)		(28,917	)		(1,616	)		(2,515	)
Net equity transactions		(1,511,039	)		9,888,136			(555,951	)		3,897,381			(75,283	)		(119,571	)
Net change in contract owners’ equity		(97,037	)		10,461,688			130,944			4,128,192			130,441			(540,535	)
Contract owners’ equity:
Beginning of period		10,461,688			0			4,128,192			0			2,061,019			2,601,554
End of period	$	10,364,651		$	10,461,688		$	4,259,136		$	4,128,192		$	2,191,460		$	2,061,019

Change in units:
Beginning units		990,766			0			390,645			0			186,043			196,582
Units purchased		8,980			1,022,296			7,363			406,060			0			1
Units redeemed		(142,944	)		(31,530	)		(56,155	)		(15,415	)		(6,453	)		(10,540	)
Ending units		856,802			990,766			341,853			390,645			179,590			186,043

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	AVIP - AVIP Balanced Model Subaccount			AVIP - AVIP Balanced Model Subaccount			AVIP - AVIP Moderate Growth Model Subaccount			AVIP - AVIP Moderate Growth Model Subaccount			AVIP - AVIP Growth Model Subaccount			AVIP - AVIP Growth Model Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	62,452		$	18,120		$	98,810		$	24,450		$	64,443		$	10,005
Reinvested capital gains		104,744			146,887			184,831			271,461			115,015			114,654
Realized gain (loss)		(4,198	)		5,652			(791	)		(29,031	)		(2,196	)		5,714
Unrealized gain (loss)		34,834			(492,088	)		21,325			(817,685	)		(2,201	)		(301,224	)
Net increase (decrease) in contract owners’ equity from operations		197,832			(321,429	)		304,175			(550,805	)		175,061			(170,851	)
Equity transactions:
Contract purchase payments (note 1)		0			0			4,800			4,800			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(3,466	)		141,214			(4,817	)		(295,827	)		0			291,160
Transfers (to) and from fixed dollar contract		0			0			0			0			0			0
Withdrawals and surrenders		(90,855	)		(266	)		0			0			0			0
Surrender charges (note 2)		0			0			0			0			0			0
Annual contract charges (note 2)		(22,971	)		(21,121	)		(18,777	)		(20,755	)		(10,264	)		(7,571	)
Annuity and death benefit payments		(91,680	)		(44,947	)		(15,023	)		(23,695	)		(90,206	)		(74,280	)
Net equity transactions		(208,972	)		74,880			(33,817	)		(335,477	)		(100,470	)		209,309
Net change in contract owners’ equity		(11,140	)		(246,549	)		270,358			(886,282	)		74,591			38,458
Contract owners’ equity:
Beginning of period		1,676,090			1,922,639			2,034,835			2,921,117			1,049,910			1,011,452
End of period	$	1,664,950		$	1,676,090		$	2,305,193		$	2,034,835		$	1,124,501		$	1,049,910

Change in units:
Beginning units		141,175			134,791			162,892			190,458			78,339			61,207
Units purchased		493			12,169			365			375			0			23,172
Units redeemed		(17,219	)		(5,785	)		(2,933	)		(27,941	)		(6,976	)		(6,040	)
Ending units		124,449			141,175			160,324			162,892			71,363			78,339

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	FIDS - VIP Government Money Market Subaccount			FIDS - VIP Government Money Market Subaccount			FID2 - VIP Mid Cap Subaccount			FID2 - VIP Mid Cap Subaccount			FID2 - VIP Growth Subaccount			FID2 - VIP Growth Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	72,325		$	2,120		$	(46,937	)	$	(61,766	)	$	(11,034	)	$	(7,807	)
Reinvested capital gains		0			0			143,043			399,535			43,698			67,763
Realized gain (loss)		12,476			38			12,491			30,141			6,271			474
Unrealized gain (loss)		0			0			549,372			(1,491,290	)		229,564			(336,143	)
Net increase (decrease) in contract owners’ equity from operations		84,801			2,158			657,969			(1,123,380	)		268,499			(275,713	)
Equity transactions:
Contract purchase payments (note 1)		584,946			88,893			4,387			22,938			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		77,150			318,858			(174,768	)		(292,907	)		(35,839	)		32,443
Transfers (to) and from fixed dollar contract		10,000			0			67			(25,907	)		0			0
Withdrawals and surrenders		(701,178	)		(455,592	)		(480,076	)		(134,464	)		(2,189	)		(3,082	)
Surrender charges (note 2)		(3	)		(6	)		(16	)		(58	)		(1	)		0
Annual contract charges (note 2)		(11,639	)		(16,603	)		(51,529	)		(55,901	)		(5,882	)		(5,687	)
Annuity and death benefit payments		(106,949	)		(84,128	)		(168,897	)		(139,679	)		(25,495	)		(20,134	)
Net equity transactions		(147,673	)		(148,578	)		(870,832	)		(625,978	)		(69,406	)		3,540
Net change in contract owners’ equity		(62,872	)		(146,420	)		(212,863	)		(1,749,358	)		199,093			(272,173	)
Contract owners’ equity:
Beginning of period		2,920,832			3,067,252			5,418,220			7,167,578			805,329			1,077,502
End of period	$	2,857,960		$	2,920,832		$	5,205,357		$	5,418,220		$	1,004,422		$	805,329

Change in units:
Beginning units		278,441			280,955			120,522			135,193			24,540			24,552
Units purchased		86,508			162,117			4,000			4,824			333			1,060
Units redeemed		(159,652	)		(164,631	)		(20,470	)		(19,495	)		(2,028	)		(1,072	)
Ending units		205,297			278,441			104,052			120,522			22,845			24,540

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	FID2 - VIP Equity-Income Subaccount			FID2 - VIP Equity-Income Subaccount			FID2 - VIP Real Estate Subaccount			FID2 - VIP Real Estate Subaccount			FID2 - VIP Target Volatility Subaccount			FID2 - VIP Target Volatility Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	8,537		$	13,441		$	31,613		$	(2,798	)	$	37,175		$	55,275
Reinvested capital gains		53,642			65,348			82,183			61,053			0			80,687
Realized gain (loss)		11,560			27,612			(25,397	)		21,302			(46,531	)		(47,736	)
Unrealized gain (loss)		82,088			(144,815	)		173,071			(781,762	)		671,267			(1,314,172	)
Net increase (decrease) in contract owners’ equity from operations		155,827			(38,414	)		261,470			(702,205	)		661,911			(1,225,946	)
Equity transactions:
Contract purchase payments (note 1)		0			4,150			2,144			14,904			0			0
Extra credit fund deposit (note 1)		0			6			0			3			0			0
Transfers (to) and from other subaccounts		(103,060	)		845,147			1,015,537			243,079			(749	)		126,078
Transfers (to) and from fixed dollar contract		0			(93,895	)		34			239			422			2,090
Withdrawals and surrenders		(21,865	)		(84,083	)		(201,023	)		(58,257	)		(278,879	)		(359,045	)
Surrender charges (note 2)		0			(3	)		(7	)		(5	)		(45	)		(87	)
Annual contract charges (note 2)		(14,250	)		(14,234	)		(21,310	)		(19,454	)		(84,983	)		(87,860	)
Annuity and death benefit payments		(41,711	)		(40,646	)		(84,535	)		(50,442	)		(170,905	)		(143,837	)
Net equity transactions		(180,886	)		616,442			710,840			130,067			(535,139	)		(462,661	)
Net change in contract owners’ equity		(25,059	)		578,028			972,310			(572,138	)		126,772			(1,688,607	)
Contract owners’ equity:
Beginning of period		1,891,188			1,313,160			1,889,454			2,461,592			5,675,350			7,363,957
End of period	$	1,866,129		$	1,891,188		$	2,861,764		$	1,889,454		$	5,802,122		$	5,675,350

Change in units:
Beginning units		60,365			39,443			106,601			100,003			386,773			417,442
Units purchased		3,748			29,719			63,811			14,210			3,955			10,805
Units redeemed		(9,361	)		(8,797	)		(18,831	)		(7,612	)		(39,021	)		(41,474	)
Ending units		54,752			60,365			151,581			106,601			351,707			386,773

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	JASS - Janus Henderson Research Subaccount			JASS - Janus Henderson Research Subaccount			JASS - Janus Henderson Global Research Subaccount			JASS - Janus Henderson Global Research Subaccount			JASS - Janus Henderson Balanced Subaccount			JASS - Janus Henderson Balanced Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(3,537	)	$	(4,348	)	$	(788	)	$	(678	)	$	18,611		$	(20,864	)
Reinvested capital gains		0			63,431			3,636			14,098			0			160,601
Realized gain (loss)		28,553			4,523			2,171			3,445			97,690			108,695
Unrealized gain (loss)		82,814			(201,090	)		22,624			(48,963	)		473,303			(1,358,361	)
Net increase (decrease) in contract owners’ equity from operations		107,830			(137,484	)		27,643			(32,098	)		589,604			(1,109,929	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(16,052	)		15,611			(5,821	)		2,427			(22,251	)		75,612
Transfers (to) and from fixed dollar contract		0			0			0			0			418			2,090
Withdrawals and surrenders		(158,611	)		(9,504	)		0			0			(208,663	)		(232,865	)
Surrender charges (note 2)		0			0			0			0			0			(15	)
Annual contract charges (note 2)		(2,839	)		(2,236	)		(811	)		(831	)		(57,959	)		(58,277	)
Annuity and death benefit payments		(10,171	)		(11,713	)		(3,661	)		(9,763	)		(157,283	)		(384,097	)
Net equity transactions		(187,673	)		(7,842	)		(10,293	)		(8,167	)		(445,738	)		(597,552	)
Net change in contract owners’ equity		(79,843	)		(145,326	)		17,350			(40,265	)		143,866			(1,707,481	)
Contract owners’ equity:
Beginning of period		305,976			451,302			116,563			156,828			4,640,066			6,347,547
End of period	$	226,133		$	305,976		$	133,913		$	116,563		$	4,783,932		$	4,640,066

Change in units:
Beginning units		16,272			16,623			8,354			9,008			181,416			201,221
Units purchased		0			791			0			378			7,693			5,307
Units redeemed		(8,009	)		(1,142	)		(639	)		(1,032	)		(22,792	)		(25,112	)
Ending units		8,263			16,272			7,715			8,354			166,317			181,416

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	JASS - Janus Henderson Overseas Subaccount			JASS - Janus Henderson Overseas Subaccount			JASS - Janus Henderson Flexible Bond Subaccount			JASS - Janus Henderson Flexible Bond Subaccount			LEGI - ClearBridge Variable Dividend Strategy Subaccount			LEGI - ClearBridge Variable Dividend Strategy Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	2,209		$	9,073		$	3,588		$	1,076		$	7,535		$	2,466
Reinvested capital gains		0			0			0			3,341			115,994			70,301
Realized gain (loss)		63,683			19,160			(21,218	)		(1,596	)		5,667			8,984
Unrealized gain (loss)		145,583			(318,100	)		21,694			(36,831	)		(29,242	)		(158,336	)
Net increase (decrease) in contract owners’ equity from operations		211,475			(289,867	)		4,064			(34,010	)		99,954			(76,585	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			0			150
Extra credit fund deposit (note 1)		0			0			0			0			0			6
Transfers (to) and from other subaccounts		(43,888	)		(14,433	)		70,473			(3,799	)		5,331			108,753
Transfers (to) and from fixed dollar contract		0			0			0			0			0			0
Withdrawals and surrenders		(242,603	)		(63,151	)		(150,365	)		(8,501	)		(46,894	)		(8,010	)
Surrender charges (note 2)		0			(3	)		0			0			(13	)		(76	)
Annual contract charges (note 2)		(21,461	)		(21,496	)		(1,964	)		(1,548	)		(7,137	)		(5,810	)
Annuity and death benefit payments		(93,527	)		(81,974	)		(3,157	)		(1,174	)		(8,888	)		(7,477	)
Net equity transactions		(401,479	)		(181,057	)		(85,013	)		(15,022	)		(57,601	)		87,536
Net change in contract owners’ equity		(190,004	)		(470,924	)		(80,949	)		(49,032	)		42,353			10,951
Contract owners’ equity:
Beginning of period		2,474,643			2,945,567			182,186			231,218			796,100			785,149
End of period	$	2,284,639		$	2,474,643		$	101,237		$	182,186		$	838,453		$	796,100

Change in units:
Beginning units		159,799			171,187			18,933			20,395			21,160			18,720
Units purchased		7,512			5,106			7,013			89			375			3,796
Units redeemed		(32,508	)		(16,494	)		(16,138	)		(1,551	)		(1,852	)		(1,356	)
Ending units		134,803			159,799			9,808			18,933			19,683			21,160

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	LEGI - ClearBridge Variable Large Cap Value Subaccount			LEGI - ClearBridge Variable Large Cap Value Subaccount			ASVT - VT Opportunity Subaccount			ASVT - VT Opportunity Subaccount			MSV2 - VIF Growth Subaccount			MSV2 - VIF Growth Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	307		$	361		$	(429	)	$	(413	)	$	(9,242	)	$	(14,117	)
Reinvested capital gains		13,891			7,417			2,634			5,756			0			651,735
Realized gain (loss)		1,364			2,637			43			128			(132,688	)		(397,897	)
Unrealized gain (loss)		9,615			(31,671	)		4,641			(13,328	)		440,151			(1,615,638	)
Net increase (decrease) in contract owners’ equity from operations		25,177			(21,256	)		6,889			(7,857	)		298,221			(1,375,917	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			1,440			1,440
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(1,018	)		(12,061	)		0			0			(15,406	)		(292,535	)
Transfers (to) and from fixed dollar contract		0			(55,381	)		1			0			0			0
Withdrawals and surrenders		0			0			0			0			(59,238	)		(128,508	)
Surrender charges (note 2)		0			0			0			0			(4	)		0
Annual contract charges (note 2)		(980	)		(991	)		(197	)		(184	)		(5,355	)		(5,707	)
Annuity and death benefit payments		(16,357	)		(3,756	)		0			0			(13,248	)		(17,039	)
Net equity transactions		(18,355	)		(72,189	)		(196	)		(184	)		(91,811	)		(442,349	)
Net change in contract owners’ equity		6,822			(93,445	)		6,693			(8,041	)		206,410			(1,818,266	)
Contract owners’ equity:
Beginning of period		188,046			281,491			27,973			36,014			673,798			2,492,064
End of period	$	194,868		$	188,046		$	34,666		$	27,973		$	880,208		$	673,798

Change in units:
Beginning units		4,592			6,296			586			589			19,324			27,696
Units purchased		197			46			0			0			441			2,822
Units redeemed		(604	)		(1,750	)		(4	)		(3	)		(2,571	)		(11,194	)
Ending units		4,185			4,592			582			586			17,194			19,324

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	GSVI - U.S. Equity Insights Subaccount			GSVI - U.S. Equity Insights Subaccount			GSVI - Strategic Growth Subaccount			GSVI - Strategic Growth Subaccount			GSVS - U.S. Equity Insights Subaccount			GSVS - U.S. Equity Insights Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(3,857	)	$	(2,864	)	$	(5,862	)	$	(5,610	)	$	(1,818	)	$	(1,633	)
Reinvested capital gains		0			2,587			17,613			73,157			0			1,047
Realized gain (loss)		13,963			1,204			(7,305	)		(302	)		(902	)		(1,768	)
Unrealized gain (loss)		81,535			(122,930	)		137,906			(240,336	)		42,641			(48,709	)
Net increase (decrease) in contract owners’ equity from operations		91,641			(122,003	)		142,352			(173,091	)		39,921			(51,063	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(12,349	)		8,097			(32,117	)		53,552			(1,704	)		(64	)
Transfers (to) and from fixed dollar contract		0			0			0			0			0			0
Withdrawals and surrenders		(90,072	)		(1,677	)		(888	)		(158	)		(744	)		0
Surrender charges (note 2)		(4	)		0			(2	)		(1	)		(1	)		0
Annual contract charges (note 2)		(3,831	)		(3,525	)		(955	)		(1,016	)		(1,507	)		(1,432	)
Annuity and death benefit payments		(12,274	)		(12,530	)		(18,675	)		(533	)		(6,348	)		(7,110	)
Net equity transactions		(118,530	)		(9,635	)		(52,637	)		51,844			(10,304	)		(8,606	)
Net change in contract owners’ equity		(26,889	)		(131,638	)		89,715			(121,247	)		29,617			(59,669	)
Contract owners’ equity:
Beginning of period		457,597			589,235			375,993			497,240			185,825			245,494
End of period	$	430,708		$	457,597		$	465,708		$	375,993		$	215,442		$	185,825

Change in units:
Beginning units		14,294			14,569			10,428			9,178			6,220			6,540
Units purchased		418			583			30			1,295			81			110
Units redeemed		(3,694	)		(858	)		(1,232	)		(45	)		(398	)		(430	)
Ending units		11,018			14,294			9,226			10,428			5,903			6,220

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	GSVS - Strategic Growth Subaccount			GSVS - Strategic Growth Subaccount			GSVS - Trend Driven Allocation Subaccount			GSVS - Trend Driven Allocation Subaccount			LAZS - Emerging Markets Equity Subaccount			LAZS - Emerging Markets Equity Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(10,309	)	$	(8,600	)	$	14,308		$	(86,677	)	$	179,797		$	105,136
Reinvested capital gains		52,455			147,044			0			226,226			0			0
Realized gain (loss)		(13,226	)		(5,921	)		(69,587	)		(14,984	)		(9,619	)		11,159
Unrealized gain (loss)		294,445			(503,577	)		797,456			(1,557,576	)		790,803			(1,107,122	)
Net increase (decrease) in contract owners’ equity from operations		323,365			(371,054	)		742,177			(1,433,011	)		960,981			(990,827	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			5,371			50,179
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		308,479			37,731			(54,869	)		176,312			(383,734	)		(146,304	)
Transfers (to) and from fixed dollar contract		0			0			418			2,090			67			(14,919	)
Withdrawals and surrenders		(155	)		0			(246,963	)		(175,531	)		(204,310	)		(118,061	)
Surrender charges (note 2)		0			0			(14	)		(40	)		(5	)		(6	)
Annual contract charges (note 2)		(7,970	)		(5,051	)		(85,208	)		(84,886	)		(51,609	)		(52,140	)
Annuity and death benefit payments		(13,189	)		(13,324	)		(261,551	)		(100,659	)		(182,836	)		(166,822	)
Net equity transactions		287,165			19,356			(648,187	)		(182,714	)		(817,056	)		(448,073	)
Net change in contract owners’ equity		610,530			(351,698	)		93,990			(1,615,725	)		143,925			(1,438,900	)
Contract owners’ equity:
Beginning of period		755,587			1,107,285			5,574,907			7,190,632			5,075,961			6,514,861
End of period	$	1,366,117		$	755,587		$	5,668,897		$	5,574,907		$	5,219,886		$	5,075,961

Change in units:
Beginning units		24,747			24,186			457,560			470,430			252,075			270,991
Units purchased		8,642			1,200			14,242			17,204			508			15,342
Units redeemed		(1,649	)		(639	)		(63,639	)		(30,074	)		(37,622	)		(34,258	)
Ending units		31,740			24,747			408,163			457,560			214,961			252,075

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	LAZS - U.S. Small Cap Equity Select Subaccount			LAZS - U.S. Small Cap Equity Select Subaccount			LAZS - International Equity Subaccount			LAZS - International Equity Subaccount			LAZS - Global Dynamic Multi-Asset Subaccount			LAZS - Global Dynamic Multi-Asset Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(9,592	)	$	(10,667	)	$	3,032		$	210,441		$	(110,139	)	$	(111,568	)
Reinvested capital gains		0			222,173			0			1,031,505			423,003			489,476
Realized gain (loss)		(15,717	)		(1,845	)		(314,014	)		(140,780	)		(47,831	)		(9,081	)
Unrealized gain (loss)		93,720			(371,864	)		1,528,879			(2,835,567	)		428,909			(2,194,766	)
Net increase (decrease) in contract owners’ equity from operations		68,411			(162,203	)		1,217,897			(1,734,401	)		693,942			(1,825,939	)
Equity transactions:
Contract purchase payments (note 1)		0			0			13,860			66,990			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		23,562			(10,684	)		(517,757	)		403,944			(58,010	)		474,777
Transfers (to) and from fixed dollar contract		0			0			185			(29,004	)		3			0
Withdrawals and surrenders		(39,874	)		(8,783	)		(405,402	)		(269,716	)		(93,794	)		(330,525	)
Surrender charges (note 2)		(2	)		(1	)		(16	)		(15	)		(43	)		(65	)
Annual contract charges (note 2)		(5,478	)		(5,627	)		(94,718	)		(94,310	)		(119,350	)		(119,963	)
Annuity and death benefit payments		(17,963	)		(16,015	)		(333,067	)		(231,501	)		(300,639	)		(237,034	)
Net equity transactions		(39,755	)		(41,110	)		(1,336,915	)		(153,612	)		(571,833	)		(212,810	)
Net change in contract owners’ equity		28,656			(203,313	)		(119,018	)		(1,888,013	)		122,109			(2,038,749	)
Contract owners’ equity:
Beginning of period		787,577			990,890			9,181,976			11,069,989			7,873,638			9,912,387
End of period	$	816,233		$	787,577		$	9,062,958		$	9,181,976		$	7,995,747		$	7,873,638

Change in units:
Beginning units		19,561			20,545			585,234			593,871			554,990			569,144
Units purchased		739			98			15,752			40,375			8,899			36,175
Units redeemed		(1,677	)		(1,082	)		(95,968	)		(49,012	)		(48,079	)		(50,329	)
Ending units		18,623			19,561			505,018			585,234			515,810			554,990

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)			LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)			ABVB - VPS Relative Value Subaccount			ABVB - VPS Relative Value Subaccount			ABVB - VPS Small Cap Growth Subaccount			ABVB - VPS Small Cap Growth Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	170		$	(6,357	)	$	(670	)	$	(1,680	)	$	(3,136	)	$	(3,520	)
Reinvested capital gains		5,715			152,622			32,682			66,621			0			127,295
Realized gain (loss)		(15,845	)		16,674			(2,179	)		7,364			(24,632	)		(13,371	)
Unrealized gain (loss)		83,031			(348,047	)		9,226			(100,064	)		64,362			(258,943	)
Net increase (decrease) in contract owners’ equity from operations		73,071			(185,108	)		39,059			(27,759	)		36,594			(148,539	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			1,440			1,440
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		12,449			(159,896	)		14,353			(59,626	)		5,912			31,113
Transfers (to) and from fixed dollar contract		0			0			0			0			0			0
Withdrawals and surrenders		(3,311	)		(1,567	)		0			(1,322	)		(10,823	)		(16,553	)
Surrender charges (note 2)		(1	)		(1	)		0			0			(5	)		0
Annual contract charges (note 2)		(6,207	)		(6,166	)		(4,786	)		(5,225	)		(2,479	)		(2,779	)
Annuity and death benefit payments		(46,009	)		(23,754	)		(13,066	)		(7,689	)		(4,825	)		(5,040	)
Net equity transactions		(43,079	)		(191,384	)		(3,499	)		(73,862	)		(10,780	)		8,181
Net change in contract owners’ equity		29,992			(376,492	)		35,560			(101,621	)		25,814			(140,358	)
Contract owners’ equity:
Beginning of period		664,558			1,041,050			386,734			488,355			228,074			368,432
End of period	$	694,550		$	664,558		$	422,294		$	386,734		$	253,888		$	228,074

Change in units:
Beginning units		20,602			25,609			19,815			23,701			7,497			7,266
Units purchased		746			637			1,292			658			511			1,116
Units redeemed		(1,906	)		(5,644	)		(1,542	)		(4,544	)		(946	)		(885	)
Ending units		19,442			20,602			19,565			19,815			7,062			7,497

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	ABVB - VPS Global Risk Allocation-Moderate Subaccount			ABVB - VPS Global Risk Allocation-Moderate Subaccount			MFSI - New Discovery Subaccount			MFSI - New Discovery Subaccount			MFSI - Mid Cap Growth Subaccount			MFSI - Mid Cap Growth Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	199,786		$	(225,719	)	$	(5,609	)	$	(6,877	)	$	(6,400	)	$	(6,434	)
Reinvested capital gains		0			719,211			0			195,710			7,800			80,535
Realized gain (loss)		(213,802	)		(236,162	)		(70,490	)		(15,334	)		(14,016	)		(10,200	)
Unrealized gain (loss)		3,292,222			(5,273,474	)		138,002			(388,588	)		103,948			(256,809	)
Net increase (decrease) in contract owners’ equity from operations		3,278,206			(5,016,144	)		61,903			(215,089	)		91,332			(192,908	)
Equity transactions:
Contract purchase payments (note 1)		18,000			8,250			0			1,000			1,440			1,440
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(414,367	)		(71,150	)		15,120			56,819			(1,662	)		60,140
Transfers (to) and from fixed dollar contract		1,251			7,324			0			0			0			0
Withdrawals and surrenders		(621,759	)		(1,165,161	)		(109,305	)		(15,080	)		(6,619	)		(4,621	)
Surrender charges (note 2)		(68	)		(668	)		(16	)		(70	)		0			(1	)
Annual contract charges (note 2)		(411,335	)		(417,094	)		(5,323	)		(5,205	)		(3,978	)		(4,015	)
Annuity and death benefit payments		(1,012,853	)		(836,515	)		(21,867	)		(25,994	)		(18,768	)		(15,734	)
Net equity transactions		(2,441,131	)		(2,475,014	)		(121,391	)		11,470			(29,587	)		37,209
Net change in contract owners’ equity		837,075			(7,491,158	)		(59,488	)		(203,619	)		61,745			(155,699	)
Contract owners’ equity:
Beginning of period		26,052,437			33,543,595			496,510			700,129			484,754			640,453
End of period	$	26,889,512		$	26,052,437		$	437,022		$	496,510		$	546,499		$	484,754

Change in units:
Beginning units		2,281,915			2,490,130			13,345			12,998			16,889			15,741
Units purchased		15,378			25,967			499			1,545			396			2,451
Units redeemed		(216,912	)		(234,182	)		(3,449	)		(1,198	)		(1,313	)		(1,303	)
Ending units		2,080,381			2,281,915			10,395			13,345			15,972			16,889

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	MFSI - Total Return Subaccount			MFSI - Total Return Subaccount			MFS2 - Massachusetts Investors Growth Stock Subaccount			MFS2 - Massachusetts Investors Growth Stock Subaccount			PVIA - Real Return Subaccount			PVIA - Real Return Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	9,984		$	155		$	(1,032	)	$	(892	)	$	123,522		$	446,612
Reinvested capital gains		85,811			168,479			5,821			15,938			0			0
Realized gain (loss)		(10,773	)		21,575			180			51			(137,500	)		(56,251	)
Unrealized gain (loss)		74,985			(455,851	)		18,297			(32,389	)		166,693			(1,528,547	)
Net increase (decrease) in contract owners’ equity from operations		160,007			(265,642	)		23,266			(17,292	)		152,715			(1,138,186	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			4,150			2,134			58,072
Extra credit fund deposit (note 1)		0			0			0			6			0			0
Transfers (to) and from other subaccounts		186,090			(14,977	)		(6,302	)		39,147			591,564			(510,093	)
Transfers (to) and from fixed dollar contract		0			(167,917	)		0			0			50			323
Withdrawals and surrenders		(64,070	)		(152,051	)		(2,707	)		(1,766	)		(301,044	)		(190,444	)
Surrender charges (note 2)		(45	)		0			0			0			(19	)		(10	)
Annual contract charges (note 2)		(24,196	)		(24,268	)		(871	)		(223	)		(81,985	)		(83,587	)
Annuity and death benefit payments		(43,242	)		(34,506	)		(2,487	)		(977	)		(354,850	)		(208,795	)
Net equity transactions		54,537			(393,719	)		(12,367	)		40,337			(144,150	)		(934,534	)
Net change in contract owners’ equity		214,544			(659,361	)		10,899			23,045			8,565			(2,072,720	)
Contract owners’ equity:
Beginning of period		1,813,562			2,472,923			108,998			85,953			7,031,837			9,104,557
End of period	$	2,028,106		$	1,813,562		$	119,897		$	108,998		$	7,040,402		$	7,031,837

Change in units:
Beginning units		80,421			98,407			5,072			3,199			471,095			530,964
Units purchased		10,217			1,808			43			2,027			51,026			7,694
Units redeemed		(7,767	)		(19,794	)		(561	)		(154	)		(57,242	)		(67,563	)
Ending units		82,871			80,421			4,554			5,072			464,879			471,095

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	PVIA - Global Bond Opportunities Subaccount			PVIA - Global Bond Opportunities Subaccount			PVIA - Commodity RealReturn® Strategy Subaccount			PVIA - Commodity RealReturn® Strategy Subaccount			PVIA - Short-Term Subaccount			PVIA - Short-Term Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	6,342		$	1,663		$	173,236		$	253,869		$	16,104		$	1,536
Reinvested capital gains		6,809			9,919			0			0			0			1,027
Realized gain (loss)		(9,601	)		(15,186	)		(34,726	)		30,891			(2,316	)		(5,108	)
Unrealized gain (loss)		21,551			(88,049	)		(248,916	)		(155,401	)		8,580			(9,014	)
Net increase (decrease) in contract owners’ equity from operations		25,101			(91,653	)		(110,406	)		129,359			22,368			(11,559	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			0			2,000
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		34,599			(13,372	)		161,483			(213,724	)		8,762			(10,591	)
Transfers (to) and from fixed dollar contract		0			0			0			0			0			(108,548	)
Withdrawals and surrenders		(6,823	)		(15,004	)		(4,096	)		(21,787	)		(83,417	)		(109,227	)
Surrender charges (note 2)		(1	)		0			0			0			(6	)		0
Annual contract charges (note 2)		(4,622	)		(4,892	)		(14,519	)		(14,920	)		(2,881	)		(3,062	)
Annuity and death benefit payments		(8,292	)		(8,286	)		(20,512	)		(16,956	)		(18,915	)		(16,281	)
Net equity transactions		14,861			(41,554	)		122,356			(267,387	)		(96,457	)		(245,709	)
Net change in contract owners’ equity		39,962			(133,207	)		11,950			(138,028	)		(74,089	)		(257,268	)
Contract owners’ equity:
Beginning of period		629,878			763,085			1,169,294			1,307,322			556,239			813,507
End of period	$	669,840		$	629,878		$	1,181,244		$	1,169,294		$	482,150		$	556,239

Change in units:
Beginning units		43,778			46,378			137,879			165,671			54,940			79,418
Units purchased		2,556			693			25,582			21,157			1,615			2,178
Units redeemed		(1,619	)		(3,293	)		(10,406	)		(48,949	)		(11,313	)		(26,656	)
Ending units		44,715			43,778			153,055			137,879			45,242			54,940

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	PVIA - Low Duration Subaccount			PVIA - Low Duration Subaccount			BNYS - Appreciation Subaccount			BNYS - Appreciation Subaccount			ROYI - Small-Cap Subaccount			ROYI - Small-Cap Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	59,957		$	9,584		$	(5,536	)	$	(5,828	)	$	(10,623	)	$	(21,690	)
Reinvested capital gains		0			0			62,952			213,838			180,407			38,426
Realized gain (loss)		(21,639	)		(22,934	)		(9,013	)		(2,847	)		14,157			(11,729	)
Unrealized gain (loss)		52,453			(155,490	)		78,457			(368,711	)		283,811			(279,978	)
Net increase (decrease) in contract owners’ equity from operations		90,771			(168,840	)		126,860			(163,548	)		467,752			(274,971	)
Equity transactions:
Contract purchase payments (note 1)		0			38,301			0			0			0			13,903
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		131,687			396,967			(20,736	)		9,046			(100,696	)		(126,822	)
Transfers (to) and from fixed dollar contract		0			0			0			0			0			(10,908	)
Withdrawals and surrenders		(95,453	)		(74,742	)		(1,108	)		(1,161	)		(187,186	)		(35,497	)
Surrender charges (note 2)		(9	)		(2	)		0			0			(10	)		(32	)
Annual contract charges (note 2)		(23,434	)		(17,697	)		(6,121	)		(5,681	)		(18,634	)		(19,179	)
Annuity and death benefit payments		(127,136	)		(70,153	)		(9,670	)		(9,821	)		(46,619	)		(44,540	)
Net equity transactions		(114,345	)		272,674			(37,635	)		(7,617	)		(353,145	)		(223,075	)
Net change in contract owners’ equity		(23,574	)		103,834			89,225			(171,165	)		114,607			(498,046	)
Contract owners’ equity:
Beginning of period		2,461,939			2,358,105			682,021			853,186			2,131,784			2,629,830
End of period	$	2,438,365		$	2,461,939		$	771,246		$	682,021		$	2,246,391		$	2,131,784

Change in units:
Beginning units		260,088			233,439			17,494			17,627			63,476			70,023
Units purchased		21,845			68,599			14			502			2,341			2,076
Units redeemed		(33,206	)		(41,950	)		(966	)		(635	)		(11,585	)		(8,623	)
Ending units		248,727			260,088			16,542			17,494			54,232			63,476

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	ROYI - Micro-Cap Subaccount			ROYI - Micro-Cap Subaccount			AIMI - Invesco V.I. EQV International Equity Series II Subaccount			AIMI - Invesco V.I. EQV International Equity Series II Subaccount			NBAS - AMT Mid Cap Intrinsic Value Subaccount			NBAS - AMT Mid Cap Intrinsic Value Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	(8,918	)	$	(10,214	)	$	(15,480	)	$	2,163		$	(6,708	)	$	(10,066	)
Reinvested capital gains		0			248,677			931			138,782			32,074			96,148
Realized gain (loss)		(34,413	)		4,222			(12,769	)		(7,977	)		7,482			29,721
Unrealized gain (loss)		153,955			(483,090	)		216,939			(427,502	)		32,347			(210,471	)
Net increase (decrease) in contract owners’ equity from operations		110,624			(240,405	)		189,621			(294,534	)		65,195			(94,668	)
Equity transactions:
Contract purchase payments (note 1)		0			0			1,080			21,934			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(56,278	)		24,264			(17,963	)		31,781			24,657			(39,721	)
Transfers (to) and from fixed dollar contract		0			0			0			(36,770	)		0			0
Withdrawals and surrenders		(57,854	)		(13,498	)		(16,726	)		(24,567	)		(17,430	)		(15,441	)
Surrender charges (note 2)		(3	)		0			(2	)		0			0			(2	)
Annual contract charges (note 2)		(6,261	)		(6,706	)		(10,039	)		(9,356	)		(7,279	)		(7,317	)
Annuity and death benefit payments		(17,203	)		(45,175	)		(42,596	)		(16,978	)		(28,143	)		(25,881	)
Net equity transactions		(137,599	)		(41,115	)		(86,246	)		(33,956	)		(28,195	)		(88,362	)
Net change in contract owners’ equity		(26,975	)		(281,520	)		103,375			(328,490	)		37,000			(183,030	)
Contract owners’ equity:
Beginning of period		751,216			1,032,736			1,193,630			1,522,120			726,337			909,367
End of period	$	724,241		$	751,216		$	1,297,005		$	1,193,630		$	763,337		$	726,337

Change in units:
Beginning units		21,476			22,620			93,061			94,439			35,113			38,956
Units purchased		633			902			1,716			5,352			1,283			655
Units redeemed		(4,521	)		(2,046	)		(7,789	)		(6,730	)		(2,740	)		(4,498	)
Ending units		17,588			21,476			86,988			93,061			33,656			35,113

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	FRT2 - Franklin Income VIP Subaccount			FRT2 - Franklin Income VIP Subaccount			FRT2 - Franklin DynaTech VIP Subaccount			FRT2 - Franklin DynaTech VIP Subaccount			FRT2 - Templeton Foreign VIP Subaccount			FRT2 - Templeton Foreign VIP Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	22,316		$	24,203		$	(1,523	)	$	(1,463	)	$	27,613		$	25,625
Reinvested capital gains		36,942			13,616			0			58,159			0			0
Realized gain (loss)		(1,773	)		3,170			(9,067	)		(1,188	)		(634	)		(9,055	)
Unrealized gain (loss)		(13,488	)		(90,906	)		49,333			(112,872	)		219,737			(140,681	)
Net increase (decrease) in contract owners’ equity from operations		43,997			(49,917	)		38,743			(57,364	)		246,716			(124,111	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			0			12,004			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		30,261			(42,443	)		(17,916	)		28,952			(128,574	)		(1,853	)
Transfers (to) and from fixed dollar contract		0			0			0			0			168			841
Withdrawals and surrenders		(49,509	)		(13,281	)		0			0			(79,861	)		(18,880	)
Surrender charges (note 2)		0			0			0			0			0			(3	)
Annual contract charges (note 2)		(6,104	)		(6,476	)		(657	)		(653	)		(14,590	)		(14,191	)
Annuity and death benefit payments		(19,163	)		(34,953	)		(385	)		(431	)		(41,261	)		(38,462	)
Net equity transactions		(44,515	)		(97,153	)		(18,958	)		27,868			(252,114	)		(72,548	)
Net change in contract owners’ equity		(518	)		(147,070	)		19,785			(29,496	)		(5,398	)		(196,659	)
Contract owners’ equity:
Beginning of period		636,057			783,127			99,238			128,734			1,429,274			1,625,933
End of period	$	635,539		$	636,057		$	119,023		$	99,238		$	1,423,876		$	1,429,274

Change in units:
Beginning units		29,702			34,123			3,520			2,704			103,938			107,947
Units purchased		1,542			14			0			861			1,760			7,388
Units redeemed		(3,564	)		(4,435	)		(543	)		(45	)		(19,453	)		(11,397	)
Ending units		27,680			29,702			2,977			3,520			86,245			103,938

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	FRT5 - Franklin VolSmart Allocation VIP Subaccount			FRT5 - Franklin VolSmart Allocation VIP Subaccount			FRT4 - Franklin Income VIP Subaccount			FRT4 - Franklin Income VIP Subaccount			FRT4 - Franklin DynaTech VIP Subaccount			FRT4 - Franklin DynaTech VIP Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	14,113		$	6,331		$	42,087		$	42,124		$	(14,702	)	$	(14,385	)
Reinvested capital gains		190,826			279,292			71,723			24,918			0			578,902
Realized gain (loss)		(28,247	)		123,444			(3,913	)		31,473			(108,860	)		(36,797	)
Unrealized gain (loss)		96,230			(987,782	)		(27,084	)		(197,462	)		497,923			(1,105,561	)
Net increase (decrease) in contract owners’ equity from operations		272,922			(578,715	)		82,813			(98,947	)		374,361			(577,841	)
Equity transactions:
Contract purchase payments (note 1)		0			0			0			150			0			0
Extra credit fund deposit (note 1)		0			0			0			6			0			0
Transfers (to) and from other subaccounts		13,372			104,300			28,113			(236,079	)		(159,087	)		290,754
Transfers (to) and from fixed dollar contract		0			0			0			0			0			(53,059	)
Withdrawals and surrenders		(135,173	)		(1,264,677	)		(44,611	)		(110,509	)		(47,565	)		(11,455	)
Surrender charges (note 2)		(29	)		(65	)		0			0			(5	)		0
Annual contract charges (note 2)		(43,832	)		(48,155	)		(9,538	)		(10,286	)		(12,796	)		(10,925	)
Annuity and death benefit payments		(93,585	)		(106,104	)		(47,645	)		(47,998	)		(17,458	)		(11,257	)
Net equity transactions		(259,247	)		(1,314,701	)		(73,681	)		(404,716	)		(236,911	)		204,058
Net change in contract owners’ equity		13,675			(1,893,416	)		9,132			(503,663	)		137,450			(373,783	)
Contract owners’ equity:
Beginning of period		2,869,009			4,762,425			1,215,328			1,718,991			952,921			1,326,704
End of period	$	2,882,684		$	2,869,009		$	1,224,460		$	1,215,328		$	1,090,371		$	952,921

Change in units:
Beginning units		200,579			285,870			70,054			91,373			39,502			32,655
Units purchased		3,070			13,352			1,693			204			586			10,935
Units redeemed		(20,477	)		(98,643	)		(5,910	)		(21,523	)		(8,259	)		(4,088	)
Ending units		183,172			200,579			65,837			70,054			31,829			39,502

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	FRT4 - Templeton Foreign VIP Subaccount			FRT4 - Templeton Foreign VIP Subaccount			FRT4 - Franklin Allocation VIP Subaccount			FRT4 - Franklin Allocation VIP Subaccount			FEDS - Kaufmann Fund II Service Shares Subaccount			FEDS - Kaufmann Fund II Service Shares Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	132,007		$	120,861		$	234		$	1,463		$	(8,925	)	$	(9,827	)
Reinvested capital gains		0			0			8,651			56,459			0			103,305
Realized gain (loss)		(2,923	)		(43,752	)		(19,034	)		(11,955	)		(19,251	)		(4,064	)
Unrealized gain (loss)		1,211,117			(801,568	)		79,078			(165,863	)		119,676			(408,878	)
Net increase (decrease) in contract owners’ equity from operations		1,340,201			(724,459	)		68,929			(119,896	)		91,500			(319,464	)
Equity transactions:
Contract purchase payments (note 1)		882			54,694			0			0			0			0
Extra credit fund deposit (note 1)		0			0			0			0			0			0
Transfers (to) and from other subaccounts		(918,393	)		(180,024	)		(194	)		2,490			(116,955	)		21,651
Transfers (to) and from fixed dollar contract		0			(23,993	)		0			0			0			0
Withdrawals and surrenders		(264,971	)		(227,787	)		(43,048	)		(17,359	)		(1,242	)		(1,447	)
Surrender charges (note 2)		(16	)		(10	)		0			0			0			0
Annual contract charges (note 2)		(80,595	)		(81,205	)		(4,338	)		(4,429	)		(5,960	)		(7,003	)
Annuity and death benefit payments		(245,694	)		(180,320	)		(12,010	)		(12,198	)		(5,958	)		(5,842	)
Net equity transactions		(1,508,787	)		(638,645	)		(59,590	)		(31,496	)		(130,115	)		7,359
Net change in contract owners’ equity		(168,586	)		(1,363,104	)		9,339			(151,392	)		(38,615	)		(312,105	)
Contract owners’ equity:
Beginning of period		7,952,045			9,315,149			551,289			702,681			708,337			1,020,442
End of period	$	7,783,459		$	7,952,045		$	560,628		$	551,289		$	669,722		$	708,337

Change in units:
Beginning units		793,913			849,265			35,573			37,527			31,439			31,208
Units purchased		8,585			57,733			162			293			482			953
Units redeemed		(150,567	)		(113,085	)		(3,455	)		(2,247	)		(5,540	)		(722	)
Ending units		651,931			793,913			32,280			35,573			26,381			31,439

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Statements of Changes in Contract Owners’ Equity (continued)

For the Periods Ended December 31, 2023 and 2022

	IVYV - Delaware Ivy VIP Asset Strategy Subaccount			IVYV - Delaware Ivy VIP Asset Strategy Subaccount			IVYV - Delaware Ivy VIP Natural Resources Subaccount			IVYV - Delaware Ivy VIP Natural Resources Subaccount			IVYV - Delaware Ivy VIP Science and Technology Subaccount			IVYV - Delaware Ivy VIP Science and Technology Subaccount
	2023			2022			2023			2022			2023			2022
Increase (decrease) in contract owners’ equity from operations:
Net investment activity	$	18,924		$	7,260		$	3,917		$	1,285		$	(8,176	)	$	(7,760	)
Reinvested capital gains		0			213,542			0			0			34,466			72,576
Realized gain (loss)		(43,312	)		(28,693	)		1,384			957			(18,032	)		(11,874	)
Unrealized gain (loss)		323,090			(691,618	)		(4,311	)		42,334			187,508			(298,618	)
Net increase (decrease) in contract owners’ equity from operations		298,702			(499,509	)		990			44,576			195,766			(245,676	)
Equity transactions:
Contract purchase payments (note 1)		0			13,978			0			75			720			1,870
Extra credit fund deposit (note 1)		0			3			0			3			0			6
Transfers (to) and from other subaccounts		(110,478	)		(4,892	)		18,957			(33,168	)		(18,323	)		46,624
Transfers (to) and from fixed dollar contract		0			0			0			0			25,000			0
Withdrawals and surrenders		(35,086	)		(46,377	)		(29,584	)		(2,557	)		(3,828	)		(1,188	)
Surrender charges (note 2)		(14	)		0			(2	)		0			(1	)		0
Annual contract charges (note 2)		(21,710	)		(21,698	)		(2,311	)		(2,618	)		(6,220	)		(5,134	)
Annuity and death benefit payments		(110,801	)		(126,080	)		(6,468	)		(21,922	)		(18,501	)		(18,666	)
Net equity transactions		(278,089	)		(185,066	)		(19,408	)		(60,187	)		(21,153	)		23,512
Net change in contract owners’ equity		20,613			(684,575	)		(18,418	)		(15,611	)		174,613			(222,164	)
Contract owners’ equity:
Beginning of period		2,515,281			3,199,856			274,163			289,774			524,384			746,548
End of period	$	2,535,894		$	2,515,281		$	255,745		$	274,163		$	698,997		$	524,384

Change in units:
Beginning units		143,452			153,530			32,203			39,684			12,743			12,207
Units purchased		1,402			2,078			2,586			617			760			1,123
Units redeemed		(16,073	)		(12,156	)		(4,983	)		(8,098	)		(1,145	)		(587	)
Ending units		128,781			143,452			29,806			32,203			12,358			12,743

The accompanying notes are an integral part of these financial statements.

National Security Variable Account N

Notes to Financial Statements

December 31, 2023

(1)

Basis of Presentation and Summary of Significant Accounting Policies

Organization and Nature of Operations

National Security Variable Account N (the “Account”) is a separate account of National Security Life and Annuity Company (“NSLA” or “the Company”). The Account is established as a funding vehicle for NSLA’s variable individual annuity contracts and is registered as a unit investment trust under the Investment Company Act of 1940, as amended (the “40 Act”). The Account is an investment company and follows accounting and reporting guidance under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, “Financial Services-Investment Companies”.

NSLA is a stock life insurance company wholly owned by AuguStar℠ Life Insurance Company (formerly The Ohio National Life Insurance Company) (“ALIC”), a stock holding company wholly owned by Constellation Insurance, Inc. (formerly Ohio National Financial Services, Inc) (“CII”). CII is 100% owned by Constellation Insurance Holdings, Inc. (formerly Ohio National Holdings, Inc. and Ohio National Mutual Holdings, Inc.), a stock holding company organized under Ohio insurance laws. In 1998, ALIC became a stock company under provisions of Sections 3913.25 to 3913.38 of the Ohio Revised Code relating to mutual insurance holding companies.

The variable annuity contracts funding the Account were sold by registered representatives of broker-dealers that entered into distribution agreements with AuguStar℠ Distributors, Inc. (“ADI”). ADI is a subsidiary of CII and is the principal underwriter of the contracts. NSLA pays ADI a sales commission based on a pre-determined percentage of each purchase payment and ADI pays a portion of that fee to broker-dealers. The commission percentage paid to broker-dealers may vary by product.

Effective March 16, 2018, NSLA no longer actively markets nor issues new individual variable annuities, which presently represent the bulk of the Company’s in-force block of variable contracts and policies. The Company will continue to service the in-force contracts and policies regardless of the absence of new sales.

Assets of the Account

Assets of the Account are assigned to the following subaccounts in amounts equating to the Account’s ownership of each underlying mutual fund:

AuguStar℠ Variable Insurance Products Fund, Inc. (formerly Ohio National Fund, Inc.): AVIP Bond, AVIP BlackRock Balanced Allocation, AVIP BlackRock Advantage International Equity, AVIP Fidelity Institutional AM® Equity Growth , AVIP AB Small Cap, AVIP AB Mid Cap Core, AVIP S&P 500® Index, AVIP BlackRock Advantage Large Cap Value, AVIP Federated High Income Bond, AVIP Nasdaq-100® Index, AVIP BlackRock Advantage Large Cap Core, AVIP BlackRock Advantage Small Cap Growth, AVIP S&P MidCap 400® Index, AVIP BlackRock Advantage Large Cap Growth, AVIP AB Risk Managed Balanced, AVIP Federated Core Plus Bond, AVIP Intech U.S. Low Volatility, AVIP iShares Managed Risk Moderate Growth, AVIP iShares Managed Risk Growth, AVIP iShares Managed Risk Balanced, AVIP Moderately Conservative Model, AVIP Balanced Model, AVIP Moderate Growth Model, and AVIP Growth Model.

Fidelity® Variable Insurance Products Fund - Service Class: VIP Government Money Market

Fidelity® Variable Insurance Products Fund - Service Class 2: VIP Mid Cap, VIP Growth, VIP Equity-Income, VIP Real Estate, and VIP Target Volatility

Janus Aspen Series - Service Shares: Janus Henderson Research, Janus Henderson Global Research, Janus Henderson Balanced, Janus Henderson Overseas, and Janus Henderson Flexible Bond

Legg Mason Partners Variable Equity Trust - Class I: ClearBridge Variable Dividend Strategy and ClearBridge Variable Large Cap Value

Allspring Variable Trust: VT Opportunity

Morgan Stanley Variable Insurance Fund, Inc. - Class II: VIF Growth

Goldman Sachs Variable Insurance Trust - Institutional Shares: U.S. Equity Insights, and Strategic Growth

Goldman Sachs Variable Insurance Trust - Service Shares: U.S. Equity Insights, Strategic Growth, and Trend Driven Allocation

Lazard Retirement Series, Inc. - Service Shares: Emerging Markets Equity, US Small Cap Equity Select, International Equity, and Global Dynamic Multi-Asset

Lincoln Variable Insurance Products Trust- Standard Class: LVIP JPMorgan Small Cap Core

AB Variable Products Series Fund, Inc. - Class B: VPS Relative Value, VPS Small Cap Growth, and VPS Global Risk Allocation-Moderate

MFS® Variable Insurance Trust - Service Class: New Discovery, Mid Cap Growth, and Total Return

MFS® Variable Insurance Trust II - Service Class: Massachusetts Investors Growth Stock

PIMCO Variable Insurance Trust - Administrative Shares: Real Return, Global Bond Opportunities, CommodityRealReturn® Strategy, Short-Term, and Low Duration

BNY Mellon Variable Investment Fund - Service Shares: Appreciation

Royce Capital Fund - Investment Class: Small-Cap and Micro-Cap

AIM Variable Insurance Funds (Invesco Variable Insurance Funds): Invesco V.I. EQV International Equity Series II

Neuberger Berman Advisers Management Trust - S Class: AMT Mid Cap Intrinsic Value

Franklin Templeton Variable Insurance Products Trust - Class 2: Franklin Income VIP, Franklin DynaTech VIP, and Templeton Foreign VIP

Franklin Templeton Variable Insurance Products Trust - Class 5: Franklin VolSmart Allocation VIP

Franklin Templeton Variable Insurance Products Trust - Class 4: Franklin Income VIP, Franklin DynaTech VIP, Templeton Foreign VIP, and Franklin Allocation VIP

Federated Hermes Insurance Series: Kaufmann Fund II Service Shares

Ivy Variable Insurance Portfolios: Delaware Ivy VIP Asset Strategy, Delaware Ivy VIP Natural Resources, and Delaware Ivy VIP Science and Technology

The underlying mutual funds (“the funds”) in which the subaccounts invest are diversified open-end management investment companies. The funds are not available to the general public directly, but are available as investment options in variable annuity contracts, and variable life insurance policies issued by life insurance companies. The investments of the funds are subject to varying degrees of market, interest and financial risks; the issuers’ abilities to meet certain obligations may be affected by economic developments in their respective industries.

Some of the underlying mutual funds have been established by investment advisers that manage other mutual funds that may have similar names and investment objectives. While some of the underlying mutual funds may have holdings that are comparable to other similarly-named mutual funds, they may not be identical in portfolio management, composition, objective, or investment strategy. Consequently, the investment performance of an underlying mutual fund and a similarly-named fund may differ substantially.

Shares of the funds are purchased at Net Asset Value (“NAV”). The resulting value of assets is converted to accumulation units for the purpose of dividing the aggregate equity ownership of the subaccounts among affected contract owners.

Ohio National Investments, Inc. (“ONI”), a wholly owned subsidiary of CII, performs investment advisory services on behalf of AuguStar℠ Variable Insurance Products Fund, Inc. in which the Account invests. For these services, ONI recorded advisory fees of approximately $58.9 million and $53.3 million from AuguStar℠ Variable Insurance Products Fund, Inc. for the periods ended December 31, 2023 and 2022, respectively.

Contract owners may, with certain restrictions, transfer their contract values between the Account and a fixed dollar contract maintained in the general account of NSLA. The accompanying financial statements include only the contract owners’ purchase payments pertaining to the variable portions of their contracts and exclude any purchase payments for the fixed portions of their contracts.

For certain products, NSLA credits an extra amount to the contract owner’s contract each time a purchase payment is made. The extra credit equals 4% of each purchase payment.

Guarantees within a contract or optional rider that exceed the value of the interest in the Account represent expenses of NSLA and are paid from its general account.

Annuity Reserves for Contracts in Payment Period

Annuity reserves for contracts in payment period represents the contract owners’ equity allocated to these future contract benefits. The allocation is based on the 2000 Annuity Table or the 1983 Individual Annuity Mortality Table (83a), depending on the year the contract annuitized and reflects the discounted amount of the expected annuity payments. The assumed interest rate is 3.0 or 4.0 percent depending on the contract selected by the annuitant. Changes to annuity reserves for adverse mortality and expense risk experience are reimbursed to the Account by NSLA. Such amounts are included in risk and administrative expenses. (See Note 2).

Security Valuation, Transactions and Related Investment Income

The fair value of the underlying mutual funds is based on the closing NAV of fund shares held at December 31, 2023.

Share transactions are recorded on the trade date. Income from dividends and capital gain distributions are recorded and reinvested in the subaccounts on the ex-dividend date. Net realized gains and losses are determined on the basis of average cost.

Use of Estimates in Preparation of Financial Statements

The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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. Actual results could differ from those estimates.

Subsequent Events

The Account has evaluated for subsequent events through the date these financial statements were issued, and there are no events that require financial statement disclosure or adjustments to the financial statements.

(2)

Risk & Administrative Expense and Contract Charges

Although death benefit payments differ according to the investment performance of the underlying subaccounts, they are not affected by mortality or expense experience because NSLA assumes the expense risk and the mortality risk of the contracts. NSLA charges the Accounts’ assets for assuming those risks.

The mortality risk results from a provision in the contract in which NSLA agrees to make annuity payments regardless of how long a particular annuitant or other payee lives and how long all annuitants or other payees as a class live if payment options involving life contingencies are chosen. Those annuity payments are determined in accordance with annuity purchase rate provisions established at the time the contracts are issued.

At the end of each valuation period, NSLA charges a mortality and expense risk fee and a fee for recovery of administrative expenses. Both fees are calculated based on Contract Owner’s Equity at the end of the valuation period and pre-determined annualized rates as stated in the product prospectuses. Administrative expenses include costs associated with providing accounting, administrative, compliance, and legal services necessary to support issuance and maintenance of contracts. The expense risk assumed by NSLA is the risk that the deductions provided for in the variable annuity contracts may be insufficient to cover the actual costs to administer the terms stated in the contracts.

All other fees assessed on contracts, including surrender charges, annual contract fee, transfer fees, and fees from optional riders are charged to contracts upon a surrender, anniversary, or transfer event, respectively. Each of these charges are assessed through redemption of units, in an amount such that the value of the redeemed units at the end of the next valuation period are equivalent to the calculated dollar value of the charge.

The tables on the following pages illustrate product and contract level charges by product:

The following basic charges are assessed through reduction of daily unit values:

	NScore Xtra	NScore Lite	NScore Premier
Mortality and Expense Risk Fees	1.15%	1.15%	1.15%
Administrative Expenses	0.25%	0.25%	0.25%
Total expenses	1.40%	1.40%	1.40%

The following charges are assessed through the redemption of units:

Annual Contract Fee
Each year on the contract anniversary (or at the time of surrender of the contract).	$30	$30	$30
Transfer Fee – per transfer
(Currently no charge for the first 12 transfers each contract year)	$10	$10	$10
Sales Charge made from purchase payments	No deduction	No deduction	No deduction
Surrender Charges A withdrawal charge may be assessed by ALIC when a contract is surrendered, or a partial withdrawal of a participant’s account value is made for any reason other than to make a plan payment to a participant. Percentages vary with the number of years from purchase.	9% of surrender value in the first year to 0% in the ninth year	7% of surrender value in the first year to 0% in the fourth year	6% of surrender value in the first year to 0% in the seventh year
State Premium Taxes
In those jurisdictions permitting, such taxes will be deducted when annuity payments begin. Otherwise, they will be deducted from purchase payments.	0.0% to 5.0%	0.0% to 5.0%	0.0% to 5.0%
Optional Death Benefits:
These annual charges are the following percentages of the optional death benefit amounts:
Optional Annual Stepped-up Death Benefit	0.10% to 0.25%	0.10% to 0.25%	0.10% to 0.25%
Optional Guaranteed Minimum Death Benefit Rider: GMDBR80 Plus (1)	0.25%	0.25%	0.25%
GMDBR85 Plus (1)	0.45%	0.45%	0.45%
5% GMDBR80 Plus (1)	0.45%	0.45%	0.45%
5% GMDBR85 Plus (1)	0.70%	0.70%	0.70%
ARDBR (1)	0.60%	0.60%	0.60%
ARDBR 2009 (1)	0.85% to 1.40%	0.85% to 1.40%	0.85% to 1.40%
Premium Protection or Joint Premium Protection death benefit: Issue ages through 70 Issue ages 71 through 75 Premium Protection Plus or Joint Premium Protection Plus death benefit (1)	0.10% 0.25% 0.45% to 0.90%	0.10% 0.25% 0.45% to 0.90%	0.10% 0.25% 0.45% to 0.90%

Optional Enhanced Death Benefit (“GEB”)
These annual charges are the following percentages of average variable account value:
GEB at issue ages through 70 (1)	0.15%	0.15%	0.15%
GEB at issue ages 71 through 75 (1)	0.30%	0.30%	0.30%
GEB “Plus” at issue ages through 70 (1)	0.30%	0.30%	0.30%
GEB “Plus” at issue ages 71 through 75 (1)	0.60%	0.60%	0.60%
Optional Guaranteed Lifetime Withdrawal Benefit (“GLWB”) These annual charges are the following percentage of your GLWB base: GLWB Preferred I.S. Joint GLWB Preferred I.S. GLWB Plus Joint GLWB Plus	NA NA 0.95% to 2.00% 1.20% to 2.40%	NA NA 0.95% to 2.00% 1.20% to 2.40%	1.00% to 2.00% 1.30% to 2.50% 0.95% to 2.00% 1.20% to 2.40%
Optional Guaranteed Minimum Income Benefit (“GMIB”)
This annual charge is the following percentage of guaranteed income base.
GMIB (1)	0.45%	0.45%	0.45%
GMIB Plus (1)	0.50%	0.50%	0.50%
GMIB Plus with Five Year Reset (1)	0.50%	0.50%	0.50%
GMIB Plus with Annual Reset (1)	0.65%	0.65%	0.65%
GMIB Plus with Annual Reset 2009 (1)	0.95% to 1.50%	0.95% to 1.50%	0.95% to 1.50%
Optional Guaranteed Principal Protection (“GPP”)
These annual charges are the following percentage of average annual guaranteed principal amount: GPP (1) GPP 2012	0.20% to 0.55% 0.45% to 1.30%	0.20% to 0.55% 0.45% to 0.90%	0.20% to 0.55% 0.45% to 1.30%
Optional Guaranteed Principal Access (“GPA”)
This annual charge is the following percentage of the eligible contract value plus later purchase payments.
GPA with 8% guarantee (1)	0.50%	0.50%	0.50%
GPA with 7% guarantee (1)	0.40%	0.40%	0.40%

(1)

No longer available for purchase.

The following basic charges are assessed through reduction of daily unit values:

	NScore Value	NScore Lite II	NScore Xtra II
Mortality and Expense Risk Fees	0.75%	1.30%	1.50%
Administrative Expenses	0.15%	0.25%	0.25%
Total expenses	0.90%	1.55%	1.75%

The following charges are assessed through the redemption of units:

Annual Contract Fee
Each year on the contract anniversary (or at the time of surrender of the contract).	$30	$30	$30
Transfer Fee – per transfer
(Currently no charge for the first 12 transfers each contract year)	$10	$10	$10
Sales Charge made from purchase payments	No deduction	No deduction	No deduction
Surrender Charges A withdrawal charge may be assessed by ALIC when a contract is surrendered, or a partial withdrawal of a participant’s account value is made for any reason other than to make a plan payment to a participant. Percentages vary with the number of years from purchase.	6% of surrender value in the first year to 0% in the seventh year	7% of surrender value in the first year to 0% in the fifth year	9% of surrender value in the first year to 0% in the tenth year

State Premium Taxes
In those jurisdictions permitting, such taxes will be deducted when annuity payments begin. Otherwise, they will be deducted from purchase payments.	0.0% to 5.0%	0.0% to 5.0%	0.0% to 5.0%
Optional Death Benefits:
These annual charges are the following percentages of the optional death benefit amounts:
Optional Annual Stepped-up Death Benefit	0.10% to 0.25%	0.25%	0.25%
Optional Guaranteed Minimum Death Benefit Rider: GMDBR80 Plus (1)	0.25%	0.25%	NA
GMDBR85 Plus (1)	0.45%	0.45%	NA
5% GMDBR80 Plus (1)	0.45%	0.45%	NA
5% GMDBR85 Plus (1)	0.70%	0.70%	NA
Annual Reset Death Benefit Rider:
ARDBR (1)	0.60%	0.60%	NA
ARDBR 2009 (1)	0.85% to 1.40%	0.85% to 1.40%	NA
ARDBR 2008 at issue ages through 74 (1)	NA	0.80% to 1.00%	NA
ARDBR 2008 at issue ages 75 through 78 (1)	NA	0.95% to 1.15%	NA
Premium Protection or Joint Premium Protection death benefit: Issue ages through 70 Issue ages 71 through 75 Premium Protection Plus or Joint Premium Protection Plus death benefit (1)	0.10% 0.25% 0.45% to 0.90%	0.10% 0.25% 0.45% to 0.90%	0.10% 0.25% 0.45% to 0.90%
Optional Enhanced Death Benefit (“GEB”)
These annual charges are the following percentages of average variable account value:
GEB at issue ages through 70 (1)	0.15%	0.15%	NA
GEB at issue ages 71 through 75 (1)	0.30%	0.30%	NA
GEB “Plus” at issue ages through 70 (1)	0.30%	0.30%	NA
GEB “Plus” at issue ages 71 through 75 (1)	0.60%	0.60%	NA
Optional Guaranteed Lifetime Withdrawal Benefit (“GLWB”) These annual charges are the following percentage of your GLWB base: GLWB Preferred I.S. Joint GLWB Preferred I.S. GLWB Plus Joint GLWB Plus	1.00% to 2.00% 1.30% to 2.50% 0.95% to 2.00% 1.20% to 2.40%	1.00% to 2.00% 1.30% to 2.50% 0.95% to 2.00% 1.20% to 2.40%	NA NA 0.95% to 2.00% 1.20% to 2.40%
Optional Guaranteed Minimum Income Benefit (“GMIB”)
This annual charge is the following percentage of guaranteed income base.
GMIB (1)	0.45%	NA	NA
GMIB Plus (1)	0.50%	NA	NA
GMIB Plus with Five Year Reset (1)	0.50%	NA	NA
GMIB Plus with Annual Reset (1)	0.65%	0.65%	NA
GMIB Plus with Annual Reset 2009 (1)	0.95% to 1.50%	0.95% to 1.50%	0.95% to 1.50%
GMIB Plus with Annual Reset 2008 without investment restrictions (1)	NA	1.00% to 1.65%	NA
GMIB Plus with Annual Reset 2008 investment restrictions (1)	NA	0.85% to 1.50%	NA
Optional Guaranteed Principal Protection (“GPP”)
This annual charge is the following percentage of average annual guaranteed principal amount. GPP (1) GPP 2012	0.20% to 0.55% 0.45% to 1.30%	0.55% 0.45% to 0.90%	0.55% 0.45% to 1.30%

Optional Guaranteed Principal Access (“GPA”)
This annual charge is the following percentage of the eligible contract value plus later purchase payments.
GPA with 8% guarantee (1)	0.50%	NA	NA
GPA with 7% guarantee (1)	0.40%	NA	NA

(1)

No longer available for purchase.

The following basic charges are assessed through reduction of daily unit values:

	NScore Lite III	NScore Premier II	NScore Flex
Mortality and Expense Risk Fees	1.40% to 1.45%	1.10%	1.40%
Administrative Expenses	0.25%	0.25%	0.35%
Total expenses	1.65% to 1.70%	1.35%	1.75%

The following charges are assessed through the redemption of units:

Annual Contract Fee
Each year on the contract anniversary (or at the time of surrender of the contract).	$30	$30	$30
Transfer Fee – per transfer
(Currently no charge for the first 12 transfers each contract year)	$10	$10	$10
Sales Charge made from purchase payments	No deduction	No deduction	No deduction
Surrender Charges A withdrawal charge may be assessed by ALIC when a contract is surrendered, or a partial withdrawal of a participant’s account value is made for any reason other than to make a plan payment to a participant. Percentages vary with the number of years from purchase.	8% of surrender value in the first year to 0% in the fifth year	7% of surrender value in the first year to 0% in the eighth year	NA
State Premium Taxes
In those jurisdictions permitting, such taxes will be deducted when annuity payments begin. Otherwise, they will be deducted from purchase payments.	0.0% to 5.0%	0.0% to 5.0%	0.0% to 5.0%
Optional Death Benefits:
These annual charges are the following percentages of the optional death benefit amounts:
Optional Annual Stepped-up Death Benefit Premium Protection or Joint Premium Protection death benefit: Issue ages through 70 Issue ages 71 through 75 Premium Protection Plus or Joint Premium Protection Plus death benefit (1)	0.25% 0.10% 0.25% 0.45% to 0.90%	0.25% 0.10% 0.25% 0.45% to 0.90%	0.25% 0.10% 0.25% 0.45% to 0.90%
Optional Guaranteed Lifetime Withdrawal Benefit (“GLWB”) These annual charges are the following percentage of your GLWB base: GLWB Preferred I.S. Joint GLWB Preferred I.S. GLWB Plus Joint GLWB Plus	1.00% to 2.00% 1.30% to 2.50% 0.95% to 2.00% 1.20% to 2.40%	1.00% to 2.00% 1.30% to 2.50% 0.95% to 2.00% 1.20% to 2.40%	1.00% to 2.00% 1.30% to 2.50% 0.95% to 2.00% 1.20% to 2.40%

Optional Guaranteed Minimum Income Benefit (“GMIB”)
This annual charge is the following percentage of guaranteed income base.
GMIB Plus with Annual Reset 2009 (1)	0.95% to 1.50%	0.95% to 1.50%	0.95% to 1.50%
Optional Guaranteed Principal Protection (“GPP”)
This annual charge is the following percentage of average annual guaranteed principal amount. GPP (1) GPP 2012	0.55% 0.45% to 1.30%	0.55% 0.45% to 1.30%	0.55% 0.45% to 0.90%

(1) No longer available for purchase.

Further information regarding fees, terms, and availability is provided in the prospectus for each of the products listed.

(3)

Federal Income Taxes

Operations of the Account form a part of, and are taxed with, the operations of NSLA, which is taxed as an insurance company under the Internal Revenue Code. Taxes are the responsibility of the contract owner upon surrender or withdrawal. No Federal income taxes are payable under the present law on dividend income or capital gains distribution from the fund shares held in the Account or on capital gains realized by the Account upon redemption of the fund shares. Accordingly, NSLA does not provide income taxes within the Account.

(4)

Fund Replacements, and Other Significant Transactions

Effective April 28, 2023, Small Cap Core of J.P. Morgan Insurance Trust - Class I merged into the LVIP JPMorgan Small Cap Core of Lincoln Variable Insurance Products Trust- Standard Class.

The Account, along with ALIC, NSLA, and certain other variable separate account entities affiliated with ALIC were parties to a correspondence letter filed with the Securities and Exchange Commission (the “SEC”) on August 25, 2023, which described the intent of those entities to execute a substitution of investment options pursuant to Commission Statement on Insurance Product Fund Substitution Applications, Release No. IC-34199. As outlined in the correspondence letter, those entities communicated their intent to substitute shares of four unaffiliated funds currently available as subaccounts under certain variable contracts for shares of four affiliated fund options, also available as subaccounts under those contracts.

The substitution transactions impacting the Account were:

Existing Subaccounts		Replacement Subaccounts
PSF PGIM Jennison Focused Blend - Class II of The Prudential Series Fund, Inc.		AVIP Fidelity Institutional AM® Equity Growth of AuguStar℠ Variable Insurance Products Fund, Inc.
PSF PGIM Jennison Growth - Class II of The Prudential Series Fund, Inc.		AVIP BlackRock Advantage Large Cap Growth of AuguStar℠ Variable Insurance Products Fund, Inc.
LVIP JPMorgan Mid Cap Value - Standard Class of Lincoln Variable Insurance Products Trust		AVIP S&P MidCap 400® Index of AuguStar℠ Variable Insurance Products Fund, Inc.
VIF U.S. Real Estate - Class II of Morgan Stanley Variable Insurance Fund, Inc.		VIP Real Estate - Service Class 2 of Fidelity® Variable Insurance Products Fund
Western Asset Core Plus VIT - Class II of Legg Mason Partners Variable Income Trust		AVIP Federated Core Plus Bond of AuguStar℠ Variable Insurance Products Fund, Inc.
V.I. Balanced-Risk Allocation Series II of AIM Variable Insurance Funds (Invesco Variable Insurance Funds)		AVIP AB Risk Managed Balanced of AuguStar℠ Variable Insurance Products Fund, Inc.
Large Cap Value - Institutional Shares and Service Shares of Goldman Sachs Variable Insurance Trust		AVIP S&P 500® Index of AuguStar℠ Variable Insurance Products Fund, Inc.

The substitution transactions were effected on August 25, 2023 via cash redemptions from the Existing Subaccounts and cash subscriptions to the Replacement Subaccounts.

The Account, along with ALIC, NSLA, and other certain variable separate account entities affiliated with ALIC were parties to a correspondence letter filed with the Securities and Exchange Commission (the “SEC”) on July 22, 2022, which described the intent of those entities to execute a substitution of investment options pursuant to Commission Statement on Insurance Product Fund Substitution Applications, Release No. IC-34199. As outlined in the correspondence letter, those entities communicated their intent to substitute shares of four unaffiliated funds currently available as subaccounts under certain variable contracts for shares of four affiliated fund options, also available as subaccounts under those contracts.

The substitution transactions impacting the Account were:

Existing Subaccounts		Replacement Subaccounts
VIP Contrafund® of the Fidelity® Variable Insurance Products Fund - Service Class 2		AVIP BlackRock Advantage Large Cap Growth of AuguStar℠ Variable Insurance Products Fund, Inc.
TOPS® Managed Risk Balanced ETF of the Northern Lights Variable Trust - Class 2 & 3		AVIP iShares Managed Risk Balanced of AuguStar℠ Variable Insurance Products Fund, Inc.
TOPS® Managed Risk Moderate Growth ETF of the Northern Lights Variable Trust - Class 2 & 3		AVIP iShares Managed Risk Moderate Growth of AuguStar℠ Variable Insurance Products Fund, Inc.
TOPS® Managed Risk Growth ETF of the Northern Lights Variable Trust - Class 2 & 3		AVIP iShares Managed Risk Growth of AuguStar℠ Variable Insurance Products Fund, Inc.

The substitution transactions were effected on October 14, 2022 via cash redemptions from the Existing Subaccounts and cash subscriptions to the Replacement Subaccounts.

The Account, along with ALIC, NSLA, and other certain variable separate account entities affiliated with ALIC and NSLA were parties to a correspondence letter filed with the SEC on March 28, 2022, which described the intent of those entities to execute a substitution of investment options pursuant to Commission Statement on Insurance Product Fund Substitution Applications, Release No. IC-34199. As outlined in the correspondence letter, those entities communicated their intent to substitute shares of an unaffiliated fund currently available as a subaccount under certain variable contracts for shares of an affiliated fund option, also available as a subaccount under those contracts.

The substitution transactions impacting the Account were:

Existing Subaccount		Replacement Subaccount
Franklin Multi-Asset Dynamic Multi-Strategy VIT of the Legg Mason Partners Variable Equity Trust - Class I		AVIP AB Risk Managed Balanced of AuguStar℠ Variable Insurance Products Fund, Inc.

The substitution transactions were effected on May 20, 2022 via cash redemptions from the Existing Subaccount and cash subscriptions to the Replacement Subaccount.

(5)

Investments

In accordance with FASB ASC 820, Fair Value Measurements and Disclosures, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Account generally uses a market approach as the calculation technique due to the nature of the mutual fund investments offered in the Account. This technique maximizes the use of observable inputs and minimizes the use of unobservable inputs.

The Account categorizes its financial instruments into a three-level hierarchy based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument in its entirety.

The Account categorizes financial assets recorded at fair value as follows:

	Level 1:	Unadjusted quoted prices accessible in active markets for identical assets at the measurement date. The assets utilizing Level 1 valuations represent investments in investment companies that have a readily determinable fair value and are valued at Net Asset Value (“NAV”).
	Level 2:	Unadjusted quoted prices for similar assets in active markets or inputs (other than quoted prices) that are observable or that are derived principally from or corroborated by observable market data through correlation or other means.
	Level 3:	Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate about the assumptions market participants would use at the measurement date in pricing the asset or liability. Consideration is given to the risk inherent in both the method of valuation and the valuation inputs.

The only type of investments used by the subaccounts is open-end 40 Act mutual funds, which have readily determinable fair values. As such, all funds are classified as Level 1 investments.

The cost of purchases and proceeds from sales of investments for the period ended December 31, 2023 were as follows:

	Purchases		Sales
AVIP - AVIP Bond Subaccount	$	126,363	$	222,533
AVIP - AVIP BlackRock Balanced Allocation Subaccount		519,004		2,652,968
AVIP - AVIP BlackRock Advantage International Equity Subaccount		125,689		715,868
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount		1,393,173		348,501
AVIP - AVIP AB Small Cap Subaccount		198,018		443,590
AVIP - AVIP AB Mid Cap Core Subaccount		8,801		187,732
AVIP - AVIP S&P 500® Index Subaccount		8,630,523		2,313,462
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount		445,448		888,481
AVIP - AVIP Federated High Income Bond Subaccount		469,756		539,767
AVIP - AVIP Nasdaq-100® Index Subaccount		1,053,754		1,242,668
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount		404,757		2,258,281
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount		276,599		678,963
AVIP - AVIP S&P MidCap 400® Index Subaccount		2,366,472		272,648
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount		755,905		1,326,986
AVIP - AVIP AB Risk Managed Balanced Subaccount		8,707,811		5,315,867
AVIP - AVIP Federated Core Plus Bond Subaccount		8,484,100		1,345,499
AVIP - AVIP Intech U.S. Low Volatility Subaccount		950,285		2,420,612
AVIP - AVIP iShares Managed Risk Balanced Subaccount		304,752		2,114,955
AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount		102,463		1,756,835
AVIP - AVIP iShares Managed Risk Growth Subaccount		86,317		701,964
AVIP - AVIP Moderately Conservative Model Subaccount		166,492		104,379
AVIP - AVIP Balanced Model Subaccount		191,905		233,681
AVIP - AVIP Moderate Growth Model Subaccount		317,765		67,941
AVIP - AVIP Growth Model Subaccount		190,513		111,525
FIDS - VIP Government Money Market Subaccount		1,480,654		1,556,002
FID2 - VIP Mid Cap Subaccount		334,815		1,109,541
FID2 - VIP Growth Subaccount		54,111		90,853
FID2 - VIP Equity-Income Subaccount		202,606		321,313
FID2 - VIP Real Estate Subaccount		1,179,386		354,750
FID2 - VIP Target Volatility Subaccount		174,080		672,044
JASS - Janus Henderson Research Subaccount		211		191,421
JASS - Janus Henderson Global Research Subaccount		4,596		12,041
JASS - Janus Henderson Balanced Subaccount		282,855		709,982
JASS - Janus Henderson Overseas Subaccount		155,371		554,641
JASS - Janus Henderson Flexible Bond Subaccount		76,692		158,117
LEGI - ClearBridge Variable Dividend Strategy Subaccount		147,425		81,497
LEGI - ClearBridge Variable Large Cap Value Subaccount		24,234		28,391
ASVT - VT Opportunity Subaccount		2,634		625
MSV2 - VIF Growth Subaccount		16,730		117,783
GSVI - U.S. Equity Insights Subaccount		16,133		138,520
GSVI - Strategic Growth Subaccount		18,718		59,604
GSVS - U.S. Equity Insights Subaccount		3,683		15,805
GSVS - Strategic Growth Subaccount		401,610		72,299
GSVS - Trend Driven Allocation Subaccount		277,950		911,829
LAZS - Emerging Markets Equity Subaccount		261,989		899,248
LAZS - U.S. Small Cap Equity Select Subaccount		29,838		79,185
LAZS - International Equity Subaccount		387,179		1,721,062
LAZS - Global Dynamic Multi-Asset Subaccount		553,761		812,730
LINC - LVIP JPMorgan Small Cap Core Subaccount		36,878		74,072
ABVB - VPS Relative Value Subaccount		62,408		33,895
ABVB - VPS Small Cap Growth Subaccount		12,801		26,717
ABVB - VPS Global Risk Allocation-Moderate Subaccount		754,905		2,996,250
MFSI - New Discovery Subaccount		18,458		145,458
MFSI - Mid Cap Growth Subaccount		19,727		47,914
MFSI - Total Return Subaccount		366,470		216,138
MFS2 - Massachusetts Investors Growth Stock Subaccount		6,837		14,415
PVIA - Real Return Subaccount		989,593		1,010,221
PVIA - Global Bond Opportunities Subaccount		59,530		31,518
PVIA - CommodityRealReturn® Strategy Subaccount		396,011		100,419
PVIA - Short-Term Subaccount		38,439		118,792
PVIA - Low Duration Subaccount		295,048		349,436

	Purchases		Sales
BNYS - Appreciation Subaccount	$	67,090	$	47,309
ROYI - Small-Cap Subaccount		269,277		452,638
ROYI - Micro-Cap Subaccount		22,227		168,744
AIMI - Invesco V.I. EQV International Equity Series II Subaccount		24,329		125,124
NBAS - AMT Mid Cap Intrinsic Value Subaccount		63,833		66,662
FRT2 - Franklin Income VIP Subaccount		101,282		86,539
FRT2 - Franklin DynaTech VIP Subaccount		0		20,481
FRT2 - Templeton Foreign VIP Subaccount		83,112		307,613
FRT5 - Franklin VolSmart Allocation VIP Subaccount		289,380		343,688
FRT4 - Franklin Income VIP Subaccount		159,976		119,847
FRT4 - Franklin DynaTech VIP Subaccount		15,224		266,837
FRT4 - Templeton Foreign VIP Subaccount		323,787		1,700,567
FRT4 - Franklin Allocation VIP Subaccount		18,202		68,907
FEDS - Kaufmann Fund II Service Shares Subaccount		11,597		150,637
IVYV - Delaware Ivy VIP Asset Strategy Subaccount		78,775		337,940
IVYV - Delaware Ivy VIP Natural Resources Subaccount		29,109		44,600
IVYV - Delaware Ivy VIP Science and Technology Subaccount		68,768		63,631

(6)	Financial Highlights

The following is a summary of accumulation units, value per unit, fair value, expenses, total returns, and investment income ratios for each period ended December 31. The fair value indicated in the Financial Highlights represents the portion of contract owners’ equity for contracts in the accumulation period only and excludes the portion of contract owners’ equity related to annuity reserves for contracts in the payment period. As such, fair value presented below equals the contract owners’ equity for Contracts in Accumulation Period as noted in the Statements of Assets and Contract Owners’ Equity, but may not agree to the total contract owner’s equity as presented in the Statements of Changes in Contract Owner’s Equity. Some of the information is presented as a range of minimum to maximum values. The range is determined by identifying the lowest and the highest expense rates during each period presented for the products with units outstanding at the end of each period, and presenting the expenses, values per unit and total returns that correspond to those products. Accordingly, some individual contract or product attributes may not be within the range presented.

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
AVIP - AVIP Bond Subaccount	2023		58,426	$11.93 to $22.13	$	1,057,332	0.90% to 1.70%	6.50% to 7.34%		3.20	%
AVIP - AVIP Bond Subaccount	2022		64,706	$11.20 to $20.61	$	1,106,156	0.90% to 1.70%	-16.60% to -15.94%		3.24	%
AVIP - AVIP Bond Subaccount	2021		70,551	$13.43 to $24.52	$	1,441,036	0.90% to 1.70%	-3.16% to -2.39%		2.73	%
AVIP - AVIP Bond Subaccount	2020		70,115	$13.87 to $25.12	$	1,470,160	0.90% to 1.70%	7.76% to 8.61%		0.69	%
AVIP - AVIP Bond Subaccount	2019		71,226	$12.87 to $23.13	$	1,390,494	0.90% to 1.70%	12.81% to 13.70%		2.18	%
AVIP - AVIP BlackRock Balanced Allocation Subaccount	2023		522,446	$28.59 to $29.77	$	14,912,721	0.90% to 1.75%	19.05% to 20.05%		1.73	%
AVIP - AVIP BlackRock Balanced Allocation Subaccount	2022		605,585	$23.81 to $25.01	$	14,492,081	0.90% to 1.75%	-19.81% to -19.14%		1.44	%
AVIP - AVIP BlackRock Balanced Allocation Subaccount	2021		650,108	$29.45 to $31.19	$	19,333,508	0.90% to 1.75%	17.01% to 18.00%		1.51	%
AVIP - AVIP BlackRock Balanced Allocation Subaccount	2020		751,586	$24.96 to $26.65	$	18,989,770	0.90% to 1.75%	13.65% to 14.61%		0.19	%
AVIP - AVIP BlackRock Balanced Allocation Subaccount	2019		859,287	$21.78 to $23.45	$	19,036,654	0.90% to 1.75%	27.07% to 28.14%		1.67	%
AVIP - AVIP BlackRock Advantage International Equity Subaccount	2023		148,844	$16.38 to $16.90	$	2,166,409	0.90% to 1.65%	17.02% to 17.88%		3.65	%
AVIP - AVIP BlackRock Advantage International Equity Subaccount	2022		198,179	$13.89 to $14.44	$	2,453,213	0.90% to 1.65%	-14.88% to -14.24%		2.64	%
AVIP - AVIP BlackRock Advantage International Equity Subaccount	2021		199,553	$16.20 to $16.97	$	2,894,908	0.90% to 1.65%	11.65% to 12.48%		1.34	%
AVIP - AVIP BlackRock Advantage International Equity Subaccount	2020		221,230	$13.41 to $14.40	$	2,863,381	0.90% to 1.55%	5.11% to 5.79%		0.64	%
AVIP - AVIP BlackRock Advantage International Equity Subaccount	2019		197,387	$12.76 to $13.62	$	2,421,046	0.90% to 1.55%	18.88% to 19.64%		1.65	%
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount	2023		61,839	$31.48 to $50.65	$	1,891,139	0.90% to 1.70%	37.07% to 38.15%		0.00	%
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount	2022		29,122	$22.79 to $36.95	$	683,435	0.90% to 1.70%	-35.02% to -34.51%		0.00	%
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount	2021		28,912	$34.79 to $56.87	$	1,040,965	0.90% to 1.70%	17.70% to 18.63%		0.00	%
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount	2020		30,597	$29.33 to $48.32	$	936,473	0.90% to 1.70%	35.56% to 36.64%		0.00	%
AVIP - AVIP Fidelity Institutional AM® Equity Growth Subaccount	2019		32,130	$21.46 to $35.64	$	735,166	0.90% to 1.70%	32.63% to 33.68%		0.00	%
AVIP - AVIP AB Small Cap Subaccount	2023		95,603	$25.75 to $38.51	$	2,448,628	0.90% to 1.70%	15.26% to 16.17%		0.00	%
AVIP - AVIP AB Small Cap Subaccount	2022		104,479	$22.17 to $33.41	$	2,313,406	0.90% to 1.70%	-29.92% to -29.37%		0.05	%
AVIP - AVIP AB Small Cap Subaccount	2021		102,666	$31.38 to $47.68	$	3,231,553	0.90% to 1.70%	6.36% to 7.21%		0.00	%
AVIP - AVIP AB Small Cap Subaccount	2020		106,093	$29.27 to $44.82	$	3,137,566	0.90% to 1.70%	31.79% to 32.84%		0.12	%
AVIP - AVIP AB Small Cap Subaccount	2019		131,283	$22.04 to $34.01	$	2,957,572	0.90% to 1.70%	26.46% to 27.46%		0.00	%
AVIP - AVIP AB Mid Cap Core Subaccount	2023		6,213	$42.29 to $48.01	$	266,739	0.90% to 1.40%	15.44% to 16.01%		0.39	%
AVIP - AVIP AB Mid Cap Core Subaccount	2022		10,907	$36.63 to $41.39	$	402,679	0.90% to 1.40%	-24.37% to -24.00%		0.23	%
AVIP - AVIP AB Mid Cap Core Subaccount	2021		11,294	$48.44 to $54.46	$	550,956	0.90% to 1.40%	15.18% to 15.75%		0.15	%
AVIP - AVIP AB Mid Cap Core Subaccount	2020		11,442	$42.06 to $47.05	$	484,438	0.90% to 1.40%	17.50% to 18.08%		0.08	%
AVIP - AVIP AB Mid Cap Core Subaccount	2019		12,342	$35.79 to $39.84	$	444,352	0.90% to 1.40%	34.69% to 35.35%		0.00	%
AVIP - AVIP S&P 500® Index Subaccount	2023		388,824	$44.50 to $50.66	$	17,771,248	0.90% to 1.75%	23.56% to 24.60%		1.58	%
AVIP - AVIP S&P 500® Index Subaccount	2022		255,053	$36.01 to $40.66	$	9,451,132	0.90% to 1.75%	-19.82% to -19.15%		1.24	%
AVIP - AVIP S&P 500® Index Subaccount	2021		268,895	$44.92 to $50.28	$	12,372,702	0.90% to 1.75%	26.05% to 27.11%		1.40	%
AVIP - AVIP S&P 500® Index Subaccount	2020		314,439	$35.63 to $39.56	$	11,428,813	0.90% to 1.75%	15.96% to 16.94%		0.39	%
AVIP - AVIP S&P 500® Index Subaccount	2019		350,592	$30.73 to $33.83	$	10,977,013	0.90% to 1.75%	28.72% to 29.80%		1.24	%
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount	2023		221,717	$29.96 to $30.18	$	6,225,267	0.90% to 1.75%	11.43% to 12.37%		2.00	%
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount	2022		243,114	$26.67 to $27.08	$	6,101,052	0.90% to 1.75%	-10.54% to -9.78%		1.54	%
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount	2021		269,081	$29.56 to $30.27	$	7,522,880	0.90% to 1.75%	23.23% to 24.27%		1.28	%
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount	2020		322,017	$23.79 to $24.57	$	7,275,419	0.90% to 1.75%	1.87% to 2.73%		0.95	%
AVIP - AVIP BlackRock Advantage Large Cap Value Subaccount	2019		322,009	$23.15 to $24.11	$	7,138,399	0.90% to 1.75%	17.16% to 18.14%		2.92	%
AVIP - AVIP Federated High Income Bond Subaccount	2023		153,623	$16.90 to $32.29	$	3,946,816	0.90% to 1.75%	10.75% to 11.68%		5.97	%
AVIP - AVIP Federated High Income Bond Subaccount	2022		163,685	$15.26 to $28.91	$	3,788,016	0.90% to 1.75%	-12.95% to -12.22%		5.69	%
AVIP - AVIP Federated High Income Bond Subaccount	2021		186,243	$17.53 to $32.93	$	4,927,484	0.90% to 1.75%	3.16% to 4.03%		5.10	%
AVIP - AVIP Federated High Income Bond Subaccount	2020		189,635	$16.99 to $31.66	$	4,857,017	0.90% to 1.75%	4.43% to 5.31%		1.54	%
AVIP - AVIP Federated High Income Bond Subaccount	2019		199,396	$16.27 to $30.06	$	4,848,669	0.90% to 1.75%	13.31% to 14.26%		3.95	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
AVIP - AVIP Nasdaq-100® Index Subaccount	2023		103,651	$37.92 to $82.24	$	3,798,102	0.90% to 1.70%	51.87% to 53.07%		0.47	%
AVIP - AVIP Nasdaq-100® Index Subaccount	2022		114,066	$24.77 to $54.15	$	2,766,837	0.90% to 1.70%	-33.70% to -33.17%		0.40	%
AVIP - AVIP Nasdaq-100® Index Subaccount	2021		136,429	$37.07 to $81.67	$	4,901,384	0.90% to 1.70%	24.87% to 25.86%		0.50	%
AVIP - AVIP Nasdaq-100® Index Subaccount	2020		143,840	$29.45 to $65.40	$	4,134,731	0.90% to 1.70%	45.84% to 47.00%		0.17	%
AVIP - AVIP Nasdaq-100® Index Subaccount	2019		157,587	$20.04 to $44.85	$	3,090,323	0.90% to 1.70%	36.54% to 37.62%		0.47	%
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount	2023		253,887	$39.92 to $49.79	$	11,284,325	0.90% to 1.75%	23.68% to 24.72%		1.02	%
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount	2022		299,702	$32.27 to $39.92	$	10,727,283	0.90% to 1.75%	-20.94% to -20.27%		0.80	%
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount	2021		310,732	$40.82 to $50.08	$	14,012,568	0.90% to 1.75%	26.28% to 27.34%		0.96	%
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount	2020		374,042	$32.33 to $39.32	$	13,302,034	0.90% to 1.75%	15.52% to 16.50%		0.19	%
AVIP - AVIP BlackRock Advantage Large Cap Core Subaccount	2019		425,876	$27.98 to $33.76	$	13,065,197	0.90% to 1.75%	31.30% to 32.41%		0.96	%
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount	2023		143,195	$30.00 to $32.61	$	4,289,783	0.90% to 1.75%	18.22% to 19.21%		0.00	%
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount	2022		155,489	$25.38 to $27.35	$	3,924,047	0.90% to 1.75%	-27.39% to -26.78%		0.00	%
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount	2021		151,710	$34.96 to $37.36	$	5,257,273	0.90% to 1.75%	2.26% to 3.13%		0.00	%
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount	2020		154,462	$34.18 to $36.23	$	5,213,308	0.90% to 1.75%	32.02% to 33.14%		0.00	%
AVIP - AVIP BlackRock Advantage Small Cap Growth Subaccount	2019		200,365	$25.89 to $27.21	$	5,109,547	0.90% to 1.75%	31.76% to 32.87%		0.09	%
AVIP - AVIP S&P MidCap 400® Index Subaccount	2023		125,764	$26.00 to $32.50	$	3,108,540	0.90% to 1.70%	13.58% to 14.47%		1.45	%
AVIP - AVIP S&P MidCap 400® Index Subaccount	2022		41,265	$22.71 to $27.09	$	872,994	0.90% to 1.55%	-14.72% to -14.17%		1.03	%
AVIP - AVIP S&P MidCap 400® Index Subaccount	2021		47,619	$26.46 to $31.77	$	1,177,070	0.90% to 1.55%	22.28% to 23.07%		1.01	%
AVIP - AVIP S&P MidCap 400® Index Subaccount	2020		51,591	$21.50 to $25.98	$	1,040,930	0.90% to 1.55%	11.59% to 12.31%		0.15	%
AVIP - AVIP S&P MidCap 400® Index Subaccount	2019		61,680	$19.14 to $23.28	$	1,115,374	0.90% to 1.55%	23.66% to 24.46%		0.82	%
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount	2023		183,337	$40.47 to $46.30	$	7,310,132	0.90% to 1.70%	38.44% to 39.53%		0.14	%
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount	2022		199,062	$29.00 to $33.44	$	5,689,774	0.90% to 1.70%	-33.69% to -33.17%		0.00	%
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount	2021		52,574	$43.39 to $50.72	$	2,280,019	0.90% to 1.65%	24.63% to 25.56%		0.26	%
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount	2020		62,420	$34.56 to $40.70	$	2,164,994	0.90% to 1.65%	31.79% to 32.77%		0.19	%
AVIP - AVIP BlackRock Advantage Large Cap Growth Subaccount	2019		82,572	$26.03 to $30.88	$	2,175,553	0.90% to 1.65%	36.43% to 37.44%		0.44	%
AVIP - AVIP AB Risk Managed Balanced Subaccount	2023		2,533,128	$16.82 to $18.24	$	43,891,086	0.90% to 1.75%	10.96% to 11.89%		1.06	%
AVIP - AVIP AB Risk Managed Balanced Subaccount	2022		2,313,126	$15.16 to $16.30	$	35,995,465	0.90% to 1.75%	-23.95% to -23.31%		0.26	%
AVIP - AVIP AB Risk Managed Balanced Subaccount	2021		460,745	$19.93 to $21.25	$	9,463,842	0.90% to 1.75%	13.07% to 14.02%		0.70	%
AVIP - AVIP AB Risk Managed Balanced Subaccount	2020		439,756	$17.63 to $18.64	$	7,930,097	0.90% to 1.75%	20.05% to 21.06%		0.28	%
AVIP - AVIP AB Risk Managed Balanced Subaccount	2019		507,672	$14.68 to $15.40	$	7,608,099	0.90% to 1.75%	23.01% to 24.05%		1.07	%
AVIP - AVIP Federated Core Plus Bond Subaccount	2023		2,096,726	$8.64 to $8.87	$	18,346,623	0.90% to 1.75%	3.37% to 4.24%		3.12	%
AVIP - AVIP Federated Core Plus Bond Subaccount	2022		1,276,899	$8.36 to $8.51	$	10,763,190	0.90% to 1.75%	-14.28% to -13.56%		1.55	%
AVIP - AVIP Federated Core Plus Bond Subaccount	2021		1,392,969	$9.76 to $9.84	$	13,644,926	0.90% to 1.75%	-2.97% to -2.15%		0.66	%
AVIP - AVIP Intech U.S. Low Volatility Subaccount	2023		1,706,964	$10.52 to $10.74	$	18,094,376	0.90% to 1.75%	4.76% to 5.64%		1.18	%
AVIP - AVIP Intech U.S. Low Volatility Subaccount	2022		1,846,512	$10.04 to $10.17	$	18,625,074	0.90% to 1.75%	-8.92% to -8.15%		0.53	%
AVIP - AVIP Intech U.S. Low Volatility Subaccount	2021		2,182,418	$11.02 to $11.07	$	24,091,606	0.90% to 1.75%	10.21%(a) to 10.69%(b)		0.00	%
AVIP - AVIP iShares Managed Risk Balanced Subaccount	2023		1,713,324	$9.39 to $9.59	$	16,214,083	0.90% to 1.75%	11.93% to 12.87%		1.05	%
AVIP - AVIP iShares Managed Risk Balanced Subaccount	2022		1,911,883	$8.39 to $8.49	$	16,111,755	0.90% to 1.75%	-17.28% to -16.59%		0.66	%
AVIP - AVIP iShares Managed Risk Balanced Subaccount	2021		1,367,435	$10.14 to $10.18	$	13,885,220	0.90% to 1.75%	1.38%(a) to 1.83%(b)		0.00	%
AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount (note 4)	2023		856,802	$12.04 to $12.17	$	10,364,651	0.90% to 1.75%	14.16% to 15.11%		0.00	%
AVIP - AVIP iShares Managed Risk Moderate Growth Subaccount (note 4)	2022		990,766	$10.55 to $10.57	$	10,461,688	0.90% to 1.75%	5.51%(a) to 5.70%(b)		0.00	%
AVIP - AVIP iShares Managed Risk Growth Subaccount (note 4)	2023		341,853	$12.42 to $12.54	$	4,259,136	0.90% to 1.75%	17.57% to 18.56%		0.00	%
AVIP - AVIP iShares Managed Risk Growth Subaccount (note 4)	2022		390,645	$10.56 to $10.58	$	4,128,192	0.90% to 1.75%	5.61%(a) to 5.80%(b)		0.00	%
AVIP - AVIP Moderately Conservative Model Subaccount	2023		179,590	$12.20	$	2,191,460	1.40%	10.23%		4.21	%
AVIP - AVIP Moderately Conservative Model Subaccount	2022		186,043	$11.07 to $11.39	$	2,061,019	0.90% to 1.40%	-16.29% to -15.88%		1.84	%
AVIP - AVIP Moderately Conservative Model Subaccount	2021		196,582	$13.22 to $13.54	$	2,601,554	0.90% to 1.40%	6.41% to 6.94%		1.12	%
AVIP - AVIP Moderately Conservative Model Subaccount	2020		201,425	$12.43 to $12.67	$	2,505,537	0.90% to 1.40%	9.89% to 10.44%		0.00	%
AVIP - AVIP Moderately Conservative Model Subaccount	2019		11,384	$11.31 to $11.47	$	129,292	0.90% to 1.40%	14.97% to 15.54%		2.38	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
AVIP - AVIP Balanced Model Subaccount	2023		124,449	$12.87 to $13.59	$	1,664,950	0.90% to 1.70%	12.05% to 12.94%		4.84	%
AVIP - AVIP Balanced Model Subaccount	2022		141,175	$11.49 to $12.03	$	1,676,090	0.90% to 1.70%	-17.16% to -16.50%		2.19	%
AVIP - AVIP Balanced Model Subaccount	2021		134,791	$13.87 to $14.41	$	1,922,639	0.90% to 1.70%	9.17% to 10.04%		0.87	%
AVIP - AVIP Balanced Model Subaccount	2020		139,944	$12.70 to $13.09	$	1,818,530	0.90% to 1.70%	11.86% to 12.75%		0.00	%
AVIP - AVIP Balanced Model Subaccount	2019		133,140	$11.36 to $11.61	$	1,539,399	0.90% to 1.70%	17.47% to 18.40%		1.55	%
AVIP - AVIP Moderate Growth Model Subaccount	2023		160,324	$14.12 to $14.85	$	2,305,193	0.90% to 1.65%	14.78% to 15.63%		5.97	%
AVIP - AVIP Moderate Growth Model Subaccount	2022		162,892	$12.30 to $12.84	$	2,034,835	0.90% to 1.65%	-18.51% to -17.91%		2.33	%
AVIP - AVIP Moderate Growth Model Subaccount	2021		190,458	$15.10 to $15.65	$	2,921,117	0.90% to 1.65%	12.97% to 13.81%		0.42	%
AVIP - AVIP Moderate Growth Model Subaccount	2020		193,401	$13.36 to $13.75	$	2,617,479	0.90% to 1.65%	13.85% to 14.70%		0.00	%
AVIP - AVIP Moderate Growth Model Subaccount	2019		169,368	$11.74 to $11.99	$	2,002,583	0.90% to 1.65%	21.80% to 22.70%		1.08	%
AVIP - AVIP Growth Model Subaccount	2023		71,363	$15.35 to $15.88	$	1,124,501	0.90% to 1.40%	17.09% to 17.67%		6.88	%
AVIP - AVIP Growth Model Subaccount	2022		78,339	$13.11 to $13.49	$	1,049,910	0.90% to 1.40%	-19.41% to -19.02%		2.15	%
AVIP - AVIP Growth Model Subaccount	2021		61,207	$16.27 to $16.66	$	1,011,452	0.90% to 1.40%	15.95% to 16.53%		0.25	%
AVIP - AVIP Growth Model Subaccount	2020		63,690	$14.03 to $14.30	$	904,391	0.90% to 1.40%	17.03% to 17.62%		0.00	%
AVIP - AVIP Growth Model Subaccount	2019		27,743	$11.99 to $12.01	$	332,828	1.35% to 1.40%	24.73% to 24.79%		0.98	%
FIDS - VIP Government Money Market Subaccount	2023		205,297	$8.84 to $12.58	$	2,358,510	0.90% to 1.70%	3.05% to 3.87%		4.68	%
FIDS - VIP Government Money Market Subaccount	2022		278,441	$8.58 to $12.11	$	2,920,399	0.90% to 1.70%	-0.33% to 0.46%		1.33	%
FIDS - VIP Government Money Market Subaccount	2021		280,955	$8.61 to $12.06	$	3,066,632	0.90% to 1.70%	-1.66% to -0.88%		0.01	%
FIDS - VIP Government Money Market Subaccount	2020		157,930	$8.75 to $12.16	$	1,708,901	0.90% to 1.70%	-1.40% to -0.62%		0.27	%
FIDS - VIP Government Money Market Subaccount	2019		202,410	$8.88 to $12.24	$	2,320,925	0.90% to 1.70%	0.21% to 1.01%		1.87	%
FID2 - VIP Mid Cap Subaccount	2023		104,052	$29.40 to $66.80	$	5,184,508	0.90% to 1.75%	12.83% to 13.78%		0.36	%
FID2 - VIP Mid Cap Subaccount	2022		120,522	$26.06 to $58.71	$	5,400,119	0.90% to 1.75%	-16.43% to -15.72%		0.26	%
FID2 - VIP Mid Cap Subaccount	2021		135,193	$31.18 to $69.66	$	7,163,000	0.90% to 1.75%	23.15% to 24.19%		0.36	%
FID2 - VIP Mid Cap Subaccount	2020		153,135	$25.32 to $56.09	$	6,516,262	0.90% to 1.75%	15.83% to 16.81%		0.39	%
FID2 - VIP Mid Cap Subaccount	2019		188,866	$21.86 to $48.02	$	7,010,207	0.90% to 1.75%	21.05% to 22.07%		0.67	%
FID2 - VIP Growth Subaccount	2023		22,845	$38.73 to $62.54	$	1,004,422	0.90% to 1.65%	33.69% to 34.68%		0.00	%
FID2 - VIP Growth Subaccount	2022		24,540	$28.76 to $46.78	$	805,329	0.90% to 1.65%	-25.87% to -25.32%		0.34	%
FID2 - VIP Growth Subaccount	2021		24,552	$38.51 to $63.10	$	1,077,502	0.90% to 1.65%	20.91% to 21.81%		0.00	%
FID2 - VIP Growth Subaccount	2020		27,612	$31.61 to $52.19	$	980,767	0.90% to 1.65%	41.21% to 42.27%		0.04	%
FID2 - VIP Growth Subaccount	2019		22,230	$22.22 to $36.95	$	570,244	0.90% to 1.65%	31.80% to 32.78%		0.05	%
FID2 - VIP Equity-Income Subaccount	2023		54,752	$30.68 to $36.84	$	1,866,129	0.90% to 1.55%	8.70% to 9.40%		1.73	%
FID2 - VIP Equity-Income Subaccount	2022		60,365	$28.22 to $33.67	$	1,891,188	0.90% to 1.55%	-6.69% to -6.09%		2.16	%
FID2 - VIP Equity-Income Subaccount	2021		39,443	$30.25 to $35.85	$	1,313,160	0.90% to 1.55%	22.70% to 23.49%		1.48	%
FID2 - VIP Equity-Income Subaccount	2020		52,968	$24.65 to $29.03	$	1,429,100	0.90% to 1.55%	4.81% to 5.49%		1.74	%
FID2 - VIP Equity-Income Subaccount	2019		50,093	$23.52 to $27.52	$	1,290,245	0.90% to 1.55%	25.17% to 25.97%		1.93	%
FID2 - VIP Real Estate Subaccount	2023		151,581	$18.81 to $21.83	$	2,850,588	0.90% to 1.75%	8.99% to 9.90%		2.72	%
FID2 - VIP Real Estate Subaccount	2022		106,601	$17.11 to $20.03	$	1,879,177	0.90% to 1.75%	-28.94% to -28.34%		1.20	%
FID2 - VIP Real Estate Subaccount	2021		100,003	$23.88 to $28.19	$	2,459,355	0.90% to 1.75%	36.26% to 37.41%		0.90	%
FID2 - VIP Real Estate Subaccount	2020		125,749	$17.38 to $20.69	$	2,257,221	0.90% to 1.75%	-8.40% to -7.62%		1.95	%
FID2 - VIP Real Estate Subaccount	2019		118,239	$18.81 to $22.58	$	2,314,071	0.90% to 1.75%	20.83% to 21.85%		1.43	%
FID2 - VIP Target Volatility Subaccount	2023		351,707	$15.86 to $17.37	$	5,802,122	0.90% to 1.75%	11.97% to 12.92%		2.03	%
FID2 - VIP Target Volatility Subaccount	2022		386,773	$14.16 to $15.38	$	5,675,350	0.90% to 1.75%	-17.10% to -16.40%		2.24	%
FID2 - VIP Target Volatility Subaccount	2021		417,442	$17.08 to $18.40	$	7,363,957	0.90% to 1.75%	10.11% to 11.03%		0.02	%
FID2 - VIP Target Volatility Subaccount	2020		481,202	$15.52 to $16.57	$	7,689,486	0.90% to 1.75%	7.11% to 8.02%		1.24	%
FID2 - VIP Target Volatility Subaccount	2019		550,961	$14.49 to $15.34	$	8,184,329	0.90% to 1.75%	16.61% to 17.59%		1.36	%
JASS - Janus Henderson Research Subaccount	2023		8,263	$28.33 to $43.56	$	226,133	0.90% to 1.55%	40.64% to 41.54%		0.07	%
JASS - Janus Henderson Research Subaccount	2022		16,272	$20.01 to $30.97	$	305,976	0.90% to 1.55%	-31.13% to -30.69%		0.00	%
JASS - Janus Henderson Research Subaccount	2021		16,623	$28.88 to $44.97	$	451,302	0.90% to 1.55%	18.22% to 18.98%		0.02	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
JASS - Janus Henderson Research Subaccount	2020		17,698	$24.27 to $38.04	$	405,364	0.90% to 1.55%	30.55% to 31.39%		0.29	%
JASS - Janus Henderson Research Subaccount	2019		46,422	$18.47 to $29.14	$	791,717	0.90% to 1.55%	33.16% to 34.02%		0.29	%
JASS - Janus Henderson Global Research Subaccount	2023		7,715	$29.66 to $30.86	$	133,913	1.35% to 1.65%	24.42% to 24.79%		0.77	%
JASS - Janus Henderson Global Research Subaccount	2022		8,354	$23.83 to $24.73	$	116,563	1.35% to 1.65%	-20.91% to -20.68%		0.87	%
JASS - Janus Henderson Global Research Subaccount	2021		9,008	$30.14 to $31.18	$	156,828	1.35% to 1.65%	15.88% to 16.23%		0.34	%
JASS - Janus Henderson Global Research Subaccount	2020		12,470	$26.01 to $26.83	$	182,680	1.35% to 1.65%	17.81% to 18.16%		0.64	%
JASS - Janus Henderson Global Research Subaccount	2019		10,859	$22.07 to $22.70	$	135,076	1.35% to 1.65%	26.62% to 27.00%		0.85	%
JASS - Janus Henderson Balanced Subaccount	2023		166,317	$25.70 to $37.55	$	4,783,932	0.90% to 1.70%	13.22% to 14.11%		1.77	%
JASS - Janus Henderson Balanced Subaccount	2022		181,416	$22.70 to $32.91	$	4,640,066	0.90% to 1.70%	-18.01% to -17.36%		0.96	%
JASS - Janus Henderson Balanced Subaccount	2021		201,221	$27.69 to $39.82	$	6,347,547	0.90% to 1.70%	14.96% to 15.87%		0.67	%
JASS - Janus Henderson Balanced Subaccount	2020		213,674	$24.09 to $34.37	$	5,905,164	0.90% to 1.70%	12.12% to 13.01%		2.08	%
JASS - Janus Henderson Balanced Subaccount	2019		191,305	$21.48 to $30.41	$	4,572,644	0.90% to 1.70%	20.23% to 21.18%		1.66	%
JASS - Janus Henderson Overseas Subaccount	2023		134,803	$12.20 to $18.86	$	2,284,639	0.90% to 1.55%	8.90% to 9.60%		1.41	%
JASS - Janus Henderson Overseas Subaccount	2022		159,799	$11.42 to $17.21	$	2,474,643	0.90% to 1.65%	-10.31% to -9.65%		1.67	%
JASS - Janus Henderson Overseas Subaccount	2021		171,187	$12.73 to $19.05	$	2,945,567	0.90% to 1.65%	11.45% to 12.28%		1.03	%
JASS - Janus Henderson Overseas Subaccount	2020		180,965	$11.42 to $16.96	$	2,784,100	0.90% to 1.65%	14.13% to 14.98%		1.19	%
JASS - Janus Henderson Overseas Subaccount	2019		220,454	$10.01 to $14.75	$	2,960,598	0.90% to 1.65%	24.65% to 25.58%		1.80	%
JASS - Janus Henderson Flexible Bond Subaccount	2023		9,808	$9.83 to $10.43	$	101,237	0.90% to 1.65%	3.59% to 4.36%		3.56	%
JASS - Janus Henderson Flexible Bond Subaccount	2022		18,933	$9.45 to $10.00	$	182,186	0.90% to 1.70%	-15.34% to -14.67%		1.97	%
JASS - Janus Henderson Flexible Bond Subaccount	2021		20,395	$11.16 to $11.72	$	231,218	0.90% to 1.70%	-2.77% to -2.00%		1.62	%
JASS - Janus Henderson Flexible Bond Subaccount	2020		20,025	$11.48 to $11.96	$	233,157	0.90% to 1.70%	8.40% to 9.27%		2.46	%
JASS - Janus Henderson Flexible Bond Subaccount	2019		20,830	$10.59 to $10.94	$	223,451	0.90% to 1.70%	7.45% to 8.30%		2.74	%
LEGI - ClearBridge Variable Dividend Strategy Subaccount	2023		19,683	$39.18 to $45.96	$	838,453	0.90% to 1.55%	12.46% to 13.18%		2.12	%
LEGI - ClearBridge Variable Dividend Strategy Subaccount	2022		21,160	$34.84 to $40.60	$	796,100	0.90% to 1.55%	-9.50% to -8.92%		1.49	%
LEGI - ClearBridge Variable Dividend Strategy Subaccount	2021		18,720	$38.50 to $44.58	$	785,149	0.90% to 1.55%	24.86% to 25.67%		1.52	%
LEGI - ClearBridge Variable Dividend Strategy Subaccount	2020		21,114	$30.84 to $35.48	$	704,071	0.90% to 1.55%	6.02% to 6.71%		1.34	%
LEGI - ClearBridge Variable Dividend Strategy Subaccount	2019		32,634	$29.08 to $33.25	$	1,050,675	0.90% to 1.55%	29.58% to 30.42%		1.86	%
LEGI - ClearBridge Variable Large Cap Value Subaccount	2023		4,185	$34.27 to $49.52	$	194,868	0.90% to 1.55%	13.34% to 14.07%		1.23	%
LEGI - ClearBridge Variable Large Cap Value Subaccount	2022		4,592	$30.24 to $43.41	$	188,046	0.90% to 1.55%	-7.86% to -7.26%		1.24	%
LEGI - ClearBridge Variable Large Cap Value Subaccount	2021		6,296	$32.81 to $46.81	$	281,491	0.90% to 1.55%	24.28% to 25.08%		0.92	%
LEGI - ClearBridge Variable Large Cap Value Subaccount	2020		8,432	$28.15 to $37.42	$	298,293	0.90% to 1.65%	3.53% to 4.31%		1.10	%
LEGI - ClearBridge Variable Large Cap Value Subaccount	2019		12,746	$27.19 to $35.88	$	441,545	0.90% to 1.65%	26.79% to 27.73%		1.59	%
ASVT - VT Opportunity Subaccount	2023		582	$59.57	$	34,666	1.40%	24.76%		0.00	%
ASVT - VT Opportunity Subaccount	2022		586	$47.75	$	27,973	1.40%	-21.90%		0.00	%
ASVT - VT Opportunity Subaccount	2021		589	$61.14	$	36,014	1.40%	23.05%		0.04	%
ASVT - VT Opportunity Subaccount	2020		592	$49.68	$	29,428	1.40%	19.33%		0.44	%
ASVT - VT Opportunity Subaccount	2019		596	$41.63	$	24,796	1.40%	29.65%		0.28	%
MSV2 - VIF Growth Subaccount	2023		17,194	$50.66 to $53.94	$	880,208	0.90% to 1.65%	45.92% to 47.00%		0.00	%
MSV2 - VIF Growth Subaccount	2022		19,324	$34.72 to $36.69	$	673,798	0.90% to 1.65%	-60.81% to -60.52%		0.00	%
MSV2 - VIF Growth Subaccount	2021		27,696	$88.59 to $92.94	$	2,492,064	0.90% to 1.65%	-1.77% to -1.04%		0.00	%
MSV2 - VIF Growth Subaccount	2020		31,632	$88.63 to $93.92	$	2,875,377	0.90% to 1.55%	113.45% to 114.83%		0.00	%
MSV2 - VIF Growth Subaccount	2019		32,286	$41.52 to $43.72	$	1,371,305	0.90% to 1.55%	29.46% to 30.30%		0.00	%
GSVI - U.S. Equity Insights Subaccount	2023		11,018	$39.09	$	430,708	1.40%	22.10%		0.58	%
GSVI - U.S. Equity Insights Subaccount	2022		14,294	$32.01	$	457,597	1.40%	-20.85%		0.81	%
GSVI - U.S. Equity Insights Subaccount	2021		14,569	$40.45	$	589,235	1.40%	27.62%		0.77	%
GSVI - U.S. Equity Insights Subaccount	2020		18,475	$31.69	$	585,502	1.40%	15.92%		0.82	%
GSVI - U.S. Equity Insights Subaccount	2019		20,867	$27.34	$	570,503	1.40%	23.48%		1.24	%
GSVI - Strategic Growth Subaccount	2023		9,226	$50.48	$	465,708	1.40%	39.99%		0.00	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
GSVI - Strategic Growth Subaccount	2022		10,428	$36.06	$	375,993	1.40%	-33.45%		0.00	%
GSVI - Strategic Growth Subaccount	2021		9,178	$54.18	$	497,240	1.40%	20.24%		0.00	%
GSVI - Strategic Growth Subaccount	2020		9,686	$45.06	$	436,407	1.40%	38.56%		0.07	%
GSVI - Strategic Growth Subaccount	2019		14,024	$32.52	$	456,033	1.40%	33.66%		0.28	%
GSVS - U.S. Equity Insights Subaccount	2023		5,903	$35.31 to $43.38	$	215,442	0.90% to 1.70%	21.53% to 22.49%		0.47	%
GSVS - U.S. Equity Insights Subaccount	2022		6,220	$28.83 to $35.69	$	185,825	0.90% to 1.70%	-21.24% to -20.62%		0.58	%
GSVS - U.S. Equity Insights Subaccount	2021		6,540	$36.32 to $45.32	$	245,494	0.90% to 1.70%	26.95% to 27.96%		0.55	%
GSVS - U.S. Equity Insights Subaccount	2020		9,970	$28.38 to $35.70	$	316,057	0.90% to 1.70%	15.35% to 16.27%		0.65	%
GSVS - U.S. Equity Insights Subaccount	2019		10,439	$24.41 to $30.95	$	284,812	0.90% to 1.70%	22.84% to 23.81%		1.03	%
GSVS - Strategic Growth Subaccount	2023		31,740	$40.34 to $43.60	$	1,366,117	0.90% to 1.40%	39.70% to 40.39%		0.00	%
GSVS - Strategic Growth Subaccount	2022		24,747	$28.88 to $31.05	$	755,587	0.90% to 1.40%	-33.61% to -33.28%		0.00	%
GSVS - Strategic Growth Subaccount	2021		24,186	$43.50 to $46.54	$	1,107,285	0.90% to 1.40%	19.88% to 20.47%		0.00	%
GSVS - Strategic Growth Subaccount	2020		25,243	$36.29 to $38.63	$	984,153	0.90% to 1.40%	38.17% to 38.86%		0.00	%
GSVS - Strategic Growth Subaccount	2019		27,119	$26.26 to $27.82	$	761,162	0.90% to 1.40%	33.45% to 34.11%		0.05	%
GSVS - Trend Driven Allocation Subaccount	2023		408,163	$13.37 to $14.75	$	5,668,897	0.90% to 1.75%	13.59% to 14.55%		1.66	%
GSVS - Trend Driven Allocation Subaccount	2022		457,560	$11.77 to $12.88	$	5,574,907	0.90% to 1.75%	-20.55% to -19.88%		0.00	%
GSVS - Trend Driven Allocation Subaccount	2021		470,430	$14.82 to $16.07	$	7,190,632	0.90% to 1.75%	14.17% to 15.14%		0.00	%
GSVS - Trend Driven Allocation Subaccount	2020		512,252	$12.98 to $13.96	$	6,835,491	0.90% to 1.75%	2.32% to 3.18%		0.28	%
GSVS - Trend Driven Allocation Subaccount	2019		543,261	$12.68 to $13.53	$	7,062,764	0.90% to 1.75%	10.01% to 10.94%		1.45	%
LAZS - Emerging Markets Equity Subaccount	2023		214,961	$12.02 to $39.30	$	5,196,822	0.90% to 1.75%	20.18% to 21.18%		4.80	%
LAZS - Emerging Markets Equity Subaccount	2022		252,075	$10.00 to $32.43	$	5,057,812	0.90% to 1.75%	-16.57% to -15.87%		3.25	%
LAZS - Emerging Markets Equity Subaccount	2021		270,991	$11.99 to $38.55	$	6,510,418	0.90% to 1.75%	3.65% to 4.53%		1.85	%
LAZS - Emerging Markets Equity Subaccount	2020		278,160	$11.57 to $36.88	$	6,459,807	0.90% to 1.75%	-2.98% to -2.16%		2.69	%
LAZS - Emerging Markets Equity Subaccount	2019		272,611	$11.92 to $37.69	$	6,606,437	0.90% to 1.75%	16.11% to 17.09%		0.89	%
LAZS - U.S. Small Cap Equity Select Subaccount	2023		18,623	$26.24 to $48.90	$	816,233	0.90% to 1.65%	8.24% to 9.05%		0.00	%
LAZS - U.S. Small Cap Equity Select Subaccount	2022		19,561	$24.24 to $44.84	$	787,577	0.90% to 1.65%	-16.89% to -16.27%		0.00	%
LAZS - U.S. Small Cap Equity Select Subaccount	2021		20,545	$29.17 to $53.55	$	990,890	0.90% to 1.65%	17.93% to 18.80%		0.05	%
LAZS - U.S. Small Cap Equity Select Subaccount	2020		21,402	$24.73 to $45.08	$	870,462	0.90% to 1.65%	5.03% to 5.81%		0.19	%
LAZS - U.S. Small Cap Equity Select Subaccount	2019		21,780	$23.55 to $42.60	$	839,619	0.90% to 1.65%	27.82% to 28.77%		0.00	%
LAZS - International Equity Subaccount	2023		505,018	$17.49 to $19.66	$	8,998,772	0.90% to 1.75%	13.89% to 14.85%		1.29	%
LAZS - International Equity Subaccount	2022		585,234	$15.35 to $17.12	$	9,127,167	0.90% to 1.75%	-16.47% to -15.77%		3.57	%
LAZS - International Equity Subaccount	2021		593,871	$18.38 to $20.33	$	11,057,259	0.90% to 1.75%	4.01% to 4.89%		0.94	%
LAZS - International Equity Subaccount	2020		603,986	$17.67 to $19.38	$	10,782,907	0.90% to 1.75%	6.37% to 7.27%		2.24	%
LAZS - International Equity Subaccount	2019		655,812	$16.61 to $18.06	$	10,970,012	0.90% to 1.75%	18.92% to 19.93%		0.34	%
LAZS - Global Dynamic Multi-Asset Subaccount	2023		515,810	$14.94 to $16.47	$	7,995,747	0.90% to 1.75%	8.91% to 9.83%		0.00	%
LAZS - Global Dynamic Multi-Asset Subaccount	2022		554,990	$13.71 to $15.00	$	7,873,638	0.90% to 1.75%	-18.79% to -18.11%		0.09	%
LAZS - Global Dynamic Multi-Asset Subaccount	2021		569,144	$16.89 to $18.32	$	9,912,387	0.90% to 1.75%	10.01% to 10.94%		2.85	%
LAZS - Global Dynamic Multi-Asset Subaccount	2020		625,086	$15.35 to $16.51	$	9,871,377	0.90% to 1.75%	-0.93% to -0.09%		0.62	%
LAZS - Global Dynamic Multi-Asset Subaccount	2019		669,607	$15.50 to $16.53	$	10,632,907	0.90% to 1.75%	15.76% to 16.74%		0.05	%
LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)	2023		19,442	$32.66 to $40.84	$	694,550	0.90% to 1.65%	11.27% to 12.09%		1.36	%
LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)	2022		20,602	$29.36 to $36.43	$	664,558	0.90% to 1.65%	-20.66% to -20.07%		0.45	%
LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)	2021		25,609	$37.00 to $45.58	$	1,041,050	0.90% to 1.65%	19.41% to 20.30%		0.51	%
LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)	2020		23,352	$30.98 to $37.89	$	792,989	0.90% to 1.65%	11.84% to 12.67%		0.99	%
LINC - LVIP JPMorgan Small Cap Core Subaccount (note 4)	2019		26,697	$27.71 to $33.63	$	815,324	0.90% to 1.65%	22.55% to 23.47%		0.42	%
ABVB - VPS Relative Value Subaccount	2023		19,565	$18.71 to $37.99	$	422,294	0.90% to 1.65%	9.91% to 10.73%		1.30	%
ABVB - VPS Relative Value Subaccount	2022		19,815	$17.02 to $34.31	$	386,734	0.90% to 1.65%	-5.97% to -5.27%		1.07	%
ABVB - VPS Relative Value Subaccount	2021		23,701	$18.10 to $36.22	$	488,355	0.90% to 1.65%	25.76% to 26.70%		0.67	%
ABVB - VPS Relative Value Subaccount	2020		26,962	$14.40 to $28.59	$	444,305	0.90% to 1.65%	0.80% to 1.56%		1.36	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
ABVB - VPS Relative Value Subaccount	2019		25,425	$14.28 to $28.15	$	428,579	0.90% to 1.65%	21.60% to 22.51%		1.01	%
ABVB - VPS Small Cap Growth Subaccount	2023		7,062	$21.27 to $58.76	$	253,888	0.90% to 1.65%	15.82% to 16.68%		0.00	%
ABVB - VPS Small Cap Growth Subaccount	2022		7,497	$18.36 to $50.36	$	228,074	0.90% to 1.65%	-40.25% to -39.81%		0.00	%
ABVB - VPS Small Cap Growth Subaccount	2021		7,266	$30.73 to $83.67	$	368,432	0.90% to 1.65%	7.43% to 8.23%		0.00	%
ABVB - VPS Small Cap Growth Subaccount	2020		5,088	$28.74 to $77.31	$	235,964	0.90% to 1.55%	51.29% to 52.27%		0.00	%
ABVB - VPS Small Cap Growth Subaccount	2019		5,903	$19.00 to $50.77	$	177,417	0.90% to 1.55%	33.93% to 34.79%		0.00	%
ABVB - VPS Global Risk Allocation-Moderate Subaccount	2023		2,080,381	$12.58 to $13.47	$	26,889,512	0.90% to 1.75%	12.82% to 13.77%		2.15	%
ABVB - VPS Global Risk Allocation-Moderate Subaccount	2022		2,281,915	$11.15 to $11.84	$	26,052,437	0.90% to 1.75%	-15.54% to -14.83%		0.62	%
ABVB - VPS Global Risk Allocation-Moderate Subaccount	2021		2,490,130	$13.20 to $13.90	$	33,543,595	0.90% to 1.75%	10.05% to 10.98%		0.00	%
ABVB - VPS Global Risk Allocation-Moderate Subaccount	2020		174,245	$12.03 to $12.52	$	2,119,938	0.90% to 1.70%	0.74% to 1.54%		1.31	%
ABVB - VPS Global Risk Allocation-Moderate Subaccount	2019		186,345	$11.94 to $12.34	$	2,245,624	0.90% to 1.70%	15.36% to 16.27%		1.95	%
MFSI - New Discovery Subaccount	2023		10,395	$34.94 to $46.52	$	436,881	0.90% to 1.55%	12.51% to 13.24%		0.00	%
MFSI - New Discovery Subaccount	2022		13,345	$31.05 to $41.08	$	496,293	0.90% to 1.55%	-31.06% to -30.62%		0.00	%
MFSI - New Discovery Subaccount	2021		12,998	$45.04 to $59.21	$	699,679	0.90% to 1.55%	0.02% to 0.67%		0.00	%
MFSI - New Discovery Subaccount	2020		16,158	$42.90 to $58.82	$	861,428	0.90% to 1.65%	43.22% to 44.28%		0.00	%
MFSI - New Discovery Subaccount	2019		16,776	$29.96 to $40.76	$	626,751	0.90% to 1.65%	38.98% to 40.01%		0.00	%
MFSI - Mid Cap Growth Subaccount	2023		15,972	$34.44 to $43.19	$	546,499	0.90% to 1.70%	18.96% to 19.90%		0.00	%
MFSI - Mid Cap Growth Subaccount	2022		16,889	$28.73 to $36.31	$	484,754	0.90% to 1.70%	-29.98% to -29.43%		0.00	%
MFSI - Mid Cap Growth Subaccount	2021		15,741	$40.70 to $51.86	$	640,453	0.90% to 1.70%	11.97% to 12.86%		0.00	%
MFSI - Mid Cap Growth Subaccount	2020		20,525	$36.07 to $46.31	$	734,338	0.90% to 1.70%	33.84% to 34.90%		0.00	%
MFSI - Mid Cap Growth Subaccount	2019		16,484	$26.74 to $34.60	$	448,825	0.90% to 1.70%	35.97% to 37.04%		0.00	%
MFSI - Total Return Subaccount	2023		82,871	$21.94 to $30.13	$	2,028,106	0.90% to 1.70%	8.38% to 9.24%		1.92	%
MFSI - Total Return Subaccount	2022		80,421	$20.24 to $27.59	$	1,813,562	0.90% to 1.70%	-11.34% to -10.64%		1.40	%
MFSI - Total Return Subaccount	2021		98,407	$22.83 to $30.87	$	2,472,923	0.90% to 1.70%	11.93% to 12.82%		1.63	%
MFSI - Total Return Subaccount	2020		96,746	$20.40 to $27.36	$	2,159,254	0.90% to 1.70%	7.68% to 8.54%		2.04	%
MFSI - Total Return Subaccount	2019		110,013	$18.95 to $25.21	$	2,281,383	0.90% to 1.70%	18.11% to 19.05%		2.12	%
MFS2 - Massachusetts Investors Growth Stock Subaccount	2023		4,554	$25.36 to $26.49	$	119,897	0.90% to 1.40%	22.00% to 22.60%		0.05	%
MFS2 - Massachusetts Investors Growth Stock Subaccount	2022		5,072	$20.79 to $21.60	$	108,998	0.90% to 1.40%	-20.56% to -20.16%		0.00	%
MFS2 - Massachusetts Investors Growth Stock Subaccount	2021		3,199	$26.17 to $27.06	$	85,953	0.90% to 1.40%	23.92% to 24.54%		0.03	%
MFS2 - Massachusetts Investors Growth Stock Subaccount	2020		3,388	$21.12 to $21.73	$	73,165	0.90% to 1.40%	20.51% to 21.11%		0.18	%
MFS2 - Massachusetts Investors Growth Stock Subaccount	2019		8,709	$17.52 to $17.94	$	155,343	0.90% to 1.40%	37.66% to 38.34%		0.36	%
PVIA - Real Return Subaccount	2023		464,879	$11.15 to $19.57	$	7,002,454	0.90% to 1.75%	1.88% to 2.73%		3.00	%
PVIA - Real Return Subaccount	2022		471,095	$10.95 to $19.05	$	6,990,166	0.90% to 1.75%	-13.41% to -12.68%		7.02	%
PVIA - Real Return Subaccount	2021		530,964	$12.64 to $21.82	$	9,100,657	0.90% to 1.75%	3.78% to 4.66%		4.98	%
PVIA - Real Return Subaccount	2020		523,128	$12.18 to $20.85	$	8,662,801	0.90% to 1.75%	9.79% to 10.72%		1.40	%
PVIA - Real Return Subaccount	2019		578,568	$11.09 to $18.83	$	8,670,697	0.90% to 1.75%	6.58% to 7.47%		1.67	%
PVIA - Global Bond Opportunities Subaccount	2023		44,715	$10.21 to $18.28	$	669,840	0.90% to 1.70%	3.51% to 4.33%		2.25	%
PVIA - Global Bond Opportunities Subaccount	2022		43,778	$9.86 to $17.52	$	629,878	0.90% to 1.70%	-12.49% to -11.80%		1.48	%
PVIA - Global Bond Opportunities Subaccount	2021		46,378	$11.27 to $19.86	$	763,085	0.90% to 1.70%	-5.76% to -5.01%		4.99	%
PVIA - Global Bond Opportunities Subaccount	2020		42,819	$11.96 to $20.91	$	748,107	0.90% to 1.70%	8.28% to 9.14%		2.47	%
PVIA - Global Bond Opportunities Subaccount	2019		46,105	$11.05 to $19.16	$	747,955	0.90% to 1.70%	4.36% to 5.18%		2.45	%
PVIA - CommodityRealReturn® Strategy Subaccount	2023		153,055	$7.39 to $8.18	$	1,181,244	0.90% to 1.70%	-9.39% to -8.67%		15.99	%
PVIA - CommodityRealReturn® Strategy Subaccount	2022		137,879	$8.09 to $9.03	$	1,169,294	0.90% to 1.70%	6.80% to 7.65%		21.31	%
PVIA - CommodityRealReturn® Strategy Subaccount	2021		165,671	$7.52 to $8.45	$	1,307,322	0.90% to 1.70%	31.11% to 32.15%		4.16	%
PVIA - CommodityRealReturn® Strategy Subaccount	2020		207,797	$5.69 to $6.45	$	1,247,749	0.90% to 1.70%	-0.35% to 0.44%		6.61	%
PVIA - CommodityRealReturn® Strategy Subaccount	2019		213,166	$5.66 to $6.47	$	1,283,117	0.90% to 1.70%	9.57% to 10.44%		4.48	%
PVIA - Short-Term Subaccount	2023		45,242	$10.16 to $11.00	$	482,150	0.90% to 1.70%	4.15% to 4.97%		4.43	%
PVIA - Short-Term Subaccount	2022		54,940	$9.75 to $10.48	$	556,239	0.90% to 1.70%	-1.82% to -1.04%		1.52	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
PVIA - Short-Term Subaccount	2021		79,418	$9.93 to $10.59	$	813,507	0.90% to 1.70%	-1.73% to -0.95%		1.08	%
PVIA - Short-Term Subaccount	2020		89,703	$10.11 to $10.69	$	937,104	0.90% to 1.70%	0.53% to 1.33%		1.25	%
PVIA - Short-Term Subaccount	2019		72,625	$10.05 to $10.55	$	748,966	0.90% to 1.70%	1.08% to 1.88%		2.47	%
PVIA - Low Duration Subaccount	2023		248,727	$9.39 to $10.05	$	2,415,663	0.90% to 1.75%	3.18% to 4.04%		3.59	%
PVIA - Low Duration Subaccount	2022		260,088	$9.10 to $9.66	$	2,436,371	0.90% to 1.75%	-7.36% to -6.58%		1.71	%
PVIA - Low Duration Subaccount	2021		233,439	$9.82 to $10.34	$	2,357,185	0.90% to 1.75%	-2.63% to -1.81%		0.52	%
PVIA - Low Duration Subaccount	2020		208,916	$10.09 to $10.53	$	2,158,257	0.90% to 1.75%	1.22% to 2.07%		1.20	%
PVIA - Low Duration Subaccount	2019		203,120	$9.97 to $10.32	$	2,063,171	0.90% to 1.75%	2.24% to 3.10%		2.77	%
BNYS - Appreciation Subaccount	2023		16,542	$39.34 to $53.01	$	771,246	0.90% to 1.70%	18.66% to 19.59%		0.48	%
BNYS - Appreciation Subaccount	2022		17,494	$33.15 to $44.33	$	682,021	0.90% to 1.70%	-19.62% to -18.98%		0.43	%
BNYS - Appreciation Subaccount	2021		17,627	$41.25 to $54.71	$	853,186	0.90% to 1.70%	24.65% to 25.64%		0.20	%
BNYS - Appreciation Subaccount	2020		18,570	$33.09 to $43.55	$	717,105	0.90% to 1.70%	21.31% to 22.28%		0.56	%
BNYS - Appreciation Subaccount	2019		23,323	$27.28 to $35.61	$	742,395	0.90% to 1.70%	33.51% to 34.57%		0.91	%
ROYI - Small-Cap Subaccount	2023		54,232	$24.18 to $53.93	$	2,246,391	0.90% to 1.70%	23.83% to 24.81%		0.82	%
ROYI - Small-Cap Subaccount	2022		63,476	$19.53 to $43.21	$	2,131,784	0.90% to 1.70%	-10.71% to -10.00%		0.38	%
ROYI - Small-Cap Subaccount	2021		70,023	$21.87 to $48.01	$	2,629,830	0.90% to 1.70%	26.67% to 27.67%		1.37	%
ROYI - Small-Cap Subaccount	2020		94,301	$17.27 to $37.61	$	2,872,678	0.90% to 1.70%	-8.71% to -7.98%		0.98	%
ROYI - Small-Cap Subaccount	2019		106,580	$18.91 to $40.87	$	3,646,310	0.90% to 1.70%	16.68% to 17.61%		0.74	%
ROYI - Micro-Cap Subaccount	2023		17,588	$20.53 to $44.99	$	724,241	0.90% to 1.70%	16.80% to 17.73%		0.00	%
ROYI - Micro-Cap Subaccount	2022		21,476	$17.57 to $38.22	$	751,216	0.90% to 1.70%	-23.73% to -23.13%		0.00	%
ROYI - Micro-Cap Subaccount	2021		22,620	$23.04 to $49.72	$	1,032,736	0.90% to 1.70%	27.81% to 28.82%		0.00	%
ROYI - Micro-Cap Subaccount	2020		26,920	$18.03 to $38.59	$	957,597	0.90% to 1.70%	21.72% to 22.69%		0.00	%
ROYI - Micro-Cap Subaccount	2019		41,870	$14.81 to $31.46	$	1,219,093	0.90% to 1.70%	17.55% to 18.48%		0.00	%
AIMI - Invesco V.I. EQV International Equity Series II Subaccount	2023		86,988	$15.53 to $18.52	$	1,297,005	0.90% to 1.70%	15.90% to 16.82%		0.00	%
AIMI - Invesco V.I. EQV International Equity Series II Subaccount	2022		93,061	$13.29 to $15.98	$	1,193,630	0.90% to 1.70%	-19.87% to -19.23%		1.42	%
AIMI - Invesco V.I. EQV International Equity Series II Subaccount	2021		94,439	$16.46 to $19.94	$	1,522,120	0.90% to 1.70%	3.84% to 4.66%		1.07	%
AIMI - Invesco V.I. EQV International Equity Series II Subaccount	2020		93,571	$15.72 to $19.20	$	1,449,609	0.90% to 1.70%	11.83% to 12.72%		2.07	%
AIMI - Invesco V.I. EQV International Equity Series II Subaccount	2019		106,472	$13.95 to $17.17	$	1,460,999	0.90% to 1.70%	26.10% to 27.09%		1.28	%
NBAS - AMT Mid Cap Intrinsic Value Subaccount	2023		33,656	$23.42 to $26.66	$	763,337	0.90% to 1.70%	8.84% to 9.70%		0.52	%
NBAS - AMT Mid Cap Intrinsic Value Subaccount	2022		35,113	$21.35 to $24.50	$	726,337	0.90% to 1.70%	-11.45% to -10.75%		0.15	%
NBAS - AMT Mid Cap Intrinsic Value Subaccount	2021		38,956	$23.92 to $27.67	$	909,367	0.90% to 1.70%	30.30% to 31.33%		0.25	%
NBAS - AMT Mid Cap Intrinsic Value Subaccount	2020		44,970	$18.22 to $21.23	$	802,435	0.90% to 1.70%	-4.46% to -3.70%		0.66	%
NBAS - AMT Mid Cap Intrinsic Value Subaccount	2019		51,210	$18.92 to $22.22	$	948,626	0.90% to 1.70%	14.49% to 15.39%		0.23	%
FRT2 - Franklin Income VIP Subaccount	2023		27,680	$22.79 to $25.00	$	635,539	0.90% to 1.40%	7.13% to 7.66%		5.03	%
FRT2 - Franklin Income VIP Subaccount	2022		29,702	$21.28 to $23.22	$	636,057	0.90% to 1.40%	-6.78% to -6.32%		4.85	%
FRT2 - Franklin Income VIP Subaccount	2021		34,123	$22.82 to $24.78	$	783,127	0.90% to 1.40%	15.14% to 15.71%		4.67	%
FRT2 - Franklin Income VIP Subaccount	2020		33,529	$19.82 to $21.42	$	668,128	0.90% to 1.40%	-0.70% to -0.21%		5.86	%
FRT2 - Franklin Income VIP Subaccount	2019		33,957	$19.96 to $21.46	$	681,155	0.90% to 1.40%	14.46% to 15.02%		5.39	%
FRT2 - Franklin DynaTech VIP Subaccount	2023		2,977	$39.98	$	119,023	1.40%	41.79%		0.00	%
FRT2 - Franklin DynaTech VIP Subaccount	2022		3,520	$28.19	$	99,238	1.40%	-40.79%		0.00	%
FRT2 - Franklin DynaTech VIP Subaccount	2021		2,704	$47.61	$	128,734	1.40%	14.54%		0.00	%
FRT2 - Franklin DynaTech VIP Subaccount	2020		2,781	$41.57	$	115,613	1.40%	42.88%		0.00	%
FRT2 - Franklin DynaTech VIP Subaccount	2019		3,471	$29.09	$	100,971	1.40%	29.35%		0.00	%
FRT2 - Templeton Foreign VIP Subaccount	2023		86,245	$15.95 to $17.50	$	1,406,282	0.90% to 1.40%	19.09% to 19.68%		3.18	%
FRT2 - Templeton Foreign VIP Subaccount	2022		103,938	$13.40 to $14.62	$	1,422,016	0.90% to 1.40%	-8.88% to -8.43%		3.00	%
FRT2 - Templeton Foreign VIP Subaccount	2021		107,947	$14.70 to $15.97	$	1,616,560	0.90% to 1.40%	2.72% to 3.23%		1.81	%
FRT2 - Templeton Foreign VIP Subaccount	2020		106,631	$14.31 to $15.47	$	1,552,622	0.90% to 1.40%	-2.53% to -2.04%		3.44	%
FRT2 - Templeton Foreign VIP Subaccount	2019		100,357	$14.68 to $15.79	$	1,504,791	0.90% to 1.40%	10.98% to 11.53%		1.75	%

	Year	Accumulation Units***		Value Per Unit	Fair Value		Expenses*	Total Return**	Investment Income Ratio****
FRT5 - Franklin VolSmart Allocation VIP Subaccount	2023		183,172	$15.37 to $16.39	$	2,882,684	0.90% to 1.70%	9.71% to 10.58%		1.89	%
FRT5 - Franklin VolSmart Allocation VIP Subaccount	2022		200,579	$14.01 to $14.82	$	2,869,009	0.90% to 1.70%	-13.74% to -13.05%		1.55	%
FRT5 - Franklin VolSmart Allocation VIP Subaccount	2021		285,870	$16.24 to $17.05	$	4,762,425	0.90% to 1.70%	15.39% to 16.31%		4.09	%
FRT5 - Franklin VolSmart Allocation VIP Subaccount	2020		225,335	$14.08 to $14.66	$	3,216,910	0.90% to 1.70%	14.82% to 15.74%		1.15	%
FRT5 - Franklin VolSmart Allocation VIP Subaccount	2019		250,354	$12.26 to $12.66	$	3,105,988	0.90% to 1.70%	15.98% to 16.90%		0.00	%
FRT4 - Franklin Income VIP Subaccount	2023		65,837	$18.89 to $19.51	$	1,224,460	0.90% to 1.70%	6.74% to 7.58%		4.91	%
FRT4 - Franklin Income VIP Subaccount	2022		70,054	$17.70 to $18.14	$	1,215,328	0.90% to 1.70%	-7.17% to -6.43%		4.39	%
FRT4 - Franklin Income VIP Subaccount	2021		91,373	$19.07 to $19.39	$	1,718,991	0.90% to 1.70%	14.64% to 15.55%		4.40	%
FRT4 - Franklin Income VIP Subaccount	2020		99,933	$16.63 to $16.78	$	1,633,762	0.90% to 1.70%	-1.11% to -0.32%		5.87	%
FRT4 - Franklin Income VIP Subaccount	2019		113,214	$16.82 to $16.83	$	1,867,776	0.90% to 1.70%	14.11% to 15.01%		5.25	%
FRT4 - Franklin DynaTech VIP Subaccount	2023		31,829	$34.06 to $37.84	$	1,090,371	0.90% to 1.65%	41.69% to 42.74%		0.00	%
FRT4 - Franklin DynaTech VIP Subaccount	2022		39,502	$23.87 to $26.71	$	952,921	0.90% to 1.65%	-41.17% to -40.74%		0.00	%
FRT4 - Franklin DynaTech VIP Subaccount	2021		32,655	$40.27 to $45.40	$	1,326,704	0.90% to 1.65%	14.20% to 15.05%		0.00	%
FRT4 - Franklin DynaTech VIP Subaccount	2020		36,186	$35.00 to $39.75	$	1,284,111	0.90% to 1.65%	42.36% to 43.42%		0.00	%
FRT4 - Franklin DynaTech VIP Subaccount	2019		48,586	$24.41 to $27.92	$	1,216,151	0.90% to 1.65%	28.90% to 29.86%		0.00	%
FRT4 - Templeton Foreign VIP Subaccount	2023		651,931	$11.74 to $14.20	$	7,744,870	0.90% to 1.75%	18.62% to 19.61%		3.00	%
FRT4 - Templeton Foreign VIP Subaccount	2022		793,913	$9.81 to $11.97	$	7,914,093	0.90% to 1.75%	-9.33% to -8.57%		2.84	%
FRT4 - Templeton Foreign VIP Subaccount	2021		849,265	$10.73 to $13.20	$	9,314,944	0.90% to 1.75%	2.31% to 3.17%		1.63	%
FRT4 - Templeton Foreign VIP Subaccount	2020		855,461	$10.40 to $12.91	$	9,141,736	0.90% to 1.75%	-3.04% to -2.22%		3.26	%
FRT4 - Templeton Foreign VIP Subaccount	2019		825,376	$10.64 to $13.31	$	9,068,471	0.90% to 1.75%	10.56% to 11.49%		1.49	%
FRT4 - Franklin Allocation VIP Subaccount	2023		32,280	$16.94 to $18.31	$	560,628	0.90% to 1.40%	13.05% to 13.60%		1.28	%
FRT4 - Franklin Allocation VIP Subaccount	2022		35,573	$16.12 to $18.05	$	551,289	0.90% to 1.70%	-17.59% to -16.94%		1.50	%
FRT4 - Franklin Allocation VIP Subaccount	2021		37,527	$19.40 to $21.91	$	702,681	0.90% to 1.70%	9.67% to 10.54%		1.62	%
FRT4 - Franklin Allocation VIP Subaccount	2020		41,493	$17.55 to $19.97	$	703,483	0.90% to 1.70%	9.88% to 10.75%		1.33	%
FRT4 - Franklin Allocation VIP Subaccount	2019		42,897	$15.85 to $18.18	$	658,687	0.90% to 1.70%	17.56% to 18.49%		3.06	%
FEDS - Kaufmann Fund II Service Shares Subaccount	2023		26,381	$26.45 to $31.53	$	669,722	0.90% to 1.65%	13.00% to 13.84%		0.00	%
FEDS - Kaufmann Fund II Service Shares Subaccount	2022		31,439	$23.24 to $27.90	$	708,337	0.90% to 1.65%	-31.39% to -30.88%		0.00	%
FEDS - Kaufmann Fund II Service Shares Subaccount	2021		31,208	$33.62 to $40.67	$	1,020,442	0.90% to 1.65%	0.60% to 1.35%		0.00	%
FEDS - Kaufmann Fund II Service Shares Subaccount	2020		30,222	$33.17 to $40.42	$	976,462	0.90% to 1.65%	26.39% to 27.33%		0.00	%
FEDS - Kaufmann Fund II Service Shares Subaccount	2019		33,855	$26.05 to $31.98	$	861,560	0.90% to 1.65%	30.76% to 31.73%		0.00	%
IVYV - Delaware Ivy VIP Asset Strategy Subaccount	2023		128,781	$18.30 to $21.10	$	2,535,894	0.90% to 1.65%	12.09% to 12.92%		2.00	%
IVYV - Delaware Ivy VIP Asset Strategy Subaccount	2022		143,452	$16.33 to $18.68	$	2,515,281	0.90% to 1.65%	-16.12% to -15.50%		1.54	%
IVYV - Delaware Ivy VIP Asset Strategy Subaccount	2021		153,530	$19.47 to $22.11	$	3,199,856	0.90% to 1.65%	8.65% to 9.46%		1.57	%
IVYV - Delaware Ivy VIP Asset Strategy Subaccount	2020		168,319	$17.92 to $20.20	$	3,210,975	0.90% to 1.65%	12.02% to 12.86%		1.96	%
IVYV - Delaware Ivy VIP Asset Strategy Subaccount	2019		191,487	$15.99 to $17.90	$	3,258,889	0.90% to 1.65%	19.80% to 20.69%		2.04	%
IVYV - Delaware Ivy VIP Natural Resources Subaccount	2023		29,806	$8.95 to $9.35	$	255,715	0.90% to 1.65%	-0.06% to 0.68%		2.65	%
IVYV - Delaware Ivy VIP Natural Resources Subaccount	2022		32,203	$8.89 to $9.35	$	274,112	0.90% to 1.65%	15.87% to 16.73%		1.64	%
IVYV - Delaware Ivy VIP Natural Resources Subaccount	2021		39,684	$7.61 to $8.07	$	289,711	0.90% to 1.65%	24.62% to 25.55%		1.59	%
IVYV - Delaware Ivy VIP Natural Resources Subaccount	2020		44,272	$6.06 to $6.48	$	258,164	0.90% to 1.65%	-13.42% to -12.78%		2.19	%
IVYV - Delaware Ivy VIP Natural Resources Subaccount	2019		45,234	$6.95 to $7.48	$	302,520	0.90% to 1.65%	7.68% to 8.48%		0.98	%
IVYV - Delaware Ivy VIP Science and Technology Subaccount	2023		12,358	$51.69 to $61.68	$	698,997	0.90% to 1.70%	36.75% to 37.83%		0.00	%
IVYV - Delaware Ivy VIP Science and Technology Subaccount	2022		12,743	$37.80 to $44.75	$	524,384	0.90% to 1.70%	-32.98% to -32.45%		0.00	%
IVYV - Delaware Ivy VIP Science and Technology Subaccount	2021		12,207	$56.40 to $66.25	$	746,548	0.90% to 1.70%	13.24% to 14.14%		0.00	%
IVYV - Delaware Ivy VIP Science and Technology Subaccount	2020		14,287	$49.81 to $58.05	$	768,915	0.90% to 1.70%	33.09% to 34.15%		0.00	%
IVYV - Delaware Ivy VIP Science and Technology Subaccount	2019		16,606	$37.42 to $43.27	$	674,024	0.90% to 1.70%	46.99% to 48.15%		0.00	%

This represents the range of annualized contract expense rates of the Account for the period indicated and includes only those expenses that are charged through a reduction in the unit values. Excluded are expenses of the underlying mutual fund and charges made directly to contract owner accounts through the redemption of units.

This represents the range of total return for the period indicated and includes a deduction only for expenses assessed through the daily unit value calculation. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction of the total return presented. Investments with a date notation indicate the inception date of that investment in the Subaccount. The total return is calculated for the twelve-month period indicated. In the first year of inception, the returns are based on the period from inception date to period end and are not annualized.

***

Accumulation units are rounded to the nearest whole number.

****

The Investment Income Ratio represents the net investment income dividends that were received by the subaccount for the periods indicated, divided by average contract owners’ equity. Distributions of net capital gains by the underlying fund and expenses of the subaccount are not included in the calculation. The recognition of investment income by the subaccount is affected by the timing of dividends declared by the underlying fund. Therefore, the Investment Income Ratio is greatly affected by the amount of subaccount assets that are present on specific dividend record dates. The Investment Income Ratios for funds that were eligible for investment during only a portion of a year are calculated by dividing the actual dividends received by the average contract owners’ equity for the period in which assets were present. The ratio is annualized in these instances.

(a) & (b)

Denotes the minimum or maximum of the total return ranges, respectively, for the underlying mutual fund options that were added and funded during the reporting period. These returns were not annualized.

KPMG LLP

Suite 3400

312 Walnut Street

Cincinnati, OH 45202

Report of Independent Registered Public Accounting Firm

To the Board of Directors of National Security Life and Annuity Company and Contract Owners of National Security Variable Account N:

Opinion on the Financial Statements

We have audited the accompanying statements of assets and contract owners’ equity of the subaccounts listed in the Appendix that comprise National Security Variable Account N (the Separate Account) as of the date listed in the Appendix, the related statements of operations for the year or period listed in the Appendix and changes in contract owners’ equity for the years or periods listed in the Appendix, and the related notes including the financial highlights in Note 6 (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of each subaccount as of the date listed in the Appendix, the results of their operations for the year or period listed in the Appendix, the changes in their contract owners’ equity for the years or periods listed in the Appendix, and the financial highlights for each of the years or periods indicated in Note 6, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Separate Account’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Separate Account in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Such procedures also included confirmation of securities owned as of December 31, 2023 by correspondence with the transfer agent of the underlying mutual funds or by other appropriate auditing procedures. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

We have not been able to determine the specific year that we began serving as the Separate Account’s auditor, however, we are aware that we have served as the Separate Account’s auditor since at least 1995.

Cincinnati, Ohio

April 1, 2024

KPMG LLP, a Delaware limited liability partnership and a member firm of

the KPMG global organization of independent member firms affiliated with

KPMG International Limited, a private English company limited by guarantee.

Appendix

Statement of assets and contract owners’ equity as of December 31, 2023, the related statement of operations for the year then ended, and the statements of changes in contract owners’ equity for each of the years in the two-year period then ended.

AB VARIABLE PRODUCTS SERIES FUND, INC. - CLASS B

VPS Global Risk Allocation-Moderate Subaccount

VPS Relative Value Subaccount (1)

VPS Small Cap Growth Subaccount

AIM VARIABLE INSURANCE FUNDS (INVESCO VARIABLE INSURANCE FUNDS)

Invesco V.I. EQV International Equity Series II Subaccount

ALLSPRING VARIABLE TRUST

VT Opportunity Subaccount

AUGUSTAR^SM VARIABLE INSURANCE PRODUCTS FUND, INC.

AVIP AB Mid Cap Core Subaccount (1)

AVIP AB Risk Managed Balanced Subaccount (1)

AVIP AB Small Cap Subaccount (1)

AVIP Balanced Model Subaccount (1)

AVIP BlackRock Advantage International Equity Subaccount (1)

AVIP BlackRock Advantage Large Cap Core Subaccount (1)

AVIP BlackRock Advantage Large Cap Growth Subaccount (1)

AVIP BlackRock Advantage Large Cap Value Subaccount (1)

AVIP BlackRock Advantage Small Cap Growth Subaccount (1)

AVIP BlackRock Balanced Allocation Subaccount (1)

AVIP Bond Subaccount (1)

AVIP Federated Core Plus Bond Subaccount (1)

AVIP Federated High Income Bond Subaccount (1)

AVIP Fidelity Institutional AM® Equity Growth Subaccount (1)

AVIP Growth Model Subaccount (1)

AVIP Intech U.S. Low Volatility Subaccount (1)

AVIP iShares Managed Risk Balanced Subaccount (1)

AVIP Moderate Growth Model Subaccount (1)

AVIP Moderately Conservative Model Subaccount (1)

AVIP Nasdaq-100® Index Subaccount (1)

AVIP S&P 500® Index Subaccount (1)

AVIP S&P MidCap 400® Index Subaccount (1)

BNY MELLON VARIABLE INVESTMENT FUND - SERVICE SHARES

Appreciation Subaccount

FEDERATED HERMES INSURANCE SERIES

Kaufmann Fund II Service Shares Subaccount

FIDELITY® VARIABLE INSURANCE PRODUCTS FUND - SERVICE CLASS

VIP Government Money Market Subaccount

FIDELITY® VARIABLE INSURANCE PRODUCTS FUND - SERVICE CLASS 2

VIP Equity-Income Subaccount

VIP Growth Subaccount

VIP Mid Cap Subaccount

VIP Real Estate Subaccount

VIP Target Volatility Subaccount

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST - CLASS 5

Franklin VolSmart Allocation VIP Subaccount

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST - CLASS 4

Franklin Allocation VIP Subaccount

Franklin DynaTech VIP Subaccount

Franklin Income VIP Subaccount

Templeton Foreign VIP Subaccount

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST - CLASS 2

Franklin DynaTech VIP Subaccount

Franklin Income VIP Subaccount

Templeton Foreign VIP Subaccount

GOLDMAN SACHS VARIABLE INSURANCE TRUST - INSTITUTIONAL SHARES

Strategic Growth Subaccount

U.S. Equity Insights Subaccount

GOLDMAN SACHS VARIABLE INSURANCE TRUST - SERVICE SHARES

Strategic Growth Subaccount

Trend Driven Allocation Subaccount

U.S. Equity Insights Subaccount

IVY VARIABLE INSURANCE PORTFOLIOS

Delaware Ivy VIP Asset Strategy Subaccount

Delaware Ivy VIP Natural Resources Subaccount

Delaware Ivy VIP Science and Technology Subaccount

JANUS ASPEN SERIES - SERVICE SHARES

Janus Henderson Balanced Subaccount

Janus Henderson Flexible Bond Subaccount

Janus Henderson Global Research Subaccount

Janus Henderson Overseas Subaccount

Janus Henderson Research Subaccount

LAZARD RETIREMENT SERIES, INC. - SERVICE SHARES

Emerging Markets Equity Subaccount

Global Dynamic Multi-Asset Subaccount

International Equity Subaccount

U.S. Small Cap Equity Select Subaccount (1)

LEGG MASON PARTNERS VARIABLE EQUITY TRUST - CLASS I

ClearBridge Variable Dividend Strategy Subaccount

ClearBridge Variable Large Cap Value Subaccount

LINCOLN VARIABLE INSURANCE PRODUCTS TRUST – STANDARD CLASS

LVIP JPMorgan Small Cap Core Subaccount (1)

MFS® VARIABLE INSURANCE TRUST - SERVICE CLASS

Mid Cap Growth Subaccount

New Discovery Subaccount

Total Return Subaccount

MFS® VARIABLE INSURANCE TRUST II - SERVICE CLASS

Massachusetts Investors Growth Stock Subaccount

MORGAN STANLEY VARIABLE INSURANCE FUND, INC. - CLASS II

VIF Growth Subaccount

NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST - S CLASS

AMT Mid Cap Intrinsic Value Subaccount

PIMCO VARIABLE INSURANCE TRUST - ADMINISTRATIVE SHARES

CommodityRealReturn® Strategy Subaccount

Global Bond Opportunities Subaccount

Low Duration Subaccount

Real Return Subaccount

Short-Term Subaccount

ROYCE CAPITAL FUND - INVESTMENT CLASS

Micro-Cap Subaccount

Small-Cap Subaccount

Statement of assets and contract owners’ equity as of December 31, 2023 and the related statements of operations and changes in contract owners’ equity for the period October 14, 2022 (commencement of operations) to December 31, 2022.

AUGUSTAR^SM VARIABLE INSURANCE PRODUCTS FUND, INC.

AVIP iShares Managed Risk Growth Subaccount

AVIP iShares Managed Risk Moderate Growth Subaccount

(1) See the footnote to the statement of assets and contract owners’ equity for the former name of the subaccount.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Statutory Financial Statements and Supplementary Information

December 31, 2023, 2022 and 2021

(With Independent Auditors’ Report Thereon)

KPMG LLP

Suite 3400

312 Walnut Street

Cincinnati, OH 45202

Independent Auditors’ Report

Audit and Governance Committee of the Board of Directors

National Security Life and Annuity Company:

Opinions

We have audited the statutory financial statements of National Security Life and Annuity Company (the Company), which comprise the statutory statements of admitted assets, liabilities, and capital and surplus as of December 31, 2023 and 2022, and the related statutory statements of income, changes in capital and surplus, and cash flow for each of the years in the three-year period ended December 31, 2023, and the related notes to the statutory financial statements.

Unmodified Opinion on Statutory Basis of Accounting

In our opinion, the accompanying statutory financial statements present fairly, in all material respects, the admitted assets, liabilities, and surplus of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flow for each of the years in the three-year period ended December 31, 2023, in accordance with statutory accounting practices prescribed or permitted by The New York State Department of Financial Services described in Note 2.

Adverse Opinion on U.S. Generally Accepted Accounting Principles

In our opinion, because of the significance of the matter discussed in the Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles section of our report, the statutory financial statements do not present fairly, in accordance with U.S. generally accepted accounting principles, the financial position of the Company as of December 31, 2023 and 2022, or the results of its operations or its cash flows for each of the years in the three-year period ended December 31, 2023.

Basis for Opinions

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles

As described in Note 2 to the statutory financial statements, the statutory financial statements are prepared by the Company using accounting practices prescribed or permitted by The New York State Department of Financial Services, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the statutory financial statements are not intended to be presented in accordance with U.S. generally accepted accounting principles. The effects on the statutory financial statements of the variances between the statutory accounting practices described in Note 2 and U.S. generally accepted accounting principles, although not reasonably determinable, are presumed to be material and pervasive.

KPMG LLP, a Delaware limited liability partnership and a member firm of

the KPMG global organization of independent member firms affiliated with

KPMG International Limited, a private English company limited by guarantee.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the statutory financial statements in accordance with accounting practices prescribed or permitted by The New York State Department of Financial Services. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of statutory financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the statutory financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year after the date that the statutory financial statements are available to be issued.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the statutory financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the statutory financial statements.

In performing an audit in accordance with GAAS, we:

●

Exercise professional judgment and maintain professional skepticism throughout the audit.

●

Identify and assess the risks of material misstatement of the statutory financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the statutory financial statements.

●

Obtain an understanding of internal control relevant to the audit in order to design 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. Accordingly, no such opinion is expressed.

●

Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the statutory financial statements.

●

Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

Supplementary Information

Our audits were conducted for the purpose of forming an opinion on the statutory financial statements as a whole. The supplementary information included in Schedule I Summary of Investments - Other Than Investments in Related Parties, Schedule III Supplementary Insurance Information, Schedule IV Reinsurance and Schedule V Valuation and Qualifying Accounts is presented for purposes of additional analysis and is not a required part of the statutory financial statements but is supplementary information required by the Securities and Exchange Commission’s Regulation S-X. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the statutory financial statements. The information has been subjected to the auditing procedures applied in the audits of the statutory financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the statutory financial statements or to the statutory financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the information is fairly stated in all material respects in relation to the statutory financial statements as a whole.

/s/ KPMG LLP

Cincinnati, Ohio

March 28, 2024

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus

December 31, 2023 and 2022

(Dollars in thousands, except share amounts)

Admitted Assets	2023			2022
Investments:
Bonds	$	63,084			63,261
Cash, cash equivalents and short-term investments		10,828			6,572
Receivables for securities		14			—
Total investments		73,926			69,833
Amounts recoverable from reinsurers		69			190
Accrued investment income		489			506
Receivable from parent, subsidiaries and affiliates		—			37
Deferred tax asset, net		200			312
Other assets		2,066			2,148
Separate account assets		328,688			318,717
Total admitted assets	$	405,438			391,743

Liabilities and Capital and Surplus
Life and annuity policies and contract reserves	$	31,498			32,497
Liability for deposit type contracts		48			118
Current federal income taxes		271			81
Accounts payable to parent and affiliates		298			290
Amounts payable to reinsurers		412			322
Interest maintenance reserve		172			215
Asset valuation reserve		516			476
Other liabilities		333			269
Transfers to separate accounts due or accrued, net		(144	)		(576	)
Separate account liabilities		328,688			318,717
Total liabilities		362,092			352,409
Capital and surplus:
Class A common stock, $250 par value. Authorized, issued and outstanding 10,000 shares		2,500			2,500
Gross paid in and contributed surplus		33,272			33,272
Aggregate write-ins for special surplus funds		(14,000	)		(14,000	)
Unassigned surplus		21,574			17,562
Total capital and surplus		43,346			39,334
Total liabilities and capital and surplus	$	405,438			391,743

See accompanying notes to statutory financial statements.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Statutory Statements of Income

Years ended December 31, 2023, 2022 and 2021

(Dollars in thousands)

	2023			2022			2021
Premiums and other considerations:
Life and annuity	$	(2,888	)		(2,669	)		(2,818	)
Total premiums and other considerations:		(2,888	)		(2,669	)		(2,818	)
Investment income:
Interest on bonds		2,364			2,261			2,357
Interest on cash and short-term investments		85			1			—
Amortization of interest maintenance reserve		32			44			50
Total investment income		2,481			2,306			2,407
Less investment expenses		—			—			18
Net investment income		2,481			2,306			2,389
Commissions and expense allowances		32			18			17
Other income		8,909			9,601			10,852
Total income		8,534			9,256			10,440
Annuity benefits, fund withdrawals, and other benefits to policyholders and beneficiaries		32,897			28,972			36,790
Change in reserves for future policy benefits and other funds		(766	)		847			(1,715	)
Commissions		1,990			2,117			2,298
General insurance expenses		1,045			830			785
Insurance taxes, licenses, and fees		126			118			(148	)
Net transfers from separate accounts		(31,523	)		(26,993	)		(33,298	)
Total expenses		3,769			5,891			4,712
Income before provision (benefit) for federal income taxes and net realized capital losses		4,765			3,365			5,728
Provision (benefit) for federal income taxes		573			503			(484	)
Income before net realized capital losses		4,192			2,862			6,212
Net realized capital losses, net of interest maintenance reserve and income taxes		(15	)		(16	)		(66	)
Net income	$	4,177			2,846			6,146

See accompanying notes to statutory financial statements.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Statutory Statements of Changes in Capital and Surplus

Years ended December 31, 2023, 2022 and 2021

(Dollars in thousands)

	Common stock		Gross paid in and contributed surplus		Aggregate write-ins for special surplus funds			Unassigned (deficit) surplus			Total capital and surplus
Balance at December 31, 2020	$	2,500		33,272		(14,000	)		8,595			30,367
Net income		—		—		—			6,146			6,146
Change in net deferred income tax		—		—		—			(1,370	)		(1,370	)
Change in nonadmitted assets and related items		—		—		—			355			355
Change in asset valuation reserve		—		—		—			(7	)		(7	)
Change in reserve valuation basis		—		—		—			14			14
Change in liability for reinsurance in unauthorized and certified companies		—		—		—			1,084			1,084
Balance at December 31, 2021		2,500		33,272		(14,000	)		14,817			36,589
Net income		—		—		—			2,846			2,846
Change in net deferred income tax		—		—		—			273			273
Change in nonadmitted assets and related items		—		—		—			(309	)		(309	)
Change in asset valuation reserve		—		—		—			(65	)		(65	)
Balance at December 31, 2022		2,500		33,272		(14,000	)		17,562			39,334
Net income		—		—		—			4,177			4,177
Change in net deferred income tax		—		—		—			(147	)		(147	)
Change in nonadmitted assets and related items		—		—		—			22			22
Change in asset valuation reserve		—		—		—			(40	)		(40	)
Balance at December 31, 2023	$	2,500		33,272		(14,000	)		21,574			43,346

See accompanying notes to statutory financial statements.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Statutory Statements of Cash Flow

Years ended December 31, 2023, 2022 and 2021

(Dollars in thousands)

	2023			2022			2021
Cash flow from operations:
Premiums, other considerations, and fund deposits	$	1,461			2,099			2,771
Investment income		2,512			2,264			2,366
		3,973			4,363			5,137
Less:
Death and other benefits		28,325			24,328			31,674
Commissions, taxes, and other expenses		3,513			3,224			3,727
Net transfers from Separate Accounts		(31,955	)		(27,513	)		(34,468	)
		(117	)		39			933
Net cash provided by operations		4,090			4,324			4,204
Cash flow from investing activities:
Proceeds from investments sold, matured, or repaid:
Bonds		7,011			6,669			11,465
Less cost of investments acquired:
Bonds		6,907			9,978			14,407
Net cash provided by (used in) investing activities		104			(3,309	)		(2,942	)
Cash flow from financing and other miscellaneous sources:
Withdrawals on deposit-type contracts and other liabilities		(73	)		(73	)		(73	)
Other, net		135			35			117
Net cash provided by (used in) financing		62			(38	)		44

Net increase in cash, cash equivalents and short-term investments		4,256			977			1,306
Cash, cash equivalents and short-term investments:
Beginning of year		6,572			5,595			4,289
End of year	$	10,828			6,572			5,595

See accompanying notes to statutory financial statements.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

(1)	Organization and Business

National Security Life and Annuity Company (“NSLAC” or the “Company”) is a stock life insurance company domiciled in New York and wholly owned by AuguStar Life Insurance Company (“ALIC”), formerly The Ohio National Life Insurance Company (“ONLIC”), a stock life insurance company. ALIC is 100% owned by Constellation Insurance, Inc. (“CII”), formerly Ohio National Financial Services, Inc. (“ONFS”), a stock holding company. CII is 100% owned by Constellation Insurance Holdings, Inc. (“CIHI”), formerly Ohio National Holdings, Inc. (“ONHI”) and Ohio National Mutual Holdings, Inc. (“ONMH”) a stock holding company organized under Ohio insurance law.

On March 22, 2021, the Board of Directors of ONMH unanimously approved an agreement with Constellation Insurance, LP (“Constellation’), whereby Constellation would acquire ONMH. On March 31, 2022, ONMH demutualized, converted to a stock company and changed its name to ONHI. ONHI is owned directly by ONLH Holdings LP (“ONLP”). ONLP is an insurance holding company under the control of Constellation. Constellation is ultimately backed by Caisse de dépôt et placement du Québec (“CDPQ”) and Ontario Teachers’ Pension Plan Board (“Ontario Teachers”), two of the world’s largest, premier, long-term institutional investors. In November 2022, ONHI and ONFS changed their names to CIHI and CII, respectively.

All references to activity entered into while under the ONMH, ONFS, and ONLIC names throughout the remainder of these footnotes have been updated to the new names of CIHI, CII, and ALIC, respectively.

The Company is licensed in 17 states and the District of Columbia and markets a portfolio of variable annuity products. The Company is subject to regulation by the insurance departments of the states in which it is licensed and undergoes periodic examinations by those departments.

Effective March 16, 2018, the Company no longer actively markets or issues new individual variable annuity business, which currently represents the majority of the Company’s inforce contracts and policies.

(2)	Basis of Presentation

The Company prepares its statutory financial statements in conformity with accounting practices prescribed or permitted by The New York State Department of Financial Services (the “Department”), which is an other comprehensive basis of accounting that differs from U.S. generally accepted accounting principles (“GAAP”). The Department requires that insurance companies domiciled in the State of New York prepare their statutory basis financial statements in accordance with the Statement of Statutory Accounting Principles (“SSAP”) that are described in the National Association of Insurance Commissioners (“NAIC”) Accounting Practices and Procedures Manual (the “Manual”) subject to any deviations prescribed or permitted by the state insurance commissioner.

The Company does not have any permitted statutory accounting practices as of December 31, 2023 and December 31, 2022.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

However, the Department has required the Company to adopt certain prescribed reserve methodologies that differ from those found in NAIC SSAP, specifically, the methodology used within the Company’s asset adequacy reserve calculation. See Note 8 for further information.

Statutory accounting practices are different in some respects from financial statements prepared in accordance with GAAP. The primary reasons for the differences between equity and net income on a GAAP basis versus capital and surplus and net income on a statutory basis are that, for GAAP reporting purposes:

●

The costs related to acquiring business, principally commissions and certain policy issue expenses related to successful acquisition efforts, are amortized over the period benefited rather than charged to income in the year incurred;

●

future policy benefit reserves are based on anticipated Company experience for lapses, mortality and investment yield, rather than statutory mortality and interest requirements, without consideration of withdrawals;

●

investments in fixed maturity securities are carried at either amortized cost or fair value based on their classifications; investments in fixed maturity securities classified as available-for-sale are carried at estimated fair value with net unrealized holding gains and losses reported in other comprehensive income; fixed maturity securities designated as trading are carried at fair value with net unrealized holding gains and losses reported in income; under statutory accounting, investments in bonds are reported at the lower of amortized cost or fair value based on their NAIC rating and any adjustments to fair value are reported directly in surplus (see Note 3(c) for more information regarding bond valuation);

●

only contracts that have significant mortality or morbidity risk are classified as insurance contracts; otherwise, they are accounted for in a manner consistent with the accounting for interest bearing or other financial instruments; for statutory reporting, contracts that have any mortality or morbidity risk, regardless of significance, and contracts with life contingent annuity purchase rate guarantees are classified as insurance contracts;

●

the asset valuation reserve and interest maintenance reserve are not recorded;

●

under GAAP, “nonadmitted” assets do not exist, while for statutory reporting nonadmitted assets are excluded from capital and surplus (see Note 3(b) for more information regarding nonadmitted assets);

●

changes in deferred taxes are recognized in either net income (loss) or other comprehensive income and not subject to the statutory limitation of 15% of capital and surplus;

●

there is a presentation of other comprehensive income and comprehensive income;

●

certain assets and liabilities are reported gross of ceded reinsurance balances;

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

●

deposits to universal life contracts, investment contracts and limited payment contracts are not included in revenue;

●

negative cash balances are reported as liabilities;

●

certain annuity related contracts give rise to embedded derivatives for GAAP while STAT does not recognize these embedded derivatives; and

●

on a statutory basis only, the correction of immaterial prior period errors are recorded directly to surplus.

The effects of the foregoing variances from GAAP on the accompanying statutory basis financial statements have not been determined, but are presumed to be material.

(3)	Summary of Significant Accounting Policies

The significant accounting policies followed by the Company that materially affect statutory financial reporting are summarized below.

(a)

Use of Estimates

In preparing the statutory financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the statutory financial statements, and the reported amounts of revenues and expenses for the reporting period. Actual results could differ significantly from those estimates.

The most significant estimates and assumptions include those used in determining the liability for future policy benefits and claims, contingencies, provision for income taxes, deferred taxes, uncertain income tax positions and contingencies, and valuation of and impairment losses on investments. Although some variability is inherent in these estimates, the recorded amounts reflect management’s best estimates based on facts and circumstances as of the date of the statutory financial statements. Management believes the amounts provided are appropriate.

(b)

Nonadmitted Assets

Certain assets designated as “nonadmitted assets” (principally certain deferred taxes, and certain receivables) have been excluded from total admitted assets by a direct charge to surplus.

(c)

Investments

Investment Income

Interest on investments is recorded within investment income. Realized capital gains and losses are reported net of federal income tax and transfers to the interest maintenance reserve (“IMR”). Realized gains (losses) on the sale of investments are determined on the basis of specific security identification on the trade date. Unrealized gains and losses on investments are charged or credited to unassigned surplus in accordance with NAIC rules.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Interest is accrued as earned using an effective yield method giving effect to amortization of premiums and accretion of discounts.

Bonds

Bonds are valued as prescribed by the Securities Valuation Office (“SVO”) of the NAIC Investment Analysis Office. Bonds are rated as “1” (highest quality), “2” (high quality), “3” (medium quality), “4” (low quality), “5” (lowest quality, not in or near default) or “6” (lowest quality, in or near default). Bonds rated as categories 1 through 5 are reported in the statutory financial statements at amortized cost using the modified scientific method. Bonds rated as category 6 are reported at the lower of amortized cost or fair value.

Mortgage-backed securities are generally stated at amortized cost and are amortized using anticipated prepayment assumptions based on a retrospective adjustment method that estimates prepayment activity by utilizing certain factors, including seasonality, current levels of interest rates, economic activity, and the term and age of the underlying collateral.

Management regularly reviews its bond portfolio in order to evaluate the necessity to record impairment losses for other-than-temporary declines in estimated fair value of investments. See Note 6 for management’s description and analysis of the portfolio.

Cash, Cash Equivalents and Short-term Investments

Short-term investments are carried at amortized cost and cash equivalents are carried at fair value. Cash equivalents are short-term and highly liquid investments with original maturities of three months or less, and short-term investments include securities and other investments with remaining maturities of one year or less, but greater than three months, at time of purchase.

(d)

Separate Accounts

Separate account assets and liabilities represent contract holders’ funds, which have been segregated into accounts with specific investment objectives. Separate account assets are recorded at estimated fair value based primarily on market quotations of the underlying securities. The investment income and gains or losses of these accounts accrue directly to the contract holders. Separate account liabilities for individual annuities issued in 1992 and after represent contract holders’ funds adjusted for possible future surrender charges in accordance with the Commissioner’s Annuity Reserve Valuation Method (“CARVM”). The difference between full account value and CARVM is reflected in transfers to separate accounts due or accrued, net, as prescribed by the NAIC, on the Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus. The annual change in the difference between full account value and CARVM is reflected in the Statutory Statements of Income as part of the net transfers from separate accounts. The Company’s revenue reflects fees charged to the separate accounts including administrative services and risks assumed and for the activity related to guaranteed contracts, which are riders to existing variable annuity contracts that are guaranteed by the Company’s general account assets. The Company’s expenses reflect benefits paid, changes in reserves and expense allowances.

Premium income, benefits and expenses of the separate accounts are included in the Statutory Statements of Income with the offset recorded in Net transfers from separate accounts in the Statutory Statements of Income. Investment income and realized capital gains (losses) on the assets of separate accounts, other than seed money, accrue to contract holders and are not recorded in the Statutory Statements of Income. Unrealized capital gains (losses) on assets of separate accounts accrue to contract holders and, accordingly, are reflected in the separate account liability to the contract holder.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

(e)

Revenues and Expenses

Premiums are credited to revenue over the premium paying period of the policies. Universal life and annuity premiums are recognized as revenue when received. Amounts received related to deposit contracts with mortality or morbidity risk, such as traditional life products and certain annuities with life contingencies, are recorded as premiums. Traditional life product revenues are recorded when due. Amounts received as payment for deposit contracts that do not incorporate any mortality or morbidity risk, including those annuities without life contingencies, are not reported as revenue, but are recorded directly to the appropriate policy reserve account.

Expenses, including acquisition costs related to acquiring new business, are charged to operations as incurred.

(f)

Reserves for Future Policy Benefits

Life Policies and Contracts

Life reserves are developed by actuarial methods and are determined based on published tables using statutorily specified interest rates and valuation methods that will provide, in the aggregate, reserves that are greater than or equal to the minimum or guaranteed policy cash value or the amounts required by law. The mortality tables and interest assumptions used are the 1958 Commissioners Standard Ordinary (“CSO”) table with interest rates of 3.0% to 4.5% and the 1980 CSO table with interest rates from 4.0% to 6.0%.

The Company waives the deduction of deferred fractional premium at death and returns any portion of the final premium beyond the date of death. Surrender values are not promised in excess of the legally computed reserves. Reserves are computed using continuous functions to reflect these practices.

The method used in valuation of substandard policies is to hold 50% of the annual substandard premium as the substandard reserve in addition to the reserve calculated using standard mortality.

The Company had no individual life insurance in force or related reserves as of December 31, 2023 and 2022, for which the gross premiums were less than the net premiums according to the standard valuation set by the Department.

Tabular interest, tabular less actual reserves released, and tabular cost for all life contracts are determined in accordance with NAIC Annual Statement instructions. Variable life insurance products use a formula that applies a weighted average credited rate to the mean account value.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Annuity and Other Deposit Funds

The Company issued traditional variable annuity contracts through its separate accounts, for which investment income and gains and losses on investments accrue directly to, and investment risk is borne by, the contract holder.

The Company also issued nontraditional variable annuity contracts in which the Company provides various forms of guarantees/riders to benefit the related contract holders.

The Company has five main types of rider benefits offered with individual variable annuity contracts:

●

guaranteed minimum death benefit (“GMDB”);

●

guaranteed minimum income benefit (“GMIB”);

●

guaranteed minimum accumulation benefit (“GMAB”);

●

guaranteed minimum withdrawal benefit (“GMWB”); and

●

guaranteed lifetime withdrawal benefit (“GLWB”).

Effective January 1, 2020, the Company began reserving for all variable annuity policies in-force under section 21 of the Valuation Manual (“VM-21”). VM-21 sets forth requirements for the valuation of principles based reserves (“PBR”) for variable annuity and other contracts involving certain guaranteed benefits similar to those offered with variable annuities. VM-21 is a holistic reserve methodology, thus rider benefit reserves are not determined separately from the base reserve but rather on the policy as a whole. The requirement applies the principles of asset adequacy analysis directly to the risks associated with these products and guarantees. The VM-21 liability is evaluated with both company assumptions and prescribed assumptions under stochastic scenarios net of currently held applicable hedge asset cash flows. The Company holds the reserve liability valuation at the Conditional Tail Expectation (“CTE”) 70 level of the company assumptions value plus any additional standard projection amount and is subject to a floor of cash surrender value. These guarantee reserves are included in the general account reserves. Prior to 2020, these policies were reserved under the Actuarial Guideline 43.

The reserves and deposit liabilities for individual deferred annuity products have been established based on the participants’ net contributions, policy term, interest rates and various contract provisions. The average interest rate credited on these annuity policies was 2.72%, 2.72% and 2.67% for the years ended December 31, 2023, 2022 and 2021, respectively. The reserves for individual annuity policies issued after 1991 have been adjusted for possible future surrender charges in accordance with CARVM.

Reserves for ordinary (individual) immediate annuities are determined using either the Annuity 2000 Mortality Table at interest rates of 4.5% to 5.5% or the IAR2012 Mortality Table at interest rates of 1.5% to 5.0%.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

(g)

Asset Valuation Reserve/Interest Maintenance Reserve

In compliance with statutory requirements, the Company maintains an asset valuation reserve (“AVR”) and an IMR as prescribed by the NAIC.

The AVR is a formula reserve, which addresses specific asset risk areas and consists of the default component and the equity component. The default component provides for future credit-related losses on bonds, including corporate debt securities. The equity component covers all types of equity investments. The two components are designed to address the default and equity risks of the Company’s assets by calculating maximum reserve targets and controlling the flow of the reserve from and into surplus. The change in AVR is charged or credited directly to unassigned surplus.

The IMR minimizes the Statutory Statements of Income impact of interest rate related realized capital gains and losses. Realized capital gains and losses for all types of bonds that result from changes in the overall level of interest rates are removed from the net realized capital gains (losses) amount and credited or charged to the liability for IMR. This liability is amortized into income over the remaining life of each bond based on a seriatim method.

Credit related other-than-temporary impairment losses are recorded through the AVR; interest related other-than-temporary impairment losses are recorded through the IMR.

(h)

Reinsurance

Reinsurance is an agreement by which a reporting entity transfers all or part of its risk under a contract to another reporting entity. For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. The Company reviews all contractual features, including those that may limit the amount of insurance risk to which the reinsurer is subject or these that delay the timely reimbursement of claims.

Accounting for reinsurance requires the use of significant management estimates and assumptions, particularly related to the future performance of the underlying business and the potential impact of counterparty credit risk. The Company periodically reviews actual and anticipated experience compared to the assumptions used to establish assets and liabilities relating to ceded and assumed reinsurance and evaluates the strength of counterparties to its reinsurance agreements. Reinsurance does not discharge the Company from its primary liability to policyholders, and to the extent that a reinsurer were unable to meet its obligations, the Company would be liable to policyholders.

Premium income, benefits to policyholders, and policyholders’ reserves are stated net of reinsurance. Premiums, benefits and reserves related to reinsured business are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance agreements. The Company records a receivable for reinsured benefits paid and reduces policyholders’ reserves for the portion of insurance liabilities that are reinsured. Commissions and expense allowances on reinsurance ceded are recorded as revenue.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

(i)

Income Taxes

Total federal income taxes are based upon the Company’s best estimate of its current and deferred tax liabilities. Current tax expense is reported in the Statutory Statements of Income as provision for federal income tax expenses if resulting from operations, and within net realized capital gains (losses) if resulting from capital transactions. Changes in the balance of deferred taxes, which provided for book versus tax temporary differences, are subject to limitations and are reported on various lines within surplus. Limitations of deferred income taxes are recorded on the change in nonadmitted assets line, whereas, deferred taxes associated with net unrealized capital gains (losses) are shown within that caption on a net basis. Accordingly, the reporting of temporary differences, such as reserves and policy acquisition costs, and permanent differences, such as dividend received deduction and tax credits, results in effective tax rates that differ from the federal statutory tax rate.

The Company is included as part of the life/non-life consolidated federal income tax return of its ultimate parent, CIHI. The method of allocation of tax among the consolidated affiliates is subject to a written agreement and is based on the affiliates’ separate company taxable income. Net operating losses and realized losses are settled when utilized. Intercompany tax balances are settled quarterly.

On August 16, 2022, the Inflation Reduction Act was enacted and signed into Law. The Act included a number of tax-related provisions including a new corporate alternative minimum tax (“CAMT”). The Act will be effective for tax years beginning after 2022, however, the Company does not expect to be subject to CAMT.

(j)

Litigation Contingencies

The Company may be subject to legal actions arising in the normal course of business. Given the inherent unpredictability of these matters, it is difficult to estimate the impact on the Company’s financial position. Liabilities are established when it is probable that a loss has been incurred and the amount of loss can be reasonably estimated. Legal costs are recognized as incurred, and for the estimated amount to be incurred. On a quarterly and annual basis, the Company reviews relevant information with respect to liabilities for litigation, regulatory investigations and litigation-related contingencies to be reflected in the Company’s statutory financial statements.

(k)

New Accounting Standards

In October 2023, the NAIC issued revisions to SSAP No. 20, Nonadmitted Assets and SSAP No. 21, Other Admitted Assets, the update includes consistency revisions to SSAP No. 20. Revisions to SSAP No. 21R provide more detail on qualifying collateral, require information to support fair value of collateral to be available on request, and provide audit transition guidance for equity collateral from entities in the scope of SSAP No. 48, Joint Ventures, Partnerships and Limited Liability Companies and SSAP No. 97, Investments to Subsidiary, Controlled and Affiliated Entities. The adoption of this guidance did not impact the Company’s statutory financial statements.

In August 2023, the NAIC issued INT 23-03 to SSAP No. 4, Assets and Nonadmitted Assets, SSAP No. 9, Subsequent Events and SSAP No. 101, Income Taxes. The INT provides guidance for CAMT reporting on or after year-end 2023 and addresses accounting, the statutory valuation allowance, admissibility, disclosures, and year-end 2023 transition. The adoption of this guidance did not impact the Company’s statutory financial statements.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

In August 2023, the NAIC issued INT 23-01, Negative IMR Admitted Asset, effective August 13, 2023. The interpretation provides an optional, limited-time guidance, which allows the admittance of net negative (disallowed) IMR up to 10% of adjusted capital and surplus. INT 23-01: Net Negative (Disallowed) Interest Maintenance Reserve will be automatically nullified on January 1, 2026. The adoption of this guidance did not impact the statutory financial statements.

In August 2023, the NAIC issued revisions to SSAP No. 26R, Bonds and SSAP No. 43R, Loan-Backed and Structured Securities, effective January 1, 2025. These revisions adopt a new principles-based bond definition and the accounting for issuer credit obligations and asset-backed securities. The Company is in the process of assessing the impact of this standard on its statutory financial statements.

In August 2023, the NAIC issued revisions to SSAP No.43R, Loan-Backed and Structured Securities, effective December 31, 2023. These revisions incorporate changes to add collateralized loan obligations (“CLOs”) to the financial modeling guidance and to clarify that CLOs are not captured as legacy securities. The adoption of this guidance did not impact the Company’s statutory financial statements.

In April 2020, May 2021, and August 2023, the NAIC adopted with modification ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-01, Reference Rate Reform (Topic 848), with an expiration date of December 31, 2022. The guidance provides temporary optional expedients and exceptions relating to contract modifications and hedging relationships that reference the London Inter-Bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. The adoption of this guidance did not impact the Company’s statutory financial statements.

(l)

Subsequent Events

The Company has evaluated subsequent events through March 28, 2024, the date the statutory financial statements were available to be issued, and no events have occurred subsequent to the statutory statements of admitted assets, liabilities, and capital and surplus date and before the date of evaluation that would require disclosure.

(4)	Business Risks and Uncertainties

The Company participates in an industry where there are risk factors that could have material adverse effects on the business and operating results. The following is a description of the various risk factors:

Legal/Regulatory Risk is the risk that changes in the legal or regulatory environment in which the Company operates could result in increased competition, reduced demand for the Company’s products, or additional unanticipated expenses in the pricing of its products.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

State insurance regulators and the NAIC regularly re-examine existing laws and regulations applicable to insurance companies and their products. Changes in these laws and regulations may be designed to protect or benefit policyholders and thus affect the Company’s operating results.

Increased assessments from guaranty associations may occur if there is an increase of impaired, insolvent or failed insurers in the jurisdictions in which the Company operates.

Concentration Risk is the risk that arises from the Company’s reliance upon certain key business relationships. The Company’s largest distributor of variable annuity products accounted for approximately 33% and 31% of total individual annuity reserves as of December 31, 2023 and 2022, respectively. It is possible that a change in the Company’s relationship with this distributor could result in a decrease in revenues from the loss of existing variable annuity deposits or from a decrease in future total variable annuity deposits. The Company has entered into a 100% coinsurance agreement with ALIC for certain guaranty benefit riders. If the Company is unable to continue to negotiate acceptable coinsurance arrangements in the future, management could be required to seek other methods for maintaining required capital.

Mortality Risk is the risk that overall life expectancy assumptions used by the Company in the pricing of its life insurance and annuity products prove to be too aggressive. This situation may occur, for example, as a result of pandemics, terrorism, natural disasters, or acts of war. The Company attempts to reduce this risk through geographical diversification and the purchase of reinsurance.

Reinsurance Risk is the risk that the reinsurance companies, where the Company has ceded a portion of its underwriting risk, may default on their obligation. The Company has entered into reinsurance agreements to cede a portion of its general account life and annuity business. The Company attempts to mitigate this risk by monitoring the ratings of reinsurance companies it chooses to cede risk, requiring collateral to support ceded reserves, and/or following up on any outstanding balances with reinsurance companies.

Ratings Risk is the risk that rating agencies change their outlook or rating of the Company. If such ratings were lowered significantly relative to its competitors, the Company’s ability to market products to new customers could be harmed, and the Company could potentially lose existing customers. The Company monitors its Risk-Based Capital (“RBC”) and other ratios for adequacy and maintains regular communications with the rating agencies in its effort to minimize the adverse impact of this risk.

Cyber-Security Risk is the potential for information and systems to be vulnerable to adverse events, such as breaches, thefts, compromised integrity, damage, fraud, or business disruption, caused by internal, external or third parties. The loss of confidentiality, integrity or availability for information and systems could disrupt operations, result in the loss of business, materially affect profitability and negatively impact the Company’s reputation. The current working environment is unprecedented with wide-scale remote usage of the Company’s networks and may expose the Company to increased cyber-security vulnerability. The Company utilizes a defense in depth approach to physically, administratively and technically mitigate cyber-security risk. Multiple layers of security controls provide redundancy in the event a security control fails, or a vulnerability is exploited. The Company continually monitors cyber-security risk and implements new processes, controls and technology to address risks as they are identified. Despite these efforts, there is still a risk a cyber-security incident could happen.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Credit Risk is the risk that issuers of investment securities or other parties, including reinsurers, default on their contractual obligations or experience adverse changes that would affect the Company. The Company attempts to minimize the adverse impact of this risk by monitoring the portfolio diversification, the Company’s exposure to impairment, collectability of the loans, and the credit quality of reinsurers.

Banking risk is the risk associated with the Company’s concentrations of credit risk of its cash deposits and checking account balances, and risk of institutional failure. The Company maintains its cash deposits and checking account balances in various bank accounts that, at times, may exceed federally insured limits. The Company’s cash deposits and checking account balances have been placed with high credit quality financial institutions. The Company has not experienced, nor does it anticipate, any losses with respect to such accounts. In early 2023 there were three prominent bank failures in the United States that resulted in a seizure by government agencies. The Company had no direct exposure to these failures, but as a result of these failures the Company examined all of its bank relationships to ensure they are sufficiently protected from potential future failures. The Company will continue to monitor its banking relationships to ensure it is properly protected.

Interest Rate Risk is the risk that interest rates will change and impact the valuation of the bond investments. A change in rates may cause certain interest-sensitive products to become uncompetitive or may cause disintermediation. To the extent that liabilities come due more quickly than assets mature, an insurer would have to borrow funds or sell assets prior to maturity and potentially recognize a gain or loss.

Equity Market Risk is the risk of loss due to declines in the equity markets in which the Company participates. A decline in the stock market will affect the contract value of the Company’s individual variable annuity contracts, which offer guaranteed benefit riders. Losses in the equity market could result in declines in separate account assets and assets under management, which would affect investment management fees revenue. The Company attempts to minimize the adverse impact of this risk by monitoring the diversification of the Company’s investment portfolio and through reinsurance arrangements with third parties.

The Company does not have any direct exposure within its investment portfolio to businesses in Russia, Ukraine, Israel or Palestine. However, the ongoing conflicts in these areas are impacting global economic and financial markets exacerbating ongoing economic challenges. The Company is actively monitoring the impact of these conflicts on its investment portfolio.

Inflation Risk is the risk that inflation will undermine the performance of investments. Times of rising inflation will cause interest rates to increase. As discussed above, interest will change and impact the valuation of the Company’s investments. The Company has the ability to hold securities until maturity and has the ability to adjust product crediting rates allowing the Company to mitigate the potential of liabilities coming due more quickly than the assets mature. The long-term nature of the Company’s business allows for the Company to manage through periods of change. The Company is monitoring the responsive monetary policy actions taken or anticipated to be taken by central banks to curb inflation and the corresponding impact on market interest rates.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Liquidity Risk is the risk that the Company may not have the ability to sell certain investments to meet obligations of the Company.

Investment Risk – see Note 6 for additional risks specific to the investment portfolio.

(5)	Fair Value Measurements

Included in various investment related line items in the statutory financial statements are certain financial instruments carried at fair value. Other financial instruments are periodically measured at fair value, such as when impaired, or for certain bonds when carried at the lower of cost or market.

Fair Value Hierarchy

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various methods including market, income and cost approaches. The market approach utilizes prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The income approach uses discounted cash flows to determine fair value. When applying either approach, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs reflect the assumptions market participants would use in valuing a financial instrument based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s estimates about the assumptions market participants would use in valuing financial assets and financial liabilities based on the best information available in circumstances.

The Company is required to categorize its assets and liabilities that are carried at estimated fair value on the Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus into a three level hierarchy based on the priority of the inputs to the valuation technique in accordance with SSAP No. 100, Fair Value Measurements. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure estimated fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement.

The levels of the fair value hierarchy are as follows:

●

Level 1 – Fair value is based on unadjusted quoted prices for identical assets and liabilities in an active market at the measurement date. The types of assets and liabilities utilizing Level 1 valuations generally include cash, cash equivalents and short-term investments, and separate account assets.

●

Level 2 – Fair value is based on significant inputs, other than quoted prices included in Level 1, that are observable in active markets or that are derived principally from, or corroborated by, observable market data through correlation or other means for identical or similar assets and liabilities. The types of assets and liabilities utilizing Level 2 valuations generally include U.S. government agency securities; municipal bonds; foreign government debt; certain corporate debt; asset-backed, mortgage-backed, and private placement securities; certain common stocks; and cash equivalent securities.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

●

Level 3 – Fair value is based on unobservable inputs for the asset or liability for which there is little or no market activity at the measurement date. Unobservable inputs used in the valuation reflect management’s best estimate about the assumptions market participants would use to price the asset or liability. The types of assets and liabilities utilizing Level 3 valuations generally include certain corporate debt, and asset-backed or mortgage-backed securities.

The following tables present the Company’s hierarchy for its financial assets and liabilities measured at estimated fair value on a recurring basis at December 31:

	Level 1		Level 2		Level 3		Total
2023
Assets:
Investments:
Cash, cash equivalents and short-term investments	$	10,828		—		—		10,828
Other assets:
Separate account assets		328,688		—		—		328,688
Total assets	$	339,516		—		—		339,516

2022
Assets:
Investments:
Cash, cash equivalents and short-term investments	$	6,572	—	—	6,572
Other assets:
Separate account assets		318,717	—	—	318,717
Total assets	$	325,289	—	—	325,289

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The carrying amount and the NAIC estimated fair value of all financial instruments were as follows as of December 31. The valuation techniques used to estimate these fair values are described below.

			NAIC
	Carrying		estimated		Fair value hierarchy level
	amount		fair value		Level 1		Level 2		Level 3
2023
Assets:
Investments:
Bonds	$	63,084		56,597		1,489		55,108		—
Cash, cash equivalents and short-term investments		10,828		10,828		10,828		—		—
Other assets:
Separate account assets		328,688		328,688		328,688		—		—
Liabilities:
Individual deferred and immediate annuity contracts	$	17,545		19,600		—		19,600		—
Separate account liabilities		328,688		328,688		328,688		—		—

2022
Assets:
Investments:
Bonds	$	63,261		54,961		1,460		53,501		—
Cash, cash equivalents and short-term investments		6,572		6,572		6,572		—		—
Other assets:
Separate account assets		318,717		318,717		318,717		—		—
Liabilities:
Individual deferred and immediate annuity contracts	$	18,602		19,787		—		19,787		—
Separate account liabilities		318,717		318,717		318,717		—		—

Determination of Fair Values

The valuation methodologies used to determine the estimated fair values of assets and liabilities under the exit price notion of SSAP No. 100, Fair Value Measurements, reflect market participant objectives and are based on the application of the fair value hierarchy that prioritizes observable market inputs over unobservable inputs. The Company determines the estimated fair values of certain financial assets and financial liabilities based on quoted market prices, where available. The Company also determines estimated fair value based on future cash flows discounted at the appropriate current market rate. Estimated fair values include adjustments for credit-related and liquidity issues of the underlying issuer of the investment.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The Company has policies and guidelines that establish valuation methodologies and consistent application of such methodologies. These policies and guidelines provide controls around the valuation process. These controls include appropriate review and analysis of investment prices against market activity or price variances, review of price source changes, and review of methodology changes.

The following is a discussion of the methodologies used to determine estimated fair values for the financial instruments listed in the above tables:

Bonds – The estimated fair value of bonds is based on market prices published by the SVO where available. Otherwise, the fair value of bonds is generally obtained from independent pricing services based on market quotations of reported trades for identical or similar securities. The Company classifies these bonds as Level 1 assets.

When there are no recent reported trades, the Company uses third party pricing services that use matrix or model processes to develop a security price using future cash flow expectations and collateral performance discounted at an estimated market rate. For the pricing of asset-backed and mortgage-backed securities, the models include estimates for future principal prepayments based on the characteristics of the underlying structure and prepayment speeds previously experienced at the interest rate levels projected for the underlying collateral. Since these securities have been priced using market observable inputs that are obtained by the independent pricing services, the Company has classified these bonds as Level 2 assets.

Bonds not priced by independent services are generally priced using an internal pricing matrix. The internal pricing matrix is developed by obtaining spreads for corporate securities with varying weighted average lives and bond ratings. The weighted average life and bond rating of a particular bond to be priced using the internal matrix are important inputs into the model and are used to determine a corresponding spread that is added to the appropriate U.S. Treasury yield to create an estimated market yield for that bond. The estimated market yield is then used to estimate the fair value of the particular bond. Since the inputs used for the internal pricing matrix are based on observable market data, the Company has classified these fair values as Level 2.

In some instances the independent pricing service will price securities using independent broker quotations from market makers and other broker/dealers recognized to be market participants, which utilize inputs that may be difficult to corroborate with observable market data. These bonds are classified as Level 3 assets.

Cash, cash equivalents and short-term investments – Cash is considered a Level 1 asset as it is the functional currency in the U.S. and is the most liquid form of an asset and not subject to valuation fluctuations. Cash is comprised of bank deposits.

Short-term investments are considered Level 2 since they are short-term, highly liquid investments that are not traded on an active market but are both, a) readily convertible to known amounts of cash, and b) so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. These short-term investments are recorded at carrying value, which approximates fair value since they are so close to maturity.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Separate account assets – Separate account assets are recorded at estimated fair value based primarily on market quotations of the underlying securities and reported as a summarized total on the Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus. The underlying securities are mutual funds that are valued using the reported net asset value, which is published daily. The Company has classified separate account assets as Level 1 assets.

Individual deferred and immediate annuity and investment contracts – The fair value of the Company’s liabilities under investment contracts is disclosed using one of two methods. For investment contracts without defined maturities, fair value is the estimated amount payable on demand, net of certain surrender charges. For investment contracts with known or determined maturities, fair value is estimated using discounted cash flow analyses. Cash flows are discounted at a rate that reflects the nonperformance risk of the Company. The inputs are market observable; therefore, the Company has classified these as Level 2 assets.

Asset Transfers Between Levels

The Company reviews its fair value hierarchy classifications annually. Changes in the observability of significant valuation inputs identified during these reviews may trigger reclassification of fair value hierarchy levels of financial assets and liabilities.

There were no transfers between levels in 2023 or 2022.

(6)

Investments

Investment Risks and Uncertainties

Investments are exposed to various risks and uncertainties that affect the determination of estimated fair values, the ability to sell certain investments during strained market conditions, the recognition of impairments, and the recognition of income on certain investments. These risks and uncertainties include:

●

the risk that the Company’s assessment of an issuer’s ability to meet all of its contractual obligations will change based on changes in the credit characteristics of that issuer;

●

the risk that the economic outlook, including fluctuations in interest rates and inflationary pressures, will be worse than expected or have more of an impact on the issuer than anticipated;

●

the risk that the Company obtains inaccurate information for the determination of the estimated fair value estimates and other-than-temporary impairments; and

●

the risk that new information or changes in other facts and circumstances lead the Company to change its intent to hold the security to maturity or until it recovers in value.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Any of these situations are reasonably possible and could result in a charge to income in a future period. During 2022, rising inflation led to increases in interest rates resulting in larger unrealized losses on the Company’s investment portfolio. During 2023, inflation began to stabilize and reduction in interest rates resulted in a decrease in the Company’s unrealized losses in its investment portfolio.

The determination of impairments is highly subjective and is based upon periodic evaluations and assessments of known and inherent risks associated with each asset class. Such evaluations and assessments are revised as conditions change and new information becomes available.

The recognition of income on certain investments, including asset-backed and mortgage-backed securities, is dependent upon certain factors such as prepayments and defaults, and changes in factors could result in changes in amounts to be earned.

Bonds

Bonds by Sector

The carrying value, gross unrealized gains and losses, and estimated fair values of investments in bonds at December 31 are as follows:

	2023
			Gross		Gross			NAIC
	Carrying		unrealized		unrealized			estimated
	value		gains		losses			fair value
Bonds:
U.S. government	$	1,785		—		(264	)		1,521
States, territories and possessions		13,568		34		(2,639	)		10,963
Special revenue and assessment		143		—		(10	)		133
Industrial and miscellaneous		47,588		350		(3,958	)		43,980
Total bonds	$	63,084		384		(6,871	)		56,597

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

	2022
			Gross		Gross			NAIC
	Carrying		unrealized		unrealized			estimated
	value		gains		losses			fair value
Bonds:
U.S. government	$	1,851		—		(296	)		1,555
States, territories and possessions		14,753		22		(3,185	)		11,590
Special revenue and assessment		162		—		(10	)		152
Industrial and miscellaneous		46,495		103		(4,934	)		41,664
Total bonds	$	63,261		125		(8,425	)		54,961

Included in the tables above under the caption U.S. government are bonds that were issued by agencies not backed by the full faith and credit of the U.S. government such as the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.

Investments with an amortized cost of $1,753 and $1,755 were on deposit with various regulatory agencies as required by law as of December 31, 2023 and 2022, respectively.

Maturities of Bonds

The carrying value and the NAIC estimated fair value of bonds at December 31, 2023, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed securities are classified based on the last payment date of the underlying mortgage loans with the longest contractual duration.

			NAIC
	Carrying		estimated
	value		fair value
Due in one year or less	$	3,361		3,015
Due after one year through five years		22,087		19,815
Due after five years through ten years		13,287		11,920
Due after ten years		24,349		21,847
Total	$	63,084		56,597

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Continuous Gross Unrealized Losses for Bonds

The following tables present the NAIC estimated fair value and gross unrealized losses of the Company’s bonds (aggregated by sector) in an unrealized loss position, aggregated by length of time the securities have been in a continuous unrealized loss position at December 31:

	Less than 12 months					12 months or longer					Total
	NAIC					NAIC					NAIC
	estimated		Unrealized			estimated		Unrealized			estimated		Unrealized
	fair value		losses			fair value		losses			fair value		losses
2023
U.S. government	$	—		—			1,521		(264	)		1,521		(264	)
States, territories & possessions		80		—			9,843		(2,639	)		9,923		(2,639	)
Special revenue assessment		—		—			133		(10	)		133		(10	)
Industrial and miscellaneous		1,022		(5	)		33,573		(3,953	)		34,595		(3,958	)
Total	$	1,102		(5	)		45,070		(6,866	)		46,172		(6,871	)

2022
U.S. government	$	1,555		(296	)		—		—			1,555		(296	)
States, territories & possessions		9,895		(2,951	)		520		(234	)		10,415		(3,185	)
Special revenue assessment		152		(10	)		—		—			152		(10	)
Industrial and miscellaneous		39,045		(4,919	)		48		(15	)		39,093		(4,934	)
Total	$	50,647		(8,176	)		568		(249	)		51,215		(8,425	)

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The table below summarizes the bonds by sector in an unrealized loss position for less than and greater than twelve months as of December 31:

	Less than			12 months
	12 months			or more			Total
2023
99.9%-80%:
U.S. government	$	—			(264	)		(264	)
States, territories & possessions		—			(351	)		(351	)
Special revenue assessment		—			(10	)		(10	)
Industrial and miscellaneous		(5	)		(1,868	)		(1,873	)
Below 80%:
States, territories & possessions		—			(2,288	)		(2,288	)
Industrial and miscellaneous		—			(2,085	)		(2,085	)
Total	$	(5	)		(6,866	)		(6,871	)

2022
99.9%-80%:
U.S. government	$	(296	)		—			(296	)
States, territories & possessions		(239	)		—			(239	)
Special revenue assessment		(10	)		—			(10	)
Industrial and miscellaneous		(2,160	)		—			(2,160	)
Below 80%:
States, territories & possessions		(2,712	)		(234	)		(2,946	)
Industrial and miscellaneous		(2,759	)		(15	)		(2,774	)
Total	$	(8,176	)		(249	)		(8,425	)

Evaluation of Other-Than-Temporarily Impaired Investments

Management regularly reviews its bond and stock portfolios to evaluate the necessity of recording impairment losses for other-than-temporary declines in fair value of investments. An analysis which focuses on the issuer’s ability to service its debts and the length of time and extent the bond has been valued below cost. This review process includes an assessment of the credit quality or an assessment of the future cash flows of the identified investment in the portfolio.

For any securities identified in the review of the portfolio, the Company considers additional relevant facts and circumstances in evaluating whether the security is other-than-temporarily impaired (“OTTI”). Relevant facts and circumstances that may be considered include:

●

comparison of current estimated fair value of the security to cost;

●

length of time the estimated fair value has been below cost;

●

financial position of the issuer, including the current and future impact of any specific events, including changes in management;

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

●

analysis of issuer’s key financial ratios based upon the issuer’s financial statements;

●

any items specifically pledged to support the credit along with any other security interests or collateral;

●

the Company’s intent to sell the security or if it is more likely than not that it will be required to sell the security before it can recover the amortized cost or, for equity securities, the forecasted recovery of estimated fair value in a reasonable period of time;

●

overall business climate, including litigation and government actions;

●

rating agency downgrades;

●

analysis of late payments, revenue forecasts and cash flow projections for use as indicators of credit issues; and

●

other circumstances particular to an individual security.

In addition to the above, for certain securitized financial assets with contractual cash flows, including loan-backed and structured securities, the Company periodically evaluates the securities using the currently estimated cash flows, including new prepayment assumptions using the retrospective adjustment methodology. If the evaluation based on currently estimated cash flows results in discounted estimated future cash flows less than the book value, an OTTI is considered to have occurred. If the Company has the ability to hold and no intent to sell the security, the impairment amount recognized as a realized loss would be the difference between the amortized cost and the discounted cash flows.

For bonds that are OTTI and securities where the Company intends to sell or does not have the ability to hold the security, the realized loss would equal the difference between the amortized cost and its fair value at the Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus date.

For industrial and miscellaneous securities, the Company evaluates the financial performance of the issuer, based upon credit performance and investment ratings, and expects to recover the entire amortized cost of each security.

As of December 31, 2023, investments in loan-backed and structured securities, for which an OTTI has not been recognized in earnings and which were in an unrealized loss position, had a fair value of $5,482. Loan-backed and structured securities in an unrealized loss position for less than 12 months had a fair value of $498 and unrealized losses of $2. Loan-backed and structured securities in an unrealized loss position for greater than 12 months had a fair value of $4,984 and unrealized losses of $466. These loan-backed and structured securities were primarily categorized as industrial and miscellaneous.

Current Year Evaluation

Total unrealized losses decreased from December 31, 2022 to December 31, 2023 due mainly to the decrease in intermediate term interest rates and lower credit spreads during the year. The Company has concluded that the majority of its securities in an unrealized loss position as of December 31, 2023 and 2022 reflect temporary fluctuations in economic factors that are not indicative of OTTI due to the Company’s ability and intent to hold these investments until recovery of estimated fair value or amortized cost, and for equity investments, anticipate a forecasted recovery in a reasonable period of time. The Company has recorded OTTI losses when necessary on securities that the Company has deemed as being indicative of OTTI.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Net Realized Capital Gains (Losses) and Change in Unrealized Capital Gains (Losses)

The following is a summary of realized capital gains (losses) and the change in unrealized capital gains (losses), including realized losses for OTTI of investments, for the years ended December 31:

	Realized (losses) gains			Change in unrealized gains (losses)		Total investment (losses) gains
2023
Bonds	$	(14	)		—		(14	)
Other		(12	)		—		(12	)
Total		(26	)		—		(26	)
Less amount credited to interest maintenance reserve		(14	)		—		(14	)
Net losses before tax		(12	)		—		(12	)
Taxes on capital losses		(3	)		—		(3	)
Net losses after tax	$	(15	)		—		(15	)

2022
Bonds	$	(41	)		—		(41	)
Other		(2	)		—		(2	)
Total		(43	)		—		(43	)
Less amount credited to interest maintenance reserve		(42	)		—		(42	)
Net losses before tax		(1	)		—		(1	)
Taxes on capital losses		(15	)		—		(15	)
Net losses after tax	$	(16	)		—		(16	)

2021
Bonds	$	21			—		21
Other		(10	)		—		(10	)
Total		11			—		11
Less amount credited to interest maintenance reserve		20			—		20
Net losses before tax		(9	)		—		(9	)
Taxes on capital losses		(57	)		—		(57	)
Net losses after tax	$	(66	)		—		(66	)

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Realized capital gains and losses, net of tax, for all types of bonds that result from changes in the overall level of interest rates are credited or charged to the IMR, and these capital gains or losses are amortized into income over the remaining period of time based on the original maturity date of the bond sold.

Realized capital gains (losses) on investments, as shown in the tables above, include write-downs for OTTI of $0 for the years ended December 31, 2023, 2022 and 2021. As of December 31, 2023, securities with a carrying value of $59, which had a cumulative write-down of $46 due to OTTI, remained in the Company’s investment portfolio.

Included in the write-downs for OTTI are write-downs for OTTI on loan-backed and structured securities of $0 for 2023, 2022 and 2021. There were no securities that recognized OTTI impairment in 2023 due to the fact that the present value of the cash flows expected to be collected was more than the amortized cost basis of the securities.

There was no investment income due and accrued excluded from surplus on bonds in default as of December 31, 2023, 2022 and 2021.

Sales of Bonds

Proceeds from sales of investments in bonds, excluding calls, during 2023, 2022 and 2021 were $1,274, $3,144 and $4,876, respectively. Gross gains of $1, $4 and $14 and gross losses of $15, $52 and $1 were realized on those transactions in 2023, 2022 and 2021, respectively.

(7)

Separate Accounts

The Company utilizes separate accounts to record and account for assets and liabilities for particular lines of business and/or transactions. For the current reporting year, the Company reported assets and liabilities from variable individual annuities and variable universal life.

In accordance with the State of New York procedures on approving items within the separate account, the separate account classification of the product is subject to Section 4240 of the New York State Insurance Law. In addition, the separate accounts are supported through affirmative approval of the plans of operations by the New York State Insurance Commissioner.

As of December 31, 2023 and 2022, the Company’s separate account statement included legally insulated assets of $328,688 and $318,717, respectively. The assets legally insulated from the general account as of December 31, are attributed to the following:

	2023		2022
Variable individual annuities	$	327,402		318,028
Variable immediate annuities		1,146		577
Variable universal life		140		112
Total	$	328,688		318,717

At December 31, 2023 and 2022, there were no separate account securities lending arrangements.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

In accordance with the products/transactions recorded within the separate account, some separate account liabilities are guaranteed by the general account. In accordance with the guarantees provided, if the investment proceeds are insufficient to cover the rate of return guaranteed for the product, the policyholder proceeds will be remitted by the general account.

As of December 31, 2023 and 2022, the general account of the Company had a maximum guarantee for separate account liabilities of $1,610 and $6,433, respectively.

To compensate the general account for the risk taken, the separate account has paid risk charges as follows for the past five years:

	Risk
	charges
2023	$	3,960
2022		4,012
2021		4,093
2020		4,050
2019		4,078

As of December 31, 2023, 2022 and 2021, the general account of the Company had paid $508, $313 and $162, respectively, towards separate account guarantees.

The Company does not guarantee a return of the contract holders’ separate account. Information regarding the nonguaranteed separate accounts of the Company is as follows as of and for the years ended December 31:

		2023				2022				2021
Premiums, considerations or deposits for the years ended		$	746				1,027				136

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

	2023		2022
Reserves for accounts with assets at:
Market value	$	326,185		315,221
Amortized cost		2,359		2,920
Total reserves	$	328,544		318,141

By withdrawal characteristics:
Subject to discretionary withdrawal:
With market value adjustment	$	—		—
At book value without market value adjustment and with current surrender charge of 5% or more		—		—
At market value		327,294		317,505
At book value without market value adjustment and with current surrender charge of less than 5%		—		—
Subtotal		327,294		317,505
Not subject to discretionary withdrawal		1,250		636
Total reserves	$	328,544		318,141

The following is a reconciliation of net transfers from separate accounts for the years ended December 31:

	2023			2022			2021
Transfers as reported in the summary of operations of the Separate Accounts Statement:
Transfers to separate accounts	$	757			1,029			147
Transfers from separate accounts *		32,271			28,022			33,437
Net transfers from separate accounts before reconciling adjustments		(31,514	)		(26,993	)		(33,290	)
Reconciling adjustments:
Processing income & policyholder charges		2			2			2
Seed money income		(11	)		(2	)		(10	)
Other net		—			—			—
Net transfers from separate accounts	$	(31,523	)		(26,993	)		(33,298	)

Includes net transfer of existing reserves from or (to) separate accounts of ($41), $733 and $514 for the years ended December 31, 2023, 2022 and 2021, respectively.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

(8)

Reserves for Future Policy Benefits

The reserves for future policy benefits are comprised of liabilities for life and annuity policies and contracts.

As discussed in Note 2, the Department has required the Company to adopt certain prescribed reserve methodologies that differ from those found in NAIC SSAP, specifically, the methodology used within the Company’s asset adequacy reserve calculation. The asset adequacy reserve, as determined by management, was in accordance with VM-21 for variable annuities, NAIC SSAP No. 51R Life Contracts, and Appendix A-820 Minimum Life and Annuity Reserve Standards and was considered sufficient by management. Management acknowledges that under A-822 (Asset Adequacy Analysis Requirements), the Company may establish an additional reserve (above the VM-21 aggregate reserve) if management determines that such a reserve is needed as a result of the asset adequacy analysis. No additional reserve was required, however, the Company was required by the Department to refine the methodology used to determine gross reserves, the reinsurance reserve credit, and associated reinsurance collateral for the variable annuities with living benefits, which resulted in recording an additional net asset adequacy reserve of $14,000 and was recorded as a direct charge to surplus as a special surplus fund at December 31, 2017.

As discussed in Note 3, the Company has five main types of rider benefits offered with individual variable annuity contracts: GMDBs, GMIBs, GLWBs, GMABs, and GMWBs.

GMDB Riders

Certain variable annuity contracts include GMDB riders with the base contract and offer additional death and income benefits through riders that can be added to the base contract. These GMDB riders typically provide that, upon the death of the annuitant, the beneficiaries could receive an amount in excess of the contract value. The GMDB rider benefit could be equal to the premiums paid into the contract, the highest contract value as of a particular time, e.g., every contract anniversary, or the premiums paid into the contract times an annual interest factor. The Company assesses a charge for the GMDB riders and prices the base contracts to allow the Company to recover a charge for any built-in death benefits.

The Company’s GMDB claim reserves are determined by estimating the expected value of death benefits and recognizing the excess ratably over the accumulation period based on total expected assessments. The Company regularly evaluates estimates used and adjusts the additional liability balance as appropriate, with a related charge or credit to benefits and claims in the period of evaluation if actual experience or other evidence suggests that earlier assumptions should be revised. Additionally, a decline in the stock market causing the contract value to fall below the amount defined in each contract could result in additional claims.

The Company reinsures Premium Protection GMDB riders sold with GLWB riders issued from August 2012 through 2014 with an affiliate. As of 2015, the Company no longer reinsures any new riders issued.

GMIB Riders

Certain variable annuity contracts include GMIB riders with the base contract. These riders allow the policyholder to annuitize the contract after ten years and to receive a guaranteed minimum monthly income for life. The amount of the payout is based upon a guaranteed income base that is typically equal to the greater of the premiums paid increased by 5% annually (6% for riders sold before May 2009) or the highest contract value on any contract anniversary. In some instances, based upon the age of the annuitant, the terms of this rider may be less favorable for the contract purchaser. The amount of the monthly income is tied to annuitization tables that are built into the GMIB rider. In the event that the policyholder could receive a higher monthly income by annuitization based upon the Company’s current annuitization rates, the annuitant will automatically receive the higher monthly income. The Company continued to sell the GMIB rider in the state of New York until August 2012. The Company reinsures 100% of the GMIB riders issued with an affiliate.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

GMIB claim reserves are determined each period by estimating the expected value of annuitization benefits in excess of the projected account balance at the date of annuitization and recognizing the excess ratably over the accumulation period based on total assessments. The Company regularly evaluates estimates used and adjusts the additional liability balance as appropriate, with a related charge or credit to benefits and claims in the period of evaluation, if actual experience or other evidence suggests that earlier assumptions should be revised.

GLWB Riders

The Company began issuing the GLWB rider in August 2012. The GLWB rider allows the owner to take withdrawals from the contract at a guaranteed percentage of the GLWB base every year even if the contract value goes to zero. Such guaranteed withdrawals may start any time after the annuitant reaches age 59 1⁄2. The percentage withdrawal amount guaranteed increases if the annuitant attains a higher age band before the owner starts taking withdrawals. In some versions of GLWB riders sold in 2014 and later, there is a guaranteed minimum percentage withdrawal amount for the first fifteen years of the contract; if the policyholder’s account value goes to zero subsequent to the fifteen year guarantee period, the percentage withdrawal amount is then calculated per a specified formula based on the ten year treasury rate from the preceding ninety calendar days, with the calculated treasury linked rate subject to a specified cap and floor.

At policy inception, the GLWB base is set at the amount of the purchase payments, and it is increased by the amount of future purchase payments. It increases (roll-up) by up to 8% simple interest every year for the first ten years, as long as no withdrawal is made. If a withdrawal is made in any year during the first ten years, there is no roll-up at all for that year. If the contract value exceeds the GLWB base on any contract anniversary prior to the first contract anniversary after the annuitant reaches age 95, the GLWB base resets to the contract value and a new ten-year roll-up period begins.

In addition to the roll-up feature, some versions of the GLWB rider also provide for a top-off of the GLWB base at the end of the tenth contract year, subject to attained age restrictions where applicable if the owner has not made any withdrawals in the first ten years. The top-off is equal to 200% of the first-year purchase payments. Policyholders are eligible for only one top-off during the contractual term. A reset to the contract value does not start a new top-off period. A top-off will typically not occur if there is any reset in the first ten years.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The Company reinsures 100% of the GLWB riders issued through 2014, excluding the GLWB interest sensitive riders which the Company began issuing in 2014. As of 2015, the Company no longer reinsures any new riders issued.

GMAB Riders

Certain variable annuity contracts include a GMAB rider. On the eighth or tenth anniversary, depending on the version of the rider, the policyholder’s account value will increase to the amount of the initial deposit if the account value at that anniversary is less than the initial deposit. The Company reinsures 100% of the GMAB riders issued through 2014. As of 2015, the Company no longer reinsures any new riders issued.

GMWB Riders

Certain variable annuity contracts include a GMWB rider, which is similar to the GMAB rider noted above, except the policyholder is allowed to make periodic withdrawals instead of waiting for the benefit in a lump sum at the end of the tenth year. The Company discontinued the sale of its GMWB rider in 2009 and reinsures 100% of the GMWB riders issued. The activity associated with GMWB riders is included with GMAB riders and labeled “GMAB.”

The following tables summarize the net amount at risk, net of reinsurance, for variable annuity contracts with guarantees invested in both general and separate accounts as of December 31 (note that most contracts contain multiple guarantees):

	2023
		Death benefits	Living benefits
		GMDB	GMIB	GLWB	GMAB
Return of net deposit

Net amount at risk ¹	$	60	—	—	52

Return of net deposits accrued at a stated rate

Net amount at risk ¹	$	—	—	—	—

Highest of return of net deposits accrued at a stated rate and return of highest anniversary value

Net amount at risk ¹	$	—	—	—	—

Return of highest anniversary value

Net amount at risk ¹	$	7,149	—	—	—

Total

Net amount at risk ¹	$	7,209	—	—	52

Death benefit net amount at risk and living benefit net amount at risk are not additive at the contract level.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

	2022
		Death benefits	Living benefits
		GMDB	GMIB	GLWB	GMAB
Return of net deposit

Net amount at risk ¹	$	479	—	—	488

Return of net deposits accrued at a stated rate

Net amount at risk ¹	$	—	—	—	10,201

Highest of return of net deposits accrued at a stated rate and return of highest anniversary value

Net amount at risk ¹	$	—	—	—	—

Return of highest anniversary value

Net amount at risk ¹	$	30,675	—	—	—

Total

Net amount at risk ¹	$	31,154	—	—	10,689

Death benefit net amount at risk and living benefit net amount at risk are not additive at the contract level.

For guarantees of benefits that are payable in the event of death (GMDB), the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the account balance as of the date of the Statement of Admitted Assets, Liabilities, and Capital and Surplus.

For benefit guarantees that are payable at annuitization (GMIB), the net amount at risk is generally defined as the present value of the minimum guaranteed annuity payments available to the contract holder, determined in accordance with the terms of the contract and best estimate assumptions, where applicable, in excess of the account balance as of the date of the Statement of Admitted Assets, Liabilities, and Capital and Surplus.

For benefit guarantees that are payable upon withdrawal (GLWB), the net amount at risk is generally defined as the present value of the current maximum guaranteed withdrawal available to or taken by the contract holder, determined in accordance with the terms of the contract and best estimate assumptions, where applicable, in excess of the account balance as of the date of the Statement of Admitted Assets, Liabilities, and Capital and Surplus.

For accumulation guarantees (GMAB), the net amount at risk is generally defined as the guaranteed minimum accumulation balance in excess of the account balance as of the date of the Statement of Admitted Assets, Liabilities, and Capital and Surplus.

All separate account assets associated with these contracts are invested in shares of various mutual funds offered by the Company and its sub advisors. Some riders require that separate account funds be invested in asset allocation models, managed volatility models and/or have other investment restrictions.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The Company did not transfer assets from the general account to the separate account for any of its variable annuity contracts during 2023, 2022 and 2021.

The following table summarizes account balances of variable annuity contracts with guarantees that were invested in separate accounts as of December 31:

	2023		2022
Mutual funds:
Bond	$	99,607		96,742
Equity		220,045		212,523
Money market		7,749		8,763
Total	$	327,401		318,028

The reserves on guaranteed riders are held in the general accounts, and there are no guaranteed separate accounts.

(9)

Annuity Reserves and Deposit Liabilities by Withdrawal Characteristics

Annuity reserves and deposit liabilities by withdrawal characteristics are shown below as of December 31, 2023:

Individual Annuities
	General account		Separate account non-guaranteed	Total	% of Total
Subject to discretionary withdrawal:
With market value adjustment	$	—	—	—	0.0	%
At book value less surrender charge of 5% or more		—	—	—	0.0	%
At fair value*		—	327,152	327,152	86.2	%
Total with adjustment or at market value		—	327,152	327,152	86.2	%
At book value without adjustment		11,636	—	11,636	3.1	%
Not subject to discretionary withdrawal		39,331	1,250	40,581	10.7	%
Total, gross		50,967	328,402	379,369	100.0	%
Reinsurance ceded		33,470	—	33,470
Total, net	$	17,497	328,402	345,899

Amount at book value less surrender charge of 5% or more that will move to at book value without adjustment in the year after the statement date	$	—	—	—

Includes $327,152 of individual and variable deferred Annuity held in Separate Accounts that are surrenderable at market value less a surrender charge.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Deposit-Type Contracts
	General account		Separate account nonguaranteed	Total	% of Total
Subject to discretionary withdrawal:
With market value adjustment	$	—	—	—	0.0	%
At book value less surrender charge of 5% or more		—	—	—	0.0	%
At fair value*		—	—	—	0.0	%
Total with adjustment or at market value		—	—	—	0.0	%
At book value without adjustment		—	—	—	0.0	%
Not subject to discretionary withdrawal		48	—	48	100.0	%
Total, gross		48	—	48	100.0	%
Reinsurance ceded		—	—	—
Total, net	$	48	—	48

The following is the reconciliation of annuity reserves and deposit liabilities as of December 31, 2023:

Life, accident and health Annual Statement:
Annuities (excluding supplementary contracts with life contingencies), net	$	17,497
Deposit-type contracts		48
Subtotal		17,545
Separate Accounts Annual Statement:
Annuities, net		328,402
Total annuity reserves and deposit liabilities, net	$	345,947

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

As of December 31, 2023, withdrawal characteristics of life actuarial reserves were as follows:


	General account						Separate account - guaranteed and non-guaranteed
	Account value		Cash value		Reserve		Account value		Cash value		Reserve
Subject to discretionary withdrawal, surrender values or policy loans:
Term policies with cash value	$	—		—		—		—		—		—
Universal life		20		20		20		—		—		—
Universal life with secondary guarantees		—		—		—		—		—		—
Indexed universal life with secondary guarantees		—		—		—		—		—		—
Other permanent cash value life insurance		330		330		330		—		—		—
Variable life		—		—		—		—		—		—
Variable universal life		—		—		1		141		141		142
Miscellaneous reserves		—		—		—		—		—		—
Not subject to discretionary withdrawal or no cash values
Term policies without cash value		XXX		XXX		99		XXX		XXX		—
Accidental death benefits		XXX		XXX		—		XXX		XXX		—
Disability - active lives		XXX		XXX		2		XXX		XXX		—
Disability - disabled lives		XXX		XXX		18		XXX		XXX		—
Miscellaneous reserves		XXX		XXX		—		XXX		XXX		—
Total (gross)		350		350		470		141		141		142
Reinsurance ceded		350		350		469		—		—		—
Total (net)	$	—		—		1		141		141		142

The following is the reconciliation of life actuarial reserves as of December 31, 2023:

Life, accident and health Annual Statement:
Life insurance, net	$	1
Separate Accounts Annual Statement:
Life insurance, net		142
Total life reserves, net	$	143

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Annuity reserves and deposit liabilities by withdrawal characteristics are shown below as of December 31, 2022:

Individual Annuities
	General account		Separate account nonguaranteed	Total	% of Total
Subject to discretionary withdrawal:
With market value adjustment	$	—	—	—	0.0	%
At book value less surrender charge of 5% or more		—	—	—	0.0	%
At fair value*		—	317,392	317,392	83.4	%
Total with adjustment or at market value		—	317,392	317,392	83.4	%
At book value without adjustment		13,534	—	13,534	3.6	%
Not subject to discretionary withdrawal		48,702	636	49,338	13.0	%
Total, gross		62,236	318,028	380,264	100.0	%
Reinsurance ceded		43,740	—	43,740
Total, net	$	18,496	318,028	336,524
Amount at book value less surrender charge of 5% or more that will move to book value without adjustment in the year after the statement date	$	—	—	—

*	Includes $317,392 of individual variable deferred annuity held in the separate accounts that were surrenderable at market values less a surrender charge.

Deposit-Type Contracts

	General account		Separate account nonguaranteed	Total	% of Total
Subject to discretionary withdrawal:
With market value adjustment	$	—	—	—	0.0	%
At book value less surrender charge of 5% or more		—	—	—	0.0	%
At fair value*		—	—	—	0.0	%
Total with adjustment or at market value		—	—	—	0.0	%
At book value without adjustment		—	—	—	0.0	%
Not subject to discretionary withdrawal		118	—	118	100.0	%
Total, gross		118	—	118	100.0	%
Reinsurance ceded		—		—
Total, net	$	118	—	118

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The following is the reconciliation of annuity reserves and deposit liabilities as of December 31, 2022:

Life, accident and health Annual Statement:
Annuities (excluding supplementary contracts with life contingencies), net	$	18,496
Deposit-type contracts		118
Subtotal		18,614
Separate Accounts Annual Statement:
Annuities, net		318,028
Total annuity reserves and deposit liabilities, net	$	336,642

As of December 31, 2022, withdrawal characteristics of life actuarial reserves were as follows:

	Account value		Cash value		Reserve		Account value		Cash value		Reserve
Subject to discretionary withdrawal, surrender values or policy loans:
Term policies with cash value	$	—		—		—		—		—		—
Universal life		72		72		72		—		—		—
Universal life with secondary guarantees		—		—		—		—		—		—
Indexed universal life with secondary guarantees		—		—		—		—		—		—
Other permanent cash value life insurance		402		402		402		—		—		—
Variable life		—		—		—		—		—		—
Variable universal life		—		—		1		112		112		113
Miscellaneous reserves		—		—		—		—		—		—
Not subject to discretionary withdrawal or no cash values
Term policies without cash value		XXX		XXX		116		XXX		XXX		—
Accidental death benefits		XXX		XXX		—		XXX		XXX		—
Disability - active lives		XXX		XXX		2		XXX		XXX		—
Disability - disabled lives		XXX		XXX		23		XXX		XXX		—
Miscellaneous reserves		XXX		XXX		—		XXX		XXX		—
Total (gross)		474		474		616		112		112		113
Reinsurance ceded		474		474		615		—		—		—
Total (net)	$	—		—		1		112		112		113

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The following is the reconciliation of life actuarial reserves as of December 31, 2022:

Life, accident and health Annual Statement:
Life insurance, net	$	1
Separate Accounts Annual Statement:
Life insurance, net		113
Total life reserves, net	$	114

(10)

Reinsurance

The Company routinely enters into reinsurance transactions with other insurance companies, third parties and affiliated companies in order to limit losses, minimize exposure to significant risks and provide additional capacity for future growth. This reinsurance involves either ceding certain risks to, or assuming risks from, other insurance companies. The Company’s statutory financial statements reflect the effects of assumed and ceded reinsurance transactions.

The Company manages its risks related to certain reinsurance agreements by monitoring the credit ratings of the reinsurer. Reinsurance with unauthorized reinsurers is secured by either letter of credit or assets held in trust for the benefit of the Company in accordance with the requirements in Appendix A-785 of the NAIC Statutory Accounting Practices and Procedures Manual. As of December 31, 2023 and 2022, a non-affiliated reinsurer held a letter of credit of $1,000. As of December 31, 2023 and 2022, ALIC, an affiliated reinsurer, held assets in trust with an estimated fair value of $120,686 and $112,003, respectively.

Affiliate Reinsurance

For the Company’s annuity products, the Company reinsures the various living and death benefit riders, GMIB, GMAB and GMWB, through a 100% coinsurance agreement with ALIC effective in July, 2007. In 2012, the Company began offering the GLWB and associated riders which are also reinsured with ALIC through a 100% coinsurance agreement. In 2014, the Company introduced a new version of the GLWB rider, which is not reinsured with ALIC. As of 2015, the Company is no longer ceding new business to ALIC.

The Company assumed and ceded traditional life insurance. This assumed and ceded block of business is currently in runoff. Amounts in the accompanying statutory financial statements related to all ceded business are as follows for the years ended December 31:

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

	2023				2022					2021
			Non-					Non-					Non-
	Affiliate		affiliate		Affiliate			affiliate		Affiliate			affiliate
Statutory Statements of Income:
Premiums ceded	$	2,984		631		3,002			636		2,989			634
Benefits incurred		350		526		314			647		204			810
Commission and expense allowances		—		32		—			18		—			17
Reserve adjustment on reinsurance		—		—		(1	)		—		(1	)		—

	2023				2022
			Non-				Non-
	Affiliate		affiliate		Affiliate		affiliate
Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus:
Reserve for future policy benefits	$	79,470		469		89,740		616
Modified coinsurance reserves		—		13		—		13
Amounts recoverable from reinsurance		—		80		—		193

Net premiums earned are summarized as follows for the years ended December 31:

	2023			2022			2021
Direct premiums earned	$	95			333			171
Reinsurance assumed		632			636			634
Reinsurance ceded		(3,615	)		(3,638	)		(3,623	)
Net premiums earned	$	(2,888	)		(2,669	)		(2,818	)

(11)

Bank Line of Credit

In April 2016, CII obtained a $525,000 senior unsecured, syndicated credit facility. The credit facility was established for the purpose of issuing letters of credit and loans for general corporate purposes and matured in April 2021. In March 2017, CII increased this credit facility by $50,000 to $575,000. In March 2018, CII increased this credit facility by $325,000 to $900,000. The credit facility would have matured in March 2023. During 2021, this facility was closed.

On May 7, 2021, CII entered into a $1,500,000 senior unsecured, syndicated credit facility. The credit facility is established for the purpose of issuing letters of credit and loans for general corporate purposes and will mature in May 2026. Letters of credit can be issued up to the maximum credit facility, however loans under the credit facility are limited to $500,000 with total combined amounts not to exceed $1,500,000. CII did not utilize this facility as of December 31, 2023 or 2022 for the benefit of the Company.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

There was no interest or fees paid by the Company on these credit facilities in 2023, 2022 or 2021.

(12)

Income Taxes

The Company provides for deferred tax assets in accordance with the NAIC issued guidance. The components of the net admitted deferred tax asset, including those certain deferred tax assets and deferred tax liabilities, recognized in the Company’s Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus as of December 31 are as follows:

	Ordinary			Capital			Total
2023
Gross deferred tax assets	$	3,433			—			3,433
Statutory valuation allowance adjustments		(33	)		—			(33	)
Adjusted gross deferred tax assets		3,400			—			3,400
Nonadmitted deferred tax assets		(3,157	)		—			(3,157	)
Admitted deferred tax assets		243			—			243
Deferred tax liabilities		(22	)		(21	)		(43	)
Admitted deferred tax assets, net	$	221			(21	)		200

2022
Gross deferred tax assets	$	3,694			—			3,694
Statutory valuation allowance adjustments		(63	)		—			(63	)
Adjusted gross deferred tax assets		3,631			—			3,631
Nonadmitted deferred tax assets		(3,191	)		—			(3,191	)
Admitted deferred tax assets		440			—			440
Deferred tax liabilities		(110	)		(18	)		(128	)
Admitted deferred tax assets, net	$	330			(18	)		312

Change
Gross deferred tax assets	$	(261	)		—			(261	)
Statutory valuation allowance adjustments		30			—			30
Adjusted gross deferred tax assets		(231	)		—			(231	)
Nonadmitted deferred tax assets		34			—			34
Admitted deferred tax assets		(197	)		—			(197	)
Deferred tax liabilities		88			(3	)		85
Admitted deferred tax assets, net	$	(109	)		(3	)		(112	)

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The amount of gross deferred tax assets admitted under each component and the resulting increased amount by tax character as of December 31 are as follows:

		Ordinary			Capital		Total
2023
Federal income taxes paid in prior years recoverable through loss carrybacks		$	—		—		—
Adjusted gross deferred tax assets expected to be realized after application of the threshold limitations:
(1)	Adjusted gross deferred tax assets expected to be realized following the balance sheet date		N/A			N/A		200
(2)	Adjusted gross deferred tax assets allowed per limitation threshold		N/A			N/A		6,472
Lesser of (1) or (2)			200			—		200
Deferred tax liabilities			22			21		43
Admitted deferred tax assets as the result of application of SSAP No. 101		$	222			21		243

2022
Federal income taxes paid in prior years recoverable through loss carrybacks		$	—			—		—
Adjusted gross deferred tax assets expected to be realized after application of the threshold limitations:
(1)	Adjusted gross deferred tax assets expected to be realized following the balance sheet date		N/A			N/A		312
(2)	Adjusted gross deferred tax assets allowed per limitation threshold		N/A			N/A		5,853
Lesser of (1) or (2)			312			—		312
Deferred tax liabilities			110			18		128
Admitted deferred tax assets as the result of application of SSAP No. 101		$	422			18		440

Change
Federal income taxes paid in prior years recoverable through loss carrybacks		$	—			—		—
Adjusted gross deferred tax assets expected to be realized after application of the threshold limitations:
(1)	Adjusted gross deferred tax assets expected to be realized following the balance sheet date		N/A			N/A		(112	)
(2)	Adjusted gross deferred tax assets allowed per limitation threshold		N/A			N/A		619
Lesser of (1) or (2)			(112	)		—		(112	)
Deferred tax liabilities			(88	)		3		(85	)
Admitted deferred tax assets		$	(200	)		3		(197	)

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The ratios used for threshold limitation (for SSAP 101 Paragraph 11b) as of December 31 are as follows:

	2023			2022			Change
Ratio percentage used to determine the recovery period and threshold limitation amount in above adjusted gross deferred tax assets		5,279.03	%		4,536.37	%		742.66	%
Amount of adjusted capital and surplus used to determine the recovery period threshold limitation amount in above adjusted gross deferred tax assets	$	43,662			39,497			4,165

There was no impact of tax-planning strategies as a percentage of adjusted gross and net admitted deferred tax assets as of December 31, 2023 and 2022.

The Company’s tax planning strategies do not include the use of reinsurance tax planning strategies.

There are no temporary differences for which deferred tax liabilities are not recognized.

The provisions for current tax expenses on earnings for years ended December 31 are as follows:

	2023		2022		2021
Current year federal tax (benefit) expense - ordinary income	$	573		503		(484	)
Current year foreign tax expense - ordinary income		—		—		—
Subtotal		573		503		(484	)
Current year tax expense - net realized capital (loss) gain		—		6		57
Utilization of capital loss carry forwards		—		—		—
Other		—		—		—
Federal and foreign income taxes incurred	$	573		509		(427	)

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The tax effects of temporary differences that give rise to significant components of the net deferred tax asset as of December 31 are as follows:

Deferred tax assets:	2023			2022			2021			Change from 2022			Change from 2021
Ordinary:
Policyholder reserves	$	3,228			3,353			3,089			(125	)		264
Deferred acquisition costs		31			69			119			(38	)		(50	)
Receivables nonadmitted		2			2			2			—			—
Tax credit carryforward		74			153			63			(79	)		90
Policyholder reserves - tax reform transition		66			99			133			(33	)		(34	)
Other		32			18			39			14			(21	)
Ordinary deferred tax assets		3,433			3,694			3,445			(261	)		249

Statutory valuation allowance adjustment		(33	)		(63	)		—			30			(63	)
Nonadmitted ordinary deferred tax assets		(3,157	)		(3,191	)		(2,882	)		34			(309	)
Admitted ordinary deferred tax assets		243			440			563			(197	)		(123	)

Capital:
Net capital loss carryforward		—			—			—			—			—

Statutory valuation allowance adjustment		—			—			—			—			—
Nonadmitted capital deferred tax assets		—			—			—			—			—
Admitted capital deferred tax assets		—			—			—			—			—
Admitted deferred tax assets		243			440			563			(197	)		(123	)

Deferred tax liabilities:
Ordinary:
Section 807(f) reserves		22			110			198			(88	)		(88	)
Ordinary deferred tax liabilities		22			110			198			(88	)		(88	)

Capital:
Investments		21			18			17			3			1
Capital deferred tax liabilities		21			18			17			3			1
Deferred tax liabilities		43			128			215			(85	)		(87	)
Admitted deferred tax assets, net	$	200			312			348			(112	)		(36	)

There was a statutory valuation allowance adjustment to gross deferred tax assets of $33 for the period ended, December 31, 2023. There was a statutory valuation allowance adjustment to gross deferred tax assets of $63 for the period ended, December 31, 2022.

The realization of the deferred tax asset is dependent upon the Company's ability to generate sufficient taxable income in future periods. Based on historical results and the prospects for future operations, management anticipates that it is more likely than not that future taxable income will be sufficient for the realization of the remaining deferred tax assets.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

The change in the net deferred income taxes as of December 31 is comprised of the following:

	2023			2022			2021			Change from 2022			Change from 2021
Total deferred tax assets	$	3,433			3,694			3,445			(261	)		249
Total deferred tax liabilities		(43	)		(128	)		(215	)		85			87
Net deferred tax assets		3,390			3,566			3,230			(176	)		336
Statutory valuation allowance adjustment		(33	)		(63	)		—			30			(63	)
Net deferred tax assets		3,357			3,503			3,230			(146	)		273
Tax effect of unrealized gains		—			—			—			—			—
Statutory valuation allowance adjustment allocated to unrealized		—			—			—			—			—
Change in net deferred income taxes	$	3,357			3,503			3,230			(146	)		273

The provision for federal income taxes incurred is different from that which would be obtained by applying the statutory federal income tax rate to income before income taxes. The significant tax effects causing this difference for the years ended December 31 are as follows:

	2023			2022			2021
Income before taxes	$	998			713			1,152
Prior period adjustment		—			—			228
Dividends received deduction		(74	)		(282	)		(347	)
Valuation allowance		(30	)		63			—
Tax credits		(135	)		(120	)		(116	)
Transfer pricing		(81	)		(172	)		(64	)
Tax exempt interest		(1	)		(4	)		(5	)
IMR		(10	)		(18	)		(6	)
Other		52			56			101
Total statutory taxes	$	719			236			943

Provision for federal income taxes	$	573			503			(484	)
Tax on capital (loss) gain		—			6			57
Change in net deferred income tax		146			(273	)		1,370
Total statutory taxes	$	719			236			943

The Company’s policy for recording penalties associated with audits, claims, and adjustments is to record such amount as a component of income taxes.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Total federal income taxes payment (including tax on capital gains) was $383 and $64 during the years ended December 31, 2023 and 2022, respectively.

As of December 31, 2023 and December 31, 2022, there are no net operating loss or capital loss carryforwards available for tax purposes. As of December 31, 2023 and 2022, the Company has valuation allowances of $33 and $63. A partial valuation allowance was established in 2022 related to limitation on the Company’s ability to utilize loss carryforwards as a result of the Transaction. As of December 31, 2023 and 2022, the Company does not have any uncertain tax positions related to the Separate Account Dividends Receivable Deduction (“SA DRD”) company share percentage(s) for tax return year 2017. As of December 31, 2023 and 2022, the Company has tax credit carryforwards of $74 and $153 which will start expiring in 2030.

There are no federal income taxes incurred that are available for recoupment in the event of future net losses.

The Company has no tax loss contingencies for which it is reasonably possible that the total liability will significantly increase within twelve months of reporting.

There are no aggregate federal income tax deposits under Internal Revenue Code Section 6603, and none are recorded as admitted assets.

The Company’s federal income tax return is consolidated with the other life insurance companies; its direct parent, ALIC, and affiliates AuguStar Life Assurance Corporation (“ALAC”), Montgomery Re, Inc. (“MONT”), Kenwood Re, Inc. (“KENW”), Sunrise Captive Re, LLC (“SUNR”), Sycamore Re, Ltd (“SYRE”), and Camargo Re Captive, Inc. (“CMGO”), and then with its common parent, CIHI.

The Company is not under current examination with the Internal Revenue Service. The statute of limitations remains open for tax years 2020, 2021 and 2022 for the consolidated tax group.

The allocation of taxes between members of the federal consolidated income tax return is subject to written agreement approved by the Board of Directors. Allocations are based on separate company calculations with current credit for losses. Intercompany tax balances are settled quarterly.

(13)

Capital and Surplus, Dividend Restrictions and Regulatory RBC

Capital and Surplus

The Company has 10,000 shares ($250 par value) authorized, issued and outstanding of Class A common stock as of December 31, 2023 and 2022. The Company has no preferred stock issued or outstanding.

The Company did not receive a capital contribution from its parent, ALIC during 2023, 2022 or 2021.

Regulatory RBC

The NAIC has established RBC requirements to assist regulators in monitoring the financial strength and stability of life insurers and provides for an insurance commissioner to intervene if the insurer experiences financial difficulty. The RBC requirements instruct every life insurer to calculate its total adjusted capital and RBC position. The formula includes components for asset risk, liability risk, interest rate exposure, and other factors. Under the NAIC requirements, each insurer must maintain its total adjusted capital and surplus above a calculated minimum threshold or take corrective measures to achieve that threshold. Based upon the December 31, 2023 and 2022 statutory financial statements, the Company exceeded all required RBC levels.

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Dividend Restrictions

The payment of dividends by the Company to ALIC is limited by New York insurance laws. The maximum ordinary dividend that may be paid without prior approval of the Superintendent of Financial Services is limited to the lesser of 10% of the Company’s statutory surplus (defined by New York Insurance Law, Section 4207a as page 3, line 37 of the Annual Statement) as of the immediate preceding calendar year or the Company’s net gain from operations for the immediately preceding calendar year, not including realized capital gains. Therefore, dividends of approximately $4,000 may be paid by the Company to ALIC in 2024 without prior approval. No dividends were declared or paid by the Company in 2023, 2022 or 2021.

(14)

Contingencies

The Company and all other solvent life insurance companies are periodically assessed by certain state guaranty funds to cover losses to policyholders of insolvent or rehabilitated companies. Some of these assessments are partially recoverable through a reduction in future premium taxes in some states. In addition, the Company is subject to legal and regulatory proceedings in the ordinary course of its business. These include proceedings specific to the Company and proceedings generally applicable to business practices in the industry in which the Company operates. The outcomes of these proceedings cannot be predicted due to their complexity, scope and uncertainties. The Company believes, however, that based on currently known information, the ultimate outcome of all pending legal and regulatory proceedings as well as state guaranty fund assessments are not likely to have a material adverse effect on the Company’s financial condition or results of operations.

(15)

Related-Party Transactions

NSLAC has an administrative service agreement with ALIC, an investment management agreement with Ohio National Investments, Inc. (“ONII”), an affiliate, and an underwriting agreement with AuguStar Distributors, Inc. (“ADI”), formerly Ohio National Equities, Inc. (“ONEQ”), an affiliate. The amounts that NSLAC owed to ALIC, ONII and ADI as recorded on the Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus as of December 31 were as follows:

	2023		2022		2021
ALIC	$	282		277		288
ADI		16		13		—
ONII		—		—		4
Total service charges owed	$	298		290		292

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Notes to Statutory Financial Statements

December 31, 2023, 2022 and 2021

(Dollars in thousands)

Charges for all services from ALIC, ONII and ADI for the years are as follows:

	2023		2022		2021
ALIC	$	658		443		323
ADI		177		178		216
ONII		—		—		18
Total service charges incurred	$	835		621		557

(16)

Accounting Changes and Corrections of Errors

The Company’s December 31, 2021 statutory financial statements reflect a prior period adjustment relating to the calculation and recording of reserves in accordance with the New York Standard Scenario (“NYSS”). As of December 31, 2020, reserves were overstated by $1,084. The events contributing to the adjustment impact surplus as follows:

	Change in reserves for future policy benefits and other funds		$	1,084
	Correction of errors, net of tax		$	1,084

The cumulative prior period surplus impact of these errors is shown as a direct adjustment to surplus within the Statutory Statements of Changes in Capital and Surplus. SSAP No. 3R, Accounting Changes and Corrections of Errors, prescribes that if a reporting entity becomes aware of a material accounting error in a previously filed financial statement after it has been submitted to the appropriate regulatory agency, the entity shall file an amended financial statement unless otherwise directed by the domiciliary regulator. Correction of all immaterial accounting errors in previously issued statutory financial statements, for which an amended financial statement was not filed, shall be reported as adjustments to unassigned funds (surplus) in the period an error is detected.

Schedule I

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Summary of Investments – Other Than Investments in Related Parties

December 31, 2023

(Dollars in thousands)

Column A	Column B		Column C		Column D
					Amount at
					which shown
			Market		in the
Type of investment	Cost		value		Balance Sheet¹
Fixed maturity available-for-sale securities:
Bonds:
U.S. Treasury securities and obligations of
U.S. government	$	1,896		1,622		1,896
Obligations of states and political subdivisions		13,568		10,964		13,568
Corporate securities		38,723		35,496		38,723
Asset-backed securities		2,346		2,134		2,346
Mortgage-backed securities		6,551		6,381		6,551
Total fixed maturity available-for-sale securities		63,084		56,597		63,084
Other long-term investments		14				14
Cash and cash equivalents		10,828				10,828
Total investments	$	73,926				73,926

¹	See Statutory Statements of Admitted Assets, Liabilities, and Capital and Surplus

See accompanying report of independent registered public accounting firm.

Schedule III

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Supplementary Insurance Information

Years ended December 31, 2023, 2021 and 2021

(Dollars in thousands)

Column A	Column B		Column C		Column D		Column E		Column F
Year segment	Deferred policy acquisition costs¹		Future policy benefits, losses, claims, and loss expenses		Unearned premiums		Other policy claims and benefits payable		Premium revenue
2023 total	$	—		31,546		—		—		(2,888	)
2022 total		—		32,615		—		—		(2,669	)
2021 total		—		32,059		—		—		(2,818	)

Column A	Column G		Column H		Column I		Column J		Column K
Year segment	Net investment income		Benefits, claims, losses and settlement expenses		Amortization of deferred policy acquisition costs¹		Other operating expenses		Premiums written²
2023 total	$	2,481		32,131		—		3,161
2021 total		2,306		29,819		—		3,065
2020 total		2,389		35,075		—		2,935

¹	Acquisition costs are not capitalized under statutory accounting.
²	Not applicable for life insurance companies.

See accompanying report of independent registered public accounting firm.

Schedule IV

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Reinsurance

Years ended December 31, 2023, 2021 and 2021

(Dollars in thousands)

Column A	Column B		Column C		Column D		Column E		Column F
	Gross amount		Ceded to other companies		Assumed from other companies		Net amount		Percentage of amount assumed to net
2023:
Life insurance in force	$	607		21,434		21,434		607	—%
Premiums:
Life insurance		—		632		632		—	—%

2022:
Life insurance in force	$	607		27,193		27,193		607	—%
Premiums:
Life insurance		—		636		636		—	—%

2021:
Life insurance in force	$	175		31,077		31,077		175	—%
Premiums:
Life insurance		—		635		635		—	—%

See accompanying report of independent registered public accounting firm.

Schedule V

NATIONAL SECURITY LIFE AND ANNUITY COMPANY

(A Wholly Owned Subsidiary of AuguStar Life Insurance Company)

Valuation and Qualifying Accounts

Years ended December 31, 2023, 2021 and 2021

(Dollars in thousands)

Column A

Column B

Column C

Column D

Column E

Description

Balance at
beginning
of period

Charged
(credited) to
costs and
expenses

Charged to
other
accounts

Deductions

Balance at
end of
period

2023:

Valuation allowances – None

—

2022:

Valuation allowances – None

—

2021:

Valuation allowances – None

—

See accompanying report of independent registered public accounting firm.