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

                                    FORM 10-Q

(Mark One)
|X|     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
        SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2001

OR

|_|     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
        SECURITIES EXCHANGE ACT OF 1934

For the transaction period from   to

Commission file number 333-64473

                              GWL&A FINANCIAL INC.
             (Exact name of registrant as specified in its charter)

                               Colorado 84-1474245
 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer
                             Identification Number)

               8515 East Orchard Road, Greenwood Village, CO 80111
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (303) 737-4128
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

Yes       X         No

As of May 11, 2001, 50,025 shares of the registrant's common stock were
outstanding, all of which were owned by the registrant's parent company.


                                        9
                                  TABLE OF CONTENTS



Part I  FINANCIAL INFORMATION

        Item 1   Financial Statements

                 Consolidated Statements of Income                             3

                 Consolidated Balance Sheets                                   4

                 Consolidated Statements of Cash Flows                         6

                 Notes to Consolidated Financial Statements                    8

        Item 2   Management's Discussion and Analysis of Financial            10
                 Condition and Results of Operations

Part II OTHER INFORMATION

        Item 1   Legal Proceedings                                            18

        Item 6   Exhibits and Reports on Form 8-K                             18

        Signatures                                                            18

















PART I   FINANCIAL INFORMATION

ITEM 1   FINANCIAL STATEMENTS

GWL&A FINANCIAL INC.

CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands)
<TABLE>
<S>                                               <C>           <C>
-------------------------------------------------------------------------
(Unaudited)
                                                   Three Months Ended
                                                       March 31,
                                               ---------------------------
                                                   2001          2000
                                               ------------- -------------
REVENUES:
  Premium income                             $    334,430       352,735
  Fee income                                      251,249       211,634
  Net investment income                           240,675       230,400
  Net realized gains on investments                 7,668         1,337
                                               ------------- -------------

                                                  834,022       796,106
                                               ------------- -------------
BENEFITS AND EXPENSES:
  Life and other policy benefits                  285,240       281,371
  Increase in reserves                             41,971        25,558
  Interest paid or credited to                    133,784       125,694
contractholders
  Provision for policyholders' share of
    earnings on participating business              1,588         2,278
  Dividends to policyholders                       23,361        22,631
                                               ------------- -------------

                                                  485,944       457,532
                                               ------------- -------------
                                               ------------- -------------

  Commissions                                      47,279        46,420
  Operating expenses                              202,134       201,932
  Premium taxes                                     7,144         8,749
                                               ------------- -------------

                                                  742,501       714,633
                                               ------------- -------------

INCOME BEFORE INCOME TAXES                         91,521        81,473

PROVISION FOR INCOME TAXES:
   Current                                         13,040        12,613
   Deferred                                        19,030        16,144
                                               ------------- -------------

                                                   32,070        28,757
                                               ------------- -------------

NET INCOME                                   $     59,451        52,716
                                               ============= =============


</TABLE>









See notes to consolidated financial statements.

GWL&A FINANCIAL INC.

CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
<TABLE>
<S>                                                          <C>               <C>
-----------------------------------------------------------------------------------------------
                                                                  March 31,      December 31,
ASSETS                                                              2001             2000
------
                                                                --------------   --------------
                                                                 (Unaudited)
INVESTMENTS:
  Fixed Maturities:
    Available-for-sale, at fair value
       (amortized cost $9,510,794 and $9,372,009)             $    9,687,651   $    9,419,865
  Mortgage loans on real estate, net                                 784,690          843,371
  Common stock                                                        94,946           95,036
  Real estate, net                                                   106,554          106,690
  Policy loans                                                     2,822,299        2,809,973
  Short-term investments, available-for-sale
       (amortized cost $400,442 and $414,860)                        392,732          414,860
                                                                --------------   --------------

      Total Investments                                           13,888,872       13,689,795

Cash                                                                 195,183          156,388
Reinsurance receivable                                               241,753          233,968
Deferred policy acquisition costs                                    265,679          279,688
Investment income due and accrued                                    143,384          139,155
Uninsured claims receivable                                          259,303          227,803
Other assets                                                         636,686          503,533
Premiums in course of collection                                     121,197          149,969
Deferred income taxes                                                106,381          138,870
Separate account assets                                           11,860,736       12,381,137
                                                                --------------   --------------
TOTAL ASSETS                                                 $    27,719,174   $   27,900,306
                                                                ==============   ==============










                                                                                  (Continued)

GWL&A FINANCIAL INC.

CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
-----------------------------------------------------------------------------------------------

                                                                  March 31,      December 31,
LIABILITIES AND STOCKHOLDER'S EQUITY                                2001             2000
------------------------------------
                                                                --------------   --------------
                                                                 (Unaudited)
POLICY BENEFIT LIABILITIES:

    Policy reserves                                           $   12,233,415   $   12,045,000
    Policy and contract claims                                       387,621          441,326
    Policyholders' funds                                             190,459          197,941
    Provision for policyholders' dividends                            73,182           72,716

GENERAL LIABILITIES:

    Due to GWL                                                        38,491           43,081
    Repurchase agreements                                            223,783
    Commercial paper                                                  98,720           97,631
    Other liabilities                                                802,218          852,842
    Undistributed earnings on
      participating business                                         161,493          165,754
    Separate account liabilities                                  11,860,736       12,381,137
                                                                --------------   --------------

      Total Liabilities                                           26,070,118       26,297,428
                                                                --------------   --------------

GUARANTEED PREFERRED BENEFICIAL INTERESTS IN THE
  COMPANY'S JUNIOR SUBORDINATED DEBENTURES                           175,000          175,000

STOCKHOLDER'S EQUITY:
    Preferred stock, $1 par value, 50,000,000 shares
authorized;
       0 shares issued and outstanding
    Preferred stock, $0 par value, 500,000 shares
authorized;
       0 shares issued and outstanding
    Common stock, $0 par value; 500,000 shares authorized;
       50,025 shares issued and outstanding                              250              250
    Additional paid-in capital                                       727,501          724,736
    Accumulated other comprehensive income                            64,640           33,672
    Retained earnings                                                681,665          669,220
                                                                --------------   --------------

      Total Stockholder's Equity                                   1,474,056        1,427,878
                                                                --------------   --------------

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                    $   27,719,174   $   27,900,306
                                                                ==============   ==============












See notes to consolidated financial statements.                                   (Concluded)

GWL&A FINANCIAL INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
-----------------------------------------------------------------------------------------------
(Unaudited)
                                                                       Three Months Ended
                                                                           March 31,
                                                                  -----------------------------
                                                                      2001            2000
                                                                  -------------   -------------

OPERATING ACTIVITIES:
    Net income                                                  $      59,451   $      52,716
    Adjustments to reconcile net income to
       net cash (used in) provided by operating activities:
       Earnings allocated to participating policyholders                1,588           2,278
       Amortization of investments                                    (19,245)        (11,689)
       Net realized gains on investments                               (7,668)         (1,337)
       Depreciation and amortization                                   28,617          10,472
       Deferred income taxes                                           19,030          16,144
    Changes in assets and liabilities:
        Policy benefit liabilities                                    136,457         300,973
        Reinsurance receivable                                         (7,785)         (7,524)
        Accrued interest and other receivables                         (6,958)        (29,927)
        Other, net                                                   (237,708)        (57,115)
                                                                  -------------   -------------
                 Net cash (used in) provided by operating             (34,221)        274,991
activities
                                                                  -------------   -------------

INVESTING ACTIVITIES:
    Proceeds from sales, maturities, and
        redemptions of investments:
        Fixed maturities
             Held-to-maturity
                Maturities and redemptions                                            116,500
             Available-for-sale
                Sales                                               1,087,405         451,242
                Maturities and redemptions                            322,773         232,994
        Mortgage loans                                                 59,296          36,738
        Real estate                                                   103,038           2,984
        Common stock                                                    5,249           5,813
    Purchases of investments:
        Fixed maturities
             Held-to-maturity                                                         (91,902)
             Available-for-sale                                    (1,499,747)       (688,190)
        Mortgage loans                                                                   (463)
        Real estate                                                  (122,922)        (10,140)
        Common stock                                                  (14,477)        (22,437)
                                                                  -------------   -------------
                 Net cash (used in) provided by investing             (59,385)         33,139
activities
                                                                  -------------   -------------










See notes to consolidated financial statements.                                   (Continued)

GWL&A FINANCIAL INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
-----------------------------------------------------------------------------------------------
(Unaudited)
                                                                        Three Months Ended
                                                                            March 31,
                                                                   -----------------------------
                                                                       2001            2000
                                                                   -------------   -------------

FINANCING ACTIVITIES:
   Contract withdrawals, net of deposits                         $     (40,875)  $    (213,626)
   Net GWL (repayments) borrowings                                      (4,590)        (10,901)
   Dividends paid                                                      (47,006)        (30,401)
   Commercial paper borrowings (repayments)                              1,089          99,207
   Repurchase agreements borrowings (repayments)                       223,783         (80,579)
                                                                   -------------   -------------
              Net cash provided by (used in) financing                 132,401        (236,300)
activities
                                                                   -------------   -------------

NET INCREASE IN CASH                                                    38,795          71,830

CASH, BEGINNING OF YEAR                                                156,388         258,312
                                                                   -------------   -------------

CASH, END OF PERIOD                                              $     195,183   $     330,142
                                                                   =============   =============



See notes to consolidated financial statements.                                    (Concluded)
</TABLE>

GWL&A FINANCIAL INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY
THREE MONTHS ENDED MARCH 31, 2001 (Unaudited)
(Dollars in Thousands)
<TABLE>
<S>                        <C>           <C>          <C>           <C>             <C>          <C>          <C>        <C>
==============================================================================================
(unaudited)

                                                                                             Accumulated
                                                                                Additional      Other
                              Preferred Stock              Common Stock           Paid-in   Comprehensive     Retained
                          ------------------------   -------------------------
                            Shares       Amount        Shares        Amount       Capital      Income         Earnings       Total
                          -----------   ----------   -----------   ----------- ------------    ----------------  -----------  ------
BALANCES, JANUARY 1, 2001         0  $         0        50,025  $        250  $    724,736    $  33,672    $  669,220   $ 1,427,878

  Net income                                                                                                   59,451        59,451
  Other comprehensive                                                                            30,968                      30,968
  income
                                                                                                                          ----------
Total comprehensive                                                                                                          90,419
income
                                                                                                                          ----------
Dividends                                                                                                     (47,006)      (47,006)
Income tax benefit on
stock compensation                                                                  2,765                                    2,765
                          -----------   ----------   -----------   -----------  ------------ ---------------  -----------  ---------

BALANCES, MARCH 31, 2001          0  $         0        50,025  $        250  $    727,501    $  64,640    $  681,665   $ 1,474,056
                          ===========   ==========   ===========   ===========  =========== ================  ===========  =========



See ____ notes to ____ consolidated ____ financial statements.
</TABLE>

                                     - 15 -
GWL&A FINANCIAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in Thousands)
--------------------------------------------------------------------------------
(Unaudited)

1.      BASIS OF PRESENTATION

        The consolidated financial statements and related notes of GWL&A
        Financial Inc. (the Company) have been prepared in accordance with
        accounting principles generally accepted in the United States of America
        applicable to interim financial reporting and do not include all of the
        information and footnotes required for complete financial statements.
        However, in the opinion of management, these statements include all
        normal recurring adjustments necessary for a fair presentation of the
        results. These financial statements should be read in conjunction with
        the audited consolidated financial statements and the accompanying notes
        included in the Company's latest annual report on Form 10-K for the year
        ended December 31, 2000.

        Operating results for the three months ended March 31, 2001, are not
        necessarily indicative of the results that may be expected for the full
        year ending December 31, 2001.

2.      NEW ACCOUNTING PRONOUNCEMENTS

        Effective January 1, 2001, GWL&A adopted Statements of Financial
        Accounting Standards (SFAS) No. 133 "Accounting for Derivative
        Instruments and Hedging Activities" as amended and interpreted. The SFAS
        requires all derivatives, whether designated in hedging relationships or
        not, to be recorded on the balance sheet at fair value. If the
        derivative is designated as a fair value hedge, the changes in the fair
        value of the derivative and of the hedged item attributable to the
        hedged risk are recognized in earnings. If the derivative is designated
        as a cash flow hedge, the effective portions of the changes in the fair
        value of the derivative are recorded in other comprehensive income and
        are recognized in the income statement when the hedge item affects
        earnings. Ineffective portions of changes in the fair value of cash flow
        hedges are recognized in earnings.

        The adoption of SFAS 133 resulted in an approximate $1,000 after-tax
        increase to other comprehensive income (OCI).

        The Company uses derivative instruments to hedge asset and liability
        positions and to control risk. Derivatives are not used for speculative
        purposes.


        The Company follows rigorous procedures to control interest rate risk
        and observes strict asset and liability matching guidelines. The Company
        uses interest rate futures, swaps, and caps to manage the impact of
        interest rate changes on cash flows.

        Certain investments are exposed to foreign currency risk. The Company
        uses swaps to hedge the impact of the variability in exchange rates on
        interest receipts denominated in foreign currencies.

        In addition, the Company has written call or put options on various
        convertible debt instruments to minimize the equity impact on the fair
        value of the debt instrument.

        Hedge ineffectiveness of $1,744, determined in accordance with SFAS 133
        for the three months ended March 31, 2001, was recorded in net
        investment income.

        Derivative gains and losses included in Other Comprehensive Income (OCI)
        are reclassified into earnings at the time interest income is recognized
        or interest receipts are received on bonds. During the three months
        ended March 31, 2001, $142 of derivative gains were reclassified to net
        investment income. The Company estimates that $567 of net derivative
        gains included in OCI will be reclassified into net investment income
        within the next twelve months.

        Transfers of Financial Assets and Extinguishments of Liabilities

        In September 2000, the Financial Accounting Standards Board (FASB)
        issued SFAS No. 140, "Accounting for Transfers and Servicing of
        Financial Assets and Extinguishments of Liabilities - A replacement of
        FASB Statement No. 125", which revises the standards for accounting for
        securitizations and other transfers of financial assets and collateral
        and requires certain disclosures. SFAS No. 140 will be effective for
        transfers and servicing of financial assets and extinguishments of
        liabilities occurring after March 31, 2001. Management does not
        anticipate that the adoption of the new SFAS will have a significant
        effect on earnings or the financial position of the Company.


3.      OTHER

        On December 31, 2000, the Company and certain affiliated companies
        completed a corporate reorganization. Prior to December 31, 2000, GWL&A
        Financial, was an indirect wholly owned subsidiary of The Great-West
        Life Assurance Company (GWL). Under the new structure, GWL&A Financial
        and GWL each continue to be indirectly and directly, respectively, owned
        by Great-West Lifeco Inc., a Canadian holding company (the Parent or
        Lifeco), but GWL no longer holds an equity interest in the Company or
        GWL&A Financial. Refer to the Company's report on Form 10-K for the year
        ended December 31, 2000, for additional information on the Company's
        organization.

        Effective January 1, 2000, the Company coinsured the majority of General
        American Life Insurance Company's (General American) group life and
        health insurance business, which primarily consists of administrative
        services only and stop-loss policies. The agreement converted to an
        assumption reinsurance agreement on January 1, 2001. The Company assumed
        approximately $150,000 of policy reserves and miscellaneous liabilities
        in exchange for an equal amount of cash and miscellaneous assets from
        General American.

        On October 6, 1999, the Company entered into an agreement with Allmerica
        Financial Corporation (Allmerica) to acquire Allmerica's group life and
        health insurance business on March 1, 2000. This business primarily
        consists of administrative services only and stop-loss policies. The
        in-force business is expected to be underwritten and retained by the
        Company upon each policy renewal date. The purchase price was based on a
        percentage of the premium and administrative fees in-force at March 1,
        2000, and March 1, 2001, $22.1 million and $4.4 million, respectively.

        The Company is involved in various legal proceedings that arise in the
        ordinary course of its business. In the opinion of management, after
        consultation with counsel, the resolution of these proceedings should
        not have a material adverse effect on its financial position or results
        of operations.

        Certain reclassifications have been made to the 2000 financial
        statements to conform to the 2001 presentation.

<TABLE>
<S>                                                       <C>                   <C>

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
           OPERATIONS

        Operating Summary (Millions)                        Three Months Ended March 31,
                                                       ----------------------------------------
                                                             2001                  2000
                                                       ------------------    ------------------

        Premium income                              $             334     $             353
        Fee income                                                251                   212
        Net investment income                                     241                   230
        Net realized gains on investments                           8                     1
                                                       ------------------ -- ------------------
                Total revenues                                    834                   796

        Total benefits and expenses                               743                   714
        Income tax expenses                                        32                    29
                                                       ------------------    ------------------
                Net income                          $              59     $              53
                                                       ==================    ==================

        Deposits for investment type contracts                    198                   171
        Deposits to separate accounts                             956                   661
        Self-funded premium equivalents                         1,550                 1,188

                                                           March 31,           December 31,
        Balance Sheet (Millions)                             2001                  2000
                                                       ------------------    ------------------

        Investment assets                           $          13,889     $          13,689
        Separate account assets                                11,861                12,381
        Total assets                                           27,719                27,897
        Total policy benefit liabilities                       12,884                12,757
        Due to GWL                                                 38                    43
        Guaranteed preferred beneficial interests
        in
          the Company's junior subordinated
          Debentures                                              175                   175
        Total stockholder's equity                              1,474                 1,427
</TABLE>

        GENERAL

        This Form 10-Q contains forward-looking statements. Forward-looking
        statements are statements not based on historical information and which
        relate to future operations, strategies, financial results or other
        developments. In particular, statements using verbs such as "expect,"
        "anticipate," "believe" or words of similar import generally involve
        forward-looking statements. Without limiting the foregoing,
        forward-looking statements include statements which represent the
        Company's beliefs concerning future or projected levels of sales of the
        Company's products, investment spreads or yields, or the earnings or
        profitability of the Company's activities. Forward-looking statements
        are necessarily based upon estimates and assumptions that are inherently
        subject to significant business, economic and competitive uncertainties
        and contingencies, many of which are beyond the Company's control and
        many of which, with respect to future business decisions, are subject to
        change. These uncertainties and contingencies can affect actual results
        and could cause actual results to differ materially from those expressed
        in any forward-looking statements made by, or on behalf of, the Company.
        Whether or not actual results differ materially from forward-looking
        statements may depend on numerous foreseeable and unforeseeable events
        or developments, some of which may be national in scope, such as general
        economic conditions and interest rates, some of which may be related to
        the insurance industry generally, such as pricing competition,
        regulatory developments and industry consolidation, and others of which
        may relate to the Company specifically, such as credit, volatility and
        other risks associated with the Company's investment portfolio, and
        other factors. Readers are also directed to consider other risks and
        uncertainties discussed in documents filed by the Company and certain of
        its subsidiaries with the Securities and Exchange Commission.

        The following discussion addresses the financial condition of the
        Company as of March 31, 2001, compared with December 31, 2000, and its
        results of operations for the quarter ended March 31, 2001, compared
        with the same period last year. The discussion should be read in
        conjunction with the Management's Discussion and Analysis section
        included in the Company's report on Form 10-K for the year ended
        December 31, 2000 to which the reader is directed for additional
        information.

        CONSOLIDATED RESULTS

        The Company's consolidated net income increased $6 million or 11% for
        the first three months of 2001 when compared to the first three months
        of 2000. The increase reflects an increase of $6 million in the
        Financial Services segment, which resulted primarily from higher fee
        income and realized gains on investments.

        Total revenues increased $38 million or 5% for the first three months of
        2001 when compared to the first three months of 2000. The growth in
        revenues for the first three months of 2001 was comprised of increased
        fee income of $39 million, increased net investment income of
        $11million, and increased realized gains on investments of $7 million.
        This is offset by premium income, which decreased $19 million for the
        first three months of 2001 when compared to the first three months of
        2000. The decreased premium income in 2001 was comprised of a decrease
        in Employee Benefits premium income of $20 million offset by an increase
        in Financial Services premium income of $1 million. The decrease in
        Employee Benefits premium income is attributable to higher termination
        rates in the segment's group life and health business.

        The growth in fee income is primarily in the Employee Benefits segment
        ($33 million). The increase in Employee Benefits was attributable to
        overall price increases in the group life and health businesses and a
        restructuring of the New England joint venture, which is offset by
        higher expenses.

        The increase in net investment income was primarily the result of
        increasing interest rates. The actual earned rate at March 31, 2001 was
        7.32% compared to 7.10% at March 31, 2000. A small increase in the
        general account's invested assets also resulted in an increase in net
        investment income.

        Realized investment gains increased from a realized investment gain of
        $1 million in the first three months of 2000 to a realized investment
        gain of $8 million in 2001. The increase is primarily due to gains of
        $6.4 million from the sale of fixed maturities.

        The benefits and expenses increased $29 million or 4% for the first
        three months of 2001 when compared to the first three months of 2000.
        The growth in benefits and expenses was primarily in the Employee
        Benefits segment, which increased $18 million, primarily due to poor
        mortality and morbidity in the segment's group life and health business,
        respectively. The Financial Services segment reflected an increase in
        benefits and expenses of $11 million, primarily due to the growth in
        increase in policy reserves.

        Income tax expense increased $3 million or 10% for the first three
        months of 2001 when compared to the first three months of 2000. The
        increase reflects higher pre-tax earnings for the first three months of
        2001.

        In evaluating its results of operations, the Company also considers net
        changes in deposits received for investment-type contracts, deposits to
        separate accounts and self-funded equivalents. Self-funded equivalents
        represent paid claims under minimum premium and administrative services
        only contracts, which amounts approximate the additional premiums that
        would have been earned under such contracts if they had been written as
        traditional indemnity or HMO programs.

        Deposits for investment-type contracts increased $27million or 16% for
        the first three months of 2001 when compared to the first three months
        of 2000. This increase is primarily attributable to the Financial
        Services segment, where the Company has experienced growth in premium
        for fixed annuity products due to higher interest crediting rates being
        offered to customers and the volatility in the variable marketplace.

        Deposits for separate accounts increased $295 million or 45% for the
        first three months of 2001 when compared to the first three months of
        2000. The increase is due primarily to increased sales in the 401(k)
        line of business and increased public/non-profit single premiums.

        Self-funded premium equivalents increased $362 million or 30% for the
        first three months of 2001 when compared to the first three months of
        2000. The increase was due to the General American business ($139
        million) and higher overall claims volume for the self-funded business.

        SEGMENT RESULTS

        Employee Benefits

        The following is a summary of certain financial data of the Employee
Benefits segment:
<TABLE>
<S>                                                       <C>                   <C>

        Operating Summary (Millions)                        Three Months Ended March 31,
                                                       ----------------------------------------
                                                             2001                  2000
                                                       ------------------    ------------------
        Premium income                              $             282     $             302
        Fee income                                                216                   183
        Net investment income                                      25                    23
        Realized investment gains (losses)                          2                    (2)
                                                       ------------------ -- ------------------
                Total revenues                                    525                   506

        Total benefits and expenses                               483                   465
        Income tax expenses                                        15                    14
                                                       ------------------    ------------------
                Net income                          $              27     $              27
                                                       ==================    ==================

        Deposits for investment type contracts                      7                    15
        Deposits to separate accounts                             592                   464
        Self-funded premium equivalents                         1,550                 1,188
</TABLE>

        Fee income increased $33 million for the first three months of 2001
        compared to the first three months of 2000. The increase is due
        primarily to the restructuring of the New England joint venture which is
        offset with higher operating expenses, as well as price increases in the
        overall group health block of business.

        Total benefits and expenses increased $17 million for the first three
        months of 2001 when compared to the first three months of 2000. The
        increase is due primarily to unfavorable mortality in the group life
        business and unfavorable morbidity in the group health business.

        401(k) premiums and deposits increased 20% for the first three months of
        2001 (from $505 million to $626 million) when compared to the first
        three months of 2000. Assets under administration (including third-party
        administration) in 401(k) decreased 11% over the first three months of
        2000 reflecting lower U.S. equity markets. The number of contributing
        participants increased from 551,000 at December 31, 2000 to 571,000 at
        March 31, 2001.

        Self-funded premium equivalents increased $362 million for the first
        three months of 2001 compared to the first three months of 2000. The
        increase is primarily due to higher self-insured claims volume.

        Financial Services

        The following is a summary of certain financial data of the Financial
        Services segment:
<TABLE>
<S>                                                               <C>                   <C>

        Operating Summary (Millions)                        Three Months Ended March 31,
                                                       ----------------------------------------
                                                             2001                  2000
                                                       ------------------    ------------------
        Premium income                              $              52     $              51
        Fee income                                                 35                    29
        Net investment income                                     216                   207
        Realized investment gains                                   6                     3
                                                       ------------------ -- ------------------
                Total revenues                                    309                   290

        Total benefits and expenses                               260                   249
        Income tax expenses                                        17                    15
                                                       ------------------    ------------------
                Net income                          $              32     $              26
                                                       ==================    ==================

        Deposits for investment type contracts                    191                   156
        Deposits to separate accounts                             326                   197
</TABLE>

        Net income for Financial Services increased $6 million or 20% for the
        first three months of 2001 when compared to the first three months of
        2000, due primarily to higher fee income and realized gains on
        investments.

        Savings

        Savings premiums and deposits increased $170 million (from $344 million
        to $514 million) or 49% for the first three months of 2001, when
        compared to the first three months of 2000, which reflects growth in
        deposits to separate accounts ($129 million) and growth in deposits to
        traditional fixed annuity products ($32 million).


        The Financial Services segment's core savings business is in the
        public/non-profit pension market. The assets of the public/non-profit
        pension business, including separate accounts but excluding Guaranteed
        Investment Contracts, increased 1% from December 31, 2000.

        The Financial Services segment's savings business experienced strong
        growth during the first three months of 2001. The total lives under
        administration increased from 1,002,785 at December 31, 2000, to
        1,135,704 at March 31, 2001.

        Customer participation in guaranteed separate accounts increased and
        assets under management for guaranteed separate account funds were
        $1,082 million at March 31, 2001 compared to $749 million at December
        31, 2000.

        Life Insurance

        Individual life insurance revenue premiums and deposits of $128 million
        increased $40 million or 46% from the same period last year, which is
        primarily due to an increase in BOLI deposits of $38 million for the
        first three months of 2001.

        GENERAL ACCOUNT INVESTMENTS

        The Company's primary investment objective is to acquire assets whose
        duration and cash flow reflect the characteristics of the Company's
        liabilities, while meeting industry, size, issuer and geographic
        diversification standards. Formal liquidity and credit quality
        parameters have also been established.

        The Company follows rigorous procedures to control interest rate risk
        and observes strict asset and liability matching guidelines. These
        guidelines are designed to ensure that even in changing market
        conditions, the Company's assets will meet the cash flow and income
        requirements of its liabilities. Using dynamic modeling to analyze the
        effects of a wide range of possible market changes upon investments and
        policyholder benefits, the Company ensures that its investment portfolio
        is appropriately structured to fulfill financial obligations to its
        policyholders.

        Fixed Maturities

        Fixed maturity investments include public and privately placed corporate
        bonds, public and privately placed structured assets and government
        bonds. This latter category contains both asset-backed and
        mortgage-backed securities, including collateralized mortgage
        obligations ("CMOs"). The Company's strategy related to structured
        assets is to focus on those with lower volatility and minimal credit
        risk. The Company does not invest in higher risk CMOs such as
        interest-only and principal-only strips, and currently has no plans to
        invest in such securities.


        Private placement investments are generally less marketable than
        publicly traded assets, yet they typically offer covenant protection
        which allows the Company, if necessary, to take appropriate action to
        protect its investment. The Company believes that the cost of the
        additional monitoring and analysis required by private placements is
        more than offset by their enhanced yield.

        One of the Company's primary objectives is to ensure that its fixed
        maturity portfolio is maintained at a high average quality, so as to
        limit credit risk. If not externally rated, the securities are rated by
        the Company on a basis intended to be similar to that of rating
        agencies.

        The distribution of the fixed maturity portfolio by credit rating is
        summarized as follows:
<TABLE>
<S>                                                          <C>                  <C>
                                                           March 31,           December 31,
                                                             2001                  2000
                                                       ------------------    ------------------

        AAA                                                   54.0%                53.5%
        AA                                                     9.9%                10.2%
        A                                                     15.4%                16.2%
        BBB                                                   18.7%                19.0%
        BB and Below (non-investment grade)                    2.0%                 1.1%
                                                       ------------------    ------------------
                          TOTAL                              100.0%               100.0%
</TABLE>

        During the first three months of 2001, net unrealized gains on fixed
        maturities included in stockholders' equity, which is net of
        policyholder-related amounts and deferred income taxes, increased
        surplus by $31 million.

        LIQUIDITY AND CAPITAL RESOURCES

        The Company's operations have liquidity requirements that vary among the
        principal product lines. Life insurance and pension plan reserves are
        primarily long-term liabilities. Accident and health reserves, including
        long-term disability, consist of both short-term and long-term
        liabilities. Life insurance and pension plan reserve requirements are
        usually stable and predictable, and are supported primarily by
        long-term, fixed income investments. Accident and health claim demands
        are stable and predictable but generally shorter term, requiring greater
        liquidity.

        Generally, the Company has met its operating requirements by maintaining
        appropriate levels of liquidity in its investment portfolio utilizing
        positive cash flows from operations. Liquidity for the Company has
        remained strong, as evidenced by significant amounts of short-term
        investments and cash, which totaled $587 million and $568 million as of
        March 31, 2001 and December 31, 2000, respectively.


        Funds provided from premiums and fees, investment income and maturities
        of investment assets are reasonably predictable and normally exceed
        liquidity requirements for payment of claims, benefits and expenses.
        However, since the timing of available funds cannot always be matched
        precisely to commitments, imbalances may arise when demands for funds
        exceed those on hand. Also, a demand for funds may arise as a result of
        the Company taking advantage of current investment opportunities. The
        Company's capital resources represent funds available for long-term
        business commitments and primarily consist of retained earnings and
        proceeds from the issuance of commercial paper and equity securities.
        Capital resources provide protection for policyholders and the financial
        strength to support the underwriting of insurance risks, and allow for
        continued business growth. The amount of capital resources that may be
        needed is determined by the Company's senior management and Board of
        Directors, as well as by regulatory requirements. The allocation of
        resources to new long-term business commitments is designed to achieve
        an attractive return, tempered by considerations of risk and the need to
        support the Company's existing business.

        Additional liquidity is available through the Company's participation in
        repurchase agreements with third party brokers. The Company had $223.8
        million of repurchase agreements at March 31, 2001, compared to zero at
        December 31, 2000. The Company's participation in repurchase agreements
        depends on current market conditions. Therefore, fluctuations may occur.

        The Company's financial strength provides the capacity and flexibility
        to enable it to raise funds in the capital markets through the issuance
        of commercial paper. The Company continues to be well capitalized, with
        sufficient borrowing capacity to meet the anticipated needs of its
        business. The Company had $98.7 million and $97.6 million of commercial
        paper outstanding at March 31, 2001, and December 31, 2000,
        respectively. The commercial paper has been given a rating of A-1+ by
        Standard & Poor's Corporation and a rating of P-1 by Moody's Investors
        Service, each being the highest rating available.


PART II  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

There are no material pending legal proceedings to which the Company or any of
its subsidiaries is a party or of which any of their property is the subject.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)     Index to Exhibits

        None

(b)     Reports on Form 8-K

A report on Form 8-K, dated January 12, 2001, was filed disclosing the Company's
reorganization.

SIGNATURES

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


                               GWL&A FINANCIAL INC.
<TABLE>
<S>          <C>                          <C>



DATE:        May 14, 2001        BY:/s/   Glen R. Derback
             -------------------          -------------------------------------------------------
                                          Glen R. Derback, Vice President and Controller
                                          (Duly authorized officer & chief accounting officer)


</TABLE>