<PAGE>


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

 [X]   Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
       Act of 1934 For the fiscal year ended December 31, 2001

                                       OR

 [_]   Transition Report Pursuant to Section 13 or 15(d) of the Securities
       Exchange Act of 1934.

                        Commission file number 001-12617

                             Trigon Healthcare, Inc.
             (Exact name of registrant as specified in its charter)
           Virginia                                              54-1773225
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

                   2015 Staples Mill Road, Richmond, VA 23230
                    (Address of principal executive offices)

        Registrant's telephone number, including area code (804) 354-7000

Securities registered pursuant to Section 12(b) of the Act:
      Class A Common Stock, $.01 Par Value               New York Stock Exchange
               (Title of Class)                             (Name of Exchange)

Securities registered pursuant to Section 12(g) of the Act:  None

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. [X] Yes [_] No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [_]

The aggregate market value of the voting stock held by non-affiliates of the
registrant as of March 26, 2002 was approximately $2,599,509,000 (based on the
last reported sales price of $72.64 per share on March 26, 2002, on the New York
Stock Exchange).

As of March 26, 2002, 35,786,194 shares of the registrant's Class A Common
Stock, par value $.01 per share, were issued and outstanding.

                      DOCUMENTS INCORPORATED BY REFERENCE:
Certain portions of Trigon Healthcare Inc.'s Annual Report to Shareholders for
the year ended December 31, 2001 into Parts II and IV of this Form 10-K.
Certain portions of Trigon Healthcare Inc.'s definitive Proxy Statement dated
March 22, 2002 for the Annual Meeting of Shareholders into Part III of this Form
10-K.

<PAGE>

                             TRIGON HEALTHCARE, INC.
                       INDEX TO ANNUAL REPORT ON FORM 10-K
                      FOR THE YEAR ENDED DECEMBER 31, 2001

<TABLE>
<CAPTION>
                                                                                                           Page
                                                                                                           ----
<S>                                                                                                        <C>
                                                       PART I

Item 1.      Business ....................................................................................    1
Item 2.      Properties ..................................................................................   18
Item 3.      Legal Proceedings ...........................................................................   18
Item 4.      Submission of Matters to a Vote of Security Holders .........................................   20

                                                       PART II

Item 5.      Market for Registrant's Common Equity and Related Stockholder Matters .......................   20
Item 6.      Selected Financial Data .....................................................................   20
Item 7.      Management's Discussion and Analysis of Financial Condition and Results of Operations .......   20
Item 7A.     Quantitative and Qualitative Disclosures About Market Risk ..................................   20
Item 8.      Financial Statements and Supplementary Data .................................................   20
Item 9.      Changes in and Disagreements with Accountants on Accounting and Financial Disclosure ........   21

                                                      PART III

Item 10.     Directors and Executive Officers of the Registrant ..........................................   21
Item 11.     Executive Compensation ......................................................................   21
Item 12.     Security Ownership of Certain Beneficial Owners and Management ..............................   21
Item 13.     Certain Relationships and Related Transactions ..............................................   21
                                                       PART IV
Item 14.     Exhibits, Financial Statement Schedules, and Reports on Form 8-K ............................   21
</TABLE>



<PAGE>

PART I

ITEM 1.  BUSINESS

GENERAL

Trigon Healthcare, Inc. through its subsidiaries is the largest managed health
care company in Virginia, serving over 2.1 million members primarily through
statewide and regional provider networks. (Trigon Healthcare, Inc. and
subsidiaries herein collectively referred to as "Trigon" or the "Company"). The
Company's membership represents approximately 30% of the Virginia population and
35% of the Virginia population in those areas where Trigon has the exclusive
right to use the Blue Cross and Blue Shield service marks and tradenames.

The Company divides its business into four segments: health insurance,
government programs, investments and all other. The Company's health insurance
segment provides a comprehensive spectrum of managed care products primarily
through three network systems with a range of utilization and cost containment
controls. Within the Company's network product offerings, employer groups may
choose various funding options ranging from fully insured to partially or fully
self-funded financial arrangements. While self-funded customers participate in
Trigon's networks, the claims are not underwritten by Trigon but are funded by
the groups. As of December 31, 2001, the fully insured, also referred to as
commercial, products made up over one-half of total enrollment. Its components
include: three HMO networks which are the Company's most tightly managed and
cost efficient networks; the preferred provider organization ("PPO") networks
which offer greater choice of providers than Trigon's HMO networks; and the
participating provider ("PAR") network which is the Company's broadest and most
flexible network. Commercial products also include Medicare supplement plans and
Medicaid HMO plans. Self-funded enrollment as of December 31, 2001 represented
36.3% of total enrollment. Self-funded arrangements are available to groups with
more than 100 employees and are typically utilized by groups with more than
1,000 employees. Trigon charges self-funded groups administrative fees which are
based on the number of members in a group or the group's claims experience. In
addition, most self-funded groups purchase aggregate and/or claim specific stop
loss coverage. In exchange for a premium, the group's aggregate liability is
capped for the year or the group's liability on any one episode of care is
capped.

The government programs segment includes the Federal Employee Program ("FEP").
Through its participation in the national contract between the Blue Cross and
Blue Shield Association ("BCBSA") and the U.S. Office of Personnel Management
("OPM"), the Company provides health benefits to federal employees in Virginia.
FEP revenues represent the reimbursement by OPM of medical costs incurred
including the actual cost of administering the program, as well as a
performance-based share of the national program's overall profit. As of December
31, 2001, FEP enrollment represented 10.4% of total enrollment. The Company
discontinued its role as a claims processing intermediary for the federal
government with the Medicare Part A program in Virginia and West Virginia
effective August 31, 1999. Additionally, the Company discontinued its role as
the primary provider of computer processing capabilities for Medicare Part A
claims processing to certain other Blue Cross and Blue Shield plans during
November 1999. As fiscal intermediary for Medicare, the Company allocated
operating expenses to this line of business to

                                       1

<PAGE>

determine reimbursement due for services rendered in accordance with the
contracts in force. Claims processed under this arrangement, which are subject
to audit, were not included in the consolidated statements of operations. The
reimbursement of allocated operating expenses, also subject to audit, was
recorded as a reduction of the Company's selling, general and administrative
expenses.

All of the investment portfolios of the consolidated subsidiaries are managed
and evaluated collectively within the investment segment. The Company's other
health-related business, including disease management programs, benefits
administration, health promotions and similar products, is reflected in an "all
other" category. In March 2001, the Company sold Trigon Administrators, Inc. and
its Property and Casualty Division, which provides workers compensation,
liability and short-term disability services, and recognized a gain of $3.5
million on the sale. The gain is included as a component of net realized losses
in the accompanying consolidated statements of operations.

Refer to Note 20, "Segment Information" on pages 53 through 55 of the Company's
2001 Annual Report to Shareholders, which are incorporated herein by reference,
for financial information relating to reportable segments.

The following table sets forth the data by network for the last five years:

                                             ENROLLMENT BY NETWORK SYSTEM

<TABLE>
<CAPTION>
                                                                            As of December 31,
                                                           2001          2000          1999          1998          1997
                                                   ------------- ------------- ------------- ------------- -------------
<S>                                                     <C>           <C>           <C>           <C>           <C>
Health Insurance
Commercial
   HMO .........................................        301,231       272,546       274,184       255,879       255,548
   PPO .........................................        540,362       488,645       378,406       297,939       263,828
   PAR .........................................        119,569       134,166       151,673       165,239       192,825
   Medicaid/Medicare HMO /(1)/ .................         61,777        58,021        51,404        31,338        35,488
   Medicare supplement .........................        116,754       119,535       119,050       121,322       125,686
                                                   ------------- ------------- ------------- ------------- -------------
Total commercial excluding Mid-South ...........      1,139,693     1,072,913       974,717       871,717       873,375
Self-funded ....................................        776,486       721,361       677,545       645,516       669,732
                                                   ------------- ------------- ------------- ------------- -------------
Total health insurance excluding Mid-South .....      1,916,179     1,794,274     1,652,262     1,517,233     1,543,107
                                                   ------------- ------------- ------------- ------------- -------------
Government

Federal Employee Program (PPO) .................        221,757       221,056       216,089       213,017       207,457
                                                   ------------- ------------- ------------- ------------- -------------
Total excluding Mid-South ......................      2,137,936     2,015,330     1,868,351     1,730,250     1,750,564
Mid-South, commercial ..........................              -             -             -       105,056        64,143
Mid-South, ASO .................................              -             -             -        26,065        25,663
                                                   ------------- ------------- ------------- ------------- -------------
Total ..........................................      2,137,936     2,015,330     1,868,351     1,861,371     1,840,370
                                                   ============= ============= ============= ============= =============
</TABLE>

/(1)/ The Company exited from the Medicare HMO market effective January 1, 2000.

SIGNIFICANT CUSTOMERS

Trigon's two largest customers are the Commonwealth of Virginia ("COV") and FEP.
Since 1972, the Company has provided health benefits to employees and retirees
of COV. The current multi-year contract, with an initial contract period through
June 2004, to administer the COV statewide, self-funded medical/drug health care
benefits programs was effective July 2000. The net self-funded revenues under
the contract represent 2.0% of total consolidated revenues during

                                       2

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2001 and cover 244,069 COV members as of December 31, 2001. Annually, at open
enrollment, COV employees may select Trigon or other health benefit plan
choices. FEP represents 17.8% of total consolidated revenues during 2001 and
covers 221,757 members as of December 31, 2001. The contract renews
automatically for a term of one year each January 1, unless either party gives
written notice at least 60 days prior to the date of renewal. Under the program,
a special FEP reserve is maintained at the national level as a protection
against adverse claims trends. However, if the contract should terminate with a
negative balance in the FEP special reserve, the losses would be allocated to
participating plans as subcontractors based on a ratio of the Company's past
five year claims experience as a percent of the total program's experience. As
of September 30, 2001, the national reserve stood at 3.2 months of claims and
administrative payments in reserve, which is above the target of a 3.0 month
reserve base. The December 31, 2001 calendar year national reserve balance has
not been published but is projected to remain at the September 30, 2001 reserve
level.

NETWORKS

Trigon's HMO, PPO and PAR networks provide for the delivery of health care
services at generally reduced costs due to favorable network arrangements with
health care providers and by including members in health care decisions. The
Company has the largest membership base in Virginia, which generally allows it
to negotiate contracts with its Virginia providers that specify favorable rates
and incorporate utilization management and other cost controls. Members assume
responsibility for a portion of health care costs through copayments,
coinsurance and annual deductible contract provisions. Members may choose to
receive health care services from providers not part of the network at an
additional cost to the member. Trigon believes that the copayment, coinsurance,
annual deductible provisions and out of network costs enhance its ability to
control costs by encouraging members to take more responsibility for their
health care decisions.

Trigon established its first Health Maintenance Organization ("HMO") in 1984 and
now operates three separate HMOs. HealthKeepers, Inc. ("HealthKeepers") is a
state qualified HMO that operates primarily in the central, eastern and
southwestern areas of Virginia. Priority Health Care, Inc. ("Priority") is a
federally qualified HMO operating in the Tidewater area in Eastern Virginia.
Peninsula Health Care, Inc. ("Peninsula"), a joint venture owned 51% by Trigon,
is a state qualified HMO operating primarily on the Peninsula in Eastern
Virginia. As of December 31, 2001, the HMO networks included approximately 2,300
primary care physicians, 5,200 specialist physicians and 53 acute care hospitals
throughout Virginia. Members choose a primary care physician who is responsible
for coordinating health care services for the member. The HMO product portfolio
is presented to customers as a stand-alone HMO offering, or through "Blue
Advantage," a program which includes HMO and PPO options administered and priced
as a single program and which can only be utilized by groups that contract with
Trigon on an exclusive basis. The Company's PPO network is a statewide PPO
network which, as of December 31, 2001, included approximately 11,800 physicians
and 89 acute care hospitals within Virginia. Members may seek care from any PPO
network physician depending on services required. Trigon's PAR network provides
more traditional health coverage and included approximately 12,200 physicians
and 89 acute care hospitals. The PAR network offers members greater
customization of benefit design and fewer restrictions in the use of non-network

                                       3

<PAGE>

providers than the PPO network. Trigon expects that its PAR network and products
will continue to be an important offering for groups desiring greater
flexibility and choice in networks and benefits, as well as a source of new PPO
and HMO members. Trigon also offers HMO products to Medicaid and State
Children's Health Insurance Program participants in the Peninsula, Tidewater and
Central Virginia regions. The Medicaid HMO products are provided under an annual
contract with the Commonwealth of Virginia that may be terminated with 90 days
notice.

Trigon's networks have contracts with hospitals, physicians and other
professionals at generally reduced rates due to the volume of business it offers
to health care providers that are a part of the network. Hospital provider
contracts, typically three to five years in duration, are generally paid on the
basis of per diems (i.e., fixed fee schedules where the daily rate is based on
the type of service; primary method of in-patient reimbursement), per case per
admission (i.e., fixed fee schedules for all services during a member's
hospitalization), or a percentage of covered charges with limits on the
subsequent year increases. The average rate negotiated with hospitals under this
arrangement is lower than the hospital's average standard retail charges.
Services not subject to special per case or per diem payment arrangements are
generally paid according to a fee schedule or as a percentage of billed charges.
In 1999, the Company completed a three year process to convert its facility
outpatient contracts from a percent of covered charges to a fixed fee
reimbursement schedule for 6,500 procedures which lead to a substantial
reduction in unit cost as well as improved certainty on unit cost increases.
When considering whether to contract with a physician, the Company conducts a
credentialing program to evaluate the applicant's professional experience,
including licensure. The Company's HMO network provides reimbursement to almost
all of the primary care physicians in the HMO network on a capitated basis.
Specialists are reimbursed based on a fee schedule or, in some cases, on a
capitated basis. Some ancillary services, lab services, behavioral health and
vision services are also capitated. PPO and PAR physician provider contracts
employ fixed fee schedules, which are below standard billing rates. The Company
uses three basic components to establish physician fee schedule payments:
Medicare's Resource Based Relative Value System methodologies, competitor
reimbursement rates and ongoing reviews of specific allowances to determine if
suitable payment levels are in place. Physician fee schedule payments are
adjusted when considered appropriate to do so in accordance with the Fair
Business Practices Act. The Company provides 120 days notice for standard
contract changes. These changes are automatically effective unless the provider
informs the Company within 15 business days from receipt of the notice of the
provider's intention to cancel the contract.

UTILIZATION MANAGEMENT

Trigon also manages health care costs in its networks by using utilization
management guidelines that are intended to address quality of care and help to
ensure that only appropriate services are rendered and that such services are
provided in a cost-effective manner. Trigon recognizes that the right care in
the right setting at the right time using the right provider for the right price
equates to quality medical care. In the HMO network, the primary care physicians
are considered to be the overall manager of the individual's health care needs
and manage and optimize care through the use of referrals and by approving all
specialty care before it is rendered. In addition, the HMO reviews all high cost
services needed by individual members

                                       4

<PAGE>

that are not provided by the primary care physician. The Company also manages
health care costs and quality by reviewing monthly cost and utilization trends
within all networks. Utilization rates and cases are reviewed in the aggregate
and by service type to identify opportunities for better quality and cost
control. In addition, the highest cost services are studied to determine if
costs can be reduced by using new, less expensive technologies or by creating
additional networks or contracts, such as networks for ambulatory care, to
reduce provider costs. The Company requires prospective approval of all hospital
and skilled nursing facility stays and concurrent review of length of stay.
Trigon uses the Milliman & Robertson Healthcare Management Guidelines (M&R),
InterQual(R) and other nationally recognized guidelines for its medical
necessity decision support criteria. M&R guidelines were developed based on
nationwide best practices benchmarks that maximize efficiency in health care
delivery. InterQual(R) is a nationally recognized, evidence-based criteria set
developed through peer review of medical literature. The Company also modifies
the decision support guidelines based on input from its regional physician
panels, thus enhancing the support of the guidelines by network providers.
Trigon prospectively reviews the medical necessity of home health, private duty
nursing and durable medical equipment. Also, the Company retrospectively reviews
physician practice patterns. Trigon conducts physician profiles that indicate
quality and cost effective standards. All new medical technologies are reviewed
in advance in an attempt to ensure that only safe and effective new medical
procedures are covered. Additionally, the Company also employs a comprehensive
disease management program. In this program, the Company identifies those
members having certain chronic diseases, such as asthma and diabetes, and
proactively works with the member and the physician to facilitate appropriate
treatment, help to ensure compliance with recommended therapies and educate
members on lifestyle modifications to manage the disease. The Company believes
that the program promotes the delivery of efficient care and helps to improve
the quality of health care delivered.

QUALITY

Trigon's HMO and PPO quality improvement standards are modeled on those of the
National Committee for Quality Assurance ("NCQA"), an independent, nonprofit
institution that reviews and accredits health maintenance and managed care
organizations. The quality improvement program instituted by the Company
provides for review of the quality of care and the quality of service as well as
the initial and ongoing review of the credentials of all network providers. The
credentialing process includes a review of whether a provider has the necessary
licenses, is qualified in the specialty indicated and whether his/her office
meets standards for safety, sanitation and accessibility. The Company reviews
the findings with a quality improvement committee, which includes practicing
physicians from the Company's networks. In addition, quality of care and quality
of service activities are monitored through profiling and data analysis, member
satisfaction surveys and problem case review. Included in these activities are
profiles of the tests, types of treatment and procedures performed for specific
diagnoses by physicians, as well as reviews of aggregate data. Network
physicians and other providers participate in these quality improvement
activities. In March 2000, Trigon's Peninsula and Priority HMOs received an
accreditation status of Excellent from the NCQA for their commercial and
Medicaid products. HealthKeepers earned an accreditation status of Excellent for
its commercial product. A score of Excellent is the highest level of
accreditation awarded to health plans. This accreditation level is reserved for
those managed care organization product lines that deliver the highest levels of
care

                                        5

<PAGE>

and service, and whose clinical and administrative systems exceed NCQA's
rigorous requirements for consumer protection and quality improvement. The NCQA
awarded Trigon Insurance Company (dba Trigon Blue Cross Blue Shield) ("Trigon
Insurance") Full Accreditation, the highest level of PPO accreditation, for its
PPO commercial products including, KeyCare, KeyAdvantage and the Federal
Employee Program, in 2001. NCQA grants Full Accreditation to those PPO plans
that have excellent programs for continuous quality improvement and meet NCQA's
demanding standards. In addition, the American Accreditation Health Care
Commission/URAC has awarded Trigon Insurance a full, two-year accreditation for
health utilization management services effective through May 2002.

MARKETING

Trigon sells its products and services to both individuals and groups. The
individual products are marketed principally through direct marketing
initiatives and through brokers. The group market includes small, medium and
large group employers. The smaller group employers generally use insurance
brokers to assist in the selection of products and analysis of the actual cost
of competing plans. As the group size grows, employers may use consultants to
assist them in the tailoring of benefits and networks. The larger group
employers are generally more sophisticated purchasers, often engaging
consultants to work with the Trigon sales staff to tailor benefit and network
design to match their specific needs more closely. In addition, Trigon has a
direct sales staff that markets the full range of Trigon products and services.

COMPETITION

The health care industry is highly competitive both in Virginia and nationally.
In some cases, market entrants, as well as existing health care companies, have
competed with the Company for business by offering very favorable pricing terms
to customers. The Company faces this competition in the areas in which it is
licensed to use the Blue Cross and Blue Shield service marks and tradenames. In
areas outside of its licensed territory, the Company's ability to successfully
compete may be adversely affected by its inability to use the Blue Cross and
Blue Shield service marks and tradenames, by the presence of competitors that
are able to use such service marks and tradenames in the areas and by the
Company's lack of substantial market share or established provider networks in
these areas. The Company also faces competition from health care providers that
combine and form their own networks in order to contract directly with employer
groups and other prospective customers to provide health care services.

INVESTMENTS

The Company's investment policies are designed to provide liquidity to meet
anticipated payment obligations and preserve capital. Trigon fundamentally
believes that concentrations of investments in any one asset class are unwise
due to constantly changing interest rates as well as market and economic
conditions. Accordingly, the Company maintains a diversified investment
portfolio consisting both of fixed income and equity securities, with the
objective of producing a consistently growing income stream and maximizing
risk-adjusted total return. The fixed income portfolio includes government and
corporate securities, both domestic and international, with an average quality
rating of "A1" as of December 31, 2001. The portfolio had an average

                                        6

<PAGE>

contractual maturity of 7.2 years as of December 31, 2001. A portion of the
fixed income portfolio is designated as a short-term fixed income portfolio and
is intended to cover near-term cash flow needs and to serve as a buffer for
unanticipated business needs. The equity portfolios contain readily marketable
securities ranging from small growth to well-established Fortune 500 companies.
The international portfolio is diversified by industry, country and
currency-related exposure. As of December 31, 2001, the Company's equity
exposure, comprised of direct equity as well as equity-indexed investments, was
12.8% of the total portfolio, as compared to 14.0% as of December 31, 2000.

The Company utilizes internal and external investment managers. Both the
internal and external managers invest within guidelines established by the
Company designed to fit into the overall investment strategy. These guidelines
establish minimum quality and diversification requirements that, among other
things, provide limitations on the allowable investment for a single issuer as
well as currency exposure for those managers investing in international
securities.

As of December 31, 2001, the composition of the Company's fixed income
investment securities by rating is as follows (in thousands):

<TABLE>
<CAPTION>
                                                                                Estimated   Percent of
                            Rating /(1)/                                       Fair Value        Total
                            ------------                                       -----------------------
<S>                                                                            <C>          <C>
Aaa .....................................................................      $  889,782         53.7%
Aa1, Aa2, Aa3 ...........................................................          47,595          2.9
A1, A2, A3 ..............................................................         131,286          7.9
Baa1, Baa2, Baa3 ........................................................         174,271         10.5
Ba1, Ba2, Ba3 ...........................................................         364,616         22.0
B1, B2, B3 ..............................................................          46,605          2.8
Caa1 or lower ...........................................................             260          0.0
Not rated (principally, other fixed income investment funds) ............           3,045          0.2
                                                                               -----------------------
Total ...................................................................      $1,657,460        100.0%
                                                                               =======================
</TABLE>

/(1)/ Ratings are assigned by Moody's Investor Service, Inc., Standard & Poor's
      Corporation or Fitch Investors Service, L.P.

Refer to Note 3, "Investment Securities," on pages 37 through 40 of the
Company's 2001 Annual Report to Shareholders, which are incorporated herein by
reference, for additional financial information relating to the Company's
investment securities.

Other than currently or formerly occupied Company property or through
mortgage-backed securities, the Company has no investment in real estate or
mortgage loans.

INFORMATION SYSTEMS

The Company develops and maintains its own information systems. Information
systems have played and will continue to play a key role in ongoing plans to
continually improve quality, lower costs and improve service for the Company's
customers. Trigon's centralized common database and analytical technologies
allow for increasingly more sophisticated methods of managing costs and quality
of care. The database includes comprehensive information on

                                        7

<PAGE>

virtually all physicians and hospitals and approximately one third of the
population in Virginia, which assists Trigon in analyzing the medical and
economic performance of providers and the medical and economic experience of
specific customer groups and individuals.

The Company uses an integrated set of applications software to support marketing
and underwriting, eligibility and billing, electronic claims submission, claims
administration, managed care programs and corporate financial management. A
combination of custom developed and licensed systems is used to meet the unique
needs of different products and markets. An overall systems architecture is
maintained to promote consistency of data, processing rules and flexibility.
Different systems serving the unique products or markets feed data to a
corporate information and decision support system. This decision support system
provides a single source of information for all of the Company's data reporting
and analytic needs. This includes operational and financial performance,
underwriting and marketing analysis, utilization management and actuarial
reporting.

REGULATION

HEALTH CARE REGULATION - FEDERAL and VIRGINIA. The Company's business is subject
to a changing legal, legislative and regulatory environment. Some of the more
significant current issues that may affect the Company's business include:

..  efforts to expand tort liability of health plans;
..  initiatives to increase health care regulation;
..  proposed class action lawsuits targeting the health care industry's efforts
   to deliver quality care at affordable costs; and
..  proposed physician antitrust waivers.

Current initiatives to increase health care regulation at the federal level
include new legislative proposals for a "patients' bill of rights." Such
legislation was passed by the Senate in June 2001 (S. 1052) and would expand
tort liability for health plans and change the practices for deciding medical
necessity. In early August 2001, similar legislation was passed by the House
(H.R. 2563) with efforts to resolve differences between the two bills
continuing. Other initiatives include legislative proposals to substitute
minimal federal standards for state regulation of Association Health Plans, to
expand prohibitions against using genetic information and to expand the mandate
for mental health parity. Given the general uncertainty of the political
process, it is not possible to determine what, if any, legislation will
ultimately be enacted or what the effect on the Company of any such legislation
would be.

Several major companies in the health care industry have had proposed class
action lawsuits filed against them by a coalition of plaintiffs' attorneys.
Given that no such lawsuits are currently pending against the Company and given
the uncertainties of predicting the outcome of litigation, it is not possible to
determine at this time what the ultimate effect, if any, on the Company of any
such litigation would be.

The Department of Labor issued its final regulation specifying new requirements
for claims and appeal procedures for ERISA regulated group health and disability
plans during 2000. The

                                        8

<PAGE>

regulation is applicable only to ERISA regulated plans, whether they are
fully-insured or self-insured. While the requirements were to be effective for
claims filed on or after January 1, 2002, the effective date has been delayed
until plan years beginning after July 2002. The Company does not believe that
the regulation will have a material adverse impact on the consolidated financial
condition or results of operations.

In 2000, the Department of Health and Human Services issued two significant sets
of final regulations resulting from the Health Insurance Portability and
Accountability Act of 1996 ("HIPAA")--one dealing with standardization of
electronic transactions and the other dealing with privacy of individually
identifiable health information. The final regulation governing security
standards for the maintenance and transmission of health information (first
proposed in 1998) is expected during 2002. The original compliance date for the
regulation on standard transactions was October 2002, but the President signed
legislation in late 2001 providing the opportunity for covered entities to apply
for a one year extension. The Company plans to file for that extension. While
the compliance date for the privacy regulation is currently April 2003, a
revised regulation is expected to be issued in 2002. A new Virginia law
governing disclosure of privacy practices was effective July 1, 2001. That law
was enacted pursuant to federal requirements established by the
Gramm-Leach-Bliley Act.

The Company has assessed the impact of the HIPAA regulation on standard
transactions on the Company's practices and operations and does not believe that
it will have a material adverse impact on operations. Given that the HIPAA
security regulation has not been finalized and that further changes to the
privacy regulation are expected, the Company has not yet fully determined what
the effect of these HIPAA regulations may be on the Company. However, compliance
with the currently issued regulations would require significant systems
enhancements, training and administration efforts.

At the state level, the Virginia General Assembly, in its 2002 Session, did not
pass legislation that would substantially increase health care costs, restrict
choice or drive up the number of uninsured Virginians. At this time, the health
care legislation that did pass is not expected to have a material effect on the
Company's consolidated financial condition or results of operations.

INSURANCE COMPANY AND HMO REGULATION. Trigon Insurance, Trigon Health and Life
Insurance Company ("Trigon Health and Life"), a health and life company, and the
three HMO subsidiaries are subject to the insurance laws and regulations of the
Commonwealth of Virginia, the domiciliary state of these companies. In addition,
Trigon Health and Life is also subject to the insurance laws and regulations of
the other jurisdictions in which it is licensed or authorized to do business.
These insurance laws and regulations generally give state regulatory authorities
broad supervisory, regulatory and administrative powers over insurance companies
and insurance holding companies with respect to most aspects of their
businesses. Such regulation is intended primarily for the benefit of the
policyholders and enrollees and not investors. Regulatory authorities exercise
extensive supervisory power over health and life insurance companies and HMOs
with respect to licensing; the approval of policy forms and policies used; the
nature of, and limitations on, a company's investments; the periodic examination
of the operations of the companies; the form and content of annual statements
and other reports required to be filed on the financial condition of the
companies; the establishment

                                        9

<PAGE>

of minimum capital or net worth requirements for these companies and other
requirements. Additionally, the HMOs are subject to regulation regarding quality
assurance, covered benefits, contracts between the HMO and its health care
providers, the accessibility of providers in the service area of an HMO and
other requirements. State regulatory authorities require the insurance companies
and the HMOs to maintain restricted investments represented by interest-bearing
investment securities, which are held by trustees or the state regulatory
agencies as a special fund for the policyholders and enrollees if the company
fails to meet its obligations in that state.

Trigon Insurance, the HMO subsidiaries and Trigon Health and Life are required
to file periodic statutory financial statements in each jurisdiction in which
they are licensed. The HMOs are subject to specific regulation and review for
the Medicaid HMO products by the Virginia Department of Medical Assistance
Services and other regulatory agencies. Trigon has one federally qualified HMO
that is also subject to regulation and review by the OPM and certain other
federal authorities, with which it must file periodic reports. Areas covered by
federal law are similar to those covered by state law and regulation. In
addition, one of the Company's HMOs offered a Medicare risk product through
December 31, 1999 that subjected that HMO to regulation and review by the U.S.
Department of Health and Human Services and certain other federal authorities as
well. Trigon Insurance, the HMO subsidiaries and Trigon Health and Life are
periodically examined by the insurance departments of the jurisdictions in which
they are licensed to do business.

INSURANCE HOLDING COMPANY REGULATION. Trigon Healthcare, Inc. is not regulated
as an insurance company but, as the direct or indirect owner of all the capital
stock of Trigon Insurance, the three HMOs and Trigon Health and Life, is
regulated as an insurance holding company and subject to the insurance holding
company act of Virginia, the state in which the subsidiaries are domiciled. The
act contains certain reporting requirements as well as restrictions on
transactions between an insurer or HMO and its affiliates. The Virginia
insurance holding company laws and regulations generally require insurance
companies and HMOs within an insurance holding company system to register with
the State Corporation Commission and to file with the State Corporation
Commission certain reports describing capital structure, ownership, financial
condition, certain intercompany transactions and general business operations. In
addition, various notice and reporting requirements generally apply to
transactions between insurance companies and HMOs and their affiliates within an
insurance holding company system, depending on the size and nature of the
transactions. Virginia insurance holding company laws and regulations require
prior regulatory approval or, in certain circumstances, prior notice of, certain
material intercompany transfers of assets as well as certain transactions
between insurance companies, HMOs, their parent holding companies and
affiliates.

Additionally, Virginia insurance holding company acts restrict the ability of
any person to obtain control of an insurance company or HMO without prior
regulatory approval. Without such approval (or an exemption), no person may
acquire any voting security of an insurance holding company which controls a
Virginia insurance company or HMO, or merge with such a holding company, if as a
result of such transaction such person would "control" the insurance holding
company. "Control" is defined as the direct or indirect power to direct or cause
the direction of

                                       10

<PAGE>

the management and policies of a person and is presumed to exist if a person
directly or indirectly owns or controls 10% or more of the voting securities of
another person.

RISK-BASED CAPITAL REQUIREMENTS. Virginia has statutory risk-based capital
("RBC") requirements for life, health and other insurance companies. Such
requirements are intended to assess the capital adequacy of life and health
insurers, taking into account the risk characteristics of an insurer's
investments and products. The formula for calculating such RBC requirements, set
forth in instructions adopted by the NAIC, is designed to take into account
asset risks, insurance risks, interest rate risks and other relevant risks with
respect to an individual insurance company's business. Under these laws, an
insurance company must submit a report of its RBC level to the Virginia State
Corporation Commission as of the end of the previous calendar year.

The RBC requirements categorize insurance companies according to the extent to
which they meet or exceed certain RBC thresholds. The law requires increasing
degrees of regulatory oversight and intervention as an insurance company's RBC
declines. The level of regulatory oversight ranges from requiring the insurance
company to inform and obtain approval from the domiciliary Insurance
Commissioner of a comprehensive financial plan for increasing its RBC to
mandatory regulatory intervention requiring an insurance company to be placed
under regulatory control in a rehabilitation or liquidation proceeding.

As of December 31, 2001, the RBC levels of Trigon Insurance, Trigon Health and
Life and each of the Company's HMOs, as calculated in accordance with the NAIC
RBC instructions, exceeded all RBC thresholds.

RESTRICTIONS ON DIVIDENDS. In the event the Company determines to pay dividends,
the principal source of funds to pay dividends to stockholders would be
dividends received by the Company from its subsidiaries. Virginia insurance laws
and regulations restrict the payment of extraordinary dividends declared by
insurance companies, including health care insurers such as Trigon Insurance, in
a holding company system. An insurance company is prohibited from paying an
extraordinary dividend unless it obtains the approval of the State Corporation
Commission. An extraordinary dividend is one which, together with the amount of
dividends and distributions paid by the insurance company during the immediately
preceding 12 months, exceeds the lesser of (i) 10% of the insurance company's
statutory surplus to policyholders as of the preceding December 31 or (ii) the
insurance company's statutory net income (excluding realized capital gains) for
the preceding calendar year. Further, an insurance company may not pay a
dividend unless, after such payment, its surplus to policyholders is reasonable
in relation to its outstanding liabilities and adequate to meet its financial
needs. The State Corporation Commission may bring an action to enjoin or rescind
payment of any dividend or distribution that would cause the insurance company's
statutory surplus to be unreasonable or inadequate. Trigon Insurance may pay the
Company $46.6 million in cash dividends during 2002 without prior approval.
During 2001, 2000 and 1999, Trigon Insurance paid cash dividends to its parent,
Trigon Healthcare, Inc., of $125 million, $125 million and $48.9 million,
respectively. During 2001, Peninsula Healthcare, Inc. paid a cash dividend of $2
million. The payment was distributed to its parent companies in proportion to
their respective ownership interests as follows: $1 million to Trigon
Healthcare, Inc. and $991,000 to Riverside Healthcare Association.

                                       11

<PAGE>

During 2001, Monticello Service Agency, Inc. paid cash dividends to its parent,
Trigon Healthcare, Inc., of $46 million. No regulatory approval was required for
this dividend.

ASSESSMENTS AGAINST INSURERS. Under insolvency or guaranty association laws in
most states, insurance companies can be assessed for amounts paid by guaranty
funds for policyholder losses incurred by insolvent insurance companies. Most
state insolvency or guaranty association laws, including Virginia's, currently
provide for assessments based upon the amount of premiums received on insurance
underwritten within such state. Substantially all of Trigon's premiums are
currently derived from insurance underwritten in Virginia.

Under the Virginia Life, Accident and Sickness Insurance Guaranty Association
(the "Association") Act, assessments against insurance companies which issue
policies of accident or sickness insurance, such as Trigon Insurance, are made
retrospectively and are based (up to prescribed limits) upon the ratio of (i)
the insurance company's premiums received in Virginia over the previous three
calendar years on accident and sickness insurance, to (ii) the aggregate amount
of premiums received by all assessed member insurance companies over such three
calendar years on accident and sickness insurance. The guaranty fund assessments
made under the act are administered by the Association, which has its own board
of directors selected by member insurers with the approval of the State
Corporation Commission. An assessment may be abated or deferred by the
Association if, in the opinion of the board, payment would endanger the ability
of the member to fulfill its contractual obligations, but the other member
insurers may be assessed for the amount of such abatement or deferral. Any such
assessment paid by a member insurance company may be offset against its premium
tax liability to the Commonwealth of Virginia over the ten calendar years
following the year of the payment, in amounts equal to ten percent of the amount
paid. The amount and timing of any future assessments, however, cannot be
reasonably estimated and are beyond the control of the Company.

VIRGINIA'S OPEN ENROLLMENT PROGRAM. The Commonwealth of Virginia has an open
enrollment program pursuant to which Trigon Insurance is required to offer
comprehensive accident and sickness insurance contracts to individuals without
imposition of certain underwriting criteria that would deny coverage on the
basis of medical condition, age or employment status. As an incentive for
participating in the open enrollment program, Trigon Insurance pays Virginia
premium tax of three-fourths of one percent (0.75%) on premiums received from
individual accident and sickness insurance rather than the general Virginia
premium tax of two and one-fourth percent (2.25%). This general Virginia premium
tax applies to all accident and sickness insurance premiums received by Trigon
Insurance from group business. To withdraw from the open enrollment program,
Trigon Insurance is required to give 24 months advance notice of withdrawal to
the State Corporation Commission.

BANKRUPTCY AND INSOLVENCY. In the event of default on any debt incurred by the
Company or the bankruptcy of the Company, the creditors and stockholders of the
Company would have no right to proceed against the assets of Trigon Insurance or
any other subsidiary of the Company. If Trigon Insurance were subject to a
rehabilitation or liquidation proceeding, such proceeding would be brought by
the State Corporation Commission which would act as the receiver with respect to
such insurance company's property and business. All creditors of Trigon

                                       12

<PAGE>

Insurance, including, without limitation, members and, if applicable, the
various state guaranty associations, would be entitled to payment in full from
such assets before the Company, as a stockholder, would be entitled to receive
any distributions therefrom.

THE BLUE CROSS BLUE SHIELD LICENSE

The Company and certain of its subsidiaries have the exclusive right to use
certain Blue Cross and Blue Shield service marks and tradenames for all of their
plans and products throughout Virginia other than certain northern Virginia
suburbs adjacent to Washington, D.C. The license requires an annual fee to be
paid to BCBSA equal to total association expenses allocated to members based
upon enrollment and premium and subjects the Company to certain other
guidelines. BCBSA is a national trade association of Blue Cross and Blue Shield
licensees, the primary function of which is to promote and preserve the
integrity of the Blue Cross and Blue Shield name and service marks as well as
provide certain coordination among plan and provider services. Each BCBSA
licensee is an independent legal organization and is not responsible for
obligations of other BCBSA member organizations. The Company has no right to use
the Blue Cross and Blue Shield service marks and tradenames outside of its
designated territory within the Commonwealth of Virginia.

Under the Company's license agreement with BCBSA, an institutional investor
(generally defined as an entity identified in Rule 13d-1(b) (1) (ii) of the
rules and regulations under the Securities Exchange Act of 1934 and which makes
certifications required by item 10 of SEC Schedule 13G) may own up to 10% of the
outstanding voting securities of the Company. All other stockholders are subject
to a 5% ownership limitation. Ownership by any stockholder of voting securities
in excess of such limits would subject the Company to automatic termination of
its license.

The Company's Articles of Incorporation contain certain provisions which are
intended to prevent any holder from acquiring shares in excess of the limits set
forth in the Company's license agreement. However, there can be no assurance
that a court would enforce these provisions or that if these provisions were not
enforced that the Company would retain the license from BCBSA. If the BCBSA
license were to be terminated, there would be a material adverse effect on the
Company's business and operations, which the Company does not believe it can
meaningfully quantify.

The license agreements between BCBSA and its licensees prohibit a licensee from
entering into certain transactions which would result in an unlicensed entity
obtaining control of the licensee or acquiring a substantial portion of the
licensee's assets related to services provided under the Blue Cross or Blue
Shield service marks. The license agreements also require that a licensee pay to
BCBSA a specific amount upon termination of the license agreement, subject to
certain limited exceptions. The amount payable upon termination of the license
agreement is equal to $25 multiplied by the number of the licensee's members
receiving products or services sold or administered under the Blue Cross or Blue
Shield service marks, subject to reduction to the extent the payment of such fee
would cause such licensee to fall below certain capital requirements established
by the BCBSA.

                                       13

<PAGE>

RATING

Trigon Healthcare, Inc. has been assigned a counterparty credit rating of "A-"
(Strong) from Standard & Poor's. The counterparty credit rating reflects
Standard and Poor's opinion of the company's overall creditworthiness and
financial ability to pay its financial obligations. The rating indicates that
the company has a strong capacity to meet its financial commitments.

SUBSIDIARIES. Trigon Insurance, HealthKeepers, Peninsula Health Care and
Priority Health Care are each presently assigned a rating of "A" (Excellent) by
A.M. Best Company. A.M. Best's ratings are divided into two broad categories -
Secure and Vulnerable. All of the ratings assigned to the Company's subsidiaries
are classified as Secure. The rating of "A" is assigned to companies which have,
on balance, excellent balance sheet strength, operating performance and business
profile when compared to the standards established by the A.M. Best Company.
These companies, in the opinion of A.M. Best, have a strong ability to meet
their ongoing obligations to policyholders. Such ratings are not directed to the
protection of investors and are subject to review and change over time.

Trigon Insurance has been assigned an insurer financial strength rating of "AA-"
(Very Strong) from Standard and Poor's. The financial strength rating reflects
Standard and Poor's current opinion of the financial security characteristics of
the company with respect to its ability to pay under its insurance contracts in
accordance with the contract terms. A company is assigned this rating because
Standard and Poor's considers the company to have financial security
characteristics that outweigh any vulnerabilities and believes the company is
highly likely to have the ability to meet financial commitments.

In January 2002, Fitch Ratings assigned "AA-" (Very Strong) ratings to
HealthKeepers, Peninsula Health Care and Priority Health Care. Companies rated
in the "AA" category by Fitch Ratings are typically viewed as possessing very
strong capacity to meet policyholder and contract obligations. Risk factors are
modest and the impact of any adverse business and economic factors is expected
to be very small.

COMMERCIAL PAPER. Standard and Poor's affirmed its "A-1" short-term issuer
credit rating to the Trigon Healthcare, Inc. $300 million private placement
commercial paper program in December 2001. An obligor rated "A-1" by Standard
and Poor's has STRONG ability to meet its financial commitments, and is rated in
the highest category by Standard & Poor's.

In November 2001, Moody's Investors Service affirmed a "Prime-2" short-term debt
rating to the Trigon Healthcare, Inc. $300 million private placement commercial
paper program. Issuers rated "Prime-2" by Moody's have a strong ability for
repayment of senior short-term debt obligations. This will normally be evidenced
by leading market positions in well-established industries, high rates of return
on funds employed, conservative capitalization structure, broad margins in
earnings coverage of fixed financial charges and high internal cash generation,
although to a lesser degree than issuers rated "Prime-1" by Moody's. Earnings
trends and coverage ratios, while sound, may be subject to variation.
Capitalization characteristics may be more affected by external conditions than
issuers rated "Prime-1" by Moody's. Ample adequate liquidity is maintained.

                                       14

<PAGE>

In October 2001 Fitch affirmed its "F1" short-term credit rating on the Trigon
Healthcare, Inc. $300 million private placement commercial paper program.
Issuers rated "F1" by Fitch are considered to have the highest credit quality,
with the strongest capacity for timely payment of financial commitments. The
"F1" rating may have an added "+" to denote any exceptionally strong credit
feature.

EMPLOYEES

As of December 31, 2001, the Company had 4,122 full-time and 86 part-time
employees. The employees are primarily located in Virginia, with the majority of
the Virginia employees in the cities of Richmond and Roanoke. Employees are also
located in California, Delaware, Illinois, Maryland, New Jersey, North Carolina,
Pennsylvania, Tennessee and Washington D.C. The Company believes that its
relationship with its employees is good. No employees are subject to collective
bargaining agreements.

EXECUTIVE OFFICERS
                               Age as of
                              December 31,
          Name                   2001                      Position
          ----                   ----                      --------

Thomas G. Snead, Jr.              48       Chairman of the Board and Chief
                                           Executive Officer

John W. Coyle                     49       President and Chief Operating Officer

William P. Bracciodieta, M.D.     56       Senior Vice President and Chief
                                           Medical Officer

John J. Brighton                  59       Senior Vice President and Chief
                                           Information Officer

Thomas R. Byrd                    44       Senior Vice President and Chief
                                           Financial Officer

James W. Copley, Jr.              49       Senior Vice President and Chief
                                           Investment Officer

Kathy Ashby Merry                 39       Senior Vice President, Service
                                           Operations

Ronald M. Nash                    64       Senior Vice President, Corporate
                                           Services

Paul F. Nezi                      54       Senior Vice President, Market Growth

Timothy P. Nolan                  40       Senior Vice President, Corporate
                                           Development

                                       15

<PAGE>

                               Age as of
                              December 31,
          Name                   2001                      Position
          ----                   ----                      --------

Thomas A. Payne                   57          Senior Vice President, Corporate
                                              Audit

Peter L. Perkins                  44          Senior Vice President and Chief
                                              Actuary

David P. Wade                     45          Senior Vice President, Marketing

J. Christopher Wiltshire          47          Senior Vice President, General
                                              Counsel and Corporate Secretary

For a listing of the positions held with the Company by each executive officer
and other information, refer to "Officers," on page 57 of the Company's 2001
Annual Report to Shareholders, which is incorporated herein by reference.

SERVICE MARKS

The Company has registered and maintains several service marks, trademarks and
tradenames at the federal level, in the Commonwealth of Virginia and in certain
other states. "Trigon," "Keycare" and "HealthKeepers" are included among these
marks. Although the Company considers its registered service marks, trademarks
and tradenames important in the operation of its business, the business of the
Company is not dependent on any individual service mark, trademark or tradename.
For a discussion of the Company's license to use certain Blue Cross and Blue
Shield service marks and tradenames, see "The Blue Cross Blue Shield License."

FORWARD-LOOKING INFORMATION

The Private Securities Litigation Reform Act of 1995 (the "Act") provides a
"safe harbor" for forward-looking statements, so long as those statements are
identified as forward-looking and are accompanied by meaningful cautionary
statements identifying important factors that could cause actual results to
differ materially from those discussed in the document. The Company desires to
take advantage of these safe harbor provisions. Certain information contained in
this Form 10-K is forward-looking within the meaning of the Act or Securities
and Exchange Commission rules. Words such as expects, anticipates, intends,
plans, believes, seeks or estimates, or variations of such words and similar
expressions are also intended to identify forward-looking statements. Such
forward-looking statements are subject to inherent risks and uncertainties, many
of which are beyond the control of the Company. Set forth below are certain
important factors that, in addition to general economic conditions and other
factors, some of which are discussed elsewhere in this Form 10-K, may affect
these forward-looking statements and the Company's business generally.

ESCALATING HEALTH CARE COSTS AND THE HEALTH CARE INDUSTRY. The Company's
profitability depends in large part on accurately predicting and effectively
managing health care costs. Predicting medical costs is difficult partially due
to the variability of medical inflation. Trigon continually reviews and adjusts
its premium and benefit structure to reflect its

                                       16

<PAGE>

underlying claims experience and revised actuarial data; however, several
factors could adversely affect the medical loss ratios. Certain of these
factors, which include changes in health care practices, inflation, new
technologies, major epidemics, natural disasters and malpractice litigation, are
beyond any health plan's control and could adversely affect the Company's
ability to accurately predict and effectively control health care costs. The
potential negative effect of escalating health care costs as well as any changes
in the Company's ability to negotiate favorable rates with its providers may
produce risks to the Company's market growth due to its impact on the
affordability of health care insurance.

Competitive price pressures in the health insurance and managed care industry,
which generally result from the entry and exit of health care companies in the
marketplace, historically have resulted in, or contributed to, pricing and
profitability cycles. While we believe structural changes in the managed health
care and health insurance industry have altered traditional cyclical patterns,
there can be no assurance that a continuation of the typical cyclical pattern
will not adversely affect the profitability of the Company in the next few
years.

COMPETITION. The health care industry is highly competitive both in Virginia and
nationally. See "Competition." There is no assurance that the overall
competition will not exert strong pressures upon Trigon's profitability, its
ability to increase enrollment, or its ability to successfully pursue growth in
areas both within and outside of Virginia.

GOVERNMENT REGULATION. The Company and its subsidiaries are subject to federal
and state regulation. See "Regulation." Regulatory initiatives may be undertaken
in the future, either at the federal or state level, to engage in structural
reform of the health care industry in order to reduce the escalation in health
care costs or to make health care more accessible. Such reform, if it occurs,
could adversely affect Trigon's results of operations or financial condition.

POTENTIAL RISKS ASSOCIATED WITH GROWTH THROUGH ACQUISITIONS. The competition to
purchase health care companies is intense, which may increase the costs of
acquiring such companies and may affect the availability of attractive
acquisition opportunities. In addition, the Company has no significant
experience in expanding its managed health care business outside Virginia. There
can be no assurance that the Company will successfully identify or complete
acquisitions or that any acquisitions, if completed, will perform as expected or
will contribute significant revenues or profits to the Company. The Company's
ability to expand successfully outside of Virginia through acquisitions or
otherwise may be adversely affected by its inability to use the Blue Cross and
Blue Shield service marks and trademarks outside of the Company's licensed
territory in Virginia, by the Company's lack of substantial market share or
established provider networks outside of Virginia and by the presence of
competitors with strong market positions in these areas.

CONCENTRATION OF BUSINESS IN VIRGINIA. While the Company's growth strategy
includes expansion outside Virginia, for the foreseeable future a significant
portion of the Company's revenues may be subject to economic factors specific to
Virginia. Therefore, there can be no assurance that a downturn in the Virginia
economy would not adversely affect the Company.

                                       17

<PAGE>

POTENTIAL LOSS OF BLUE CROSS AND BLUE SHIELD SERVICE MARKS AND TRADENAMES.
Trigon and the BCBSA are parties to a license agreement pursuant to which the
Company and certain of its subsidiaries have the exclusive right to use certain
Blue Cross and Blue Shield service marks and tradenames for their products
throughout Virginia other than certain northern Virginia suburbs adjacent to
Washington, D.C. See "The Blue Cross Blue Shield License." If the BCBSA license
were to be terminated, there would be a material adverse effect on the Company's
business and operations, which the Company does not believe it can meaningfully
quantify. To the extent that the Company continues to use the Blue Cross and
Blue Shield service marks and tradenames in marketing its managed care products,
there can be no assurance that any negative publicity concerning BCBSA and other
BCBSA licenses will not adversely affect the sales of the Company's managed care
products and the Company's operations.

Item 2.  Properties

The Company is headquartered in Richmond, Virginia, where it owns a four-story
building with 268,000 square feet of office space. The Company also owns an
office facility and warehouse in Roanoke, Virginia with 190,500 square feet. The
Company leases additional office space totaling 570,400 square feet in Richmond,
125,500 square feet in Roanoke and other locations in Virginia and 3,300 square
feet combined in Maryland, Pennsylvania and Delaware. These properties are
primarily used by the health insurance segment for operations and for corporate
administration. The Company also owns a 70,800 square foot office facility in
Fayetteville, North Carolina that is for sale.

Square footage utilized by segment as of December 31, 2001 was as follows:
health insurance, 953,700; government programs, 29,000; investments, 3,900; and
other reportable segments, 41,100. The remaining 130,000 square feet utilized by
the Company was used for corporate administration.

In 2001, the Company announced a four-year $84 million building project to
expand its headquarters in Richmond, VA. The expansion plan includes
construction of a 308,000 square foot building to house the operations center
and major renovation to the existing headquarters building. The project will be
funded with internal cash and investments.

Item 3.  Legal Proceedings

In conjunction with the Demutualization in 1997, the Company was required to
make a payment of $175 million to the Commonwealth of Virginia (Commonwealth
Payment) which was expensed and paid in prior years. The Company claimed the
$175 million Commonwealth Payment as a deduction. The Internal Revenue Service
(IRS) denied this deduction during the course of its audit of the Company. The
Company continued to pursue the deduction and in April 2001 received a Technical
Advice Memorandum (Memorandum) from the National Office of the IRS that supports
the Company's position that the payment constitutes a normal business expense,
and therefore should be deductible. On March 18, 2002, the Company received
notice from the IRS that they are considering revoking this Memorandum and,
accordingly, have withdrawn the Memorandum as of this date. The Company will
continue to pursue this

                                       18

<PAGE>

deduction. If successful, the Company expects to recover approximately $35
million in cash refunds and $26 million in income tax credit carryovers plus
after-tax interest currently estimated to be $8 million.

In addition, the Company's subsidiary, Trigon Insurance Company, filed a lawsuit
against the federal government in June 2000 for the recovery of federal income
tax overpayments for the years 1989 through 1995. The case was tried in November
2001, and closing arguments were made to the court in March 2002. If successful,
the Company expects to recover approximately $33 million in cash refunds plus
after-tax interest of about $18 million and to receive tax refunds for the years
1996 through 2000 of about $26 million. In addition, if the Company is
successful it could receive substantial additional tax deductions that could
lower federal income tax liability for years after 1995.

The lawsuit, filed in the United States District Court for the Eastern District
of Virginia, relates to the initial valuation and deductibility of the Company's
assets when, along with other Blue Cross or Blue Shield organizations, it became
subject to federal income taxation in 1987. As part of this change in tax
status, Congress provided that if a Blue Cross or Blue Shield organization
disposed of an asset that it had acquired while tax-exempt, its taxable gain or
loss would be computed by reference to the asset's fair market value at the time
the organization became subject to tax. The Company is seeking deductions for
losses incurred on the termination of certain customer and provider contracts
that were held by it on January 1, 1987, based on the fair market value of the
contracts on that date.

The Internal Revenue Service asserts that the Company is not entitled to deduct
losses incurred on the termination of these contracts. The resolution of the
Company's refund claim is subject to uncertainties, including whether the court
will allow the deductions and, if so, the amount of the deductions that will be
allowed. While the Company believes that its claim is meritorious, it cannot
predict the ultimate outcome of the claim.

If the Company wins this lawsuit and has previously collected refunds for the
Demutualization payment deductions discussed above, a portion of the tax
recoveries for the years after 1995 would most likely be realized in the form of
income tax credit carryovers rather than cash. Regarding both of these matters,
favorable resolution of these claims is subject to various uncertainties,
including whether the deductions will be allowed at all and, in the case of the
claim for losses on the termination of customer and provider contracts, the
amount of the deductions, if any, that will be allowed. While the Company
believes that its claims have merit, it cannot predict the ultimate outcome of
the claims. The Company has not recognized the favorable impact of these claims,
if any, in the consolidated financial statements.

The Company and certain of its subsidiaries are involved in various other legal
actions occurring in the normal course of their business. While the ultimate
outcome of such litigation cannot be predicted with certainty, in the opinion of
Company management, after consultation with counsel responsible for such
litigation, the outcome of those actions is not expected to have a material
adverse effect on the financial condition or results of operations of the
Company.

                                       19

<PAGE>

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.

PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Refer to page 28, "Market Prices of Common Stock and Dividend Data," of the
Company's 2001 Annual Report to Shareholders, which is incorporated herein by
reference.

Refer to "Part 1 - Business -- Regulation -- Insurance Holding Company
Regulation" and "Part 1 - Business -- Regulation -- Restrictions on Dividends"
for discussion of insurance holding company regulations and dividend
restrictions. In addition, under the terms of the Company's $300 million
revolving credit agreements, dividend payments are permitted without limitation
if no default has occurred or is continuing; in the event that the Company no
longer has an investment grade rating, certification is required that prior to
and after certain dividend payments, no default will exist or be continuing.

ITEM 6.  SELECTED FINANCIAL DATA

Refer to pages 18 and 19, "Selected Consolidated Financial and Operating Data,"
of the Company's 2001 Annual Report to Shareholders, which are incorporated
herein by reference.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Refer to pages 20 through 27, "Management's Discussion and Analysis of Financial
Condition and Results of Operations," of the Company's 2001 Annual Report to
Shareholders, which are incorporated herein by reference.

ITEM 7a. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Refer to page 28, "Quantitative and Qualitative Disclosures About Market Risk,"
of the Company's 2001 Annual Report to Shareholders, which is incorporated
herein by reference.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Refer to pages 29 through 55, the Consolidated Financial Statements, page 56,
"Independent Auditors' Report," and page 17, "Quarterly Financial Information,"
of the Company's 2001 Annual Report to Shareholders, which are incorporated
herein by reference.

                                       20

<PAGE>

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

Not applicable.

PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Refer to pages 1 through 3, "Election of Directors," and page 6, "Section 16(a)
Beneficial Ownership Reporting Compliance," of the Company's definitive Proxy
Statement dated March 22, 2002, which are incorporated herein by reference
solely as they relate to the Directors of the Company.

Pursuant to General Instruction G(3) to Form 10-K, information as to executive
officers of the Company is set forth in Part I of this Form 10-K. See "Item 1 -
Business -- Executive Officers."

ITEM 11.  EXECUTIVE COMPENSATION

Refer to pages 7 through 12, "Compensation of Executive Officers," of the
Company's definitive Proxy Statement dated March 22, 2002, which are
incorporated herein by reference solely as they relate to this item.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Refer to pages 3 and 4, "Beneficial Ownership of Securities," of the Company's
definitive Proxy Statement dated March 22, 2002, which are incorporated herein
by reference solely as they relate to this item.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Refer to page 4, "Certain Business Relationships," of the Company's definitive
Proxy Statement dated March 22, 2002, which are incorporated herein by reference
solely as they relate to this item.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)  The following documents are filed as part of this report.
     1.   Consolidated Financial Statements from the Company's 2001 Annual
          Report to Shareholders are incorporated herein by reference in Item 8:
           -- Consolidated Balance Sheets as of December 31, 2001 and 2000 (page
              29)
           -- Consolidated Statements of Operations for the years ended December
              31, 2001, 2000 and 1999 (page 30)

                                       21

<PAGE>

           -- Consolidated Statements of Changes in Shareholders' Equity and
              Comprehensive Income for the years ended December 31, 2001, 2000
              and 1999 (page 31)

           -- Consolidated Statements of Cash Flows for the years ended December
              31, 2001, 2000 and 1999 (page 32)

           -- Notes to Consolidated Financial Statements (pages 33 through 55)

           -- Independent Auditors' Report (page 56)

       2.  Financial statement schedules

           Independent Auditors' Report...............(filed herein on page S-1)
           Schedule I - Financial Information of Registrant
             (parent only) as of December 31, 2001 and 2000 and for the
             years ended December 31, 2001, 2000 and 1999..... (filed herein on
             pages S-2 - S-7)

       3.  Exhibits.  The following is a list of exhibits to this Form 10-K.

   Exhibit
   Number            Description
   ------            -----------

         2 -- Amended and Restated Plan of Demutualization (incorporated by
              reference to exhibits filed with the Company's Registration
              Statement on Form S-1 (registration number 333-09773)).
       3.1 -- Amended and Restated Articles of Incorporation of Trigon
              Healthcare, Inc. (incorporated by reference to exhibits filed with
              the Company's Registration Statement on Form S-1 (registration
              number 333-09773)).
       3.2 -- Amended and Restated Bylaws of Trigon Healthcare, Inc. dated April
              28, 1999 (incorporated by reference to exhibits filed with the
              Company's Form 10-Q for the period ended March 31, 1999).
       3.3 -- Articles of Amendment to Amended and Restated Articles of
              Incorporation setting forth the designation, preferences and
              rights of Series A Junior Participating Preferred Stock of Trigon
              Healthcare, Inc. dated July 16, 1997 (Incorporated by reference to
              exhibits filed with the Company's Form 8-A/A filed on July 16,
              1997).
       4   -- Form of Stock Certificate (other Instruments Defining the
              Rights of Security-Holders) (incorporated by reference to exhibits
              filed with the Company's Registration Statement on Form S-1
              (registration number 333-09773)).
       4.1 -- Rights Agreement dated as of July 16, 1997 between Trigon
              Healthcare, Inc. and First Chicago Trust Company of New York, as
              Rights Agent (incorporated by reference to exhibits filed with the
              Company's Form 8-A/A filed on July 16, 1997).
       4.2 -- Form of Rights Certificate (incorporated by reference to exhibits
              filed with the Company's Form 8-A/A filed on July 16, 1997).
      10.1 -- License Agreement by and between the Blue Cross and Blue Shield
              Association and the Company (incorporated by reference to exhibits
              filed with the Company's Form 10-K for the year ended December 31,
              1996).
                  (a) Blue Cross license
                  (b) Blue Shield license

                                       22

<PAGE>

   10.2   --  Limited Fixed Return Plan for Certain Officers and Directors of
              Trigon Insurance Company (incorporated by reference to exhibits
              filed with the Company's Registration Statement on Form S-1
              (registration number 333-09773)). *
   10.4   --  Non-Contributory Retirement Program for Certain Employees of
              Trigon Insurance Company (incorporated by reference to exhibits
              filed with the Company's Registration Statement on Form S-1
              (registration number 333-09773)). *
   10.5   --  Amended and Restated Supplemental Executive Retirement Program
              for Certain Employees of Trigon Insurance Company dated as of
              October 1, 1998 (incorporated by reference to exhibits filed with
              the Company's Form 10-K for the year ended December 31, 1998). *
   10.6   --  Salary Deferral Plan for Norwood H. Davis, Jr. (incorporated by
              reference to exhibits filed with the Company's Registration
              Statement on Form S-1 (registration number 333-09773)). *
   10.7   --  Amended and Restated Employment Agreement dated September 16, 1998
              by and between Trigon Insurance Company and Norwood H. Davis, Jr.
              (incorporated by reference to exhibits filed with the Company's
              Form 10-Q for the period ended September 30, 1998). *
   10.9   --  Amended and Restated Employees' Thrift Plan of Trigon Insurance
              Company dated as of October 1, 1998 (incorporated by reference to
              exhibits filed with the Company's Form 10-K for the year ended
              December 31, 1998). *
  10.10   --  Amended and Restated Trigon Insurance Company 401(k) Restoration
              Plan dated as of October 1, 1998 (Incorporated by reference to
              exhibits filed with the Company's Form 10-K for the year ended
              December 31, 1998). *
  10.12   --  Form of Employment Agreement dated as of December 12, 1990 by and
              between Trigon Insurance Company and John C. Berry and certain
              other executive officers (incorporated by reference to exhibits
              filed with the Company's Registration Statement on Form S-1
              (registration number 333-09773)). *
  10.15   --  1997 Stock Incentive Plan (incorporated by reference to exhibits
              filed with the Company's Proxy Statement dated March 13, 1997). *
  10.16   --  Employee Stock Purchase Plan (incorporated by reference to
              exhibits filed with the Company's Proxy Statement dated March
              13, 1997). *
  10.17   --  Non-Employee Directors Stock Incentive Plan (incorporated by
              reference to exhibits filed with the Company's Proxy Statement
              dated March 13, 1997). *
  10.18   --  Amendment to the License Agreement by and between the Blue Cross
              and Blue Shield Association and the Company (incorporated by
              reference to exhibits filed with the Company's Form 10-Q for the
              period ended September 30, 1997).
  10.19   --  Amendment to the Non-Contributory Retirement Program for Certain
              Employees of Trigon Insurance Company (incorporated by ference to
              exhibits filed with the Company's Form 10-K for the year ended
              December 31, 1997). *
  10.20   --  Form of Executive Continuity Agreement dated as of September 16,
              1998 between Trigon Insurance Company and Thomas G. Snead, Jr. and
              certain other executive officers (incorporated by reference to
              exhibits filed with the Company's Form
              10-Q for the period ended September 30, 1998). *
  10.21   --  Form of Executive Continuity Agreement dated as of September 16,
              1998 between Trigon Insurance Company and John C. Berry and
              certain other executive officers

                                       23

<PAGE>

              (incorporated by reference to exhibits filed with the Company's
              Form 10-Q for the period ended September 30, 1998). *
  10.22   --  Amendment to the Non-Contributory Retirement Program for Certain
              Employees of Trigon Insurance Company (now to be known as) The
              Trigon Insurance Company Retirement Program dated as of October 1,
              1998 (incorporated by reference to exhibits filed with the
              Company's Form 10-K for the year ended December 31, 1998).*
  10.23   --  Clarifying Amendment to the Non-Contributory Retirement Program
              for Certain Employees of Trigon Insurance Company (now to be known
              as) The Trigon Insurance Company Retirement Program dated as of
              October 1, 1998 (incorporated by reference to exhibits filed with
              the Company's Form 10-K for the year ended December 31, 1998). *
  10.24   --  Thomas G. Snead Employment Agreement dated May 19, 1999
              (incorporated by reference to exhibits filed with the Company's
              Form 10-Q for the period ended June 30, 1999). *
  10.25   --  Amendment No. 1 to Executive Continuity Agreement Between Trigon
              Insurance Company and Thomas G. Snead, Jr. dated May 19, 1999
              (incorporated by reference to exhibits filed with the Company's
              Form 10-Q for the period ended June 30, 1999).*
  10.26   --  Clarifying Amendment No. 2 to the Non-Contributory Retirement
              Program for Certain Employees of Trigon Insurance Company (now to
              be known as) The Trigon Insurance Company Retirement Program
              (incorporated by reference to exhibits filed with the Company's
              Form 10-K for the year ended December 31, 1999). *
  10.27   --  Clarifying Amendment No. 3 to the Non-Contributory Retirement
              Program for Certain Employees of Trigon Insurance Company (now to
              be known as) The Trigon Insurance Company Retirement Program
              (incorporated by reference to exhibits filed with the Company's
              Form 10-K for the year ended December 31, 1999). *
  10.28   --  Clarifying Amendment No. 4 to The Trigon Insurance Company
              Retirement Program (incorporated by reference to exhibits filed
              with the Company's Form 10-K for the year ended December 31,
              1999). *
  10.30   --  First amendment to the Trigon Healthcare, Inc. 1997 Stock
              Incentive Plan dated February 15, 2000 (incorporated by reference
              to exhibits filed with the Company's Form 10-Q for the period
              ended March 31, 2000). *
  10.32   --  Form of Executive Continuity Agreement dated as of February 12,
              2001 between Trigon Insurance Company and John W. Coyle
              (incorporated by reference to exhibits filed with the Company's
              Form 10-Q for the period ended March 31, 2001). *
  10.33   --  Form of Employment Agreement dated as of February 12, 2001 by
              and between Trigon Insurance Company and John W. Coyle
              (incorporated by reference to exhibits filed with the Company's
              Form 10-Q for the period ended March 31, 2001). *
  10.34   --  Five-Year Credit Agreement dated as of November 14, 2001 among
              Trigon Healthcare, Inc., the banks party thereto and JPMorgan
              Chase Bank, as Administrative Agent.
  10.35   --  364-Day Credit Agreement dated as of November 14, 2001 among
              Trigon Healthcare, Inc., the banks party thereto and JPMorgan
              Chase Bank, as Administrative Agent.

                                       24

<PAGE>

     11   --  Computation of per share earnings.  Refer to Note 14, "Net Income
              and Net Income Per Share," on page 50 of Trigon Healthcare Inc.'s
              2001 Annual Report to Shareholders, which is incorporated herein
              by reference.
     13   --  Excerpts from the Company's Annual Report to Shareholders for the
              year ended December 31, 2001.
     21   --  Subsidiaries of the Registrant.
   23.1   --  Independent Auditors' Consent.

 *   Management contract or compensatory plan or arrangement required to be
     filed as an exhibit to this Form 10-K pursuant to Item 14(c) of this Form
     10-K.

All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.

                                       25

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                         TRIGON HEALTHCARE, INC.
                                              Registrant



                                      By:  /s/ THOMAS R. BYRD
                                           ------------------
                                              THOMAS R. BYRD

                                   Title:  SENIOR VICE PRESIDENT AND
                                              CHIEF FINANCIAL OFFICER

Date:  March 26, 2002

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

<TABLE>
<CAPTION>
        SIGNATURE                              TITLE                                    DATE
        ---------                              -----                                    ----
<S>                                     <C>                                         <C>
/s/ THOMAS G. SNEAD, JR.                Chairman of the Board and
--------------------------------------  Chief Executive Officer
THOMAS G. SNEAD, JR.                    (Principal Executive Officer)               March 25, 2002




/s/ THOMAS R. BYRD                      Senior Vice President and Chief
--------------------------------------  Financial Officer  (Principal Financial
THOMAS R. BYRD                          and Accounting Officer)                     March 26, 2002




/s/ LENOX D. BAKER, JR.                 Director                                    March 24, 2002
--------------------------------------
LENOX D. BAKER, JR., M.D.



/s/ A. HUGH EWING, III                  Director                                    March 24, 2002
--------------------------------------
A. HUGH EWING, III


</TABLE>

<PAGE>

SIGNATURE                               TITLE                     DATE
---------                               -----                     ----


/s/ WILLIAM R. HARVEY                   Director                  March 22, 2002
--------------------------------------
WILLIAM R. HARVEY, Ph.D.



/s/ GARY A. JOBSON                      Director                  March 22, 2002
--------------------------------------
GARY A. JOBSON



/s/ JOSEPH S. MALLORY                   Director                  March 22, 2002
--------------------------------------
JOSEPH S. MALLORY



/s/ DONALD B. NOLAN                     Director                  March 21, 2002
--------------------------------------
DONALD B. NOLAN, M.D.



/s/ WILLIAM N. POWELL                   Director                  March 26, 2002
--------------------------------------
WILLIAM N. POWELL



/s/ JOHN SHERMAN, JR.                   Director                  March 21, 2002
--------------------------------------
JOHN SHERMAN, JR.



/s/ R. GORDON SMITH                     Director                  March 21, 2002
--------------------------------------
R. GORDON SMITH, ESQ.



/s/ JACKIE M. WARD                      Director                  March 21, 2002
--------------------------------------
JACKIE M. WARD

<PAGE>

                          Independent Auditors' Report


The Board of Directors
Trigon Healthcare, Inc.:

Under date of February 6, 2002, we reported on the consolidated balance sheets
of Trigon Healthcare, Inc. and subsidiaries as of December 31, 2001 and 2000,
and the related consolidated statements of operations, changes in shareholders'
equity and comprehensive income, and cash flows for each of the years in the
three-year period ended December 31, 2001, as contained in the 2001 annual
report to shareholders. These consolidated financial statements and our report
thereon are incorporated by reference in the annual report on Form 10-K for the
year 2001. In connection with our audits of the aforementioned consolidated
financial statements, we also audited the related financial statement schedule
included in the annual report on Form 10-K. This financial statement schedule is
the responsibility of the Company's management. Our responsibility is to express
an opinion on this financial statement schedule based on our audits.

In our opinion, such financial statement schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.

/s/ KPMG LLP

Richmond, Virginia
February 6, 2002

                                      S-1

<PAGE>

                                                                      SCHEDULE I

                    TRIGON HEALTHCARE, INC. AND SUBSIDIARIES
              FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY)

                                 Balance Sheets
                           December 31, 2001 and 2000
                      (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                                    2001              2000
                                                                           --------------    --------------
<S>                                                                      <C>                 <C>
ASSETS

Current assets

    Cash                                                                 $           423                 -
    Investment securities, at estimated fair value                               464,179           389,776
    Other receivables                                                              7,820            16,701
    Income taxes receivable                                                       22,975            14,994
    Receivable from subsidiaries *                                                    33                 -
    Other                                                                             11                 3
                                                                           --------------    --------------

Total current assets                                                             495,441           421,474
                                                                           --------------    --------------

Investment in subsidiaries *                                                     825,841           884,321
Deferred income taxes                                                              1,474               688
Other assets                                                                       2,457               223
                                                                           --------------    --------------

Total assets                                                             $     1,325,213         1,306,706
                                                                           ==============    ==============

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

    Accounts payable and accrued expenses                                $         3,845             2,326
    Payable for investment securities                                              1,282            13,826
    Payable to subsidiaries *                                                          6               244
    Commercial paper                                                              99,660                 -
                                                                           --------------    --------------

Total current liabilities                                                        104,793            16,396
                                                                           --------------    --------------

Commercial paper, noncurrent                                                     200,000           275,448
                                                                           --------------    --------------

Total liabilities                                                                304,793           291,844
                                                                           --------------    --------------

SHAREHOLDERS' EQUITY

    Common stock, $0.01 par; shares issued and outstanding:

        35,786, 2001; 37,539, 2000                                                   358               375
    Capital in excess of par                                                     784,514           802,584
    Retained earnings                                                            234,364           205,045
    Unearned compensation - restricted stock                                      (1,817)           (2,234)
    Accumulated other comprehensive income                                         3,001             9,092
                                                                           --------------    --------------

Total shareholders' equity                                                     1,020,420         1,014,862

Commitments and contingencies

                                                                           --------------    --------------

Total liabilities and shareholders' equity                               $     1,325,213         1,306,706
                                                                           ==============    ==============
</TABLE>

*Amounts are eliminated in consolidation.

See accompanying independent auditors' report and notes to financial
information.

                                      S-2

<PAGE>

                                                                      SCHEDULE I

                    TRIGON HEALTHCARE, INC. AND SUBSIDIARIES
         FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY), CONTINUED

                            Statements of Operations
              For the years ended December 31, 2001, 2000 and 1999
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                            2001            2000             1999
                                                                  --------------   -------------   --------------
<S>                                                               <C>              <C>             <C>
REVENUES

    Investment income                                             $       31,505          32,087           19,157
    Net realized losses                                                  (21,767)         (4,431)          (8,051)
    Cash dividends from subsidiaries *                                   172,032         125,000           48,900
                                                                  --------------   -------------   --------------

Total revenues                                                           181,770         152,656           60,006

EXPENSES
    Selling, general and administrative expenses                           3,719           4,418            2,095
    Interest expense                                                      12,755          17,249            8,359
                                                                  --------------   -------------   --------------

Total expenses                                                            16,474          21,667           10,454
                                                                  --------------   -------------   --------------

Income before income taxes and equity in undistributed
  earnings of subsidiaries                                               165,296         130,989           49,552

Income tax expense (benefit)                                              (3,291)            554              106
                                                                  --------------   -------------   --------------

Income before equity in undistributed earnings of subsidiaries
                                                                         168,587         130,435           49,446

Equity in undistributed earnings of subsidiaries *                       (52,527)        (18,426)         (28,983)
                                                                  --------------   -------------   --------------

Net income                                                        $      116,060         112,009           20,463
                                                                  ==============   =============   ==============
</TABLE>


*Amounts are eliminated in consolidation.

See accompanying independent auditors' report and notes to financial
information.

                                      S-3

<PAGE>

                                                                      SCHEDULE I

                    TRIGON HEALTHCARE, INC. AND SUBSIDIARIES
         FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY), CONTINUED

                  Statements of Changes in Shareholders' Equity
                     and Comprehensive Income For the years
                     ended December 31, 2001, 2000 and 1999
                                 (in thousands)


<TABLE>
<CAPTION>
                                                                                            Accumulated
                                                      Capital                                     Other
                                          Common    in Excess   Retained       Unearned   Comprehensive
                                           Stock       of Par   Earnings   Compensation          Income         Total
                                     -----------  -----------   --------   ------------   -------------    ----------
<S>                                  <C>          <C>           <C>        <C>            <C>              <C>
Balance at January 1, 1999           $       423      839,187    202,554              -          29,060     1,071,224

Net income                                     -            -     20,463              -               -        20,463
Change in minimum pension
  liability, net of income taxes               -            -          -              -             834           834
Net unrealized losses on investment
  securities, net of income taxes
  (including consolidated
  subsidiaries' after-tax net
  unrealized losses of $26,507)                -            -          -              -         (20,806)      (20,806)
                                                                                                           ----------
Comprehensive income                                                                                              491

Repurchase and retirement of common
  stock                                      (41)     (20,500)  (110,121)             -               -      (130,662)
Purchase and reissuance of common
  stock under stock option and
  other employee benefit plans,
  including tax benefits and net of
  amortization                                 -         (767)         -         (1,926)              -        (2,693)
Change in common stock held by
  consolidated grantor trusts                  -       (1,403)         -              -               -        (1,403)
                                     -----------  -----------   --------   ------------   -------------    ----------

Balance at December 31, 1999         $       382      816,517    112,896         (1,926)          9,088       936,957

Net income                                     -            -    112,009              -               -       112,009
Change in minimum pension
  liability, net of income taxes               -            -          -              -             293           293
Net unrealized losses on investment
  securities, net of income taxes
  (including consolidated
  subsidiaries' after-tax net                  -            -          -              -            (289)         (289)
  realized gains of $7,632)
                                                                                                           ----------
Comprehensive income                                                                                          112,013

Repurchase and retirement of common
  stock                                       (7)      (3,305)   (19,860)             -               -       (23,172)
Purchase and reissuance of common
  stock under stock option and other
  employee benefit plans, including
  tax benefits and net of
  amortization                                 -      (14,002)         -           (308)              -       (14,310)

Change in common stock held by
  consolidated grantor trusts                  -        3,374          -              -               -         3,374
                                     -----------  -----------   --------   ------------   -------------    ----------

Balance at December 31, 2000         $       375      802,584    205,045        (2,234)           9,092     1,014,862
                                     ===========  ===========   ========   ============   =============    ==========
</TABLE>

                                      S-4

<PAGE>

                                                                      SCHEDULE I

                    TRIGON HEALTHCARE, INC. AND SUBSIDIARIES
         FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY), CONTINUED

               Statements of Changes in Shareholders' Equity and
                        Comprehensive Income, Continued
              For the years ended December 31, 2000, 1999 and 1998
                                  (in thousands)

<TABLE>
<CAPTION>
                                                                                            Accumulated
                                                     Capital                                      Other
                                          Common   in Excess    Retained       Unearned   Comprehensive
                                           Stock      of Par    Earnings   Compensation          Income         Total
                                       ---------   ---------    --------   ------------   -------------   -----------

<S>                                    <C>         <C>          <C>        <C>            <C>             <C>
Balance at December 31, 2000           $     375     802,584     205,045         (2,234)          9,092     1,014,862

Net income                                     -           -     116,060              -               -       116,060
Change in minimum pension
  liability, net of income taxes               -           -           -              -              22            22
Net unrealized losses on investment
  securities, net of income taxes
  (including consolidated
  subsidiaries' after-tax net
  unrealized losses of $8,438)                 -           -           -              -          (6,113)       (6,113)
                                                                                                          -----------
Comprehensive income                                                                                          109,969

Repurchase and retirement of common
  stock                                      (17)     (8,764)    (86,741)             -               -       (95,522)
Purchase and reissuance of common
  stock under stock option and other
  employee benefit plans, including
  tax benefits and net of
  amortization                                 -      (8,858)          -            417               -        (8,441)

Change in common stock held by
  consolidated grantor trusts                  -        (448)          -              -               -          (448)
                                       ---------   ---------    --------   ------------   -------------   -----------

Balance at December 31, 2001           $     358     784,514     234,364         (1,817)          3,001     1,020,420
                                       =========   =========    ========   ============   =============   ===========
</TABLE>


See accompanying independent auditors' report and notes to financial
information.

                                      S-5

<PAGE>

                                                                      SCHEDULE I

                    TRIGON HEALTHCARE, INC. AND SUBSIDIARIES
         FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY), CONTINUED

                            Statements of Cash Flows
              For the years ended December 31, 2001, 2000 and 1999
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                            2001            2000             1999
                                                                   -------------   -------------    -------------
<S>                                                                <C>                   <C>               <C>
Net income                                                         $     116,060         112,009           20,463
Adjustments to reconcile net income to net cash provided by
      operating activities
     Accretion of discounts and amortization of premiums, net               (872)         (3,526)          (1,930)
     Amortization of unearned compensation                                 1,842           2,681            1,031
     Undistributed earnings of subsidiaries *                             52,527          18,426           28,983
     Increase in other receivables                                        (2,229)           (517)          (1,205)
     Increase in income taxes receivable                                  (7,981)        (14,994)               -
     Increase in receivable from subsidiaries *                              (33)              -                -
     Decrease (increase) in other assets                                  (1,815)            245             (316)
     Increase (decrease) in accounts payable and accrued
      expenses                                                             1,628          (1,432)           2,353
     Increase (decrease) in income taxes payable                               -          (5,099)           3,398
     Change in deferred income taxes                                      (2,403)          1,616              294
     Increase (decrease) in payable to subsidiaries *                       (238)            244              (79)
     Realized investment losses, net                                      21,767           4,431            8,051
                                                                   -------------   -------------    -------------

 Net cash provided by operating activities                               178,253         114,084           61,043
                                                                   -------------   -------------    -------------

Cash flows from investing activities
     Investment securities purchased                                  (1,216,982)     (1,025,962)        (972,506)
     Proceeds from investment securities sold                            983,034         782,616          693,938
     Maturities of fixed income securities                               141,437         158,341          223,340
     Investments in subsidiaries *                                        (2,879)        (18,500)         (31,000)
                                                                   -------------   -------------    -------------

Net cash used in investing activities                                    (95,390)       (103,505)         (86,228)
                                                                   -------------   -------------    -------------

Cash flows from financing activities
     Proceeds from long-term debt                                              -               -          160,000
     Payments on long-term debt                                                -        (245,000)               -
     Change in commercial paper notes                                     24,212         275,448                -
     Purchase and reissuance of common stock under employee
      benefit and stock option plans                                     (10,594)        (17,666)          (3,694)
     Change in common stock purchased by grantor trusts                     (427)           (280)            (489)
     Purchase and retirement of common stock                             (95,522)        (23,172)        (130,662)
     Change in outstanding checks in excess of bank balance                 (109)             91               18
                                                                   -------------   -------------    -------------

Net cash provided by (used in) financing activities                      (82,440)        (10,579)          25,173
                                                                   -------------   -------------    -------------

Increase (decrease) in cash                                                  423               -              (12)
Cash - beginning of year                                                       -               -               12
                                                                   -------------   -------------    -------------

Cash - end of year                                                 $         423               -                -
                                                                   =============   =============    =============

Cash paid during the year for
     Interest                                                      $      12,977          16,150            7,545
                                                                   =============   =============    =============
     Income taxes                                                            957           2,159                -
                                                                   =============   =============    =============
</TABLE>

*Amounts are eliminated in consolidation.
See accompanying independent auditors' report and notes to financial
information.

                                      S-6

<PAGE>

                                                                      SCHEDULE I

                    TRIGON HEALTHCARE, INC. AND SUBSIDIARIES
          FINANCIAL INFORMATION OF REGISTRANT (PARENT ONLY), CONTINUED

           Notes to Financial Information of Registrant (Parent Only)

The financial information provided should be read in conjunction with the
Consolidated Financial Statements of Trigon Healthcare, Inc. ("Registrant")
incorporated by reference in Part II, Section 8 of this Form 10-K and the
following notes:

(a)  Basis of Presentation

     The accompanying condensed financial information reflects the financial
     position as of December 31, 2001 and 2000 and the results of operations,
     changes in shareholders' equity and comprehensive income and cash flows for
     the years ended December 31, 2001, 2000 and 1999.

(b)  Investment in Subsidiaries

     The Registrant made capital contributions to its subsidiary, Monticello
     Service Agency, Inc. of $2.9 million, $18.5 million and $31.0 million
     during 2001, 2000 and 1999, respectively.

(c)  Borrowings

     The information about commercial paper contained in note 11 of the notes to
     the consolidated financial statements of the Registrant and its
     subsidiaries is incorporated herein by reference.

(d)  Capital Stock

     The information about capital stock contained in note 13 of the notes to
     the consolidated financial statements of the Registrant and its
     subsidiaries is incorporated herein by reference.

(e)  Cash Dividends

     During 2001, 2000, and 1999, the Registrant received cash dividends from
     its subsidiaries of $172.0 million, $125.0 million and $48.9 million,
     respectively.

f)   Comprehensive Income

     The information about comprehensive income contained in note 15 of the
     notes to the consolidated financial statements of the Registrant and its
     subsidiaries is incorporated herein by reference.

                                      S-7

<PAGE>

EXHIBIT INDEX

Exhibit
Number                     Description
------                     -----------

 10.34  -- Five-Year Credit Agreement dated as of November 14, 2001 among
           Trigon Healthcare, Inc., the banks party thereto and JPMorgan Chase
           Bank, as Administrative Agent.

 10.35  -- 364-Day Credit Agreement dated as of November 14, 2001 among Trigon
           Healthcare, Inc., the banks party thereto and JPMorgan Chase Bank,
           as Administrative Agent.

    13  -- Excerpts from the Company's Annual Report to Shareholders for the
           year ended December 31, 2001.

    21  -- Subsidiaries of the Registrant.

  23.1  -- Independent Auditors' Consent.