FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

For the quarterly period ended September 30, 1999

OR

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

For the transaFction period from                       to

Comission file number                                                  333-1173

                   GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
             (Exact name of registrant as specified in its charter)

                               Colorado 84-0467907
 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer
                             Identification Number)

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

                                 [303] 689-4128
              (Registrant's telephone number, including area code)

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

Yes       X         No

As of September 30, 1999, 7,032,000 shares of the registrant's common stock were
outstanding, all of which were owned by the registrant's parent company.

NOTE:  The  registrant  meets the  conditions  set forth in General  Instruction
H(1)(a) and (b) of Form 10-Q and is therefore  filing this form with the reduced
disclosure  format.  This  Form  10-Q  is  filed  by the  registrant  only  as a
consequence  of the sale by the  registrant of a market value  adjusted  annuity
product.

<PAGE>


                                      - 2 -
                                TABLE OF CONTENTS


<TABLE>

<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                                                                      Page
                                                                                      -----------
Part I         FINANCIAL INFORMATION

               Item 1   Financial Statements

                        Consolidated Statements of Income                             3

                        Consolidated Balance Sheets                                   4

                        Consolidated Statements of Cash Flows                         6

                        Notes to Consolidated Financial Statements                    8

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

Part II        OTHER INFORMATION

               Item 1   Legal Proceedings                                              20

               Item 6   Exhibits and Reports on Form 8-K                               20

               Signatures                                                              20


</TABLE>

















<PAGE>


PART I   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands)
<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>
(Unaudited)
                                            Three Months Ended           Nine Months Ended
                                               September 30,               September 30,
                                         --------------------------  --------------------------
                                            1999          1998          1999          1998
                                         ------------  ------------  ------------  ------------
REVENUES:
  Premiums                             $    298,227  $    349,042  $    909,703  $    699,929
  Fee income                                162,396       145,920       466,702       390,610
  Net investment income                     219,159       222,294       651,217       669,719
  Net realized gains (losses)
    on investments                            3,796        13,512          (130)       32,827
                                         ------------  ------------  ------------  ------------

                                            683,578       730,768     2,027,492     1,793,085
                                         ------------  ------------  ------------  ------------
BENEFITS AND EXPENSES:
  Life and other policy benefits            272,030       244,721       784,459       537,189
  Increase in reserves                       15,811        71,989        38,160       120,152
  Interest paid or credited to
    contractholders                         107,364       125,071       333,005       372,066
  Provision for policyholders' share
of
    earnings (losses) on participating
    business                                   (237)        1,953         2,408         5,312
                                         ------------  ------------  ------------  ------------
  Dividends to policyholders                 16,271        17,354        49,951        51,479
                                         ------------  ------------  ------------  ------------

                                            411,239       461,088     1,207,983     1,086,198
                                         ------------  ------------  ------------  ------------
                                                                     ------------  ------------

  Commissions                                41,072        41,872       131,405        98,708
  Operating expenses                        148,367       141,448       442,542       373,271
  Premium taxes                               7,829        11,031        25,701        24,215
                                         ------------  ------------  ------------  ------------

                                            608,507       655,439     1,807,631     1,582,392
                                         ------------  ------------  ------------  ------------

INCOME BEFORE INCOME TAXES                   75,071        75,329       219,861       210,693

PROVISION FOR INCOME TAXES:
   Current                                   13,748        28,322        53,411        69,611
   Deferred                                   9,046        (2,148)       19,064         1,598
                                         ------------  ------------  ------------  ------------

                                             22,794        26,174        72,475        71,209
                                         ------------  ------------  ------------  ------------

NET INCOME                             $     52,277  $     49,155  $    147,386  $    139,484
                                         ============  ============  ============  ============

</TABLE>




See notes to consolidated financial statements.


<PAGE>
<TABLE>


<S>     <C>    <C>    <C>    <C>    <C>    <C>
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)

                                                                September 30,    December 31,
ASSETS                                                              1999             1998
------
                                                                --------------   --------------
                                                                (Unaudited)
INVESTMENTS:
  Fixed Maturities:
    Held-to-maturity, at amortized cost
       (fair value $2,312,845 and $2,298,936)                $      2,314,819 $      2,199,818
    Available-for-sale, at fair value
       (amortized cost $6,979,776 and $6,752,532)                   6,845,174        6,936,726
  Mortgage loans on real estate, net                                  995,274        1,133,468
  Common stock                                                         52,024           48,640
  Real estate, net                                                     93,663           73,042
  Policy loans                                                      2,634,991        2,858,673
  Short-term investments, available-for-sale
       (cost approximates fair value)                                 186,584          420,169
                                                                --------------   --------------

      Total Investments                                            13,122,529       13,670,536

Cash                                                                  112,649          176,119
Reinsurance receivable                                                195,575          192,958
Deferred policy acquisition costs                                     290,913          238,901
Investment income due and accrued                                     139,007          157,587
Other assets                                                          378,284          311,078
Premiums in course of collection                                      130,457           84,940
Deferred income taxes                                                 233,403          191,483
Separate account assets                                            10,760,763       10,099,543
                                                                --------------   --------------





TOTAL ASSETS                                                 $     25,363,580 $     25,123,145
                                                                ==============   ==============

</TABLE>



See notes to consolidated financial statements.          (Continued)


<PAGE>


GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
<TABLE>

<S>     <C>    <C>    <C>    <C>    <C>    <C>
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)

                                                                September 30,    December 31,
LIABILITIES AND STOCKHOLDER'S EQUITY                                1999             1998
------------------------------------
                                                                --------------   --------------
                                                                 (Unaudited)
POLICY BENEFIT LIABILITIES:

    Policy reserves                                          $     11,611,617 $     11,839,714
    Policy and contract claims                                        469,158          491,932
    Policyholders' funds                                              181,922          181,779
    Provision for policyholders' dividends                             69,760           69,530

GENERAL LIABILITIES:

    Due to Parent Corporation                                          41,715           52,877
    Surplus note - due to Parent Corporation                          175,000
    Repurchase agreements                                              80,749          244,258
    Commercial paper                                                   54,702           39,731
    Other liabilities                                                 606,999          761,505
    Undistributed earnings on
      participating business                                          131,206          143,717
    Separate account liabilities                                   10,760,763       10,099,543
                                                                --------------   --------------

      Total Liabilities                                            24,183,591       23,924,586
                                                                --------------   --------------

STOCKHOLDER'S EQUITY:
    Preferred stock, $1 par value,
       50,000,000 shares authorized:
            Series A, cumulative, 1,500 shares authorized,
              none outstanding
            Series B, cumulative, 1,500 shares authorized,
              none outstanding
            Series C, cumulative, 1,500 shares authorized,
              none outstanding
            Series D, cumulative, 1,500 shares authorized,
              none outstanding
            Series E, non-cumulative, 2,000,000
              shares authorized, none outstanding
    Common stock, $1 par value; 50,000,000 shares
authorized;
       7,032,000 shares issued and outstanding                          7,032            7,032
    Additional paid-in capital                                        699,556          699,556
    Accumulated other comprehensive income (loss)                     (39,067)          61,560
    Retained earnings                                                 512,468          430,411
                                                                --------------   --------------

      Total Stockholder's Equity                                    1,179,989        1,198,559
                                                                --------------   --------------

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                   $     25,363,580 $     25,123,145
                                                                ==============   ==============

</TABLE>



See notes to consolidated financial statements.


<PAGE>


GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
                                                                       Nine Months Ended
                                                                         September 30,
                                                                 -------------------------------
                                                                     1999             1998
                                                                 --------------  ---------------

OPERATING ACTIVITIES:
    Net income                                                 $      147,386  $      139,484
    Adjustments to reconcile net income to
      net cash provided by operating activities:
       Gain allocated to participating policyholders                    2,404           5,312
       Amortization of investments                                    (13,798)         (5,447)
       Realized losses (gains) on disposal of investments
           and write-downs of mortgage loans and real estate              130         (32,827)
       Amortization                                                    33,653          60,590
       Deferred income taxes                                           19,064          (9,035)
    Changes in assets and liabilities:
        Policy benefit liabilities                                    537,562         771,818
        Reinsurance receivable                                         (2,617)          4,669
        Accrued interest and other receivables                        (26,937)         25,742
        Other, net                                                   (245,854)       (353,675)
                                                                 --------------  ---------------
                 Net cash provided by operating activities            450,993         606,631
                                                                 --------------  ---------------

INVESTING ACTIVITIES:
    Proceeds from sales, maturities, and
        redemptions of investments:
        Fixed maturities
             Held-to-maturity
                Maturities and redemptions                            413,320         385,071
             Available-for-sale
                Sales                                               2,640,214       5,137,042
                Maturities and redemptions                            610,044         990,923
        Mortgage loans                                                142,473         168,777
        Real estate                                                     5,114          16,456
        Common stock                                                   12,598           3,183
    Purchases of investments:
        Fixed maturities
             Held-to-maturity                                        (515,776)       (471,514)
             Available-for-sale                                    (3,233,049)     (5,940,683)
        Mortgage loans                                                 (2,311)        (95,788)
        Real estate                                                   (28,256)         (3,075)
        Common stock                                                  (15,400)         (3,235)
                                                                 --------------  ---------------
                 Net cash provided by investing activities             28,971         187,157
                                                                 --------------  ---------------

</TABLE>







                        (Continued)


<PAGE>


GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
<TABLE>

<S>     <C>    <C>    <C>    <C>    <C>    <C>
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
                                                                       Nine Months Ended
                                                                         September 30,
                                                                 ------------------------------
                                                                     1999            1998
                                                                 --------------  --------------

FINANCING ACTIVITIES:
   Contract withdrawals, net of deposits                       $     (493,405) $     (366,309)
   Net Parent Corporation borrowings (repayments)                     163,838          41,136
   Dividends paid                                                     (65,329)        (59,404)
   Net commercial paper borrowings (repayments)                        14,971          45,648
   Net repurchase agreements borrowings (repayments)                 (163,509)       (225,435)
                                                                 --------------  --------------
              Net cash used in financing activities                  (543,434)       (564,364)
                                                                 --------------  --------------

NET INCREASE (DECREASE) IN CASH                                       (63,470)        229,424

CASH, BEGINNING OF YEAR                                               176,119         126,278
                                                                 --------------  --------------

CASH, END OF PERIOD                                            $      112,649  $      355,702
                                                                 ==============  ==============

</TABLE>










See notes to consolidated financial statements.                  (Concluded)


<PAGE>


GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

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

1.      BASIS OF PRESENTATION

The  consolidated  financial  statements and related notes of Great-West  Life &
Annuity  Insurance Company (the "Company") have been prepared in accordance with
generally  accepted  accounting   principles  applicable  to  interim  financial
reporting and do not include all of the information  and footnotes  required for
complete  financial  statements.  However,  in the opinion of management,  these
statements  include  all  normal  recurring  adjustments  necessary  for a  fair
presentation  of the  results.  These  financial  statements  should  be read in
conjunction  with  the  audited   consolidated   financial  statements  and  the
accompanying  notes included in the Company's latest annual report on Form 10-K,
as amended, for the year ended December 31, 1998.

Operating  results  for  the  nine  months  ended  September  30,  1999  are not
necessarily  indicative  of the results  that may be expected  for the full year
ending December 31, 1999.

2.      NEW ACCOUNTING PRONOUNCEMENTS

In June 1998, the Financial Accounting Standards Board issued Statement No. 133,
"Accounting  for Derivative  Instruments and for Hedging  Activities",  which is
required to be adopted in years  beginning  after June 15, 1999.  This Statement
provides  a  comprehensive  and  consistent  standard  for the  recognition  and
measurement of derivatives and hedging  activities.  In June 1999, the Financial
Accounting  Standards Board issued Statement No. 137, "Accounting for Derivative
Instruments  and Hedging  Activities  - Deferral of the  Effective  Date of FASB
Statement No. 133", which delays the effective date of Statement No. 133 for one
year, to fiscal years  beginning  after June 15, 2000.  Because of the Company's
minimal use of derivatives,  management does not anticipate that the adoption of
the new Statement  will have a  significant  effect on earnings or the financial
position of the Company.

In March 1998, the Accounting  Standards Executive Committee of the AIPCA issued
Statement of Position (SOP) 98-1, "Accounting for the Costs of Computer Software
Developed  or  Obtained  for  Internal  Use".  The SOP,  which was adopted as of
January 1, 1999,  requires  the  capitalization  of certain  costs  incurred  in
connection  with  developing or obtaining  internal use  software.  Prior to the
adoption of SOP 98-1,  the Company  expensed all  internal use software  related
costs as incurred.  During the nine months ended September 30, 1999, the Company
capitalized $8,068 in internal use software costs related to the adoption of SOP
98-1.



<PAGE>


3.      OTHER

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



<PAGE>


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

<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                               Three Months Ended         Nine Months Ended
                                                  September 30,             September 30,
                                             ------------------------   -----------------------
        Operating Summary (Millions)           1999          1998         1999         1998
                                             ----------   -----------   ----------   ----------

        Premiums                          $       298  $       349   $       910  $       700
        Fee income                                162          146           466          390
        Net investment income                     219          222           651          670
        Realized investment gains
          (losses)                                  4           13             0           33
                                             ----------   -----------   ----------   ----------
             Total revenues                       683          730         2,027        1,793

        Total benefits and expenses               608          655         1,808        1,582
        Income tax expense                         23           26            72           71
                                             ==========   ===========   ==========   ==========
             Net income                   $        52  $        49   $       147  $       140
                                             ==========   ===========   ==========   ==========


        Deposits for investment-type
          contracts                       $       137  $       616   $       412  $     1,071
        Deposits to separate accounts             551          584         1,916        1,693
        Self-funded premium
          equivalents                             746          658         2,252        1,784

                                                              September 30,      December 31,
        Balance Sheet (Millions)                                  1999               1998
                                                             ----------------   ---------------

        Investment assets                                 $       13,123     $       13,671
        Separate account assets                                   10,761             10,100
        Total assets                                              25,364             25,123
        Total policy benefit liabilities                          12,332             12,583
        Long-term debt - due to
             Parent Corporation                                       32                 35
        Surplus note                                                 175
        Total shareholder's equity                        $        1,180     $        1,199
</TABLE>

GENERAL

The following  discussion addresses the financial condition of the Company as of
September  30,  1999,  compared  with  December  31,  1998,  and its  results of
operations for the three and nine months ended September 30, 1999, compared with
the same periods last year.  The discussion  should be read in conjunction  with
the  Management's  Discussion  and Analysis  section  included in the  Company's
report on Form 10-K, as amended,  for the year ended December 31, 1998, to which
the reader is directed for additional information.



<PAGE>


CONSOLIDATED RESULTS

The Company's  consolidated net income increased $3 million or 6% and $7 million
or 5% for the third  quarter and nine months of 1999 when  compared to the third
quarter and nine months of 1998. The increases reflect an increase of $3 million
in the Financial  Services  segment for the third quarter of 1999.  The Employee
Benefits  segment's net income increased $7 million for the nine months of 1999,
which reflected  improved morbidity gains being partially offset by net realized
investment losses.

Total revenues  increased/(decreased)  $(47) million or (6)% and $234 million or
13% for the third  quarter and for the nine months of 1999 when  compared to the
same periods of 1998. The  increase/(decrease) in revenues for the third quarter
and nine months of 1999 was comprised of increased/(decreased) premium income of
$(51)  million  and $210  million,  increased  fee income of $16 million and $76
million,  decreased  net  investment  income of $3 million  and $19  million and
decreased realized gains on investments of $9 million and $33 million.

The  increased/(decreased)  premium  income in 1999 was  comprised  of growth in
Employee  Benefits  premium  income of $8 million and $278 million for the third
quarter and nine  months of 1999,  offset by a decrease  in  Financial  Services
premium  income of $59 million  and $68  million for the third  quarter and nine
months of 1999.  The  growth in 1999 in  Employee  Benefits  is  related  to its
acquisition of Anthem Health & Life Insurance Company ("AH&L") in July 1998. The
financial  results of AH&L are  included for the full nine months of 1999 versus
only the period from acquisition in 1998. The majority of the growth in Employee
Benefits in 1999 reflects  increased premium income of $216 million derived from
AH&L.  The decrease in Financial  Services  premium is related to lower sales of
Bank Owned Life Insurance ("BOLI").

The growth in fee income is also  primarily  in the Employee  Benefits  segment,
where the  increase in fee income  derived from the  acquisition  of AH&L was $7
million and $38 million  during the third  quarter and nine months of 1999.  The
remaining  increase was the result of new sales and  increased  fees on variable
funds related to growth in equity markets.

The  decrease  in net  investment  income  was the  result of a  combination  of
declining  interest rates and a reduction in general account assets.  The actual
earned rate at September  30, 1999 was 6.93%  compared to 7.17% at September 30,
1998.

Realized gains on investments decreased $9 million and $33 million for the third
quarter  and for the nine months of 1999 when  compared  to the same  periods of
1998.  The rise in interest  rates in 1999  resulted in losses on sales of fixed
maturities  totaling $8 million,  while lower interest rates  contributed to $33
million of fixed maturity gains in 1998. Increases  (decreases) in the provision
for asset losses of $(6) million and $.6 million  were  recognized  for the nine
months of 1999 and 1998, respectively.



<PAGE>


Benefits  and  expenses  increased/(decreased)  $(47)  million  or (7)% and $226
million or 14% for the third  quarter and nine  months of 1999 when  compared to
the third quarter and nine months of 1998.  The  increased/(decreased)  benefits
and expenses in 1999 were comprised of an increase in Employee Benefits benefits
and  expenses  of $17 million  and $316  million for the third  quarter and nine
months of 1999, offset by a decrease in Financial Services benefits and expenses
of $64 million  and $90  million for the third  quarter and nine months of 1999.
The increase in Employee  Benefits  primarily  reflects benefits and expenses of
$255 million for the nine months of 1999 derived from the acquisition of AH&L in
July 1998.  The  decrease in  Financial  Services  represents  a decrease in the
change in policy reserves related to lower sales of BOLI.

Income tax expense increased/(decreased) $(3) million or (12)% and $1 million or
1% for the third  quarter  and nine  months of 1999 when  compared  to the third
quarter  and  nine  months  of  1998.  The  decrease  of the  third  quarter  is
attributable to the tax deduction  associated with the dividends received in the
Company's  separate  accounts.  The increase for the nine months reflects higher
pre-tax  earnings for the nine months of 1999 and the use of net operating  loss
carryforwards related to the subsidiaries during 1998.

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

Deposits for  investment-type  contracts  decreased $479 million or 78% and $659
million or 62% for the third  quarter and nine  months of 1999 when  compared to
the  third  quarter  and  nine  months  of  1998.  This  decrease  is  primarily
attributable  to the  Financial  Services  segment,  and is primarily  due to an
indemnity  reinsurance  agreement  with  Great-West  Life,  whereby  the Company
reinsured by coinsurance  certain  Great-West Life individual  non-participating
life  insurance  policies  during the third  quarter of 1998.  This  transaction
increased  deposits  in 1998 by $410  million.  The  additional  decrease is due
primarily to  decreased  deposits  related to BOLI sales ($100  million and $240
million for the third  quarter and nine months of 1999 when compared to the same
periods last year).

Deposits for separate accounts  increased/(decreased)  $(33) million or (6)% and
$223 million or 13% for the third  quarter and nine months of 1999 when compared
to the third  quarter and nine months of 1998.  The increase for the nine months
of 1999 is due to a  continuing  movement  toward  variable  funds and away from
fixed options. During the second quarter of 1999, the Company began distributing
a BOLI separate  account  product,  resulting in $100 million in deposits during
the second quarter.



<PAGE>


Self-funded premium equivalents increased $88 million or 13% and $468 million or
26% for the third  quarter  and nine  months of 1999 when  compared to the third
quarter and nine months of 1998. The increase was due to the acquisition of AH&L
($115 million and $267 million for third quarter and nine months of 1999),  with
the additional growth for the nine months of 1999 coming from growth in business
in the remainder of the Employee Benefits segment.

Total  assets  increased  $241  million  or 1% when  compared  to the year ended
December 31, 1998.


<PAGE>


SEGMENT RESULTS

Employee Benefits

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

                                               Three Months Ended         Nine Months Ended
                                                  September 30,             September 30,
                                             ------------------------   -----------------------
        Operating Summary (Millions)           1999          1998         1999         1998
                                             ----------   -----------   ----------   ----------

        Premiums                          $       266  $       258   $       778  $      500
        Fee income                                141          126           402         337
        Net investment income                      21           26            60          69
        Realized investment gains
          (losses)                                               3            (2)          6
                                             ----------   -----------   ----------   ----------
             Total revenues                       428          413         1,238         912

        Total benefits and expenses               389          372         1,118         802
        Income tax expense                         12           14            39          36
                                             ==========   ===========   ==========   ==========
             Net income                   $        27  $        27   $        81  $       74
                                             ==========   ===========   ==========   ==========

        Deposits for investment-type
          contracts                       $            $        29   $        18  $       44
        Deposits to separate accounts             395          401         1,320       1,190
        Self-funded premium
          equivalents                             746          658         2,252       1,784
</TABLE>

Net income for Employee Benefits  increased $7 million or 9% for the nine months
of 1999 when compared to the nine months of 1998. The increase was primarily due
to improved  morbidity  experience  offset  somewhat by net realized  investment
losses.

401(k)  premiums and deposits  decreased 7% (from $449 million to $418  million)
and increased 9% (from $1,291  million to $1,407  million) for the third quarter
and nine months of 1999, as a result of higher recurring  deposits from existing
customers. Assets under administration (including third-party administration) in
401(k) increased 8% over the nine months of 1998, primarily due to strong equity
markets.  The number of  contributing  participants  increased  from  477,000 at
December 31, 1998 to 512,000 at September 30, 1999.

Equivalent  premium  revenue and fee income for group life and health  increased
11% (from $1,022  million to $1,130  million)  and 31% (from  $2,565  million to
$3,364 million) from the third quarter and nine months of 1998, primarily due to
the acquisition of AH&L.


<PAGE>


Financial Services

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

<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                               Three Months Ended         Nine Months Ended
                                                  September 30,             September 30,
                                             ------------------------   -----------------------
        Operating Summary (Millions)           1999          1998         1999         1998
                                             ----------   -----------   ----------  -----------

        Premiums                          $        32  $        91   $       132  $      200
        Fee income                                 21           20            64          53
        Net investment income                     198          196           591         601
        Realized investment gains
          (losses)                                  4           10             2          27
                                             ----------   -----------   ----------  -----------
             Total revenues                       255          317           789         881

        Total benefits and expenses               219          283           690         780
        Income tax expense                         11           12            33          35
                                             ==========   ===========   ==========  ===========
             Net income                   $        25  $        22   $        66  $       66
                                             ==========   ===========   ==========  ===========

        Deposits for investment-type
          contracts                       $       137  $       587   $       394  $    1,027
        Deposits to separate accounts             156          183           596         503
</TABLE>

Net  income for  Financial  Services  increased  $3 million or 14% for the third
quarter of 1999 when  compared to the third quarter of 1998 and was flat for the
nine months of 1999 when  compared to the nine months of 1998.  The reduction in
realized gains in 1999 has been offset with increased investment margins and fee
income on separate accounts.

Savings

Savings  equivalent  premiums and deposits  decreased  13% (from $271 million to
$236  million) and 1% (from $747 million to $739  million) for the third quarter
and nine months of 1999. The in quarter  decrease is related to separate account
activity.

The   Financial   Services   segment's   core   savings   business   is  in  the
public/non-profit  pension market. The assets of the  public/non-profit  pension
business,  including  separate  accounts  but  excluding  Guaranteed  Investment
Contracts, decreased 4% from December 31, 1998.

New  contributions  to variable  business  represented 59% of the total deposits
received in the nine months of 1999 compared to 59% for the nine months of 1998.

Customer  participation  in guaranteed  separate  accounts  increased and assets
under  management  for  guaranteed  separate  account funds were $628 million at
September 30, 1999 compared to $562 million at December 31, 1998.



<PAGE>


Life Insurance

Individual life insurance revenue premiums and deposits of $110 million and $446
million for the third quarter and nine months of 1999  represented a decrease of
$500  million  or 82% and $590  million or 57% from the third  quarter  and nine
months of 1998,  which is primarily due to a coinsurance  agreement in the prior
year,  which  resulted in increased  deposits of $410  million.  The  additional
decrease is due  primarily  to  decreased  deposits  related to BOLI sales ($100
million  and $240  million  for the third  quarter  and nine months of 1999 when
compared to the same periods last year).

GENERAL ACCOUNT INVESTMENTS

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

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

Fixed Maturities

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

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

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



<PAGE>


The distribution of the fixed maturity  portfolio (both  available-for-sale  and
held-to-maturity) by credit rating is summarized as follows:

                                            September 30,      December 31,
                                                1999               1998
                                           -----------------  -----------------

        AAA                                      48.2%             45.6%
        AA                                        8.8%              9.4%
        A                                        20.2%             23.8%
        BBB                                      22.4%             20.7%
        BB and Below (non-investment grade)        .4%              0.5%
                                           -----------------  -----------------
        TOTAL                                   100.0%            100.0%

During the third quarter and nine months of 1999, net unrealized  gains (losses)
on  fixed  maturities  included  in  stockholder's   equity,  which  is  net  of
policyholder-related amounts and deferred income taxes, decreased surplus by $12
million and $101 million, respectively.

LIQUIDITY AND CAPITAL RESOURCES

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

Generally,  the  Company  has  met its  operating  requirements  by  maintaining
appropriate levels of liquidity in its investment  portfolio  utilizing positive
cash flows from operations.  Liquidity for the Company has remained  strong,  as
evidenced by  significant  amounts of  short-term  investments  and cash,  which
totaled $299 million and $596 million as of September  30, 1999 and December 31,
1998, respectively.



<PAGE>


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

The Company's financial strength provides the capacity and flexibility to enable
it to raise funds in the capital  markets  through  the  issuance of  commercial
paper. The Company continues to be well capitalized,  with sufficient  borrowing
capacity  to meet the  anticipated  needs of its  business.  The Company had $55
million and $40 million of commercial  paper  outstanding  at September 30, 1999
and December 31, 1998. The  commercial  paper has been given a rating of A-1+ by
Standard & Poor's  Corporation and a rating of P-1 by Moody's Investors Service,
each being the highest rating available.

YEAR 2000 ISSUE

The Year 2000  ("Y2K")  problem  arises  when a computer  performing  date-based
computations  or operations  produces  erroneous  results due to the  historical
practice of using two digit years within  computer  hardware and software.  This
causes  errors  or  misinterpretations  of the  century  in  date  calculations.
Virtually all businesses,  including the Company,  are required to determine the
extent of their Y2K  problems.  Systems  that  have a Y2K  problem  must then be
converted or replaced by systems that will operate correctly with respect to the
year 2000 and beyond.

The Company has a written plan that encompasses all computer hardware, software,
networks,  facilities  (embedded systems) and telephone  systems.  The plan also
includes  provisions  for  identifying  and  verifying  that major  vendors  and
business partners are Y2K compliant. The Company is developing contingency plans
to address the  possibility of both internal and external  failures as well. The
plan calls for full Y2K  compliance  for core  systems by June 30, 1999 and full
Y2K compliance for all Company systems by October 31, 1999.

The Company's plan  established  five phases for becoming Y2K ready.  Phase 1 is
"impact analysis" which includes initial inventory and preliminary assessment of
Y2K impact.  Phase 2 is  "solution  planning"  which  includes  system by system
planning to outline the approach and timing for reaching compliance.  Phase 3 is
"conversion/renovation" which means the actual process of replacing or repairing
non-ready  systems.  Phase 4 is  "testing"  to ensure that the systems  function
correctly under a variety of different date scenarios  including  current dates,
year 2000 and leap year dates. Phase 5 is  "implementation"  which means putting
Y2K ready systems back into production.

As of September 30, 1999, we believe that the Company is Y2K ready.

In addition  to  ensuring  that the  Company's  own  systems are Y2K ready,  the
Company has  identified  third  parties  with which the Company has  significant
business relationships in order to assess the potential impact on the Company of
the third  parties' Y2K issues and plans.  As of September 30, 1999, the Company
had  completed  most of this  assessment  process.  The  Company  will  continue
investigating  third party  readiness and will conduct system testing with third
parties  throughout  1999.  The Company  does not have  control over these third
parties and cannot  make any  representations  as to what  extent the  Company's
future operating  results may be adversely  affected by the failure of any third
party to address successfully its own Y2K issues.

On the basis of currently  available  information,  the expense  incurred by the
Company, including anticipated future expenses, related to the Y2K issue has not
and is not  expected to be  material to the  Company's  financial  condition  or
results of operations.  The Company has spent approximately $13.6 million on its
Y2K  project  through the end of  September  30, 1999 and expects to spend up to
approximately  $14.8  million on its Y2K  project.  All of these funds will come
from the Company's cash flow from  operations.  The Company has continued  other
scheduled non-Y2K information systems changes and upgrades. Although work on Y2K
issues may have resulted in minor delays on the other  projects,  the delays are
not expected to have a material  adverse  effect on the  Company's  consolidated
financial condition or results of operations.

The most  reasonably  likely  worst case Y2K  scenario is that the Company  will
experience  isolated  internal  or third  party  computer  failures  and will be
temporarily unable to process insurance and annuity benefit transactions. All of
the  Company's  Y2K efforts have been  designed to prevent  such an  occurrence.
However,  if the Company  identifies  internal  or third party Y2K issues  which
cannot be timely corrected, there can be no assurance that the Company can avoid
Y2K problems or that the cost of curing the problem will not be material.

In an effort to mitigate  risks  associated  with Y2K failures,  the Company has
developed contingency plans to address core functions,  including relations with
third  parties.  The  contingency  plans  address  possible  failures  generated
internally,  by  vendors  or  business  partners,  and  by  customers.   General
contingency plan approaches include manual processing,  payments on an estimated
basis and use of disaster recovery facilities.

PART II  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

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



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)     Index to Exhibits

        Exhibit Number      Title                            Page
        ----------------    ----------------------------     -------------

        27                  Financial Data Schedule          21

(b)     Reports on Form 8-K

No reports on Form 8-K have been filed during the third quarter of 1999.

SIGNATURES

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


                             GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY



DATE: November 12, 1999  BY: /s/     Glen R. Derback
                         Glen R. Derback, Vice President and Controller
                         (Duly authorized officer and chief accounting officer)


<PAGE>