This prospectus describes individual and group flexible premium deferred annuity contracts. The individual contracts and interests in the group contracts are referred to in this prospectus as the “Contracts.” Annuity Investors Life Insurance Company^® (the “Company”) is the issuer of the Contracts.

The Contracts offer both variable and fixed investment options. The variable investment options under the Contracts are Subaccounts of Annuity Investors^® Variable Account B (the “Separate Account”). The Contracts currently offer 46 Subaccounts. Each Subaccount is invested in shares of a registered investment company or a portfolio thereof (each, a “Portfolio”). The Portfolios are listed below.

AIM Variable Insurance Funds

-AIM V.I. Capital Development Fund-Series I Shares
-AIM V.I. Core Equity Fund-Series I Shares
-AIM V.I. Financial Services Fund-Series I Shares
-AIM V.I. Global Health Care Fund -Series I Shares
-AIM V.I. High Yield Fund-Series I Shares
-AIM V.I. Small Cap Equity Fund-Series I Shares

American Century Variable Portfolios

-American Century VP Large Company Value Fund-Class I
-American Century VP Mid Cap Value Fund-Class I
-American Century VP Ultra^â Fund-Class I
-American Century VP Vista ^SM Fund-Class I

-Calamos Growth and Income Portfolio

Davis Variable Account Fund, Inc.

-Davis Value Portfolio

The Dreyfus Socially Responsible Growth Fund, Inc.-Initial Shares

Dreyfus Stock Index Fund, Inc.-Initial Shares

Dreyfus Investment Portfolios

-Dreyfus IP MidCap Stock Portfolio-Service Shares
-Dreyfus IP Technology Growth Portfolio-Initial Shares

Dreyfus Variable Investment Funds

-Dreyfus VIF Appreciation Portfolio-Initial Shares
-Dreyfus VIF Developing Leaders Portfolio-Initial Shares
-Dreyfus VIF Growth and Income Portfolio-Initial Shares
-Dreyfus VIF Money Market Portfolio

DWS Investments VIT Funds

-DWS Small Cap Index VIP-Class A

Financial Investors Variable Insurance Trust

-Ibbotson Balanced ETF Asset Allocation Portfolio-Class II
-Ibbotson Conservative ETF Asset Allocation Portfolio-Class II
-Ibbotson Growth ETF Asset Allocation Portfolio-Class II
-Ibbotson Income /Growth ETF Asset Allocation Portfolio-Class II

Franklin Templeton Variable Insurance Products Trust

-Templeton Foreign Securities Fund-Class 2

Janus Aspen Series

-Janus Aspen Series Balanced Portfolio-Institutional Shares
-Janus Aspen Series Forty Portfolio-Institutional Shares
-Janus Aspen Series International Growth Portfolio-Inst. Shares
-Janus Aspen Series Large Cap Growth Portfolio-Inst. Shares
-Janus Aspen Series Mid Cap Growth Portfolio-Inst. Shares

Oppenheimer Variable Account Funds

-Oppenheimer Balanced Fund/VA-Non-Service Shares
-Oppenheimer Capital Appreciation Fund/VA-NS Shares
-Oppenheimer Main Street Fund^®/VA-Non-Service Shares

PIMCO Variable Insurance Trust

-PIMCO VIT Real Return Portfolio-Administrative Class
-PIMCO VIT Total Return Portfolio-Administrative Class

Van Kampen-The Universal Institutional Funds, Inc.

-Van Kampen UIF Core Plus Fixed Income Portfolio-Class I
-Van Kampen UIF Mid-Cap Growth Portfolio-Class I
-Van Kampen UIF U.S. Mid Cap Value Portfolio-Class I
-Van Kampen UIF U.S. Real Estate Portfolio-Class I
-Van Kampen UIF Value Portfolio-Class I

Wilshire Variable Insurance Trust

-Wilshire 2010 Moderate Fund
-Wilshire 2015 Moderate Fund
-Wilshire 2025 Moderate Fund
-Wilshire 2035 Moderate Fund
-Wilshire 2045 Moderate Fund

 i

The fixed investment options are provided through the Company’s Fixed Account. The Contracts currently offer 5 fixed investment options:

	§		Fixed Accumulation Account
	§		One-Year Guaranteed Interest Rate Option
	§		Three-Year Guaranteed Interest Rate Option
	§		Five-Year Guaranteed Interest Rate Option
	§		Seven-Year Guaranteed Interest Rate Option

The Contracts are available for tax-qualified and non-tax-qualified annuity purchases. All Contracts are designed to be eligible for tax-deferred treatment during the Accumulation Period. The tax treatment of annuities is discussed in the Federal Tax Matters section of this prospectus.

The Company will pay a bonus credit of 4% of each Purchase Payment made to the Contracts. To help in recovering cost associated with this bonus, the Contracts include a Contingent Deferred Sales Charge (“CDSC”) that is slightly higher and is imposed for slightly longer on each Purchase Payment. This means that the bonus may be beneficial to you only if you hold the Contract for a sufficient length of time.

This prospectus includes information you should know before investing in the Contracts. This prospectus is not complete without the current prospectuses for the Portfolios. Please keep this prospectus and the Portfolio prospectuses for future reference.

A Statement of Additional Information (“SAI”), dated May 1, 2007, contains more information about the Separate Account and the Contracts. The Company filed the SAI with the Securities and Exchange Commission (“SEC”). It is part of this prospectus. For a free copy, complete and return the form on the last page of this prospectus, or call the Company at 1-800-789-6771. You may also access the SAI (as well as all other documents filed with the SEC with respect to the Contracts, the Separate Account or the Company) at the SEC’s Web site: http://www.sec.gov. The registration number is 333-51971. The table of contents for the SAI is printed on the last page of this prospectus.

NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 ii

TABLE OF CONTENTS

DEFINITIONS			1
EXPENSE TABLES			3
Contract Owner Transaction Expenses			3
Annual Contract Maintenance Fee			3
Separate Account Annual Expenses			3
Total Annual Portfolio Operating Expenses			3
Examples			4
FINANCIAL INFORMATION			5
Condensed Financial Information			5
Financial Statements			5
OVERVIEW			5
What is the Separate Account?			5
What Are the Contracts?			5
How Do I Purchase or Cancel a Contract?			5
Will Any Penalties or Charges Apply If I Make Withdrawals or Surrender a Contract?			6
What Other Charges and Deductions Apply to the Contract?			6
How Do I Contact the Company?			6
THE PORTFOLIOS			7
Portfolios			7
Additions or Substitutions of Portfolios			10
CHARGES AND DEDUCTIONS			10
Charges and Deductions By the Company			10
Contingent Deferred Sales Charge (“CDSC”)			11
Contract Maintenance Fee			12
Transfer Fee			12
Administration Charge			12
Mortality and Expense Risk Charge			13
Premium Taxes			13
Discretionary Waivers of Charges			13
Expenses of the Portfolios			13
PURCHASE PAYMENTS AND ALLOCATION TO INVESTMENT OPTIONS			14
Purchase Payments			14
Purchase Payment Bonus			14
Investment Options—Allocations			15
Principal Guarantee Program			16
Renewal of Fixed Account Guarantee Options			16
TRANSFERS			17
Transfers			17
Automatic Transfer Programs			18
Telephone, Facsimile or Internet Transfers			19
Changes in or Termination of Automatic Transfer Programs			19
Restrictions on Transfers Relate to Active Trading Strategies			19
WITHDRAWALS AND SURRENDERS			20
Surrender and Withdrawals			20
Free Withdrawal Privilege			20
Long-Term Care Waiver Rider			21
Systematic Withdrawal			21
CONTRACT LOANS			21
Contract Loans			21

TERMINATION			21
Termination			21
OTHER INFORMATION AND NOTICES			22
Reports and Confirmations			22
Householding — Revocation of Consent			22
Electronic Delivery of Required Documents			22
Legal Proceedings			22
Voting Rights			22
ANNUITY BENEFIT			23
Annuity Benefit			23
DEATH BENEFIT			23
Death Benefit			23
Death Benefit Amount			23
Death Benefit Amount (Version 1)			24
Example of Determination of Death Benefit Amount			24
Death Benefit Amount (Version 2)			25
Successor Owner Election			25
Payment of Benefits			25
SETTLEMENT OPTIONS			26
Settlement Options			26
THE CONTRACTS			27
Right to Cancel			27
Persons With Rights Under a Contract			27
ANNUITY INVESTORS LIFE INSURANCE COMPANY®			29
THE SEPARATE ACCOUNT			29
DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS			30
FEDERAL TAX MATTERS			31
Tax Deferral on Annuities			31
Tax-Qualified Retirement Plans			31
Individual Retirement Annuities			31
Roth IRAs			32
Tax-Sheltered Annuities			32
Texas Optional Retirement Program			32
Pension, Profit—Sharing, and 401(k) Plans			32
Roth TSAs and Roth 401(k)s			32
Governmental Deferred Compensation Plans			32
Nonqualified Deferred Compensation Plans			32
Summary of Income Tax Rules			33

CALCULATION OF BENEFIT PAYMENTS			34
Calculation of Fixed Dollar Benefit Payments			34
Calculation of Variable Dollar Benefit Payments			34
Commuted Values			34
GLOSSARY OF FINANCIAL TERMS			35
Account Value			35
Accumulation Units			35
PERFORMANCE INFORMATION			37
Performance Information			37
Yield Data			37
Total Return Data			37
Other Performance Measures			37
THE REGISTRATION STATEMENT			38
STATEMENT OF ADDITIONAL INFORMATION			39
APPENDIX A: CONDENSED FINANCIAL INFORMATION			40
APPENDIX B: PORTFOLIOS			46
AIM Variable Insurance Funds			46
American Century Variable Portfolios, Inc.			47
Calamos® Advisors Trust			48
Davis Variable Account Fund, Inc.			48
Dreyfus Portfolios			48
DWS Investments VIT Funds (1)			49
Financial Investors Variable Insurance Trust			50
Franklin Templeton Variable Insurance Products Trust			50
Janus Aspen Series			51
Oppenheimer Variable Account Funds			52
PIMCO Variable Insurance Trust			52
Van Kampen-The Universal Institutional Funds, Inc.			52
Wilshire Variable Insurance Trust			53
APPENDIX C: TRANSFER RESTRICTIONS			55
Restrictions on Transfers; Disruptive Trading, Market Timing and Frequent Transfers			55
U.S. Mail Restrictions on Persons Engaged in Harmful Trading Practices			55
U.S Mail Restrictions on Managers of Multiple Contracts			55
Other Restrictions			56

The capitalized terms defined on this page will have the meanings given to them when used in this prospectus. Other terms which may have a specific meaning under the Contracts, but which are not defined on this page, will be explained as they are used in this prospectus.

Account Value

The value of a Contract during the Accumulation Period. It is equal to the sum of the value of the Owner’s interest in the Subaccounts and the Owner’s interest in the Fixed Account options.

Accumulation Period

The period during which purchase payments and accumulated earnings are invested according to the investment options elected. The Accumulation Period ends when a Contract is annuitized or surrendered in full, or on the Death Benefit Valuation Date.

Accumulation Unit

A share of a Subaccount that an Owner purchases during the Accumulation Period.

Accumulation Unit Value

The value of an Accumulation Unit at the end of a Valuation Period. See the Glossary of Financial Terms of this prospectus for an explanation of how Accumulation Unit Values are calculated.

Annuity Commencement Date

The first day of the first payment interval for which an annuity benefit payment is to be made. For tax qualified forms, the Annuity Commencement Date generally must be no later than the Contract anniversary following the Owner’s 70^th birthday. For non-tax qualified forms, the Annuity Commencement Date is generally the Owner’s 85^th birthday, or five years after the Contract’s effective date, if later.

Benefit Payment Period

The period during which either annuity benefit or death benefit payments are paid under a settlement option. The Benefit Payment Period begins on the first day of the first payment interval in which a benefit payment will be paid.

Benefit Unit

A share of a Subaccount that is used to determine the amount of each variable dollar benefit payment during the Benefit Payment Period.

Benefit Unit Value

The value of a Benefit Unit at the end of a Valuation Period. See the Glossary of Financial Terms of this prospectus for an explanation of how Benefit Unit Values are calculated.

Company

1

Owner

For purposes of this prospectus, references to the Owner means the owner of an individual annuity contract or the participant in a group annuity contract (even though the participant is not the owner of the group contract itself.) The words “you” and “your” also refer to the Owner.

Valuation Date

A day on which Accumulation Unit Values and Benefit Unit Values can be calculated. Each day that the New York Stock Exchange is open for business is a Valuation Date.

Valuation Period

The period starting at the close of regular trading on the New York Stock Exchange on any Valuation Date and ending at the close of trading on the next succeeding Valuation Date.

These tables describe the fees and expenses that you will pay when you buy, hold or withdraw amounts from the Contract.

The first table describes the fees and expenses that you will pay at the time that you buy the Contract, withdrawal amounts from the Contract, surrender the Contract, transfer cash value between investment options or borrow money under the Contract. Premium taxes may also be deducted.

Contract Owner Transaction Expenses

					Current				Maximum
Maximum Contingent Deferred Sales Charge (as to purchase payments only)						8.00	%			8.00	%
Transfer Fee						$25	*			$30
Automatic Transfer Program Fee						None				$30
Systematic Withdrawal Fee						None				$30

Loan Interest Spread**						3.00	%

**	The Loan Interest Spread is the difference between the amount of interest we charge you for a loan and the amount of interest we credit to that portion of the Contract used to secure the loan.

The next table describes the fees and expenses that you will pay periodically during the time that you own the Contract, not including Portfolio fees and expenses.

Annual Contract Maintenance Fee		$	30

Separate Account Annual Expenses

(as a percentage of the average value of the Owner’s interest in the Subaccounts)

						Standard Contracts
						With Administration
		Standard Contracts				Charge Waived*
Mortality and Expense Risk Charge			1.25	%			1.25	%
Administration Charge			0.15	%			0.00	%
Total Separate Account Annual Expenses			1.40	%			1.25	%

*	When we also expect to incur reduced administrative expenses, we may waive the Administration Charge.

3

Total Annual Portfolio Operating Expenses

(expenses that are deducted from Portfolio assets, including management fees, distribution and service (12b-1) fees, and other expenses)

		Minimum				Maximum
Before any fee reduction or expense reimbursement			0.27	%			10.73	%
After contractual fee reductions and/or expense reimbursements			0.27	%			1.67	%

The information about Portfolio expenses that the Company used to prepare this table was provided to the Company by the Portfolios. The Company has not independently verified the Portfolio expense information. The minimum and maximum expenses shown in the table are for the year ended December 31, 2006, except as noted below. Actual expenses of a Portfolio in future years may be higher or lower.

The maximum expenses shown in the table are the expenses of the Wilshire 2045 Moderate Fund (the “Wilshire Fund”). The Wilshire Fund is structured as a “fund of funds” and invests in other investment companies (the “Acquired Funds”). As a result, the Wilshire Fund will likely incur higher expenses than funds that invest directly in securities. The expenses shown in the table for the Wilshire Fund include fees and expenses of the Acquired Funds. The Wilshire Fund’s expenses before any reduction or reimbursement reflect the small asset base of the Wilshire Fund, which commenced operations on May 1, 2006. The Wilshire Fund’s expenses after reductions and/or reimbursements reflect that (1) its adviser has contractually agreed to waive management fees and/or reimburse expenses through April 30, 2008, so that the Wilshire Fund’s expenses, excluding the fees and expenses of the Acquired Funds will not exceed 0.50% and (2) two components (other expenses and expense reimbursements) of the Wilshire Fund’s total expenses were calculated as of April 10, 2007 to reflect asset growth in the Wilshire Fund since December 31, 2006.

Examples
These examples are intended to help you compare the cost of investing in the Contract with the cost of investing in other variable annuity contracts. These costs include the Contract Owner transaction expenses (described in the first table above), the annual contract maintenance fee and the Separate Account annual expenses (described in the second table above), and Portfolio operating expenses (described in the third table above). Your actual costs may be higher or lower than the costs shown in the examples.

Assumptions

•

You invest $10,000 in the Contract for the periods indicated and your investment has a 5% return each year.

•

The annual contract maintenance fee of $30 and Separate Account annual expenses of 1.40% are incurred.

•

The maximum Portfolio expenses before reimbursement (10.73%) or after reimbursement (1.67%) are incurred or the minimum Portfolio expenses (0.27%) are incurred.

•

Table #1 assumes that you surrender your Contract at the end of the indicated period and the applicable contingent deferred sales charge is incurred.

•

Table #2 assumes that you annuitize your Contract at the end of the indicated period or you keep your Contract and leave your money in your Contract for the entire period.

		1 year				3 years				5 years				10 years
Maximum portfolio expenses before reimbursement		$	1,979			$	4,183			$	6,243			$	11,401
Maximum portfolio expenses after reimbursement		$	1,145			$	1,803			$	2,459			$	4,604
Minimum portfolio expenses		$	1,003			$	1,355			$	1,677			$	2,839

		1 year				3 years				5 years				10 years
Maximum portfolio expenses before reimbursement		$	1,979			$	4.283			$	6,343			$	11,401
Maximum portfolio expenses after reimbursement		$	1,145			$	1,903			$	2,559			$	4,604
Minimum portfolio expenses		$	1,003			$	1,455			$	1,777			$	2,839

		1 year				3 years				5 years				10 years
Maximum portfolio expenses before reimbursement		$	1,179			$	3,483			$	5,743			$	11,404
Maximum portfolio expenses after reimbursement		$	345			$	1,103			$	1,959			$	4,604
Minimum portfolio expenses		$	203			$	655			$	1,177			$	2,839

Condensed Financial Information

Condensed financial information for the Contracts is set forth in Appendix A to this prospectus. This information includes the following information for the standard Contracts and the enhanced Contracts:

•		year-end accumulation unit values for each Subaccount from December 31, 1997 to December 31, 2006 (or from the end of the year of inception to December 31, 2006)
•		number of accumulation units outstanding as of the end of each period.

Financial Statements

The financial statements and reports of the independent registered public accounting firm of the Company and of the Separate Account are included in the Statement of Additional Information.

What is the Separate Account?

The Separate Account is a unit investment trust registered with the SEC under the Investment Company Act of 1940. The Separate Account is divided into Subaccounts. Each Subaccount is invested in one of the Portfolios listed on the cover page of this prospectus. If you choose a variable investment option, you are investing in the Subaccounts, not directly in the Portfolios.

What Are the Contracts?

The Contracts are individual and group deferred annuities, which are insurance products. The Contracts are sold with either a standard fee structure or with the administration charge waived, as described in the Expense Tables of this prospectus. The Contracts are available in both tax-qualified and non-tax-qualified forms, both of which are designed to be eligible for tax-deferred investment status. See the Federal Tax Matters section of this prospectus for more information about tax qualifications and taxation of annuities in general. During the Accumulation Period, the amounts you contribute can be allocated among any of the then available variable investment options and Fixed Account options. The variable investment options are the Subaccounts of the Separate Account, each of which is invested in a Portfolio. The Owner bears the risk of any investment gain or loss on amounts allocated to the Subaccounts. The Fixed Account options earn a rate of interest declared from time to time by the Company, which will be no less than the minimum interest rate permitted under the law of the state when and where the Contract is issued. The Company guarantees amounts invested in the Fixed Account options and the earnings thereon so long as those amounts remain in the Fixed Account.

During the Benefit Payment Period, payments can be allocated between variable dollar and fixed dollar options. If a variable dollar option is selected, Benefit Units can be allocated to any of the same Subaccounts that are available during the Accumulation Period.

How Do I Purchase or Cancel a Contract?

The requirements to purchase a Contract are explained in The Contracts section of this prospectus. You may purchase a Contract only through a licensed securities representative. You may cancel a Contract within twenty days after you receive it (the right to cancel may be longer in some states). In many states, you will bear the risk of investment gain or loss on any amounts allocated to the Subaccounts prior to cancellation. The right to cancel may not apply to group Contracts. The right to cancel is described in the Right to Cancel section of this prospectus.

Will Any Penalties or Charges Apply If I Make Withdrawals or Surrender a Contract?

A contingent deferred sales charge (“CDSC”) may apply to amounts withdrawn or surrendered depending on the timing and amount of the withdrawal or surrender. The maximum CDSC is 8% for each purchase payment. For CDSC purposes, any bonus credited to a purchase payment is generally deemed to be part of that purchase payment. CDSC would not be imposed, however, with respect to any bonus amounts recaptured following a cancellation during the right to cancel period. CDSC is also not imposed with respect to any bonus amounts upon full or partial surrender during the first Contract year. The CDSC percentage decreases over eight years to 0% after the eighth year from the date of receipt of each purchase payment. The CDSC will be waived in its entirety following the tenth Contract Anniversary for Contracts issued pursuant to Internal Revenue Code Section 403(b) (if the Contract is issued without an employer plan endorsement), including those issued to Contract Owners in the Texas Teachers Retirement System. Withdrawal and surrender procedures and the CDSC are described in the Surrender and Withdrawals section of this prospectus. A penalty tax may also be imposed at the time of a withdrawal or surrender depending on your age and other circumstances of the surrender. Tax consequences of a withdrawal or surrender are described in the Federal Tax Matters section of this prospectus. The right to make withdrawals or surrender may be restricted under certain tax-qualified retirement plans.

What Other Charges and Deductions Apply to the Contract?

Other than the CDSC, the Company will charge the fees and charges listed below unless the Company reduces or waives the fee or charge as discussed in the Charges and Deductions section of this prospectus:

§		a transfer fee for certain transfers among investment options;
§		an annual contract maintenance fee, which is assessed only against investments in the Subaccounts;
§		a mortality and expense risk charge, which is an expense of the Separate Account and charged against all assets in the Subaccounts (this charge may never be waived);
§		an administration charge, which is an expense of the Separate Account and charged against all assets in the Subaccounts; and
§		premium taxes, if any.

In addition to charges and deductions under the Contracts, the Portfolios incur expenses that are passed through to Owners. Portfolio expenses for the fiscal year ended December 31, 2006 are described in the prospectuses and SAIs for the Portfolios.

How Do I Contact the Company?

Any questions or inquiries should be directed to the Company’s Administrative Office, P.O. Box 5423, Cincinnati, Ohio 45201-5423, 1-800 789-6771. Please include the Contract number and the Owner’s name. You may also call the Company at 1-800 789-6771, or visit us at our web site, www.gafri.com, to request a copy.

Portfolios

The Separate Account currently is divided into 46 Subaccounts. Each Subaccount invests in the corresponding Portfolio listed below. The current Portfolio prospectuses, which accompany this prospectus, contain additional information concerning the investment objectives, policies and practices of each Portfolio, the investment advisory services and administrative services of each Portfolio, and the expenses of each Portfolio.

You should read the Portfolio prospectuses carefully before making any decision concerning the allocation of Purchase Payments to, or transfers among, the Subaccounts.

There is no assurance that the Portfolios will achieve their stated objectives. The SEC does not supervise the management or the investment policies and/or practices of any of the Portfolios.

All dividends and capital gains distributed by the Portfolios are reinvested in the Separate Account and reflected in Accumulation Unit Values. Portfolio dividends and net capital gains are not distributed to Owners.

The Portfolios are available only through insurance company separate accounts and certain qualified retirement plans. Though a Portfolio may have a name and/or investment objectives that are similar to those of a publicly available mutual fund, and/or may be managed by the same investment advisor that manages a publicly available mutual fund, the performance of the Portfolio is entirely independent of the performance of any publicly available mutual fund. Neither the Company nor the Portfolios make any representations or assurances that the investment performance of any Portfolio will be the same or similar to the investment performance of any publicly available mutual fund.

Portfolio		Adviser and Type of Fund
AIM Variable Insurance Funds
AIM V.I. Capital Development Fund Series I Shares		A I M Advisors, Inc. Mid cap growth
AIM V.I. Core Equity Fund Series I Shares		A I M Advisors, Inc. Large cap blend
AIM V.I. Financial Services Fund Series I Shares		A I M Advisors, Inc. Sector
AIM V.I. Global Health Care Fund Series I Shares		A I M Advisors, Inc. Sector
AIM V.I. High Yield Fund Series I Shares		A I M Advisors, Inc. High yield bond
AIM V.I. Small Cap Equity Fund Series I Shares		A I M Advisors, Inc. Small cap blend
American Century Variable Portfolios, Inc.
American Century VP Large Company Value Fund Class I Shares		American Century Investment Management, Inc. Large cap value
American Century VP Mid Cap Value Fund Class I Shares		American Century Investment Management, Inc. Mid cap value
American Century VP Ultraâ Fund Class I Shares		American Century Investment Management, Inc. Large cap growth
American Century VP VistaSM Fund Class I Shares		American Century Investment Management, Inc. Mid cap growth
Calamosâ Advisors Trust
Calamos Growth and Income Portfolio		Calamos Advisors LLC Convertibles

Portfolio		Adviser and Type of Fund
Davis Variable Account Fund, Inc.
Davis Value Portfolio		Davis Selected Advisers, L.P. Sub-Adviser—Davis Selected Advisers-NY, Inc. Large cap blend
Dreyfus Portfolios
Dreyfus Investment Portfolios MidCap Stock Portfolio Service Shares		The Dreyfus Corporation Mid cap blend
Dreyfus Investment Portfolio Technology Growth Portfolio Initial Shares		The Dreyfus Corporation Sector
The Dreyfus Socially Responsible Growth Fund, Inc. Initial Shares		The Dreyfus Corporation Large cap growth
Dreyfus Stock Index Fund, Inc. Initial Shares		The Dreyfus Corporation Index Manager—Mellon Equity Associates (an affiliate of Dreyfus) Large cap blend
Dreyfus Variable Investment Fund Appreciation Portfolio Initial Shares		The Dreyfus Corporation Sub-Adviser—Fayez Sarofim & Co Large cap blend
Dreyfus Variable Investment Fund Developing Leaders Portfolio Initial Shares		The Dreyfus Corporation Small cap blend
Dreyfus Variable Investment Fund Growth and Income Portfolio Initial Shares		The Dreyfus Corporation Large cap blend
Dreyfus Variable Investment Fund Money Market Portfolio		The Dreyfus Corporation Money market
DWS Investments VIT Funds
DWS Small Cap Index VIP Class A		Deutsche Asset Management, Inc. Sub-Adviser—Northern Trust Investments, N.A. Small cap blend
Financial Investors Variable Insurance Trust
Ibbotson Balanced ETF Asset Allocation Portfolio Class II		ALPS Advisers, Inc. Sub-Adviser—Ibbotson Associates, Inc. Asset allocation
Ibbotson Conservative ETF Asset Allocation Portfolio Class II		ALPS Advisers, Inc. Sub-Adviser—Ibbotson Associates, Inc. Asset allocation
Ibbotson Growth ETF Asset Allocation Portfolio Class II		ALPS Advisers, Inc. Sub-Adviser—Ibbotson Associates, Inc. Asset allocation
Ibbotson Income and Growth ETF Asset Allocation Portfolio Class II		ALPS Advisers, Inc. Sub-Adviser—Ibbotson Associates, Inc. Asset allocation
Franklin Templeton Variable Insurance Products Trust
Templeton Foreign Securities Fund Class 2		Advisor—Templeton Investment Counsel, LLC Sub-Advisor—Franklin Templeton Investment Management Limited Foreign large cap value

Portfolio		Adviser and Type of Fund
Janus Aspen Series
Janus Aspen Series Balanced Portfolio Institutional Shares		Janus Capital Management LLC Balanced
Janus Aspen Series Forty Portfolio Institutional Shares		Janus Capital Management LLC Large cap growth
Janus Aspen Series International Growth Portfolio Institutional Shares		Janus Capital Management LLC Foreign large cap growth
Janus Aspen Series Large Cap Growth Portfolio Institutional Shares		Janus Capital Management LLC Large cap growth
Janus Aspen Series Mid Cap Growth Portfolio Institutional Shares		Janus Capital Management LLC Mid cap growth
Oppenheimer Variable Account Funds
Oppenheimer Balanced Fund/VA Non-Service Shares		OppenheimerFunds Balanced
Oppenheimer Capital Appreciation Fund/VA Non-Service Initial Shares		OppenheimerFunds Large cap growth
Oppenheimer Main Street Fund®/VA Non-Service Initial Shares		OppenheimerFunds Large cap blend
PIMCO Variable Insurance Trust
PIMCO VIT Real Return Portfolio Administrative Class		Pacific Investment Management Company LLC Inflation-indexed bond
PIMCO VIT Total Return Portfolio Administrative Class		Pacific Investment Management Company LLC Intermediate term bond
Van Kampen—The Universal Institutional Funds, Inc.
Van Kampen UIF Core Plus Fixed Income Portfolio Class I		Van Kampen(1) Intermediate term bond
Van Kampen UIF Mid Cap Growth Portfolio Class I		Van Kampen(1) Mid cap growth
Van Kampen UIF U.S. Mid Cap Value Portfolio Class I		Van Kampen(1) Mid cap value
Van Kampen UIF U.S. Real Estate Portfolio Class I		Van Kampen(1) Specialty-real estate
Van Kampen UIF Value Portfolio Class I		Van Kampen(1) Large cap value
Wilshire Variable Insurance Trust
Wilshire 2010 Moderate Fund		Wilshire Associates Incorporated Target maturity
Wilshire 2015 Moderate Fund		Wilshire Associates Incorporated Target maturity
Wilshire 2025 Moderate Fund		Wilshire Associates Incorporated Target maturity
Wilshire 2035 Moderate Fund		Wilshire Associates Incorporated Target maturity
Wilshire 2045 Moderate Fund		Wilshire Associates Incorporated Target maturity

Each Ibbotson Portfolio and each Wilshire Portfolio listed in the table above is structured as a “fund of funds.” A “fund of funds” attempts to achieve its investment objective by investing in other investment companies (each, an “Acquired Fund”), which in turn invest directly in securities. Each Ibbotson Portfolio and each Wilshire Portfolio indirectly incurs a proportionate share of the expenses of each Acquired Fund in which it invests. As a result of this fund of funds structure, the Ibbotson Portfolios and the Wilshire Portfolio will likely incur higher expenses than funds that invest directly in securities.

Additions or Substitutions of Portfolios

New Subaccounts may be established when, in our sole discretion, marketing, tax, investment or other conditions warrant. Any new Subaccounts will be made available to existing Owners on a basis to be determined by us and that is not discriminatory. We do not guarantee that any of the Subaccounts or any of the Portfolios will always be available for allocation of Purchase Payments or variable dollar benefit payments or for transfers. We may substitute the shares of a different portfolio or a different class of shares for shares held in a Portfolio.

In the event of any addition, merger, combination or substitution, we may make such changes in the Contract as may be necessary or appropriate to reflect such event. Additions, mergers, combinations or substitutions may be due to an investment decision by us, or due to an event not within our control, such as liquidation of a Portfolio or an irreconcilable conflict of interest between the Separate Account and another insurance company that offers the Portfolio. We will obtain approval of additions, mergers, combinations or substitution from the SEC to the extent required by the Investment Company Act of 1940, or other applicable law. We will also notify you before we make a substitution.

Charges and Deductions By the Company

There are two types of charges and deductions by the Company. There are charges assessed to the Contract which are reflected in the Account Value of the Contract, but not in Accumulation Unit Values (or Benefit Unit Values). These charges are the contingent deferred sales charge, the annual contract maintenance fee, transfer fees, and premium taxes, where applicable. There are also charges assessed against the Separate Account. These charges are reflected in the Accumulation Unit Values (and Benefit Unit Values) of the Subaccounts. These charges are the mortality and expense risk charge and the administration charge.

Except as indicated below, the Company will never charge more to a Contract than the fees and charges described, even if its actual expenses exceed the total fees and charges collected. If the fees and charges collected by the Company exceed the actual expenses it incurs, the excess will be profit to the Company and will not be returned to Owners.

The Company reserves the right to increase the amount of the transfer fee in the future, and/or to charge fees for the automatic transfer programs described in the Transfers section of this prospectus, and/or for the systematic withdrawal program described in the Surrender and Withdrawals section of this prospectus, if in the Company’s discretion, it determines such charges are necessary to offset the costs of administering transfers or systematic withdrawals.

Contingent Deferred Sales Charge (“CDSC”)

		Purpose of Charge		Offset expenses incurred by the Company in the sale of the Contracts, including commissions paid and costs of sales literature.
		Amount of Charge		Up to 8% of each purchase payment withdrawn from the Contract depending on number of years elapsed since receipt of the purchase payment.

For Contracts issued after May 1, 2004 for states where the Company has received regulatory approval:

Number of full years elapsed between date of receipt of purchase payment and date request for withdrawal or surrender received			0				1				2				3				4				5				6				7			8 or more
CDSC as a percentage of purchase payment withdrawn or surrendered			8	%			8	%			7	%			6	%			5	%			4	%			3	%			2	%			0	%

For all other Contracts:

Number of full years elapsed between date of receipt of purchase payment and date request for withdrawal or surrender received			0				1				2				3				4				5				6				7			8 or more
CDSC as a percentage of purchase payment withdrawn or surrendered			8	%			8	%			8	%			7	%			6	%			5	%			4	%			2	%			0	%

		When Assessed		On surrenders or withdrawals of purchase payments during Accumulation Period.
		Assessed Against What		Purchase payments only, not earnings. See the Surrender and Withdrawals section of this prospectus for information on order of withdrawal of earnings and purchase payments.
		Waivers		§		Free withdrawal privilege. See the Surrender and Withdrawals section of this prospectus for information.
				§		In the Company’s discretion where the Company incurs reduced sales and servicing expenses.
				§		Upon separation from service if Contract issued with employer plan endorsement or deferred compensation endorsement.
				§		If the Contract is issued with a tax-sheltered annuity endorsement (and without an employer plan endorsement): (i) upon separation from service if Owner has attained age 55 and Contract has been in force for at least seven years; or (ii) after Contract has been in force ten years or more.
				§		Long-term care waiver rider. See the Surrender and Withdrawals section of this prospectus for information.
				§		If the Social Security Administration determines after the Contract is issued that the Owner is “disabled” as that term is defined in the Social Security Act of 1935, as amended.
				§		Successor Owner election. See the Account Value section of this prospectus for information.
				§		Where required to satisfy state law or required for participation in certain retirement plans.

Contract Maintenance Fee

		Purpose of Charge		Offset expenses incurred in issuing the Contracts and in maintaining the Contracts and the Separate Account.
		Amount of Charge		$30.00 per year.
		When Assessed		During the Accumulation Period, the charge is deducted on each anniversary of the effective date of the Contract, and at time of surrender. During the Benefit Payment Period, a portion of the charge is deducted from each variable dollar benefit payment.
		Assessed Against What		Amounts invested in the Subaccounts. During the Accumulation Period, the charge is deducted pro rata from the Subaccounts in which the Contract has an interest on the date of the charge. During the Benefit Payment Period, a pro rata portion of the annual charge is deducted from each benefit payment from the variable account. The charge is not assessed against the Fixed Account options.
		Waivers		§		During the Accumulation Period if the Account Value is at least $40,000 on the date the charge is due (individual contracts only).
				§		During the Benefit Payment Period if the amount applied to a variable dollar benefit is at least $40,000 (individual contracts only).
				§		In the Company’s discretion where the Company incurs reduced sales and servicing expenses.
				§		During the Benefit Payment Period where required to satisfy state law.

Transfer Fee

		Purpose of Charge		Offset cost incurred in administering the Contracts.
		Amount of Charge		$25 for each transfer in excess of 12 in any contract year. The Company reserves the right to change the amount of this charge at any time.
		When Assessed		During the Accumulation Period.
		Assessed Against What		Deducted from amount transferred.
		Waivers		Currently, the transfer fee does not apply to transfers associated with the dollar cost averaging, interest sweep and portfolio rebalancing programs. Transfers associated with these programs do not count toward the 12 free transfers permitted in a contract year. The Company reserves the right to eliminate this waiver at any time.

Administration Charge

		Purpose of Charge		Offset expenses incurred in administering the Contracts and the Separate Account.
		Amount of Charge		Daily charge equal to 0.000411% of the daily Net Asset Value for each Subaccount, which corresponds to an annual effective rate of 0.15%.
		When Assessed		During the Accumulation Period and during the Benefit Payment Period if a variable dollar benefit is elected.
		Assessed Against What		Amounts invested in the Subaccounts. Not assessed against the Fixed Account options.
		Waivers		May be waived or reduced in the Company’s discretion where the Company incurs reduced sales and servicing expenses.

Mortality and Expense Risk Charge

		Purpose of Charge		Compensation for bearing certain mortality and expense risks under the Contract. Mortality risks arise from the Company’s obligation to make benefit payments during the Benefit Payment Period and to pay the death benefit. The expense risk assumed by the Company is the risk that the Company’s actual expenses in administering the Contracts and the Separate Account will exceed the amount recovered through the contract maintenance fees, transfer fees and administration charges.
		Amount of Charge		Daily charge equal to 0.003446% of the daily Net Asset Value for each Subaccount, which corresponds to an effective annual rate of 1.25%.
		When Assessed		During the Accumulation Period, and during the Benefit Payment Period if a variable dollar benefit is elected.
		Assessed Against What		Amounts invested in the Subaccounts. Not assessed against the Fixed Account options.
		Waivers		None.

Premium Taxes

Currently some state governments impose premium taxes on annuity purchase payments. These taxes currently range from zero to 3.5% depending upon the jurisdiction. A federal premium tax has been proposed but not enacted. The Company will deduct any applicable premium taxes from the Account Value either upon death, withdrawal, surrender, annuitization, or at the time purchase payments are made, but no earlier than when the Company incurs a tax liability under applicable law.

Discretionary Waivers of Charges

The Company will look at the following factors to determine if it will waive a charge, in part or in full, due to reduced sales and servicing expenses: (1) the size and type of the group to which sales are to be made; (2) the total amount of purchase payments to be received; and (3) any prior or existing relationship with the Company. The Company would expect to incur reduced sales and servicing expenses in connection with Contracts offered to employees of the Company, its subsidiaries and/or affiliates. There may be other circumstances, of which the Company is not presently aware, which could result in reduced sales and servicing expenses. In no event will the Company waive a charge where such waiver would be unfairly discriminatory to any person.

Expenses of the Portfolios

In addition to charges and deductions by the Company, there are Portfolio management fees and administration expenses which are described in the prospectus and Statement of Additional Information for each Portfolio. Portfolio expenses, like Separate Account expenses, are reflected in Accumulation Unit Values (or Benefit Unit Values).

Each Contract allows for an Accumulation Period during which purchase payments are invested according to the Owner’s instructions. During the Accumulation Period, the Owner can control the allocation of investments through transfers or through the following investment programs offered by the Company: dollar cost averaging, portfolio rebalancing and interest sweep. These programs and telephone, facsimile and Internet transfer procedures are described in the Transfers section of this prospectus. The Owner can access the Account Value during the Accumulation Period through surrenders or withdrawal, systematic withdrawal, or contract loans (if available). These withdrawal features are described more fully in the Surrender and Withdrawals and Contract Loans sections of this prospectus.

Purchase Payments

Purchase payments may be made at any time during the Accumulation Period. The current restrictions on purchase payment amounts are:

		Tax-Qualified		Non-Tax-Qualified
Minimum initial purchase payment		$2,000*		$10,000
Minimum monthly payments under periodic payment program		$50		$100
Minimum additional payments		$50		$50
Maximum single purchase payment		$500,000 or Company approval		$500,000 or Company approval

The Company reserves the right to increase or decrease the minimum initial purchase payment or minimum purchase payment under a periodic payment program, the minimum allowable additional purchase payment, or the maximum single purchase payment, at its discretion and at any time, where permitted by law.

Each purchase payment will be applied by the Company to the credit of the Owner’s account. If the application or order ticket form is in good order, the Company will apply the initial purchase payment to an account for the Owner within two business days of receipt of the purchase payment. If the application or order ticket form is not in good order, the Company will attempt to get the application or order ticket form in good order within five business days. If the application or order ticket form is not in good order at the end of this period, the Company will inform the applicant of the reason for the delay and that the purchase payment will be returned immediately unless he or she specifically gives the Company consent to keep the purchase payment until the application or order ticket form is in good order. Once the application or order ticket form is in good order, the purchase payment will be applied to the Owner’s account within two business days.

Each additional Purchase Payment is credited to a Contract as of the Valuation Date on which the Company receives the Purchase Payment and any related allocation instructions in good order. If any portion of the additional Purchase Payment is allocated to a Subaccount, it will be applied at the next Accumulation Unit Value calculated after the Company receives the Purchase Payment and related allocation instructions in good order.

The Company may, in its sole discretion, restrict or prohibit the credit of purchase payment to any Fixed Account option or any Subaccount from time to time on a nondiscriminatory basis.

Purchase Payment Bonus

A bonus in the amount of 4% of each purchase payment will be credited to the Account Value. The bonus will be deemed to be a purchase payment for all purposes under a Contract and this prospectus except where otherwise noted. For example, the bonus will be allocated as part of purchase payment allocations. Any bonus credited to a purchase payment is also deemed to be part of that purchase payment for CDSC purposes. This means if the bonus is returned to the Owner on a surrender or withdrawal following the first Contract year, a CDSC, to the extent applicable to the purchase payment, will be deducted from the bonus amount. CDSC would not be imposed, however, with respect to any bonus amounts recaptured following a cancellation during the Right to Cancel period. CDSC is also not imposed with respect to any bonus amounts upon full or partial surrender during the first Contract year.

The bonus will not be returned to the Owner if a Contract is canceled under the Right to Cancel provision, if any, or if a Contract is surrendered in full during the first Contract year, unless otherwise required by state law. In either case, the bonus will be forfeited and the Owner will bear the risk of investment gains or losses on the amount of the bonus that was allocated to Subaccounts.

The bonus is funded from the Company’s General Account, and the Company guarantees that the bonus will never be less than 4%. The CDSC for the Contract is slightly higher and longer than for the other variable annuity contracts issued by the Company through Annuity Investors^Ò Variable Account B. The Company expects to partially recover the expenses associated with providing the bonus under the Contract from this additional CDSC. The standard mortality and expense risk charge for the Contract is the same as for other variable annuity standard contracts issued by the Company through Annuity Investors^Ò Variable Account B. It does not include any additional charge for the bonus feature.

In certain circumstances, due to the generally higher surrender charge and longer surrender period for a contract with a bonus, an annuity contract without a bonus may provide greater value on surrender or withdrawal. In addition, if you surrender or withdrawal your contract during the first Contract Year, we will recapture the entire amount of the bonus even if your Contract has declined in value to an amount less than your Purchase Payments. As with any variable annuity that includes a contingent deferred sales charge, you should carefully consider your need to access your Account Value during the CDSC period, and the extent to which the free withdrawal privilege available under the Contract may be sufficient.

Investment Options—Allocations

Purchase payments can be allocated in whole percentages to any of the available Subaccounts or Fixed Account options. See The Portfolios section of this prospectus for a listing and description of the currently available Subaccounts. The currently available Fixed Account options are:

Fixed Accumulation Account Option
One-Year Guaranteed Interest Rate Option
Three-Year Guaranteed Interest Rate Option
Five-Year Guaranteed Interest Rate Option
Seven-Year Guaranteed Interest Rate Option

The current restrictions on allocations are:

		Tax-Qualified and Non-Tax-Qualified
Minimum allocation to any Subaccount		$10
Minimum allocation to Fixed Accumulation Account		$10
Minimum allocation to Fixed Account guarantee period option		$2,000  No amounts may be allocated to a guarantee period option which would extend beyond the Annuity Commencement Date.
Allocations to either Five-Year Guaranteed Interest Rate Option or Seven-Year Guaranteed Interest Rate Option		For Contracts issued after May 1, 2004 for states where the Company has received regulatory approval, amounts may be allocated to the Five-Year Guaranteed Interest Rate Option and the Seven-Year Guaranteed Interest Rate Option only during the first contract year.
Allocation during right to cancel period		No current restrictions, however, the Company reserves the right to require that purchase payment(s) be allocated to the money market Subaccount or to the Fixed Accumulation Account option during the right to cancel period.

Interests in the Fixed Account options are not securities and are not registered with the SEC. Amounts allocated to the Fixed Account options will receive interest at a rate no less than the minimum interest rate permitted under the law of the state when and where the Contract is issued. The interest rate credited to each purchase payment allocated to the Fixed Accumulation Account will not be changed for at least 12 months after its allocation. The interest rate to an amount that is held under a Fixed Account guaranteed interest rate option will not be changed until the end of the guarantee period. The guarantee period is measured from the date that the amount is allocated or transferred to that option. Interest on the amounts allocated to the Fixed Account options is earned daily. Amounts allocated to the Fixed Account options and interest credited to the Fixed Account options are guaranteed by the Company. Your Contract contains more information about the Fixed Account options, including information about how and when interest rates are determined and changed and how and when interest is credited to amounts allocated to the Fixed Account options.

Interests in the Subaccounts are securities registered with the SEC. The Owner bears the risk of investment gain or loss on amounts allocated to the Subaccounts.

The Company may, in its sole discretion, restrict or prohibit allocation to any Fixed Account option or any Subaccount from time to time on a nondiscriminatory basis.

Principal Guarantee Program

An Owner may elect to have the Company allocate a portion of a purchase payment to the seven-year guaranteed interest rate option such that, at the end of the seven-year guarantee period, that account will grow to an amount equal to the total purchase payment (so long as there are no surrenders or loans from the Contract). The Company determines the portion of the purchase payment that must be allocated to the seven-year guarantee option such that, based on the interest rate then in effect, that account will grow to equal the full amount of the purchase payment after seven years. The remainder of the purchase payment will be allocated according to the Owner’s instructions. The minimum purchase payment eligible for the principal guarantee program is $5,000. The Principal Guarantee Program is only available during the first contract year.

Renewal of Fixed Account Guarantee Options

An amount allocated or transferred to a Fixed Account guarantee interest rate option will mature at the end of the guarantee period. The Company will notify you of the date on which the amount matures and the Fixed Account options available at that time. When the amount matures, the Owner may elect in writing to transfer it to any of the investment options then available under the Contract. Such an election must be made within the 30-day period ending on the date the amount matures. If the Owner does not transfer the amount, then it will be applied to a new guarantee period under the same Fixed Account guaranteed interest rate option, if available to the Owner. The interest rate for the new guarantee period will be the then current rate for that option. If that option is not available, the amount will be allocated to the Fixed Accumulation Account option. Such a transfer or renewal will be effective on the day after the amount matures.

Transfers

If allowed by the Company, in its sole discretion, during the Accumulation Period, an Owner may transfer amounts among Subaccounts, between Fixed Account options, and/or between Subaccounts and Fixed Account options by written request once each Valuation Period.

The current restrictions on transfers are:

		Tax-Qualified and Non-Tax-Qualified
Minimum transfer from any Subaccount		$500 or balance of Subaccount, if less
Minimum transfer from Fixed Account option		$500 or balance of Fixed Account option, if less
Minimum transfer to Fixed Account guarantee period option		$2,000 No amounts may be transferred to a guarantee period option, which would extend beyond the Annuity Commencement Date.
Maximum transfer from Fixed Account option other than Fixed Account guarantee period option which is maturing		During any contract year, 20% of the Fixed Account option’s value as of the most recent contract anniversary.
Transfers to either Five-Year Guaranteed Interest Rate Option or Seven-Year Guaranteed Interest Rate Option		For Contracts issued after May 1, 2004 for states where the Company has received regulatory approval, amounts may be transferred to the Five-Year Guaranteed Interest Rate Option and the Seven-Year Guaranteed Interest Rate Option only during the first contract year.
Transfers from Fixed Account options		§    May not be made prior to first contract anniversary.
		§   Amounts transferred from Fixed Account options to
		Subaccounts may not be transferred back to Fixed Account
		options for a period of 6 months from the date of the
		original transfer.

A transfer is effective on the Valuation Date during which the Company receives the request for transfer. Transfers to a Subaccount will be processed at the next Accumulation Unit Value calculated after the Company receives the transfer request in good order. The Company may, in its sole discretion, restrict, delay or prohibit transfers to any Fixed Account option or any Subaccount from time to time on a nondiscriminatory basis.

Automatic Transfer Programs

During the Accumulation Period, the Company offers the automatic transfer services described below. To enroll in one of these programs, you will need to complete the appropriate authorization form, which you can obtain from the Company by calling 1-800-789-6771. There are risks involved in switching between investments available under the Contract.

Currently, the transfer fee does not apply to dollar cost averaging, portfolio rebalancing, or interest sweep transfers, and transfers under these programs will not count toward the twelve transfers permitted under the Contract without a transfer fee charge.

				Minimum Account
Service		Description		Requirements		Limitations/Notes
Dollar Cost Averaging Dollar cost averaging requires regular investments regardless of fluctuating price levels and does not guarantee profits or prevent losses in a declining market. You should consider your financial ability to continue dollar cost averaging transfers through periods of changing price levels.		Automatic transfers from the money market Subaccount to any other Subaccount(s), or from the Fixed Accumulation Account option (where available) to any Subaccount(s), on a monthly or quarterly basis.		Source of funds must be at least $10,000. Minimum transfer per month is $500. When balance of source of funds falls below $500, entire balance will be allocated according to dollar cost averaging instructions.		Dollar cost averaging transfers may not be made to any of the Fixed Account options. The dollar cost averaging transfers will take place on the last Valuation Date of each calendar month or quarter as requested by the Owner.
Portfolio Rebalancing Portfolio rebalancing does not guarantee profits or prevent losses in a declining market.		Automatically transfer amounts between the Subaccounts and the Fixed Accumulation Account option (where available) to maintain the percentage allocations selected by the Owner.		Minimum Account Value of $10,000.		Transfers will take place on the last Valuation Date of each calendar quarter. Portfolio rebalancing will not be available if the dollar cost averaging program or an interest sweep from the Fixed Accumulation Account option is being utilized.
Interest Sweep		Automatic transfers of the income from any Fixed Account option(s) to any Subaccount(s).		Balance of each Fixed Account option selected must be at least $5,000. Maximum transfer from each Fixed Account option selected is 20% of such Fixed Account option’s value per year. Amounts transferred under the interest sweep program will reduce the 20% maximum transfer amount otherwise allowed.		Interest sweep transfers will take place on the last Valuation Date of each calendar quarter. Interest sweep is not available from the Seven-Year Guaranteed Interest Rate Option if the Principal Guarantee Program is selected.

Telephone, Facsimile or Internet Transfers

Currently, instead of placing a request in writing, an Owner may place a request for all or part of the Account Value to be transferred by telephone, facsimile or over the Internet. All transfers must be in accordance with the terms of the Contract. Transfer instructions are currently accepted once each Valuation Period. Transfer instructions currently may be placed by telephone at 1-800-789-6771, or via facsimile at 513-412-3766, or over the Internet through the Company’s web site at www.gafri.com, between 9:30 a.m. and 4:00 p.m. Once instructions have been accepted, they may not be rescinded; however, new instructions may be given the following Valuation Period. Access to these alternate methods of placing transfer requests, particularly through the Company’s web site, may be limited or unavailable during periods of peak demand, system upgrading and maintenance, or for other reasons. The Company may withdraw the right to make transfers by telephone, facsimile or over the Internet upon 10 days’ written notice to affected Contract Owners.

The Company will not be liable for complying with transfer instructions that the Company reasonably believes to be genuine, or for any loss, damage, cost or expense in acting on such instructions. In addition, the Company will not be liable for refusing to comply with transfer instructions that the Company reasonably believes are not genuine, or for any loss, damage, cost or expense for failing to act on such instructions. The Owner or person with the right to control payments will bear the risk of such loss. The Company will employ reasonable procedures to determine that telephone, facsimile or Internet instructions are genuine. If the Company does not employ such procedures, the Company may be liable for losses due to unauthorized or fraudulent instructions. These procedures may include, among others, tape recording telephone instructions or requiring use of a unique password or other identifying information.

Changes in or Termination of Automatic Transfer Programs

The Owner may terminate any of the automatic transfer programs at any time, but must give the Company at least 30 days’ notice to change any automatic transfer instructions that are already in place. Termination and change instructions will be accepted by U.S. or overnight mail, or by facsimile at 513-412-3766. The Company may terminate, suspend or modify any aspect of the automatic transfer programs described above without prior notice to Owners, as permitted by applicable law. Any such termination, suspension or modification will not affect automatic transfer programs already in place.

The Company may also impose an annual fee or increase the current annual fee, as applicable, for any of the foregoing automatic transfer programs in such amount(s) as the Company may then determine to be reasonable for participation in the program. The maximum amount of the annual fee that would be imposed for participating in each automatic transfer program is $30.

Restrictions on Transfers Relate to Active Trading Strategies

Neither the Contracts described in this prospectus nor the underlying Portfolios are designed to support active trading strategies that involve frequent movement between or among Subaccounts (sometimes referred to as “market-timing” or “short-term trading”). An Owner who intends to use an active trading strategy should consult his/her registered representative and request information on variable annuity contracts that offer underlying Portfolios designed specifically to support active trading strategies.

We have implemented several processes and/or restrictions aimed at eliminating the negative impact of active trading strategies. Appendix C to this prospectus contains more information about the processes and restrictions.

Surrender and Withdrawals

An Owner may surrender a Contract either in full or take a partial withdrawal during the Accumulation Period. A CDSC may apply on surrender or withdrawal. If bonus amounts credited to a purchase payment are returned to the Owner on a withdrawal or surrender following the first year, a CDSC, to the extent applicable to the purchase payment, will be deducted from the bonus amount. CDSC would not be imposed, however, with respect to any bonus amounts recaptured following a cancellation during the free look period. CDSC is also not imposed with respect to any bonus amounts upon withdrawal or surrender during the first Contract year. The restrictions and charges on withdrawals and surrenders are:

		Tax-Qualified		Non-Tax-Qualified
Minimum amount of withdrawal		$500
Minimum remaining Surrender Value after withdrawal		$500
Amount available for surrender or withdrawal (valued as of end of Valuation Period in which request for surrender or withdrawal is received by the Company)		Surrender Value, subject to tax law or employer plan restrictions on withdrawals or surrender		Surrender Value, subject to employer plan restrictions on withdrawals or surrender
Tax penalty for early withdrawal		When applicable, 10% of amount distributed before age 591/2 (25% for certain SIMPLE IRAs)
Contract maintenance fee on surrender		$30 (no CDSC applies to fee)
Contingent deferred sales charge (“CDSC”)		Up to 8% of purchase payments
Order of withdrawal for purposes of CDSC (order may be different for tax purposes)		First from accumulated earnings (no CDSC applies) and then from purchase payments on “first-in, first-out” basis (CDSC may apply)

A surrender will terminate the Contract. Withdrawals are taken proportionally from all Subaccounts and Fixed Account options in which the Contract is invested on the date the Company receives the request unless the Owner requests that the withdrawal be from a specific investment option.

     A surrender or withdrawal is effective on the Valuation Date during which the Company receives the request, and will be processed at the Next Accumulation Unit Value calculated after the Company receives the request in good order. Payment of a surrendered or withdrawn amount may be delayed if it includes an amount paid to the Company by a check that has not yet cleared. Processing and payment of the amount surrendered or withdrawn from a Fixed Account option may be delayed for up to six months after receipt of the request for surrender or withdrawal as allowed by state law. If the Company delays processing and payment, it will comply with the applicable state law. Payment of the amount surrendered or withdrawn from the Subaccounts may be delayed during any period the New York Stock Exchange is closed or trading is restricted, or when the Securities and Exchange Commission either: (1) determines that there is an emergency which prevents valuation or disposal of securities held in the Separate Account; or (2) permits a delay in payment for the protection of security holders.

Free Withdrawal Privilege

The Company will waive the CDSC on full or partial surrender or withdrawal during the first contract year, on an amount equal to not more than 10% of all purchase payments received. During the second and succeeding contract years, the Company will waive the CDSC on an amount equal to not more than the greater of: (a) accumulated earnings (Account Value in excess of purchase payments); or (b) 10% of the Account Value as of the last contract anniversary.

If the free withdrawal privilege is not exercised during a contract year, it does not carry over to the next contract year. The free withdrawal privilege may not be available under some group Contracts.

Long-Term Care Waiver Rider

If a Contract is modified by the Long-Term Care Waiver Rider, a surrender or withdrawal may be made free of any CDSC if the Owner has been confined in a qualifying licensed hospital or long-term care facility for at least 90 days beginning on or after the first contract anniversary. There is no charge for this rider, but it may not be available in all states.

Systematic Withdrawal

During the Accumulation Period, an Owner may elect to automatically withdraw money from the Contract. The Account Value must be at least $10,000 in order to make a systematic withdrawal election. The minimum monthly amount that can be withdrawn is $100. Systematic withdrawals will be subject to the CDSC to the extent the amount withdrawn exceeds the free withdrawal privilege. The Owner may begin or discontinue systematic withdrawals at any time by request to the Company, but at least 30 days’ notice must be given to change any systematic withdrawal instructions that are currently in place. The Company reserves the right to discontinue offering systematic withdrawals at any time. Currently, the Company does not charge a fee for systematic withdrawal services. However, the Company reserves the right to impose an annual fee in such amount as the Company may then determine to be reasonable for participation in the systematic withdrawal program. If imposed, the fee will not exceed $30 annually.

Before electing a systematic withdrawal program, you should consult with a financial advisor. Systematic withdrawal is similar to annuitization, but will result in different taxation of payments and potentially different amount of total payments over the life of the Contract than if annuitization were elected.

Contract Loans

The Company may make loans to Owners of certain tax-qualified Contracts. Any such loans will be secured with an interest in the Contract, and the collateral for the loan will be moved from the Subaccounts you designate to the Fixed Accumulation Account option and earn a fixed rate of interest applicable to loan collateral. Loan amounts and repayment requirements are subject to provisions of the Internal Revenue Code, and default on a loan will result in a taxable event. You should consult a tax advisor prior to exercising loan privileges. If loans are available under a Contract, loan provisions are described in the loan endorsement to the Contract.

A loan, whether or not repaid, will have a permanent effect on the Account Value of a Contract because the collateral cannot be allocated to the Subaccounts or Fixed Account guarantee periods. The longer the loan is outstanding, the greater the effect is likely to be. The effect could be favorable or unfavorable. If the investment results are greater than the rate being credited on collateral while the loan is outstanding, the Account Value will not increase as rapidly as it would if no loan were outstanding. If investment results are below that rate, the Account Value will be higher than it would have been if no loan had been outstanding.

Termination

The Company reserves the right to terminate any Contract at any time during the Accumulation Period if the Surrender Value is less than $500. In that case, the Contract will be involuntarily surrendered and the Company will pay the Owner the amount which would be due the Owner on a full surrender. A group Contract may be terminated on 60 days advance notice, in which case participants will be entitled to continue their interests on a deferred, paid-up basis, subject to the Company’s involuntary surrender right as described above.

Reports and Confirmations

At least once each Contract Year, we will mail reports of the Contract’s Account Value and any other information required by law to you. We will not send these reports after the Commencement Date or a full surrender of the Contract, whichever is first.

We will confirm receipt of any Purchase Payments made after the initial Purchase Payment in quarterly statements of account activity.

Householding — Revocation of Consent

Owners at a shared address who have consented to receive only one copy of each prospectus, annual report, or other required document per household (“householding”) may revoke their consent at any time, and may receive separate documents, by contacting the Company at 1-800-789-6771 or www.gafri.com.

Owners who are currently receiving multiple copies of required documents may contact the Company at 1-800-789-6771 or www.gafri.com for additional information about householding.

Electronic Delivery of Required Documents

Owners who wish to receive prospectuses, SAIs, annual reports, and other required documents only in electronic form must give their consent. Consent may be revoked at any time. Please contact the Company at 1-800-789-6771 or www.gafri.com for additional information about electronic delivery of documents.

Legal Proceedings

The Company and Great American Advisors^®, Inc. are involved in various kinds of routine litigation which, in management’s judgment, are not of material importance to their assets or the Separate Account. There are no pending legal proceedings against the Separate Account.

Voting Rights

To the extent required by law, all Portfolio shares held in the Separate Account will be voted by the Company at regular and special shareholder meetings of the respective Portfolios in accordance with instructions received from persons having voting interests in the corresponding Subaccount. During the Accumulation Period, the Company will vote Portfolio shares according to instructions of Owners, unless the Company is permitted to vote shares in its own right.

The number of votes that an Owner may vote will be calculated separately for each Subaccount. The number will be determined by applying the Owner’s percentage interest, if any, in a particular Subaccount to the total number of votes attributable to that Subaccount.

The Owner’s percentage interest and the total number of votes will be determined as of the record date established by that Portfolio for voting purposes. Voting instructions will be solicited by written communication in accordance with procedures established by the respective Portfolios.

The Company will vote or abstain from voting shares for which it receives no timely instructions and shares it holds as to which Owners have no beneficial interest (including shares held by the Company as reserves for benefit payments*). The Company will vote or abstain from voting such shares in proportion to the voting instructions it receives from Owners of all Contracts participating in the Subaccount.

Each person or entity having a voting interest in a Subaccount will receive proxy material, reports and other material relating to the appropriate Portfolio. The Portfolios are not required to hold annual or other regular meetings of shareholders.

*

Neither the Owner nor Payee has any interest in the Separate Account during the Benefit Payment Period. Benefit Units are merely a measure of the amount of the payment the Company is obligated to pay on each payment date.

Annuity Benefit

An Owner may designate the date that annuity payments will begin, and may change the date up to 30 days before annuity payments are scheduled to begin. Unless the Company agrees otherwise, the first day of a Benefit Payment Period in which annuity payments are paid cannot be later than the Annuity Commencement Date.

Annuity Benefit payments will be made to the Annuitant as Payee. In lieu of that, you may elect by Written Request to have Annuity Benefit payments made to you as Payee. Any Annuity Benefit amounts remaining payable on the death of the Payee will be paid to the contingent Payee designated by you by Written Request. We may reject the naming of a non-natural contingent Payee.

The amount applied to a settlement option will be the Account Value as of the end of the Valuation Period immediately proceeding the first day of the Benefit Payment Period. For tax-qualified Contracts, if the Payee is a non-natural person, a surrender will be deemed to have been made and the amount applied to a settlement option will be the Surrender Value instead of the Account Value, unless the non-natural person Payee is the Owner of the individual or group Contract and has an immediate obligation to make corresponding payments to the Annuitant of the Contract.

The Owner may select any form of settlement option which is currently available. The standard forms of settlement options are described in the Settlement Options section of this prospectus.

If the Owner has not previously made an election as to the form of settlement option, the Company will contact the Owner to ascertain the form of settlement option to be paid. If the Owner does not select a settlement option, such as a specific fixed dollar benefit payment, a variable dollar benefit payment, or a combination of a variable and fixed dollar benefit payment, the Company will apply the Account Value (or Surrender Value) to a fixed dollar benefit for the life of the Annuitant with 120 monthly payments assured, as described in the Settlement Options section of this prospectus.

Death Benefit

A death benefit will be paid under a Contract if the Owner dies during the Accumulation Period. If a surviving spouse becomes a Successor Owner of the Contract, the death benefit will be paid on the death of the Successor Owner if he or she dies during the Accumulation Period.

Death Benefit Amount

The determination of the Death Benefit Amount depends on the form of Contract in effect in your state of residence when the Contract was issued. For example, in 2003, the Company sought approval from the various states for an endorsement with revised provisions concerning the determination of the Death Benefit Amount (the “2003 Death Benefit Endorsement”). Please contact the Company if you have questions as to how to determine the Death Benefit Amount under your Contract.

Death Benefit Amount (Version 1)

The Death Benefit Amount will equal the greater of:

	1)		the Account Value on the Death Benefit Valuation Date; or
	2)		the Minimum Death Benefit.

The Minimum Death Benefit is equal to the total purchase payments, including the bonus(es) thereon, reduced proportionally for withdrawals. This reduction will include any charges or adjustments applicable to such withdrawals, and will be made on the date of the withdrawal. This means that the Minimum Death Benefit will be reduced on that date in the same percentage as the percentage reduction in the Account Value.

Example of Determination of Death Benefit Amount (Version 1)
This example is intended to help you understand how a withdrawal impacts the Death Benefit amount.

Assuming your total Purchase Payments equal $100,000, your Account Value is $90,000, you withdraw $10,000 from the Contract, and you are left with an Account Value of $80,000.

Step One: Calculate the proportional reduction.

1		—		$80,000   $90,000		Account Value immediately after withdrawal Account Value immediately before withdrawal		=  11.1111%		Percentage Reduction

$100,000		Purchase Payments		x  11.1111%		Percentage Reduction		=  $11,111		Proportional Reduction

Step Two: Calculate the reduced Purchase Payment amount.

Purchase Payments		$	100,000
Less proportional reduction for withdrawals			- 11,111
Purchase Payments reduced for withdrawals		$	88,889

Step Three: Determine the Death Benefit amount.

Immediately after the withdrawal, the reduced Purchase Payments of $88,889 is greater than the Account Value of $80,000, so the Death Benefit amount would be $88,889.

The Death Benefit Amount will be reduced by any applicable premium tax or other tax not previously deducted. It will also be reduced by any outstanding loans.

The Death Benefit Amount will be allocated among the Subaccounts and Fixed Account options as of the Death Benefit Valuation Date. This allocation will be made in the same proportion as the value of each option bears to the Owner’s total Account Value immediately before the Death Benefit Valuation Date.

For all Contracts an Owner may elect the form of payment of the death benefit at any time before his or her death. The form of payment may be a lump sum, or any available form of settlement option. The standard forms of settlement options are described in the Settlement Options section of this prospectus. There is no additional charge associated with the form of Death Benefit election. If the Owner does not make an election as to the form of death benefit, the Beneficiary may make an election within one year after the Owner’s death. If no election as to form of settlement option is made; the Company will apply the death benefit to a fixed dollar benefit for a period certain of 48 months. The first day of the Benefit Payment Period in which a death benefit is paid may not be more than one year after the Owner’s death; the day a death benefit is paid in a lump sum may not be more than five years after the Owner’s date of death.

Death Benefit Amount (Version 2)

The death benefit will be an amount equal to the larger of the following two amounts:

	1)		The Account Value on the Death Benefit Valuation Date; or
	2)		The total purchase payment(s), including the bonus(es) thereon, less any partial withdrawals and any CDSC that applied to those amounts.

Any applicable premium tax or other taxes not previously deducted, and any outstanding loans, will be deducted from the death benefit amount described above. The Death Benefit Amount will be allocated among the Subaccounts and Fixed Account options as of the Death Benefit Valuation Date. This allocation will be made in the same proportion as the value of each option bears to the Owner’s total Account Value immediately before the Death Benefit Valuation Date.

For all Contracts an Owner may elect the form of payment of the death benefit at any time before his or her death. The form of payment may be a lump sum, or any available form of settlement option. The standard forms of settlement options are described in the Settlement Options section of this prospectus. There is no additional charge associated with the form of Death Benefit election. If the Owner does not make an election as to the form of death benefit, the Beneficiary may make an election within one year after the Owner’s death. If no election as to form of settlement option is made; the Company will apply the death benefit to a fixed dollar benefit for a period certain of 48 months. The first day of the Benefit Payment Period in which a death benefit is paid may not be more than one year after the Owner’s death; the day a death benefit is paid in a lump sum may not be more than five years after the Owner’s date of death.

Successor Owner Election

If the Contract is issued after May 1, 2004, and the surviving spouse of a deceased Owner becomes a Successor Owner of the Contract, the Account Value will be stepped-up to equal the death benefit which otherwise would have been payable, as of what would have been the Death Benefit Valuation Date. In addition, contingent deferred sales charges will be waived on the entire stepped-up Account Value as of that date, but will apply to any purchase payments applied to the Contract after that date. There is no additional charge associated with this feature.

For purposes of determining what would have been the Death Benefit Valuation Date, the election to become Successor Owner will be deemed to be instructions as to the form of death benefit. The election to become Successor Owner must be made within one year of the date of the Owner’s death.

Prior to May 1, 2004, the Successor Owner provisions of the Contract were available only by endorsement and may not have been available in all states.

Payment of Benefits

When a Contract is annuitized, or when a death benefit is applied to a settlement option, the Account Value or the death benefit, as the case may be, the Company promises to pay a stream of benefit payments for the duration of the settlement option selected. Upon annuitization, the Account Value is no longer available to the Owner. Benefit payments may be calculated and paid: (1) as a variable dollar benefit; (2) as a fixed dollar benefit; or (3) as a combination of both. The stream of payments, whether variable dollar or fixed dollar, is an obligation of the Company’s general account. However, only the amount of fixed dollar benefit payments is guaranteed by the Company. The Owner (or Payee) bears the risk that any variable dollar benefit payment may be less than the initial variable dollar benefit payment, or that it may decline to zero, if Benefit Unit Values for that payment decrease sufficiently. Transfers between a variable dollar benefit and a fixed dollar benefit are not permitted, but transfers of Benefit Units among Subaccounts are permitted once each 12 months after a variable dollar benefit has been paid for at least 12 months. The formulas for transferring Benefit Units among Subaccounts during the Benefit Payment Period are set forth in the Statement of Additional Information.

Settlement Options

The Company will make periodic payments in any form of settlement option that is acceptable to it at the time of an election. The standard forms of settlement options are described below. Payments under any settlement option may be in monthly, quarterly, semiannual or annual payment intervals. If the amount of any regular payment under the form of settlement option elected would be less than $50, an alternative form of settlement option will have to be elected. The Company, in its discretion, may require benefit payments to be made by direct deposit or wire transfer to the account of a designated Payee.

The Company may modify minimum amounts, payment intervals and other terms and conditions at any time without prior notice to Owners. If the Company changes the minimum amounts, the Company may change any current or future payment amounts and/or payment intervals to conform with the change. More than one settlement option may be elected if the requirements for each settlement option elected are satisfied. Once payment begins under a settlement option that is contingent on the life of a specified person or persons, the settlement option may not be changed or commuted (i.e., redeemed at present value). Other settlement options may be commuted as described in the Commuted Values section of this prospectus.

The dollar amount of benefit payments will vary with the frequency of the payment interval and the duration of the payments. Generally, each payment in a stream of payments will be lesser in amount as the frequency of payments increases, or as the length of the payment period increases, because more payments will be paid. For life contingent settlement options, each payment in the stream of payments will generally be lesser in amount as the life expectancy of the Annuitant or Beneficiary increases because more payments are expected to be paid.

Income for a Fixed Period: The Company will make periodic payments for a fixed period of 5 to 30 years. (Payment intervals of 1 to 4 years are available for death benefit settlement options only.)

Life Annuity with Payments for a Fixed Period: The Company will make periodic payments for a fixed period, or until the death of the person on whose life benefit payments are based if he or she lives longer than the fixed period.

Joint and One-Half Survivor Annuity: The Company will make periodic payments until the death of the primary person on whose life benefit payments are based; thereafter, the Company will make one-half of the periodic payment until the death of the secondary person on whose life benefit payments are based.

Life Annuity: The Company will make periodic payments until the death of the person on whose life the benefit payments are based.

Each Contract is an agreement between the Company and the Owner. Values, benefits and charges are calculated separately for each Contract. In the case of a group Contract, the agreement is between the group Owner and the Company. An individual participant under a group Contract will receive a certificate of participation, which is evidence of the participant’s interest in the group Contract. A certificate of participation is not a Contract. Values, benefits and charges are calculated separately for each certificate issued under a Contract. The description of Contract provisions in this prospectus applies to the interests of certificate Owners, except where otherwise noted.

Because the Company is subject to the insurance laws and regulations of all the jurisdictions where it is licensed to operate, the availability of certain Contract rights and provisions in a given State may depend on that State’s approval of the Contracts. Where required by state law or regulation, the Contracts will be modified accordingly.

Right to Cancel

The Owner of an individual Contract may cancel it before midnight of the twentieth day following the date the Owner receives the Contract. For a valid cancellation, the Contract must be returned to the Company, and written notice of cancellation must be given to the Company, or to the agent who sold the Contract, by that deadline. If mailed, the return of the Contract or the notice is effective on the date it is postmarked, with the proper address and with postage paid. If the Owner cancels the Contract, the Contract will be void and the Company will refund the purchase payment(s) paid for it, plus or minus any investment gains or losses under the Contract, and less the bonus amounts credited to the purchase payment(s), as of the end of the Valuation Period during which the returned Contract is received by the Company. When required by state or federal law, the Company will return the purchase payment(s), less the bonus amounts, without any investment gain or loss, during all or part of the right to cancel period. When required by state or federal law, the Company will return the Purchase Payments in full, without deducting any fees or charges, during the right to cancel period. When required by state law, the right to cancel period may be longer than 20 days. When required by state law, the right to cancel may apply to group Contracts. During the right to cancel period specified on the first page of the Contract, the Company reserves the right to allocate all purchase payments to either the Fixed Accumulation Account or a money market Subaccount, at our discretion. If we exercise this right, we will allocate the Account Value as of the end of the right to cancel period to the Fixed Account options and/or to the Subaccounts in the percentages that the Owner instructed.

Persons With Rights Under a Contract

Owner: The Owner is the person with authority to exercise rights and receive benefits under the Contract (e.g., make allocations among investment options, elect a settlement option, designate the Annuitant, Beneficiary and Payee). An Owner must ordinarily be a natural person, or a trust or other legal entity holding a contract for the benefit of a natural person. Ownership of a non-tax-qualified Contract may be transferred, but transfer may have adverse tax consequences. Ownership of a tax-qualified Contract may not be transferred. Unless otherwise elected or required by law, a transfer of Ownership will not automatically cancel a designation of an Annuitant or Beneficiary or any settlement options election previously made.

Joint Owners: There may be joint Owners of a non-tax-qualified Contract. Joint Owners may each exercise transfer rights and make purchase payment allocations independently. All other rights must be exercised by joint action. A surviving joint Owner who is not the spouse of a deceased Owner may not become a Successor Owner, but will be deemed to be the Beneficiary of the death benefit which becomes payable on the death of the first Owner to die, regardless of any Beneficiary designation.

Successor Owner: The surviving spouse of a deceased Owner may become a Successor Owner if the surviving spouse was either the joint Owner or sole surviving Beneficiary under the Contract. In order for a spouse to become a Successor Owner, the Owner must make an election prior to the Owner’s death, or the surviving spouse must make an election within one year of the Owner’s death.

Annuitant: The Annuitant is the person whose life is the measuring life for life contingent annuity benefit payments. The Annuitant must be the same person as the Owner under a tax-qualified Contract. The Owner may designate or change an Annuitant under a non-tax-qualified Contract. Unless otherwise elected or required by law, a change of Annuitant will not automatically cancel a designation of a Beneficiary or any settlement option election previously made.

Beneficiary: The person entitled to receive the death benefit. The Owner may designate or change the Beneficiary, except that a surviving joint Owner will be deemed to be the Beneficiary regardless of any designation. Unless otherwise elected or required by law, a change of Beneficiary will not automatically cancel a designation of any Annuitant or any settlement option election previously made. If no Beneficiary is designated, and there is no surviving joint Owner, the Owner’s estate will be the Beneficiary. The Beneficiary will be the measuring life for life contingent death benefit payments.

Payee: Under a tax-qualified Contract, the Owner-Annuitant is the Payee of annuity benefits. Under a non-tax-qualified Contract, the Owner may designate the Annuitant or the Owner as the Payee of annuity benefits. Irrevocable naming of a Payee other than the Owner can have adverse tax consequences. The Beneficiary is the Payee of the death benefit.

Assignee: Under a tax-qualified Contract, assignment is not permitted. The Owner of a non-tax-qualified Contract may assign most of his/her rights or benefits under a Contract. Assignment of rights or benefits may have adverse tax consequences.

The Company is a stock life insurance company incorporated under the laws of the State of Ohio in 1981. The Company is principally engaged in the sale of variable and fixed annuity policies. The home office of the Company is located at 525 Vine Street, Cincinnati, Ohio 45202.

The Company is a wholly owned subsidiary of Great American Life Insurance Company^Ò which is a wholly owned subsidiary of Great American Financial Resources^Ò, Inc. (“GAFRI”), a publicly traded insurance holding company (NYSE: GFR). GAFRI is in turn indirectly controlled by American Financial Group, Inc., a publicly traded holding company (NYSE: AFG).

The Company may from time to time publish in advertisements, sales literature and reports to Owners the ratings and other information assigned to it by one or more independent rating organizations such as A.M. Best Company, Standard & Poor’s, and Fitch. The purpose of the ratings is to reflect the financial strength and/or claims-paying ability of the Company. Each year A.M. Best Company reviews the financial status of thousands of insurers, culminating in the assignment of Best’s Ratings. These ratings reflect A.M. Best Company’s opinion of the relative financial strength and operating performance of an insurance company in comparison to the norms of the life/health insurance industry. Ratings of the Company do not reflect the investment performance of the Separate Account or the degree of risk associated with an investment in the Separate Account.

The Separate Account was established by the Company on December 19, 1996, as an insurance company separate account under the laws of the State of Ohio pursuant to resolution of the Company’s Board of Directors. The Separate Account is registered with the SEC under the 1940 Act as a unit investment trust. However, the SEC does not supervise the management or the investment practices or policies of the Separate Account.

The assets of the Separate Account are owned by the Company, but they are held separately from the other assets of the Company. Under Ohio law, the assets of a separate account are not chargeable with liabilities incurred in any other business operation of the Company. Income, gains and losses incurred on the assets in the Separate Account, whether realized or not, are credited to or charged against the Separate Account, without regard to other income, gains or losses of the Company.

Therefore, the performance of the Separate Account is entirely independent of the investment performance of the Company’s general account assets or any other separate account maintained by the Company. The assets of the Separate Account will be held for the exclusive benefit of Owners of, and the persons entitled to payment under, the Contracts offered by this prospectus and all other contracts issued by the Separate Account. The obligations under the Contracts are obligations of the Company.

Great American Advisors^®, Inc. (“GAA”) is the principal underwriter of the contracts. Its business address is 525 Vine Street, Cincinnati, Ohio 45202. GAA is a wholly-owned subsidiary of Great American Financial Resources, Inc. and an affiliate of the Company.

The Contracts are sold by insurance agents who are also registered representatives of (1) GAA or (2) other broker-dealers that have entered into selling agreements with GAA. GAA and the other broker-dealers are registered under the Securities Exchange Act of 1934, and are members of the National Association of Securities Dealers, Inc. All registered representatives who sell the Contracts are appointed by the Company as insurance agents and are authorized under applicable state insurance regulations to sell variable annuity contracts.

The Company pays commissions to GAA for promotion and sale of the contracts. GAA retains the commissions for sales made through its registered representatives, or pays the commissions to other broker-dealers for sales made through their registered representatives. GAA and the other broker-dealers pay their registered representatives from their own funds. Commissions paid by us are calculated as a percentage of the purchase payments received for a contract or a percentage of the contract value (sometimes called a trail commission).

Commissions paid on the Contracts and payments for other services are not charged directly to you or your Account Value, but are charged indirectly through fees and charges imposed under the Contracts. If these fees and charges are not sufficient to cover the commissions and other payments, any deficiency will be made up from our general assets.

We paid the following amounts to GAA for the last three years: $1,757,857 for 2006, $1,995,224 for 2005, and $2,262,019 for 2004. These amounts include compensation related to other contracts issued through Annuity Investors Variable Account B.

A Portfolio may compensate the Company or GAA for the distribution and operational services that the Company or GAA provides and the costs that it incurs in providing these services. For example, each business day, we aggregate all purchase, redemption, and transfer requests from Contract owners with respect to a Portfolio and submit one request to the applicable Portfolio. As a result, the Portfolio does not incur the expenses related to processing individual requests from Contract owners. GAA also maintains the distribution network that supports the sale of our variable annuity products that invest in the Portfolios. Payments from a Portfolio to the Company or GAA for these services may be made pursuant to (1) the Portfolio’s Rule 12b-1 plan, in which case the payments are deducted from the Portfolio’s assets or (2) service, administration, sub-transfer or similar agreements between the Company or GAA and the Portfolio’s investment adviser or its affiliate.

This section provides a general description of federal income tax considerations relating to the Contracts. The purchase, holding and transfer of a Contract may have federal estate and gift tax consequences in addition to income tax consequences. Estate and gift taxation is not discussed in this prospectus or in the Statement of Additional Information. State taxation will vary depending on the state in which you reside, and is not discussed in this prospectus or in the Statement of Additional Information.

The tax information provided in the prospectus and Statement of Additional Information is not intended or written to be used as legal or tax advice. It is written solely to provide information related to the sale and holding of the Contracts. As a taxpayer, you cannot use it for the purpose of avoiding penalties that may be imposed under the tax laws. You should seek advice on legal or tax questions based on your particular circumstances from an independent attorney or tax advisor.

Tax Deferral on Annuities

Internal Revenue Code (“IRC”) Section 72 governs taxation of annuities in general. The income earned on a Contract is generally not included in income until it is withdrawn from the Contract. In other words, a Contract is a tax-deferred investment. The Contracts must meet certain requirements in order to qualify for tax-deferred treatment under IRC Section 72. These requirements are discussed in the Statement of Additional Information. In addition, tax deferral is not available for a Contract when the Owner is not a natural person unless the Contract is part of a tax-qualified retirement plan or the Owner is a mere agent for a natural person. For a nonqualified deferred compensation plan, this rule means that the employer as Owner of the Contract will generally be taxed currently on any increase in the Account Value, although the plan itself may provide a tax deferral to the participating employee. For a group nonqualified Contract where the Owner has no rights over the separate interests, this rule is applied to each participant who is not a natural person.

Tax-Qualified Retirement Plans

Annuities may also qualify for tax-deferred treatment, or serve as a funding vehicle, under tax-qualified retirement plans that are governed by other IRC provisions. These provisions include IRC Sections 401 (pension and profit sharing plans), 403(b) (tax-sheltered annuities), 408 and 408A (individual retirement annuities), and 457(g) (governmental deferred compensation plans). Tax-deferral is generally also available under these tax-qualified retirement plans through the use of a trust or custodial account without the use of an annuity.

The tax law rules governing tax-qualified retirement plans and the treatment of amounts held and distributed under such plans are complex. If the Contract is to be used in connection with a tax-qualified retirement plan, including individual retirement annuities (“IRAs”), you should seek competent legal and tax advice regarding the suitability of the Contract for the situation involved and the requirements governing the distribution of benefits.

Contributions to a tax-qualified Contract are typically made with pre-tax dollars, while contributions to a non-tax-qualified Contract are typically made from after-tax dollars, though there are exceptions in either case. Tax-qualified Contracts may also be subject to restrictions on withdrawals that do not apply to non-tax-qualified Contracts. These restrictions may be imposed to meet the requirements of the IRC or of an employer plan. Following is a brief description of the types of tax-qualified retirement plans for which the Contracts are available.

Individual Retirement Annuities

IRC Sections 219 and 408 permit individuals or their employers to contribute to an individual retirement arrangement known as an “Individual Retirement Annuity” or “IRA”. Under applicable limitations, an individual may claim a tax deduction for certain contributions to an IRA. Contributions made to an IRA for an employee under a Simplified Employee Pension (SEP) Plan or Savings Incentive Match Plan for Employees (SIMPLE) established by an employer will not be includable in the gross income of the employee until the employee receives distributions from the IRA. Distributions from an IRA are taxable to the extent that they represent contributions for which a tax deduction was claimed, contributions made under a SEP plan or SIMPLE, or income earned on the Contract.

Roth IRAs

IRC Section 408A permits certain individuals to contribute to a Roth IRA. Contributions to a Roth IRA are not tax deductible. Tax-free distributions of contributions may be made at any time. Distributions of earnings are tax-free following the five-year period beginning with the first year for which a Roth IRA contribution was made if the Owner has attained age 59¹/2, become disabled, or died, or for qualified first-time homebuyer expenses.

Tax-Sheltered Annuities

IRC 403(b) of the Code permits contributions to a “tax-sheltered annuity” or “TSA” for the employees of public schools and certain charitable, religious, educational and scientific organizations described in IRC Section 501(c)(3). TSA contributions and Contract earnings are generally not included in the gross income of the employee until the employee receives distributions from the TSA. Amounts attributable to contributions made under a salary reduction agreement cannot be distributed until the employee attains age 59¹/2, severs employment, becomes disabled, incurs a hardship, or dies. The Texas ORP or any other plan under which the Contract was purchased may impose additional restrictions.

Texas Optional Retirement Program

The Texas Optional Retirement Program (“ORP”) provides for the purchase of IRC 403(b) Tax-Sheltered Annuities with fixed employer and employee contributions. Amounts attributable to such contributions cannot be distributed until the employee terminates employment from all Texas public institutions of higher education, retires, attains age 70¹/2, or dies. Amounts attributable to employer contributions vest after one year of participation. Distributions require written certification from the employer of the employee’s vesting status and, if the employee is living and under age 70¹/2, the employee’s retirement or other termination from employment.

Pension, Profit–Sharing, and 401(k) Plans

IRC Section 401 permits employers to establish various types of retirement plans for employees, and permits self-employed individuals to establish such plans for themselves and their employees. These plans may use annuity contracts to fund plan benefits. Generally, contributions are deductible to the employer in the year made, and contributions and earnings are generally not included in the gross income of the employee until the employee receives distributions from the plan. The IRC and the plan may impose restrictions on distributions. Purchasers of a Contract for use with such plans should seek competent advice regarding the suitability of the proposed plan documents and the Contract for their specific needs.

Roth TSAs and Roth 401(k)s

IRC Section 402A permits participants in certain TSA programs or 401(k) plans to designate some part or all of their future elective contributions as Roth contributions. Roth contributions to a TSA or 401(k) plan are included in the participant’s taxable income as earned. Distributions are considered to come proportionally from contributions and earnings. Distributions attributable to contributions are tax-free. Distributions attributable to earnings are tax-free following the five-year period beginning with the first year for which Roth contributions are made to the plan if the Owner has attained age 59¹/2, become disabled, or died. Amounts attributable to Roth TSA and Roth 401(k) contributions are subject to the same distribution restrictions that apply to other amounts attributable to TSA or 401(k) contributions made under a salary reduction agreement. The plan may impose additional restrictions.

Governmental Deferred Compensation Plans

State and local government employers may purchase annuity contracts to fund deferred compensation plans for the benefit of their employees described in IRC Section 457(b). Contributions and earnings are generally not included in the gross income of the employee until the employee receives distributions from the plan. Amounts cannot be distributed until the employee attains age 70¹/2, severs employment, becomes disabled, incurs an unforeseeable emergency, or dies. The plan may impose additional restrictions.

Nonqualified Deferred Compensation Plans

Employers may invest in annuity contracts in connection with unfunded deferred compensation plans for their employees. Such plans may include deferred compensation plans of non-governmental tax-exempt employers described in IRC Section 457(b); deferred compensation plans of both governmental and nongovernmental tax-exempt employers that are taxed under IRC Section 457(f) and subject to Section 409A; and nonqualified deferred compensation plans of for-profit employers subject to Section 409A. In most cases, these plans are designed so that amounts credited under the plan will not be includable in the employees’ gross income until paid under the plan. In these situations, the annuity contracts are not plan assets and are subject to the claims of the employer’s general creditors. Whether or not made from the Contract, benefits payments are subject to restrictions imposed by the IRC and the plan.

Summary of Income Tax Rules

The following chart summarizes the basic income tax rules governing tax-qualified and non-tax-qualified Contracts.

		Tax-Qualified Contracts and Employer Plans		Basic Non-Tax-Qualified Contracts
Plan Types		§       IRC §401 (Pension, Profit–Sharing, 401(k))		IRC §72 only
		§       IRC §403(b) (Tax-Sheltered Annuities)
		§       IRC §408 (IRA, SEP, SIMPLE IRA)
		§       IRC §408A (Roth IRA)
		§       IRC §402A (Roth TSA or Roth 401(k))
		§       IRC §457
		§       IRC §409A (Nonqualified Deferred Compensation)
Who May Purchase a Contract		Natural person, employer, or employer plan. Nonqualified deferred compensation plans will generally lose tax-deferred status of Contract itself.		Anyone. Non-natural person may purchase but will generally lose tax-deferred status.
Restrictions on Distributions		Distributions from tax-qualified Contracts may be restricted to meet requirements of the Internal Revenue Code and/or terms of the retirement plan.		None.
Taxation of Surrenders		If there is an after-tax “investment in the contract,” a pro rata portion of the amount surrendered is taxable income based on the ratio of “investment in the contract” to Account Value. Usually, 100% of distributions from a qualified plan must be included in taxable income because there were no after-tax contributions and therefore no “investment in the contract.” Distributions from §408A Roth IRA or §402A Roth TSA or Roth 401(k) are completely tax free if certain requirements are met.		Account Value in excess of “investment in the contract” is included in taxable income. Generally, the “investment in the contract” will equal the sum of all purchase payments less prior non-taxable withdrawals. Surrenders are deemed to come from earnings first, and “investment in the contract” last. For a Contract purchased through a IRC §1035 exchange that includes contributions made before August 14, 1982, withdrawals are not taxable until those contributions have been returned in full.
Taxation of Benefit Payments (annuity benefit payments or death benefit payments)		For fixed dollar benefit payments, a percentage of each payment is tax free equal to the ratio of after-tax “investment in the contract” (if any) to the total expected payments, and the balance is included in taxable income. For variable dollar benefit payments, a specific dollar amount of each payment is tax free, as predetermined by a pro rata formula, rather than a percentage of each payment. In either case, once the after-tax “investment in the contract” has been recovered, the full amount of each benefit payment is included in taxable income. Distributions from a §408A Roth IRA or §402A Roth TSA or Roth 401(k) are completely tax free if certain requirements are met.
Taxation of Lump Sum Death Benefit		Taxed to recipient generally in same manner as full surrender.
Possible Penalty Taxes for Surrenders and Benefit Payments Before Age 591/2		Taxable portion of payments made before age 591/2 may be subject to 10% penalty tax (or 25% for a SIMPLE IRA during the first two years of participation). Penalty taxes do not apply to payments after the participant’s death, or to §457 plans or §409A nonqualified deferred compensation plans. Other exceptions may apply.		Taxable portion of payments made before age 591/2 may be subject to a 10% penalty tax. Penalty taxes do not apply to payments after the Owner’s death. Other exceptions may apply.
Assignment of Contract/Transfer of Ownership		Assignment and transfer of Ownership generally not permitted.		Generally, deferred earnings taxable to transferor on transfer or assignment; transferee’s “investment in the contract” is increased by same amount. Gift tax consequences are not discussed herein.
Federal Income Tax Withholding		Eligible rollover distributions from §401, §403(b), and governmental §457(b) plan Contracts are subject to 20% mandatory withholding on taxable portion unless direct rollover. Distributions under nongovernmental §457(b) plan, 457(f) plan, and nonqualified deferred compensation plan are subject to wage withholding. For all other payments, Payee may elect to have taxes withheld or not.		Generally, Payee may elect to have taxes withheld or not.

Calculation of Fixed Dollar Benefit Payments

Fixed dollar benefit payments are determined by multiplying the amount applied to the fixed dollar benefit (expressed in thousands of dollars and after deduction of any fees and charges, loans, or applicable premium taxes) by the amount of the payment per $1,000 of value which the Company is currently paying for settlement options of that type. Fixed dollar benefit payments will remain level for the duration of the Benefit Payment Period.

For Contracts issued after May 1, 2004 in states where the Company has received regulatory approval, the Company generally guarantees minimum benefit factors based on annuity 2000 mortality tables for blended lives (60% female/40% male) with interest at 1% per year, compounded annually.

For all other Contracts, the Company guarantees minimum fixed dollar benefit payment factors based on 1983 annuity mortality tables for individuals or groups, as applicable, with interest at 3% per year, compounded annually. For group Contracts, individual tax-qualified Contracts and individual non-tax-qualified Internal Revenue Code (“IRC”) Section 457 Contracts, the Company uses tables for blended lives (60% female/40% male). For individual non-tax-qualified Contracts except IRC Section 457, the Company uses tables for male and female lives. Where required by state law, the Company uses blended tables for all Contracts. The minimum monthly payments per $1,000 of value for the Company’s standard settlement options are set forth in tables in the Contracts. Upon request, the Company will provide information about minimum monthly payments for ages or fixed periods not shown in the settlement option tables.

Calculation of Variable Dollar Benefit Payments

The first variable dollar benefit payment is the amount it would be if it were a fixed dollar payment calculated at the Company’s minimum guaranteed settlement option factors.

The amount of each variable dollar benefit payment will reflect the investment performance of the Subaccount(s) selected and may vary from payment to payment. For example, because the base payment includes a fixed rate of interest, payments will be less than the base payment if the net investment performance of the applicable Subaccounts is less than that rate of interest. Payments will be more than the base payment if the net investment performance of the applicable Subaccount(s) is greater than the rate of interest.

The amount of each payment is the sum of the payment due for each Subaccount selected. The payment due for a Subaccount equals the shares for that Subaccount, which are the Benefit Units, times their value, which is the Benefit Unit Value for that Subaccount as of the end of the fifth Valuation Period preceding the due date of the payment. The number of Benefit Units for each Subaccount selected is determined by allocating the amount of the variable dollar base benefit payment among the Subaccount(s) selected in the percentages indicated by the Owner (or Payee). The dollar amount allocated to a Subaccount is divided by the Benefit Unit Value for that Subaccount as of the first day of the Benefit Payment Period. The result is the number of Benefit Units that the Company will pay for that Subaccount at each payment interval. The number of Benefit Units for each Subaccount remains fixed during the Benefit Payment Period, except as a result of any transfers among Subaccounts or as provided under the settlement option elected. An explanation of how Benefit Unit Values are calculated is included in the Glossary of Financial Terms of this prospectus.

Commuted Values

After receiving benefits under a Contract for at least 5 years, a Beneficiary may elect to receive a lump-sum commuted value of the remaining benefit payments. The commuted value is less than the sum of payments not made because those payments include interest. The commuted value at any time is an amount equal to the payments not yet made under the settlement option less interest from the date of each payment not yet made. The interest rate used to calculate the commuted value of payments may not be the same interest rate originally used to establish the payments under the settlement option. The Company will, upon request, provide information on the then current commuted value, if any, of any non-life contingent settlement options elected.

Payments contingent on life may not be commuted. A Beneficiary may not commute payments under a settlement option elected by the Owner.

The following financial terms explain how the variable portion of the Contracts is valued. Read these terms in conjunction with the Definitions section of this prospectus.

Account Value

The value of a Contract during the Accumulation Period is referred to as the “Account Value.” The Account Value at any given time is the sum of: (1) the value of the Owner’s interest in the Fixed Account options as of that time; and (2) the value of the Owner’s interest in the Subaccounts as of that time. The value of the Owner’s interest in the Subaccounts at any time is equal to the sum of the number of Accumulation Units for each Subaccount attributable to that Contract multiplied by the Accumulation Unit Value for the applicable Subaccount at the end of that Valuation Period. The Account Value at any time is net of any charges, deductions, withdrawals, surrender, and/or outstanding loans incurred prior to or as of the end of that Valuation Period.

Accumulation Units

Amounts allocated or transferred to a Subaccount are converted into Accumulation Units. The number of Accumulation Units credited is determined by dividing the dollar amount directed to the Subaccount by the Accumulation Unit Value for that Subaccount as of the end of the Valuation Period in which the amount allocated is received by the Company, or as of the end of the Valuation Period in which the transfer is made.

Accumulation Units will be canceled as of the end of the Valuation Period during which one of the following events giving rise to cancellation occurs:

	§		transfer from a Subaccount
	§		surrender or withdrawal from the Subaccounts
	§		payment of a death benefit
	§		application of the amounts in the Subaccounts to a settlement option
	§		deduction of the contract maintenance fee
	§		deduction of any transfer fee

Accumulation Unit Value: The initial Accumulation Unit Value for each Subaccount other than the money market Subaccount was set at $10. The initial Accumulation Unit Value for the money market Subaccount was set at $1. The initial Accumulation Unit Value for a Subaccount was established at the inception date of the Separate Account, or on the date the Subaccount was established, if later. The Company establishes distinct Accumulation Unit Values for Contracts with different Separate Account fee structures, as described in the Expense Tables.

After the initial Accumulation Unit Value is established, the Accumulation Unit Value for a Subaccount at the end of each Valuation Period is the Accumulation Unit Value at the end of the previous Valuation Period multiplied by the Net Investment Factor for that Subaccount for the current Valuation Period.

A Net Investment Factor of 1 produces no change in the Accumulation Unit Value for that Valuation Period. A Net Investment Factor of more than 1 or less than 1 produces an increase or a decrease, respectively, in the Accumulation Unit Value for that Valuation Period. The Accumulation Unit Value will vary to reflect the investment experience of the applicable Portfolios.

Benefit Unit Value: The initial Benefit Unit Value for a Subaccount will be set equal to the Accumulation Unit Value for that Subaccount at the end of the first Valuation Period in which a variable dollar benefit is established by the Company. The Company will establish distinct Benefit Unit Values for Contracts with different Separate Account fee structures, as described in the Expense Tables.

The Benefit Unit Value for a Subaccount at the end of each Valuation Period after the first is the Benefit Unit Value at the end of the previous Valuation Period multiplied by the Net Investment Factor for that Subaccount for the current Valuation Period, and multiplied by a daily investment factor for each day in the Valuation Period. The daily investment factor reduces the previous Benefit Unit Value by the daily amount of the assumed interest rate, which is already incorporated in the calculation of variable dollar payments.

Net Investment Factor: The Net Investment Factor for any Subaccount for any Valuation Period is determined by dividing NAV2 by NAV1 and subtracting a factor representing the mortality and expense risk charge and the administration charge (as well as the charges for any optional riders or endorsements) deducted from the Subaccount during that Valuation Period, where:

NAV1 is equal to the Net Asset Value for the Portfolio for the preceding Valuation Period; and

NAV2 is equal to the Net Asset Value for the Portfolio for the current Valuation Period plus the per share amount of any dividend or net capital gain distributions made by the Portfolio during the current Valuation Period, and plus or minus a per share charge or credit if the Company adjusts its tax reserves due to investment operations of the Subaccount or changes in tax law.

In other words, the Net Investment Factor represents the percentage change in the total value of assets invested by the Separate Account in a Portfolio. That percentage is then applied to Accumulation Unit Values and Benefit Unit Values as described in the discussion of those terms in this section of the prospectus.

Performance Information

From time to time, the Company may advertise yields and/or total returns for the Subaccounts. These figures are based on historical information and are not intended to indicate future performance. Performance data and a more detailed description of the methods used to determine yield and total return are included in the Statement of Additional Information.

Yield Data

The “yield” of the money market Subaccount refers to the annualized income generated by an investment in that Subaccount over a specified seven-day period. The “effective yield” of the money market Subaccount is the same as the “yield” except that it assumes reinvestment of the income earned in that Subaccount. The effective yield will be slightly higher than the yield because of the compounding effect of this assumed reinvestment. The Company only advertises yields for the money market Subaccount.

Total Return Data

The Company may advertise two types of total return data: “average annual total return” and “cumulative total return.” Average annual total return is presented in both standardized and non-standardized form. “Standardized” total return data reflects the deduction of all charges that apply to all Contracts of that type, except for premium taxes. The CDSC reflected in standardized total return is the percentage CDSC that would apply at the end of the period presented assuming the purchase payment was received on the first day of the period presented. “Non-standardized” total return data does not reflect the deduction of CDSCs and contract maintenance fees. Cumulative total return data is currently presented only in non-standardized form.

Total return data that does not reflect the CDSC and other charges will be higher than the total return realized by an investor who incurs the charges.

“Average annual total return” is either hypothetical or actual return data that reflects performance of a Subaccount for a one-year period or for an average of consecutive one-year periods. If average annual total return data is hypothetical, it reflects performance for a period of time before the Separate Account commenced operations. When a Subaccount has been in operation for one, five and ten years, average annual total return will be presented for these periods, although other periods may be presented as well.

“Cumulative total return” is either hypothetical or actual return data that reflects the performance of a Subaccount from the beginning of the period presented to the end of the period presented. If cumulative total return data is hypothetical, it reflects performance for a period of time before the Separate Account commenced operations.

Other Performance Measures

The Company may include in reports and promotional literature rankings of the Subaccounts, the Separate Account or the Contracts, as published by any service, company, or person who ranks separate accounts or other investment products on overall performance or other criteria. Examples of companies that publish such rankings are Lipper Analytical Services, Inc., VARDS, IBC/Donoghue’s Money Fund Report, Financial Planning Magazine, Money Magazine, Bank Rate Monitor, Standard & Poor’s Indices, Dow Jones Industrial Average and Morningstar.

The Company may also:

	§		compare the performance of a Subaccount with applicable indices and/or industry averages;
	§		present performance information that reflects the effects of tax-deferred compounding on Subaccount investment returns;
	§		compare investment return on a tax-deferred basis with currently taxable investment return;
	§		illustrate investment returns by graphs, charts or otherwise.

The Company filed a Registration Statement with the SEC under the Securities Act of 1933 relating to the Contracts offered by this prospectus. This prospectus was filed as a part of the Registration Statement, but it does not constitute the complete Registration Statement. The Registration Statement contains further information relating to the Company and the Contracts. Statements in this prospectus discussing the content of the Contracts and other legal instruments are summaries. The actual documents are filed as exhibits to the Registration Statement. For a complete statement of the terms of the Contracts or any other legal document, refer to the appropriate exhibit to the Registration Statement. The Registration Statement and the exhibits thereto may be inspected and copied at the office of the SEC, located at 450 Fifth Street, N.W., Washington, D.C., and may also be accessed at the SEC’s web site www:http://.sec.gov. The registration number for the Registration Statement is 333-51971.

A Statement of Additional Information containing more details concerning the subjects discussed in this prospectus is available. The following is the table of contents for the Statement of Additional Information:

		Page
ANNUITY INVESTORS LIFE INSURANCE COMPANY®			3
General Information and History			3
State Regulations			3
SERVICES			3
Safekeeping of Separate Account Assets			3
Records and Reports			3
Experts			3
DISTRIBUTION OF THE CONTRACTS			4
CALCULATION OF PERFORMANCE INFORMATION			4
Money Market Subaccount Standardized Yield Calculation			4
Average Annual Total Return Calculation			5
Cumulative Total Return Calculation			6
Standardized Average Annual Total Return Data			7
Non-Standardized Average Annual Total Return Data			13
OTHER PERFORMANCE MEASURES			22
BENEFIT UNITS-TRANSFER FORMULAS			23
FEDERAL TAX MATTERS			24
Taxation of Separate Account Income			24
Tax Deferred Status of Non Qualified Contracts			25
FINANCIAL STATEMENTS			25

Copies of the Statement of Additional Information dated May 1, 2007 are available without charge. To request a copy, please clip this coupon on the dotted line below, enter your name and address in the spaces provided, and mail to: Annuity Investors Life Insurance Company, P.O. Box 5423, Cincinnati, Ohio 45201-5423. You may also call the Company at 1-800-789-6771, or visit us at our web site www.gafri.com to request a copy.

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						Number of
				Standard with		Standard with
		Number of		Administration		Administration
Standard		Standard		Charges Waived		Charges Waived
Accumulation Unit		Accumulation Units		Accumulation Unit		Accumulation Units
Value		Outstanding		Value		Outstanding		Year
AIM V.I. Capital Development Fund-Series I Shares
12.930724		1,168,401.050		12.971702		3,263.486		12/31/06
11.254617		16,459.887		11.273166		1,389.067		12/31/05
10.413665		2,721.825		10.415009		0.000		12/31/04
AIM V.I. Core Equity Fund-Series I Shares
10.812798		946,182.515		10.823900		1,519.271		12/31/06
AIM V.I. Financial Services Fund-Series I Shares
13.250780		177,386.400		13.363998		3,143.486		12/31/06
11.540835		198,663.153		11.621786		4,990.080		12/31/05
11.051409		208,252.570		11.112051		645.378		12/31/04
10.313195		157,061.561		10.354097		600.821		12/31/03
8.070175		118,822.635		8.090189		3.808		12/31/02
9.616190		71,816.401		9.625737		0.000		12/31/01
AIM V.I. Global Health Care Fund-Series I Shares
11.212446		367,788.244		11.308218		3,860.272		12/31/06
10.805644		405,402.095		10.881403		5,707.536		12/31/05
10.132965		382,011.757		10.188541		577.604		12/31/04
9.553444		311,542.224		9.591322		0.000		12/31/03
7.580976		210,450.701		7.599777		0.000		12/31/02
10.175290		59,824.959		10.185393		0.000		12/31/01
AIM V.I. High Yield Fund-Series I Shares
11.887590		336,558.419		11.935983		6,170.179		12/31/06
10.886907		350,885.548		10.914657		5,631.776		12/31/05
10.749148		449,939.142		10.760209		4,991.698		12/31/04
10.095432		859,221.923		8.956974		4,988.977		12/31/03
8.186958		488,086.809		7.252971		21.978		12/31/02
8.410616		546,183.962		7.440073		0.000		12/31/01
10.025816		403,918.794		—		—		12/31/00
11.510803		221,636.210		—		—		12/31/99
10.689459		70,047.913		—		—		12/31/98
10.687084		10,260.821		—		—		12/31/97
AIM V.I. Small Cap Equity Fund-Series I Shares
12.572746		59,594.167		12.612595		1,809.113		12/31/06
10.857407		15,527.249		10.875302		2,705.709		12/31/05
10.184771		48.134		10.186091		0.000		12/31/04
American Century VP Large Company Value Fund-Class I Shares
12.494572		420,902.275		12.534154		18,866.080		12/31/06
10.560864		99,384.541		10.578263		5,867.404		12/31/05
10.216542		36,701.792		10.217864		0.000		12/31/04
American Century VP Mid Cap Value Fund-Class I Shares
13.320957		911,824.088		13.363156		17,345.331		12/31/06
11.229852		114,376.075		11.248357		7,815.280		12/31/05
10.395465		24,970.228		10.396812		0.000		12/31/04

						Number of
				Standard with		Standard with
		Number of		Administration		Administration
Standard		Standard		Charges Waived		Charges Waived
Accumulation Unit		Accumulation Units		Accumulation Unit		Accumulation Units
Value		Outstanding		Value		Outstanding		Year
American Century VP Ultra® Fund-Class I Shares
9.979396		707,542.380		10.011033		0.000		12/31/06
10.463493		32,615.015		10.497965		143.364		12/31/05
10.386756		598.086		10.388096		0.000		12/31/04
American Century VP VistaSM Fund-Class I Shares
11.918299		976,806.445		11.956077		979.911		12/31/06
11.088360		79,780.294		11.124884		1,175.748		12/31/05
10.399373		4,938.285		10.400714		0.000		12/31/04
The Dreyfus Socially Responsible Growth Fund, Inc.-Initial Shares
11.353220		701,011.037		9.306724		0.000		12/31/06
10.543914		795,479.598		8.630191		743.278		12/31/05
10.320091		913,267.538		8.434196		0.000		12/31/04
9.854396		925,266.631		8.041428		0.000		12/31/03
7.930106		960,232.146		6.461591		0.000		12/31/02
11.317226		1,066,026.751		9.207778		0.000		12/31/01
14.823134		894,007.973		—		—		12/31/00
16.894039		408,482.196		—		—		12/31/99
13.169143		140,614.024		—		—		12/31/98
10.320883		26,332.500		—		—		12/31/97
Dreyfus Stock Index Fund, Inc.-Initial Shares
15.179498		4,190,418.249		12.245744		11,156.427		12/31/06
13.328744		4,493,460.193		10.736383		12,475.438		12/31/05
12.911696		4,792,865.682		10.384683		3,723.761		12/31/04
11.835440		4,670,251.024		9.504688		2,960.789		12/31/03
9.349226		4,454,143.840		7.496983		209.774		12/31/02
12.210993		4,141,595.630		9.777260		0.000		12/31/01
14.100696		3,598,196.884		—		—		12/31/00
15.760394		2,129,772.165		—		—		12/31/99
13.250646		779,485.606		—		—		12/31/98
10.479569		69,510.645		—		—		12/31/97
Dreyfus IP Technology Growth Portfolio-Initial Shares
10.684409		1,309,668.746		10.718243		1,372.144		12/31/06
10.388053		32,100.558		10.405161		4,403.010		12/31/05
10.151024		198.889		10.152333		0.000		12/31/04
Dreyfus VIF Appreciation Portfolio-Initial Shares
15.017729		946,182.350		12.237088		16,608.513		12/31/06
13.075735		1,005,802.778		10.638507		17,188.337		12/31/05
12.704674		1,036,367.953		10.320936		13,273.463		12/31/04
12.265787		936,025.635		9.949338		10,260.940		12/31/03
10.264481		821,738.414		8.313661		172.414		12/31/02
12.497173		717,965.716		10.107007		0.000		12/31/01
13.974173		649,590.073		—		—		12/31/00
14.262203		517,772.082		—		—		12/31/99
12.975443		170,523.015		—		—		12/31/98
10.103905		18,347.666		—		—		12/31/97

						Number of
				Standard with		Standard with
		Number of		Administration		Administration
Standard		Standard		Charges Waived		Charges Waived
Accumulation Unit		Accumulation Units		Accumulation Unit		Accumulation Units
Value		Outstanding		Value		Outstanding		Year
Dreyfus VIF Developing Leaders Portfolio-Initial Shares
15.049986		807,530.215		14.301836		7,958.520		12/31/06
14.708620		908,638.512		13.956241		10,144.353		12/31/05
14.099077		919,021.905		13.357598		6,692.266		12/31/04
12.842412		898,484.551		12.148627		5,322.133		12/31/03
9.888294		887,931.962		9.340276		5,837.045		12/31/02
12.397758		698,539.631		11.693304		0.000		12/31/01
13.391746		482,890.909		—		—		12/31/00
11.984035		275,503.637		—		—		12/31/99
9.867472		171,968.905		—		—		12/31/98
10.362314		41,359.506		—		—		12/31/97
Dreyfus VIF Growth and Income Portfolio-Initial Shares
12.799045		534,977.589		11.784954		12,161.716		12/31/06
11.335178		573,338.603		10.421252		12,803.895		12/31/05
11.122877		660,745.227		10.210579		11,571.700		12/31/04
10.496627		594,854.140		9.621119		10,166.144		12/31/03
8.409071		633,983.863		7.696282		8,651.943		12/31/02
11.419341		646,842.656		10.435877		0.000		12/31/01
12.299306		572,006.660		—		—		12/31/00
12.961023		331,756.261		—		—		12/31/99
11.243790		159,409.837		—		—		12/31/98
10.196538		32,231.762		—		—		12/31/97
Dreyfus VIF Money Market Portfolio
1.183188		6,426,348.042		1.161069		1,045.886		12/31/06
1.152576		6,753,332.466		1.128752		323.650		12/31/05
1.140557		5,458,310.932		1.115026		241.762		12/31/04
1.146684		11,398,828.937		1,119521		142.363		12/31/03
1.153638		26,597,370.970		1.125015		54.380		12/31/02
1.153108		17,775,594.379		1.123012		0.000		12/31/01
1.128116		7,677,545.259		—		—		12/31/00
1.083700		2,638,837.162		—		—		12/31/99
1.050876		658,981.650		—		—		12/31/98
1.016499		0.000		—		—		12/31/97
DWS Small Cap Index VIP Fund-Class A
17.321028		452,371.808		17.520732		798.011		12/31/06
14.951171		417,983.505		15.100616		720.109		12/31/05
14.543337		347,239.433		14.666441		634.700		12/31/04
12.525203		434,240.830		12.612134		613.862		12/31/03
8.673629		165,980.862		8.720926		78.204		12/31/02
11.074827		153,151.939		11.118707		0.000		12/31/01
11.003134		83,894.729		—		—		12/31/00
11.606269		15,259.149		—		—		12/31/99

						Number of
				Standard with		Standard with
		Number of		Administration		Administration
Standard		Standard		Charges Waived		Charges Waived
Accumulation Unit		Accumulation Units		Accumulation Unit		Accumulation Units
Value		Outstanding		Value		Outstanding		Year
Janus Aspen Series Balanced Portfolio-Institutional Shares
20.527683		2,849,443.225		16.248241		31,326.242		12/31/06
18.802986		3,224,954.488		14.860520		30,739.469		12/31/05
17.664922		3,596,278.746		13.939897		28,575.277		12/31/04
16.507560		3,685,075.400		13.006905		25,172.606		12/31/03
14.676594		3,702,620.254		11.547104		9,113.219		12/31/02
15.907374		3,578,735.833		12.496901		0.000		12/31/01
16.920712		3,181,464.624		—		—		12/31/00
17.556100		1,571,579.505		—		—		12/31/99
14.043929		373,285.807		—		—		12/31/98
10.604609		30,519.754		—		—		12/31/97
Janus Aspen Series Forty Portfolio-Institutional Shares
11.403714		1,272,789.383		11.535242		10,429.872		12/31/06
10.576925		1,421,322.533		10.682685		11,093.343		12/31/05
9.505422		1,369,066.381		9.585912		7,843.530		12/31/04
8.153727		1,483,721.928		8.210347		6,761.170		12/31/03
6.859260		1,548,077.357		6.896673		204.741		12/31/02
8.247987		1,650,016.481		8.280678		0.000		12/31/01
10.678675		1,384,637.536		—		—		12/31/00
13.234548		471,936.628		—		—		12/31/99
Janus Aspen Series International Growth Portfolio-Institutional Shares
27.500771		1,183,279.918		22.376171		19,213.077		12/31/06
18.969977		966,575.134		15.411650		14,006.180		12/31/05
14.542258		681,071.772		11.796574		11,536.669		12/31/04
12.398800		669,789.197		10.042608		9,400.966		12/31/03
9.318679		678,787.112		7.536654		78.508		12/31/02
12.698027		675,126.139		10.254541		0.000		12/31/01
16.774550		620,740.857		—		—		12/31/00
20.234788		142,343.325		—		—		12/31/99
11.256365		45,382.775		—		—		12/31/98
9.735841		12,541.039		—		—		12/31/97
Janus Aspen Series Large Cap Growth Portfolio-Institutional Shares
13.332590		1,661,699.848		10.774147		5,554.950		12/31/06
12.140136		1,816,341.463		9.795642		8,863.042		12/31/05
11.805932		1,963,661.008		9.511537		5,388.088		12/31/04
11.455733		2,117,639.460		9.215438		5,531.696		12/31/03
8.817912		2,338,003.425		7.082990		30.710		12/31/02
12.166993		2,211,504.181		9.758629		0.000		12/31/01
16.393493		1,792,958.592		—		—		12/31/00
19.453513		643,514.256		—		—		12/31/99
13.699715		172,190.630		—		—		12/31/98
10.239960		32,737.591		—		—		12/31/97