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

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT
COMPANIES

Investment Company Act file number 811-22652
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First Trust Variable Insurance Trust
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(Exact name of registrant as specified in charter)

120 East Liberty Drive, Suite 400
Wheaton, IL 60187
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(Address of principal executive offices) (Zip code)

W. Scott Jardine, Esq.
First Trust Portfolios L.P.
120 East Liberty Drive, Suite 400
Wheaton, IL 60187
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(Name and address of agent for service)

registrant's telephone number, including area code: 630-765-8000
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Date of fiscal year end: December 31
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Date of reporting period: December 31, 2012
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 100 F Street, NE,
Washington, DC 20549. The OMB has reviewed this collection of information under
the clearance requirements of 44 U.S.C. ss. 3507.

ITEM 1. REPORTS TO STOCKHOLDERS.

The Report to Shareholders is attached herewith.

FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
FOR THE PERIOD MAY 1, 2012 (COMMENCEMENT OF OPERATIONS)
THROUGH DECEMBER 31, 2012

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TABLE OF CONTENTS
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FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
DECEMBER 31, 2012

Shareholder Letter........................................................... 1
Market Overview.............................................................. 2
Performance Summary and Portfolio Components................................. 4
Understanding Your Fund Expenses............................................. 7
Portfolio of Investments..................................................... 8
Statement of Assets and Liabilities.......................................... 16
Statement of Operations...................................................... 17
Statement of Changes in Net Assets........................................... 18
Financial Highlights......................................................... 19
Notes to Financial Statements................................................ 20
Report of Independent Registered Public Accounting Firm ..................... 25
Additional Information....................................................... 26
Board of Trustees and Officers .............................................. 27
Privacy Policy .............................................................. 29

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This report contains certain forward-looking statements within the meaning of
the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934,
as amended. Forward-looking statements include statements regarding the goals,
beliefs, plans or current expectations of First Trust Advisors L.P. ("First
Trust" or the "Advisor") and its representatives, taking into account the
information currently available to them. Forward-looking statements include all
statements that do not relate solely to current or historical fact. For example,
forward-looking statements include the use of words such as "anticipate,"
"estimate," "intend," "expect," "believe," "plan," "may," "should," "would" or
other words that convey uncertainty of future events or outcomes.

Forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause the actual results, performance or achievements of
any series of the First Trust Variable Insurance Trust (the "Trust") to be
materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. When evaluating the
information included in this report, you are cautioned not to place undue
reliance on these forward-looking statements, which reflect the judgment of the
Advisor and its representatives only as of the date hereof. We undertake no
obligation to publicly revise or update these forward-looking statements to
reflect events and circumstances that arise after the date hereof.

PERFORMANCE AND RISK DISCLOSURE

There is no assurance that the First Trust/Dow Jones Dividend & Income
Allocation Portfolio (the "Fund"), the sole series of the Trust, will achieve
its investment objective. The Fund is subject to market risk, which is the
possibility that the market values of securities owned by the Fund will decline
and that the value of Fund shares may therefore be less than what you paid for
them. Accordingly, you can lose money by investing in the Fund. See "Risk
Considerations" in the Notes to Financial Statements for a discussion of certain
other risks of investing in the Fund.

Performance data quoted represents past performance, which is no guarantee of
future results, and current performance may be lower or higher than the figures
shown. For the most recent month-end performance figures, please visit
http://www.ftportfolios.com or speak with your financial advisor. Investment
returns and net asset value will fluctuate and Fund shares, when sold, may be
worth more or less than their original cost.

HOW TO READ THIS REPORT

This report contains information that may help you evaluate your investment. It
includes details about the Fund and presents data and analysis that provide
insight into the Fund's performance and investment approach.

By reading the portfolio commentary by the portfolio management team of the
Fund, you may obtain an understanding of how the market environment affected the
Fund's performance. The statistical information that follows may help you
understand the Fund's performance compared to that of relevant market
benchmarks.

It is important to keep in mind that the opinions expressed by personnel of
First Trust are just that: informed opinions. They should not be considered to
be promises or advice. The opinions, like the statistics, cover the period
through the date on the cover of this report. The risks of investing in the Fund
are spelled out in the prospectus, the statement of additional information, this
report and other Fund regulatory filings.

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SHAREHOLDER LETTER
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FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL LETTER FROM THE CHAIRMAN AND CEO
DECEMBER 31, 2012

Dear Shareholders:

I am pleased to present you with the annual report for your investment in First
Trust Variable Insurance Trust (the "Trust").

The report you hold contains detailed information about the initial series of
the Trust, First Trust/Dow Jones Dividend & Income Allocation Portfolio (the
"Fund"), for the period ended December 31, 2012. It contains a market overview
and a performance analysis for the period. I encourage you to read this document
and discuss it with your financial advisor. A successful investor is also
typically a knowledgeable one, as we have found to be the case at First Trust.

First Trust remains committed to being a long-term investor and investment
manager and to bringing you quality financial solutions regardless of market ups
and downs. We have always believed that there are two ways to attain success in
reaching your financial goals: staying invested in quality products and having a
long-term investment horizon. We are committed to this approach in the products
we manage or supervise and offer to investors.

First Trust offers a variety of products that we believe could fit many
financial plans to help investors seeking long-term investment success. We
encourage you to talk to your advisor about the other investments First Trust
offers that might also fit your financial goals and to discuss those goals with
your advisor regularly so that he or she can help keep you on track.

First Trust will continue to make available up-to-date information about your
investment so you and your financial advisor are current on what you own. We
value our relationship with you, and thank you for the opportunity to assist you
in achieving your financial goals. I look forward to 2013 and to the next
edition of your Fund's report.

Sincerely,

/s/ James A. Bowen

James A. Bowen
Chairman of the Board of Trustees of First Trust Variable Insurance Trust and
Chief Executive Officer of First Trust Advisors L.P.

Page 1

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MARKET OVERVIEW
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FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
DECEMBER 31, 2012

ROBERT F. CAREY, CFA
SENIOR VICE PRESIDENT AND CHIEF MARKET STRATEGIST
FIRST TRUST ADVISORS L.P.

Mr. Carey is responsible for the overall management of research and analysis of
the First Trust product line. Mr. Carey has over 22 years of experience as an
Equity and Fixed-Income Analyst and is a recipient of the Chartered Financial
Analyst ("CFA") designation. He is a graduate of the University of Illinois at
Champaign-Urbana with a B.S. in Physics. He is also a member of the Investment
Analysts Society of Chicago and the CFA Institute. Mr. Carey has appeared as a
guest on such programs as Bloomberg TV, CNBC and WBBM Radio and has been quoted
by several publications, including The Wall Street Journal, The Wall Street
Reporter, Bloomberg News Service, and Registered Rep.

STATE OF THE ECONOMY/INVESTING

The U.S. economy continued to grow at about a 2% annual clip during 2012. The
Federal Reserve has injected trillions of dollars of stimulus into the economy
since the start of the financial crisis. It has already helped stabilize the
commercial and residential real estate markets in the U.S. by artificially
keeping interest rates at or near historically low levels. While we continue to
see job creation on a monthly basis, the number of new jobs created, 158,000 per
month on average in 2012, is at least 100,000 below the low end of the desired
target. We believe a good amount of the stimulus is simply sitting idle waiting
to be put to work. Some smart policy-making out of Washington, D.C. early in
2013 could inspire a real boost in economic activity, in our opinion.

Should economic growth in the U.S. accelerate at some point in response to the
abundance of stimulus from the Federal Reserve, interest rates could quickly
begin to rise off their artificially low levels, in our opinion. While that
would naturally impede total returns in the bond market, it should benefit the
relative performance of equities. Data from Standard & Poor's revealed that,
since 1953, U.S. stocks actually posted their best returns when the yield on the
10-year Treasury note rose to around 4.0%, according to Businessweek. The S&P
500 gained an average of 1.7% per month during periods when yields climbed to a
range of 3.0% to 4.0%. Stock prices usually retrench when the yield on the
10-year Treasury note tops 6.0%. Sam Stovall, S&P's chief equity strategist,
defined this "sweet spot" as a period where growth in the economy reduces
unemployment, increases corporate earnings, but does not trigger growth-slowing
efforts by the Federal Reserve.

EQUITIES

All of the major U.S. stock indices posted double-digit returns in 2012. The Dow
Jones U.S. Total Market Index(SM) posted a total return of 16.58%, according to
Bloomberg. The Dow Jones U.S. Total Market Index(SM) posted a total return of
3.91% from 4/30/12-12/31/12. The number one classification within the Lipper
U.S. Diversified Equity Classification category (open-end funds) for net new
cash inflows in 2012 was Equity Income, at $21.7 billion, according to Strategic
Insight and Lipper. We find that impressive when you compare those inflows to
the broader Lipper U.S. Diversified Equity Classification category, which posted
net outflows totaling $68.6 billion in 2012.

The S&P Dow Jones Indices, which tracks approximately 10,000 U.S. traded stocks,
announced that total stock dividend distributions (excluding special and extra
one-time dividend payments) increased by a net (increases minus decreases) $35.6
billion in 2012, according to its own release. In 2012, there were 2,883
dividend increases, up from 1,953 in 2011, and 275 decreases, up from 101 in
2011. The dividend payout rate, which is the percentage of a dollar's worth of
earnings paid in the form of a cash dividend, was just 36% in 2012. The
historical average dating back to the 1930s is closer to 52%. That implies that
companies, on average, may have the ability to increase their payout rate moving
forward.

Page 2

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MARKET OVERVIEW - (CONTINUED)
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FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
DECEMBER 31, 2012

BONDS

Despite the aforementioned potential for a rise in interest rates, the demand
for investment-grade corporate debt could get a lift from institutional
investors. The need for pensions to more closely align maturities with their
liabilities may result in managers lightening exposure to equities in favor of
10- and 30-year corporate bonds. Pension plan demand for investment-grade
corporate bonds could total $100-$150 billion in each of the next several years,
according to Michael Moran, a pension strategist at Goldman Sachs Asset
Management.

Cash flows into the Lipper Intermediate Investment Grade Debt Classification and
Corporate Debt Classification categories (open-end funds) were just as strong in
the second half of 2012 as the first half. Net new cash inflows into
Intermediate Investment Grade funds totaled $39.5 billion in the last six months
of 2012, up from $36.1 billion in the first half, according to Strategic
Insight. Net inflows totaled $75.6 billion for the entire year, up from $23.5
billion in 2011. Net new cash inflows into Corporate Debt funds totaled $9.9
billion in the last six months of 2012, down from $12.9 billion in the first
half of 2012. Net inflows totaled $22.9 billion for the entire year, up from
$6.8 billion in 2011.

Page 3

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PERFORMANCE SUMMARY AND PORTFOLIO COMPONENTS
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FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
DECEMBER 31, 2012 (UNAUDITED)

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO

From portfolio inception (May 1, 2012) to year end 2012, the First Trust/Dow
Jones Dividend & Income Allocation Portfolio (the "Fund") returned 4.38% versus
4.96% for the blended benchmark: 50% Russell 3000(R) Index and 50% Barclays U.S.
Corporate Investment-Grade Index.

Following a strong first quarter for equities, economic data were mixed and
anxieties returned about the European debt situation around the time the Fund
was launched. This resulted in equity benchmarks giving up some of their first
quarter gains during the second quarter. Profit growth estimates also started to
recede as the Chinese economy cooled and political events in both Europe and the
U.S. conspired to send equities lower. Markets regained their momentum in the
third quarter as volatility declined. Sentiment toward the Eurozone improved in
July after the European Central Bank promised to do whatever it takes to keep
the Eurozone together. In the fourth quarter, markets traded slightly lower due
to news flow out of Washington. The election and ongoing negotiations over the
"fiscal cliff" impacted markets during the fourth quarter and the economy
continued to plod along as economic data showed sluggish growth.

The equity portion of the Fund had quarterly rebalances in early July and
October. The Fund's objective is to seek to provide total return by allocating
among dividend-paying stocks and investment-grade bonds. To accomplish this
objective for the equity portion, the selection process is focused on dividend
strength, capital strength and price stability. This process resulted in
overweight positions in Consumer Staples, Industrials and Financials stocks,
while Energy, Information Technology and Telecommunication Services were
underweight.

Of the ten Global Industry Classification Standard sectors, commonly referred to
as GICS sectors, five had positive total attribution effects (allocation effect
combined with selection effect) and five had negative total attribution effect
for the Fund. Four sectors had a positive selection effect: Consumer Staples,
Information Technology, Industrials and Energy. Five sectors had a negative
selection effect: Consumer Discretionary, Financials, Health Care, Materials and
Utilities. The Fund had no allocation to the Telecommunication Services sector,
so it had no selection effect. The Fund had a positive allocation effect in
eight of the ten sectors, with Telecommunication Services and Materials the only
detractors.

The Consumer Discretionary sector was the biggest overall detractor from
relative performance due to security selection. The Fund was also slightly
overweight the Consumer Discretionary sector relative to the Russell 3000(R)
Index. The Fund's relative performance for the sector was most hindered by the
selection of Monro Muffler Brake, Inc., John Wiley & Sons, Inc. and Garmin Ltd.
Relative to the Russell 3000(R) Index, the Fund lagged in the Financials and
Telecommunication Services sectors. In the Financials sector, Assurant, Inc. and
Reinsurance Group of America, Inc. detracted from relative performance. The
Telecommunication Services sector was the best-performing sector in the Russell
3000(R) Index, albeit with the smallest sector weighting. As noted above, the
Fund had no allocation to the Telecommunication Services sector.

The Consumer Staples sector was the top-contributing sector to relative
performance. The Fund was overweight the sector which led to a positive
allocation effect on top of a sizable selection effect. The top Fund
contributors from the sector were Costco Wholesale Corp., Wal-Mart Stores, Inc.
and Flowers Foods, Inc. Relative to the Russell 3000(R) Index, the Fund had
positive attribution effects from the Information Technology and Industrials
sectors. The Information Technology sector was the worst-performing sector in
the Russell 3000(R) Index. The Fund was underweight the sector and had a
positive selection effect as well. The top-contributing positions from the
sector were Maximus, Inc., Visa, Inc. and Jack Henry & Associates, Inc. The
Industrials sector also had positive allocation and selection effects. The
top-contributing positions from the sector were Equifax, Inc., Cummins, Inc. and
Rockwell Collins, Inc.

The Fund's top five contributors to performance were Maximus, Inc., H&R Block,
Inc., Visa, Inc., Costco Wholesale Corp. and Eli Lilly & Co. The top detractors
from performance were Intel Corp., Western Union Co., Occidental Petroleum
Corp., FactSet Research Systems, Inc. and Chimera Investment Corp.

As we look forward to 2013, equity valuations remain attractive, in our opinion.
The upcoming debt ceiling debate, along with sluggish job and earnings growth,
are likely to remain headlines in the near term. However, we believe taking a
long-term view of equities reveals attractive valuations and opportunities for
patient investors. The Fund will remain consistent in its objective of providing
total return by allocating among dividend-paying stocks and investment-grade
bonds.

Page 4

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PERFORMANCE SUMMARY AND PORTFOLIO COMPONENTS - (CONTINUED)
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
DECEMBER 31, 2012 (UNAUDITED)

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO (CONTINUED)

The corporate bond market had a solid performance in 2012. Along with decent
earnings and generally strong balance sheets, markets were aided by three key
drivers. The first occurred in July when European leaders pledged "to do
whatever it takes to preserve the Euro". Their orchestrated effort assuaged
market fears about the ability of government and central bank officials to
contain the three year old debt crisis. The second driver occurred in August as
members of the Federal Reserve began to muse publically about the need for a
third round of quantitative easing. In September, the Fed did indeed announce
QE3, pledging to purchase mortgages and other securities in order to keep
interest rates low for years. The third driver, manifest throughout the year,
was the demand for bonds outstripping the supply. Interestingly, even while new
debt issuance was close to a record amount, demand more than matched it. Some of
this is explained by investors moving out of equity funds in favor of bond
funds.

In this environment, the Fund's bond portfolio's solid returns were driven
mostly by improving credit spreads and less so by interest rate changes. Since
Fund inception, the option-adjusted spread for the Barclays U.S. Corporate
Investment-Grade Index tightened to 141 from 186 while the 10-year Treasury
yield dropped to 1.72% from 1.94%. As investors sought more yield, the riskiest
segments of the investment-grade bond market were the ones that performed the
best. Long duration bonds outperformed short duration. Returns on Baa-rated
issues beat those A-rated and higher. The more volatile Financials sector ended
with much better returns than the Industrials and Utility sectors. Since
inception, the total return on the fixed-income portion of the Fund's portfolio
was in line with the benchmark.

The bond portion of the Fund seeks to provide income and preserve capital
through investing in a diverse allocation of investment-grade corporate bonds
and bonds backed by the U.S. Government and its agencies. The Fund may also hold
exchange-traded funds ("ETFs") that invest in these types of securities when it
is in the best interest of the Fund for purposes of efficient liquidity and
diversification benefits as compared to that provided by transacting in bonds
directly. At different times during the period, the Fund held as many as three
and as few as one fixed-income ETFs to accomplish these objectives.

Looking forward, our view is that the fixed-income portion of the strategy will
provide coupon-like returns in 2013. Investment-grade credit looks to be near
fully valued given a slowly expanding economy and interest rates that have
little room to fall outside of another full blown crisis. In this context, the
greater carry from riskier credits is expected to add the most value. In our
view, the bank and finance sector offers the best opportunity for spread
compression.

Page 5

FIRST TRUST VARIABLE INSURANCE TRUST
ANNUAL REPORT
DECEMBER 31, 2012 (UNAUDITED)

------------------------------------------------------------------------------------------------------------
RETURN COMPARISON PERIOD ENDED DECEMBER 31, 2012

SINCE INCEPTION
INCEPTION DATE CUMULATIVE TOTAL RETURN

First Trust/Dow Jones Dividend & Income Allocation Portfolio 5/1/12 4.38%
Blended Benchmark (a) 4.96%
Barclays U.S. Corporate Investment-Grade Index (b) 6.36%
Russell 3000(R) Index (c) 3.32%

(a) The Blended Benchmark return is a 50/50 split between the Russell 3000(R)
Index and the Barclays U.S. Corporate Investment-Grade Index returns.

(b) Barclays U.S. Corporate Investment-Grade Index measures the performance of
investment grade U.S. corporate bonds. The index includes all publicly
issued, dollar-denominated corporate bonds with a minimum of $250 million
par outstanding that are investment grade-rated (Baa3/BBB- or higher). The
index excludes bonds having less than one year to final maturity as well
as floating rate bonds, non-registered private placements, structured
notes, hybrids, and convertible securities. (Bloomberg).

(c) The Russell 3000(R) Index is composed of 3,000 large U.S. companies, as
determined by market capitalization. This index represents approximately
98% of the investable U.S. equity market. (Bloomberg). (The index reflects
no deduction for fees, expenses or taxes).

The return for the Fund does not reflect the deduction of expenses associated
with variable products, such as mortality and expense risk charges, separate
account charges, and sales charges or the effect of taxes. These expenses would
reduce the overall returns shown.

PERFORMANCE OF A $10,000 INITIAL INVESTMENT
May 1, 2012 - December 31, 2012

First Trust/Dow Jones Dividend & Blended Barclays U.S. Corporate Russell 3000(R)
Income Allocation Portfolio Benchmark Investment-Grade Index Index

5/1/2012 10000 10000 10000 10000
12/31/12 10438 10496 10636 10332

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% OF TOTAL
TOP 10 HOLDINGS INVESTMENTS
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iShares iBoxx Investment Grade
Corporate Bond Fund 28.7%
Wal-Mart Stores, Inc., 5.63%, 04/15/2041 1.0
Bank of America Corp., 5.70%, 01/24/2022 1.0
MidAmerican Energy Co., 5.30%, 03/15/2018 1.0
Dow Chemical (The) Co., 5.70%, 05/15/2018 1.0
American International Group, Inc., 5.85%,
01/16/2018 0.9
Goldman Sachs Group (The), Inc., 5.75%,
01/24/2022 0.9
Wyeth LLC, 5.95%, 04/01/2037 0.9
Citigroup, Inc., 4.50%, 01/14/2022 0.9
Kinder Morgan Energy Partners, L.P., 3.95%,
09/01/2022 0.9
------------------------------------------------------
Total 37.2%
=====

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% OF TOTAL
SECTOR INVESTMENTS
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Common Stocks:
Financials 9.1%
Industrials 9.1
Consumer Staples 7.0
Information Technology 6.8
Consumer Discretionary 6.8
Health Care 6.4
Materials 2.1
Energy 1.6
Utilities 1.3
------------------------------------------------------
Total Common Stocks 50.2
Exchange-Traded Funds 28.7
Corporate Bonds & Notes 21.1
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Total 100.0%
======

Page 6

FIRST TRUST VARIABLE INSURANCE TRUST
UNDERSTANDING YOUR FUND EXPENSES
DECEMBER 31, 2012 (UNAUDITED)

As a shareholder of First Trust/Dow Jones Dividend & Income Allocation
Portfolio, you incur two types of costs: (1) transaction costs; and (2) ongoing
costs, including management fees; distribution and/or service (12b-1) fees; and
other Fund expenses. This Example is intended to help you understand your
ongoing costs (in U.S. dollars) of investing in the Fund and to compare these
costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the
period and held through the six-month period ended December 31, 2012.

ACTUAL EXPENSES

The first three columns of the table below provide information about actual
account values and actual expenses. You may use the information in these
columns, together with the amount you invested, to estimate the expenses that
you paid over the period. Simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the
result by the number in the third column under the heading entitled "Expenses
Paid During Period" to estimate the expenses you paid on your account during the
period

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The next three columns of the table below provide information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an assumed rate of return of 5% per year before expenses, which is not
the Fund's actual return. The hypothetical account values and expenses may not
be used to estimate the actual ending account balance or expenses you paid for
the period. You may use this information to compare the ongoing cost of
investing in the Fund and other funds. To do so, compare this 5% hypothetical
example with the 5% hypothetical examples that appear in the shareholder reports
of the other funds.

Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads) or contingent deferred sales charges. Therefore, the
hypothetical section of the table is useful in comparing ongoing costs only, and
will not help you determine the relative total costs of owning different funds.
In addition, if these transactional costs were included, your costs would have
been higher.

HYPOTHETICAL
ACTUAL EXPENSES (5% RETURN BEFORE EXPENSES)
------------------------------------------ ------------------------------------------------------
EXPENSES EXPENSES
BEGINNING ENDING PAID DURING BEGINNING ENDING PAID DURING ANNUAL-
ACCOUNT ACCOUNT PERIOD ACCOUNT ACCOUNT PERIOD IZED
VALUE VALUE 07/01/2012- VALUE VALUE 07/01/2012- EXPENSE
07/01/2012 12/31/2012 12/31/2012 (a) 07/01/2012 12/31/2012 12/31/2012 (a) RATIO (b)
-------------- ---------- -------------- -------------- ---------- -------------- ---------

First Trust/Dow Jones Dividend &
Income Allocation Portfolio $ 1,000.00 $ 1,041.70 $ 6.16 $ 1,000.00 $ 1,019.10 $ 6.09 1.20%

(a) Expenses are equal to the annualized expense ratio multiplied by the
average account value over the period (July 1, 2012 through December 31,
2012), multiplied by 184/366 (to reflect the six-month period).
Hypothetical expenses are assumed for the most recent fiscal half-year.

(b) The expense ratio reflects an expense cap.

Page 7

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2012

SHARES DESCRIPTION VALUE
----------- ------------------------------------------------------------------------------ -------------
COMMON STOCKS - 48.9%

AEROSPACE & DEFENSE - 2.0%
1,582 General Dynamics Corp......................................................... $ 109,585
1,119 Lockheed Martin Corp.......................................................... 103,273
1,574 Northrop Grumman Corp......................................................... 106,371
1,829 Raytheon Co................................................................... 105,277
1,949 Rockwell Collins, Inc......................................................... 113,373
1,334 United Technologies Corp...................................................... 109,401
-------------
647,280
-------------

AIR FREIGHT & LOGISTICS - 0.7%
1,785 CH Robinson Worldwide, Inc.................................................... 112,848
1,461 United Parcel Service, Inc., Class B ......................................... 107,719
-------------
220,567
-------------

BEVERAGES - 0.9%
1,601 Brown-Forman Corp............................................................. 101,263
2,757 Coca-Cola (The) Co............................................................ 99,941
1,478 PepsiCo, Inc.................................................................. 101,140
-------------
302,344
-------------

CAPITAL MARKETS - 0.7%
4,875 SEI Investments Co............................................................ 113,782
1,652 T. Rowe Price Group, Inc...................................................... 107,595
-------------
221,377
-------------

CHEMICALS - 1.4%
1,263 Air Products & Chemicals, Inc................................................. 106,117
1,889 FMC Corp...................................................................... 110,544
1,755 International Flavors & Fragrances, Inc....................................... 116,778
1,452 Sigma-Aldrich Corp............................................................ 106,838
-------------
440,277
-------------

COMMERCIAL BANKS - 1.2%
2,292 Bank of Hawaii Corp........................................................... 100,963
2,708 Commerce Bancshares, Inc...................................................... 94,942
1,821 Cullen Frost Bankers, Inc..................................................... 98,826
3,047 US Bancorp ................................................................... 97,321
-------------
392,052
-------------

COMMERCIAL SERVICES & SUPPLIES - 0.3%
4,572 Healthcare Services Group, Inc................................................ 106,208
-------------

COMMUNICATIONS EQUIPMENT - 0.7%
2,039 Harris Corp................................................................... 99,829
2,961 Plantronics, Inc.............................................................. 109,172
-------------
209,001
-------------

CONTAINERS & PACKAGING - 0.7%
2,023 Aptargroup, Inc............................................................... 96,538
2,470 Ball Corp..................................................................... 110,532
-------------
207,070
-------------

Page 8 See Notes to Financial Statements

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

SHARES DESCRIPTION VALUE
----------- ------------------------------------------------------------------------------ -------------
COMMON STOCKS - (CONTINUED)

DISTRIBUTORS - 0.3%
1,714 Genuine Parts Co.............................................................. $ 108,976
-------------

DIVERSIFIED CONSUMER SERVICES - 0.4%
6,033 H&R Block, Inc................................................................ 112,033
-------------

ELECTRIC UTILITIES - 0.3%
2,489 Cleco Corp.................................................................... 99,585
-------------

ELECTRICAL EQUIPMENT - 0.7%
2,949 AMETEK, Inc................................................................... 110,794
953 Roper Industries, Inc......................................................... 106,240
-------------
217,034
-------------

FOOD & STAPLES RETAILING - 1.6%
1,044 Costco Wholesale Corp......................................................... 103,116
2,158 CVS Caremark Corp............................................................. 104,339
3,343 Sysco Corp.................................................................... 105,839
1,416 Wal-Mart Stores, Inc.......................................................... 96,614
2,870 Walgreen Co................................................................... 106,219
-------------
516,127
-------------

FOOD PRODUCTS - 2.4%
3,002 Campbell Soup Co.............................................................. 104,740
5,180 Flowers Foods, Inc............................................................ 120,539
2,623 General Mills, Inc............................................................ 105,995
1,869 H.J. Heinz Co................................................................. 107,804
3,575 Hormel Foods Corp............................................................. 111,576
2,025 Kellogg Co.................................................................... 113,096
1,684 McCormick & Co., Inc.......................................................... 106,984
-------------
770,734
-------------

GAS UTILITIES - 0.6%
2,287 New Jersey Resources Corp..................................................... 90,611
5,142 Questar Corp.................................................................. 101,606
-------------
192,217
-------------

HEALTH CARE EQUIPMENT & SUPPLIES - 1.9%
1,734 Baxter International, Inc..................................................... 115,588
1,331 Becton, Dickinson & Co........................................................ 104,071
1,000 C.R. Bard, Inc................................................................ 97,740
1,759 Covidien plc ................................................................. 101,565
2,423 Medtronic, Inc................................................................ 99,391
1,879 Stryker Corp.................................................................. 103,007
-------------
621,362
-------------

HEALTH CARE PROVIDERS & SERVICES - 2.4%
2,640 Aetna, Inc.................................................................... 122,232
2,698 AmerisourceBergen Corp........................................................ 116,500
2,684 Cardinal Health, Inc.......................................................... 110,527
1,509 Chemed Corp................................................................... 103,502
1,215 McKesson Corp................................................................. 117,806

See Notes to Financial Statements Page 9

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

SHARES DESCRIPTION VALUE
----------- ------------------------------------------------------------------------------ -------------
COMMON STOCKS - (CONTINUED)

HEALTH CARE PROVIDERS & SERVICES - (CONTINUED)
3,502 Owens & Minor, Inc............................................................ $ 99,842
1,887 UnitedHealth Group, Inc....................................................... 102,351
-------------
772,760
-------------

HOTELS, RESTAURANTS & LEISURE - 1.2%
1,557 Cracker Barrel Old Country Store, Inc......................................... 100,053
1,875 Darden Restaurants, Inc....................................................... 84,506
1,139 McDonald's Corp............................................................... 100,471
1,576 Yum! Brands, Inc.............................................................. 104,647
-------------
389,677
-------------
HOUSEHOLD DURABLES - 0.3%
2,504 Garmin, Ltd................................................................... 102,213
-------------

HOUSEHOLD PRODUCTS - 1.3%
1,937 Church & Dwight Co., Inc...................................................... 103,765
972 Colgate-Palmolive Co.......................................................... 101,613
1,218 Kimberly-Clark Corp........................................................... 102,836
1,507 Procter & Gamble (The) Co..................................................... 102,310
-------------
410,524
-------------

INDUSTRIAL CONGLOMERATES - 0.7%
1,133 3M Co......................................................................... 105,199
1,894 Danaher Corp.................................................................. 105,875
-------------
211,074
-------------

INSURANCE - 6.0%
1,382 ACE, Ltd...................................................................... 110,284
1,354 Allied World Assurance Co. Holdings, AG ...................................... 106,695
2,759 American Financial Group, Inc................................................. 109,036
4,081 Amtrust Financial Services, Inc............................................... 117,084
2,802 Assurant, Inc................................................................. 97,229
2,994 Axis Capital Holdings, Ltd.................................................... 103,712
1,370 Chubb Corp.................................................................... 103,188
2,803 Hanover Insurance Group (The), Inc............................................ 108,588
3,084 HCC Insurance Holdings, Inc................................................... 114,756
2,705 Mercury General Corp.......................................................... 107,361
4,724 Montpelier Re Holdings, Ltd................................................... 107,991
1,408 PartnerRe, Ltd................................................................ 113,330
1,807 Reinsurance Group of America, Inc............................................. 96,711
1,355 RenaissanceRe Holdings, Ltd................................................... 110,107
2,036 Torchmark Corp................................................................ 105,200
1,530 Travelers (The) Cos., Inc..................................................... 109,885
3,082 Validus Holdings, Ltd......................................................... 106,576
2,788 W.R. Berkley Corp............................................................. 105,219
-------------
1,932,952
-------------

IT SERVICES - 3.1%
1,494 Accenture PLC, Class A ....................................................... 99,351
1,783 Automatic Data Processing, Inc................................................ 101,649

Page 10 See Notes to Financial Statements

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

SHARES DESCRIPTION VALUE
----------- ------------------------------------------------------------------------------ -------------
COMMON STOCKS - (CONTINUED)

IT SERVICES - (CONTINUED)
4,481 Broadridge Financial Solutions, Inc........................................... $ 102,525
503 International Business Machines Corp.......................................... 96,350
2,762 Jack Henry & Associates, Inc.................................................. 108,436
1,749 Maximus, Inc.................................................................. 110,572
3,140 Paychex, Inc.................................................................. 97,780
4,410 Total System Services, Inc.................................................... 94,462
780 Visa, Inc..................................................................... 118,232
5,739 Western Union Co.............................................................. 78,108
-------------
1,007,465
-------------

LEISURE EQUIPMENT & PRODUCTS - 0.6%
2,739 Hasbro, Inc................................................................... 98,330
2,948 Mattel, Inc................................................................... 107,956
-------------
206,286
-------------

LIFE SCIENCES TOOLS & SERVICES - 0.3%
1,452 Techne Corp................................................................... 99,230
-------------

MACHINERY - 2.1%
2,341 CLARCOR, Inc.................................................................. 111,853
1,135 Cummins, Inc.................................................................. 122,978
3,012 Donaldson Co., Inc............................................................ 98,914
1,250 Parker Hannifin Corp.......................................................... 106,325
793 Valmont Industries, Inc....................................................... 108,284
1,302 Wabtec Corp/De ............................................................... 113,977
-------------
662,331
-------------

MEDIA - 0.9%
2,274 John Wiley & Sons, Inc., Class A ............................................. 88,527
2,985 Meredith Corp................................................................. 102,833
2,000 Walt Disney (The) Co.......................................................... 99,580
-------------
290,940
-------------

MULTI-UTILITIES - 0.3%
2,776 Wisconsin Energy Corp......................................................... 102,296
-------------

MULTILINE RETAIL - 0.6%
1,578 Family Dollar Stores, Inc..................................................... 100,061
1,647 Target Corp................................................................... 97,453
-------------
197,514
-------------

OIL, GAS & CONSUMABLE FUELS - 1.6%
894 Chevron Corp.................................................................. 96,677
1,829 ConocoPhillips ............................................................... 106,064
1,142 Exxon Mobil Corp.............................................................. 98,840
2,534 HollyFrontier Corp............................................................ 117,958
1,214 Occidental Petroleum Corp..................................................... 93,004
-------------
512,543
-------------

PHARMACEUTICALS - 1.6%
1,526 Abbott Laboratories .......................................................... 99,953

See Notes to Financial Statements Page 11

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

SHARES DESCRIPTION VALUE
----------- ------------------------------------------------------------------------------ -------------
COMMON STOCKS - (CONTINUED)

PHARMACEUTICALS - (CONTINUED)
3,098 Bristol-Myers Squibb Co....................................................... $ 100,964
2,205 Eli Lilly & Co................................................................ 108,750
1,519 Johnson & Johnson ............................................................ 106,482
4,209 Pfizer, Inc................................................................... 105,562
-------------
521,711
-------------

PROFESSIONAL SERVICES - 0.4%
2,244 Equifax, Inc.................................................................. 121,445
-------------

REAL ESTATE INVESTMENT TRUSTS (REITS) - 1.0%
3,708 Hatteras Financial Corp....................................................... 91,996
751 Public Storage ............................................................... 108,865
2,134 Rayonier, Inc................................................................. 110,605
-------------
311,466
-------------

ROAD & RAIL - 1.0%
2,210 Landstar System, Inc.......................................................... 115,937
882 Union Pacific Corp............................................................ 110,885
4,894 Werner Enterprises, Inc....................................................... 106,053
-------------
332,875
-------------

SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 2.0%
3,074 Altera Corp................................................................... 105,869
2,672 Analog Devices, Inc........................................................... 112,384
4,616 Intel Corp.................................................................... 95,228
2,190 KLA-Tencor Corp............................................................... 104,594
3,792 Texas Instruments, Inc........................................................ 117,325
3,128 Xilinx, Inc................................................................... 112,295
-------------
647,695
-------------

SOFTWARE - 0.9%
4,057 CA, Inc....................................................................... 89,173
1,085 FactSet Research Systems, Inc................................................. 95,545
3,511 Microsoft Corp................................................................ 93,849
-------------
278,567
-------------

SPECIALTY RETAIL - 1.2%
2,972 Monro Muffler Brake, Inc...................................................... 103,931
1,515 PetSmart, Inc................................................................. 103,535
1,619 Ross Stores, Inc.............................................................. 87,669
2,336 TJX (The) Cos., Inc........................................................... 99,163
-------------
394,298
-------------

TEXTILES, APPAREL & LUXURY GOODS - 1.0%
1,865 Coach, Inc.................................................................... 103,526
2,202 NIKE, Inc., Class B .......................................................... 113,623
690 Ralph Lauren Corp............................................................. 103,445
-------------
320,594
-------------

TOBACCO - 0.6%
3,130 Altria Group, Inc............................................................. 98,345

Page 12 See Notes to Financial Statements

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

SHARES DESCRIPTION VALUE
----------- ------------------------------------------------------------------------------ -------------
COMMON STOCKS - (CONTINUED)

TOBACCO - (CONTINUED)
2,412 Reynolds American, Inc........................................................ $ 99,929
-------------
198,274
-------------

TRADING COMPANIES & DISTRIBUTORS - 1.0%
2,523 Applied Industrial Technologies, Inc.......................................... 105,991
2,433 Fastenal Co................................................................... 113,597
501 W.W. Grainger, Inc............................................................ 101,387
-------------
320,975
-------------

TOTAL COMMON STOCKS .......................................................... 15,729,949
(Cost $15,542,190) -------------

EXCHANGE-TRADED FUNDS - 28.0%
74,405 iShares iBoxx Investment Grade Corporate Bond Fund ........................... 9,002,261
-------------
TOTAL EXCHANGE-TRADED FUNDS .................................................. 9,002,261
(Cost $9,010,644) -------------

PRINCIPAL STATED STATED
VALUE DESCRIPTION COUPON MATURITY VALUE
----------- ---------------------------------------------------- --------- ------------- -------------
CORPORATE BONDS AND NOTES - 20.5%

AEROSPACE & DEFENSE - 1.3%
$ 150,000 United Technologies Corp............................ 3.10% 06/01/22 159,173
250,000 United Technologies Corp............................ 1.80% 06/01/17 257,613
-------------
416,786
-------------
BEVERAGES - 0.8%
250,000 Anheuser-Busch Inbev Worldwide, Inc................. 2.50% 07/15/22 252,097
-------------
CAPITAL MARKETS - 0.9%
250,000 Goldman Sachs Group (The), Inc...................... 5.75% 01/24/22 296,088
-------------
CHEMICALS - 0.9%
250,000 Dow Chemical (The) Co............................... 5.70% 05/15/18 297,669
-------------
COMMERCIAL BANKS - 0.8%
250,000 Wells Fargo & Co.................................... 1.50% 07/01/15 254,463
-------------
CONSUMER FINANCE - 0.8%
250,000 Capital One Financial Corp.......................... 1.00% 11/06/15 249,330
-------------
DIVERSIFIED FINANCIAL SERVICES - 3.0%
250,000 Bank of America Corp................................ 5.70% 01/24/22 301,185
250,000 Citigroup, Inc...................................... 4.50% 01/14/22 279,450
250,000 General Electric Capital Corp....................... 2.30% 04/27/17 259,487
100,000 JPMorgan Chase & Co................................. 6.40% 05/15/38 134,526
-------------
974,648
-------------
DIVERSIFIED TELECOMMUNICATION SERVICES - 1.6%
250,000 AT&T, Inc........................................... 0.88% 02/13/15 251,303

See Notes to Financial Statements Page 13

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

DIVERSIFIED TELECOMMUNICATION SERVICES - (CONTINUED)
$ 250,000 Verizon Communications, Inc......................... 2.45% 11/01/22 $ 250,627
-------------
501,930
-------------
ELECTRIC UTILITIES - 0.9%
250,000 MidAmerican Energy Co............................... 5.30% 03/15/18 299,131
-------------
FOOD & STAPLES RETAILING - 1.0%
250,000 Wal-Mart Stores, Inc................................ 5.63% 04/15/41 328,699
-------------
INSURANCE - 0.9%
250,000 American International Group, Inc................... 5.85% 01/16/18 296,207
-------------
MEDIA - 1.1%
250,000 Comcast Corp........................................ 4.65% 07/15/42 264,595
100,000 Walt Disney (The) Co................................ 0.45% 12/01/15 99,579
-------------
364,174
-------------
METALS & MINING - 0.8%
250,000 Freeport-Mcmoran Copper & Gold, Inc................. 1.40% 02/13/15 249,606
-------------
OIL, GAS & CONSUMABLE FUELS - 1.6%
250,000 ConocoPhillips Co................................... 2.40% 12/15/22 249,755
250,000 Kinder Morgan Energy Partners L.P................... 3.95% 09/01/22 267,841
-------------
517,596
-------------
PHARMACEUTICALS - 1.7%
250,000 Merck & Co., Inc.................................... 2.25% 01/15/16 261,410
215,000 Wyeth LLC .......................................... 5.95% 04/01/37 287,836
-------------
549,246
-------------
SOFTWARE - 0.8%
250,000 Oracle Corp......................................... 2.50% 10/15/22 252,798
-------------
TOBACCO - 1.6%
250,000 Altria Group, Inc................................... 2.85% 08/09/22 247,898
250,000 Philip Morris International, Inc.................... 1.13% 08/21/17 249,482
-------------
497,380
-------------
TOTAL CORPORATE BONDS AND NOTES .............................................. 6,597,848
(Cost $6,600,483) -------------

TOTAL INVESTMENTS - 97.4% .................................................... 31,330,058
(Cost $31,153,317) (a)

NET OTHER ASSETS AND LIABILITIES - 2.6% ...................................... 846,312
-------------
NET ASSETS - 100.0% .......................................................... $ 32,176,370
=============

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

(a) Aggregate cost for federal income tax purposes is $31,153,550. As of
December 31, 2012, the aggregate gross unrealized appreciation for all
securities in which there was an excess of value over tax cost was
$467,764 and the aggregate gross unrealized depreciation for all
securities in which there was an excess of tax cost over value was
$291,256.

Page 14 See Notes to Financial Statements

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
PORTFOLIO OF INVESTMENTS - (CONTINUED)
DECEMBER 31, 2012

VALUATION INPUTS
A summary of the inputs used to value the Fund's investments as of December 31,
2012 is as follows (see Note 2A - Portfolio Valuation in the Notes to Financial
Statements):

LEVEL 2 LEVEL 3
TOTAL LEVEL 1 SIGNIFICANT SIGNIFICANT
VALUE AT QUOTED OBSERVABLE UNOBSERVABLE
12/31/2012 PRICES INPUTS INPUTS
------------ ------------ ------------ ------------

Common Stocks*....................................... $ 15,729,949 $ 15,729,949 $ -- $ --
Exchange-Traded Funds................................ 9,002,261 9,002,261 -- --
Corporate Bonds and Notes*........................... 6,597,848 -- 6,597,848 --
------------ ------------ ------------ ------------
TOTAL INVESTMENTS.................................... $ 31,330,058 $ 24,732,210 $ 6,597,848 $ --
============ ============ ============ ============

* See the Portfolio of Investments for industry breakout.

All transfers in and out of the Levels during the period are assumed to be on
the last day of the period at their current value. There were no transfers
between the Levels at December 31, 2012.

See Notes to Financial Statements Page 15

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2012

ASSETS:

Investments, at value
(Cost $31,153,317).......................................................................... $ 31,330,058
Cash........................................................................................... 1,133,284
Prepaid expenses............................................................................... 339
Receivables:
Fund shares sold............................................................................ 273,433
Interest.................................................................................... 64,609
Dividends................................................................................... 41,709
From Investment Advisor..................................................................... 5,908
------------
Total Assets.............................................................................. 32,849,340
------------

LIABILITIES:
Payables:
Investment securities purchased............................................................. 595,078
Audit fees.................................................................................. 29,000
Administrative service fees................................................................. 12,159
Custodian fees.............................................................................. 10,833
12b-1 service fees.......................................................................... 6,146
Administrative fees......................................................................... 5,417
Fund shares redeemed........................................................................ 3,998
Printing fees............................................................................... 2,885
Transfer agent fees......................................................................... 2,277
Licensing fees.............................................................................. 2,009
Legal fees.................................................................................. 1,120
Financial reporting fees.................................................................... 771
Other liabilities.............................................................................. 1,277
------------
Total Liabilities......................................................................... 672,970
------------
NET ASSETS..................................................................................... $ 32,176,370
============
NET ASSETS CONSIST OF:
Paid-in capital................................................................................ $ 31,999,862
Accumulated net investment income (loss)....................................................... --
Accumulated net realized gain (loss) on investments............................................ (233)
Net unrealized appreciation (depreciation) on investments...................................... 176,741
------------
NET ASSETS..................................................................................... $ 32,176,370
============
NET ASSET VALUE, offering price and redemption price of Shares
outstanding (Net Assets/Shares outstanding)............................................... $ 10.31
============
Number of Shares outstanding................................................................... 3,120,254
============

Page 16 See Notes to Financial Statements

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED DECEMBER 31, 2012 (a)

INVESTMENT INCOME:

Dividends (net of foreign withholding tax of $207)............................................. $ 262,200
Interest....................................................................................... 27,173
------------
Total investment income..................................................................... 289,373
------------
EXPENSES:
Investment advisory fees....................................................................... 50,338
Administrative fees............................................................................ 43,333
Audit fees..................................................................................... 29,000
12b-1 service fees............................................................................. 20,974
Transfer agent fees............................................................................ 17,533
Administrative service fees.................................................................... 16,852
Trustees' fees and expenses.................................................................... 12,422
Custodian fees................................................................................. 10,833
Printing fees.................................................................................. 6,904
Financial reporting fees....................................................................... 6,167
Legal fees..................................................................................... 3,737
Licensing fees................................................................................. 2,800
Other.......................................................................................... 4,992
------------
Total expenses.............................................................................. 225,885
Fees waived and expenses reimbursed by the investment advisor............................... (125,220)
------------
Net expenses................................................................................ 100,665
------------
NET INVESTMENT INCOME (LOSS)................................................................... 188,708
------------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on investments..................................................... 126,195
Net change in unrealized appreciation (depreciation) on investments......................... 176,741
------------
NET REALIZED AND UNREALIZED GAIN (LOSS)........................................................ 302,936
------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS................................ $ 491,644
============

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

(a) The Fund was seeded on April 12, 2012 and commenced operations on May 1,
2012.

See Notes to Financial Statements Page 17

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS

PERIOD
ENDED
12/31/2012 (a)
--------------
OPERATIONS:

Net investment income (loss)............................................ $ 188,708
Net realized gain (loss)................................................ 126,195
Net change in unrealized appreciation (depreciation).................... 176,741
--------------
Net increase (decrease) in net assets resulting from operations......... 491,644
--------------

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income................................................... (188,708)
Net realized gain....................................................... (126,428)
Return of capital....................................................... (49,832)
--------------
Total distributions to shareholders..................................... (364,968)
--------------

CAPITAL TRANSACTIONS:
Proceeds from Shares sold............................................... 33,794,066
Proceeds from Shares reinvested......................................... 364,968
Cost of Shares redeemed................................................. (2,109,340)
--------------
Net increase (decrease) in net assets resulting from capital
transactions ...................................................... 32,049,694
--------------
Total increase (decrease) in net assets................................. 32,176,370

NET ASSETS:
Beginning of period..................................................... --
--------------
End of period........................................................... $ 32,176,370
==============
Accumulated net investment income (loss) at end of period............... $ --
==============

CAPITAL TRANSACTIONS WERE AS FOLLOWS:
Shares at beginning of period........................................... --
Shares sold............................................................. 3,291,758
Shares redeemed......................................................... (206,835)
Shares issued as reinvestment........................................... 35,331
--------------
Shares at end of period................................................. 3,120,254
==============

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

(a) The Fund was seeded on April 12, 2012 and commenced operations on May 1,
2012.

Page 18 See Notes to Financial Statements

FIRST TRUST/DOW JONES DIVIDEND & INCOME ALLOCATION PORTFOLIO
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD

PERIOD
ENDED
12/31/2012 (a)
--------------
Net asset value, beginning of period $ 10.00
-----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (b) ............... 0.15
Net realized and unrealized gain (loss) ........ 0.29
-----------
Total from investment operations ............... 0.44
-----------

DISTRIBUTIONS PAID TO SHAREHOLDERS FROM:
Net investment income .......................... (0.07)
Net realized gain .............................. (0.04)
Return of capital .............................. (0.02)
-----------
Total distributions ............................ (0.13)
-----------
Net asset value, end of period ................. $ 10.31
===========
TOTAL RETURN (c) (d) ........................... 4.38%
===========

RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) ........... $ 32,176
Ratio of expenses to average net assets
without fee waivers and expenses reimbursed... 2.69% (e)
Ratio of expenses to average net assets ........ 1.20% (e)
Ratio of net investment income (loss)
to average net assets ........................ 2.25% (e)
Portfolio turnover rate ........................ 34%

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

(a) The Fund was seeded on April 12, 2012 and commenced operations on May 1,
2012.

(b) Per Share values have been calculated using the average share method.

(c) Total return is based on the combination of reinvested dividends, capital
gain and return of capital distributions, if any. Total return is not
annualized for periods less than one year. The return for the Fund does
not reflect the deduction of expenses associated with variable products,
such as mortality and expense risk charges, and sales charges. These
expenses would reduce the overall return above.

(d) The total return would have been lower if certain fees had not been waived
and expenses reimbursed by the investment advisor.

(e) Annualized.

See Notes to Financial Statements Page 19

--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012

1. FUND DESCRIPTION

First Trust Variable Insurance Trust (the "Trust") is a diversified open-end
management investment company organized as a Massachusetts business trust on
December 14, 2011 and is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940, as amended (the "1940 Act").
The Trust currently offers shares of one fund, First Trust/Dow Jones Dividend &
Income Allocation Portfolio (the "Fund"), which commenced investment operations
on May 1, 2012. Shares of the Fund are sold only to variable insurance accounts
(each an "Account") to fund the benefits of the variable annuity and variable
life insurance contracts (each a "Contract" and collectively "the Contracts")
issued by life insurance companies writing variable annuity contracts and
variable life insurance contracts (each a "Participating Insurance Company").

The Fund's investment objective is to seek to provide total return by allocating
among dividend-paying stocks and investment grade bonds. The Fund seeks to
achieve its investment objective by investing, under normal market conditions,
approximately 40-60% of its net assets in equity securities and approximately
40-60% of its net assets in fixed income securities at the time of purchase. The
equity portion of the portfolio will be derived from a quantitative process that
seeks to provide total return through investing generally in dividend paying
stocks included in the Dow Jones U.S. Total Stock Market Index(SM). First Trust
Advisors L.P. ("First Trust") reserves the right to over-weight, under-weight or
exclude certain securities from the Fund that would otherwise be selected
pursuant to the quantitative process in certain instances.

The fixed-income component seeks to provide income and preserve capital through
investing in a diversified investment grade bond portfolio. Investment grade
bonds are those bonds rated "BBB-" or higher by Standard & Poor's Ratings Group
or Fitch Ratings, Inc. or "Baa3" or higher by Moody's Investors Service, Inc. at
the time of purchase. Under normal market conditions, at the time of purchase
approximately 80% of the net assets of the Fund allocated to corporate bonds
will be invested in: investment grade bonds included in the Dow Jones Corporate
Bond Index(SM) (the "Bond Index") and other investment grade bonds of issuers
whose securities are included in the Bond Index; and investment grade bonds of
issuers included in the Dow Jones Industrial Index(SM) (the "Dow 30"). The Fund
may also invest in U.S. government and agency securities, including
mortgage-backed securities. The Fund may, at certain times, also hold
exchange-traded funds ("ETFs") that invest in investment grade corporate bonds
and U.S. government bonds in lieu of investing directly in bonds.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in accordance with accounting principles
generally accepted in the United States of America ("U.S. GAAP") requires
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates.

A. PORTFOLIO VALUATION:

The net asset value ("NAV") of each Share is determined daily as of the close of
regular trading on the New York Stock Exchange ("NYSE"), normally 4:00 p.m.
Eastern time, on each day the NYSE is open for trading. If the NYSE closes early
on a valuation day, the NAV is determined as of that time. Domestic debt
securities and foreign securities are priced using data reflecting the earlier
closing of the principal markets for those securities. The NAV per Share is
calculated by dividing the value of all assets of the Fund (including accrued
interest and dividends), less all liabilities (including accrued expenses,
dividends declared but unpaid, and any borrowings of the Fund) by the total
number of Shares outstanding.

The Fund's investments are valued daily in accordance with valuation procedures
adopted by the Trust's Board of Trustees, and in accordance with provisions of
the 1940 Act. The Fund's securities will be valued as follows:

Common stocks and other equity securities listed on any national or
foreign exchange (excluding the NASDAQ(R) Stock Market LLC ("NASDAQ") and
the London Stock Exchange Alternative Investment Market ("AIM")) are
valued at the last sale price on the exchange on which they are
principally traded or, for NASDAQ and AIM securities, the official closing
price. Securities traded on more than one securities exchange are valued
at the last sale price or official closing price, as applicable, at the
close of the securities exchange representing the principal market for
such securities.

Bonds, notes and other debt securities are valued on the basis of
valuations provided by dealers who make markets in such securities or by
an independent pricing service approved by the Trust's Board of Trustees,
which may use the following valuation inputs when available:

1) benchmark yields;

2) reported trades;

3) broker/dealer quotes;

4) issuer spreads;

5) benchmark securities;

6) bids and offers; and

7) reference data including market research publications.

Page 20

--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012

Securities traded in the over-the-counter market are valued at their
closing bid prices.

Short-term investments that mature in less than 60 days when purchased are
valued at amortized cost.

All market quotations used in valuing the Fund's securities will be obtained
from a third party pricing service. If no quotation is received from a pricing
service, attempts will be made to obtain one or more broker quotes for the
security. In the event the pricing service does not provide a valuation, broker
quotations are not readily available, or the valuations received are deemed
unreliable, the Trust's Board of Trustees has designated First Trust to use a
fair value method to value the Fund's securities. Additionally, if events occur
after the close of the principal markets for certain securities (e.g., domestic
debt and foreign securities) that could materially affect the Fund's NAV, First
Trust will use a fair value method to value the Fund's securities. The use of
fair value pricing is governed by valuation procedures adopted by the Trust's
Board of Trustees, and in accordance with the provisions of the 1940 Act. As a
general principle, the fair value of a security is the amount which the Fund
might reasonably expect to receive for the security upon its current sale. In
light of the judgment involved in fair valuations, there can be no assurance
that a fair value assigned to a particular security will be the amount which the
Fund might be able to receive upon its current sale. Fair valuation of a
security will be based on the consideration of all available information,
including, but not limited to, the following:

1) the type of security;

2) the size of the holding;

3) the initial cost of the security;

4) transactions in comparable securities;

5) price quotes from dealers and/or pricing services;

6) relationships among various securities;

7) information obtained by contacting the issuer, analysts, or the
appropriate stock exchange;

8) an analysis of the issuer's financial statements; and

9) the existence of merger proposals or tender offers that might
affect the value of the security.

If the securities in question are foreign securities, the following additional
information may be considered:

1) the value of similar foreign securities traded on other foreign
markets;

2) ADR trading of similar securities;

3) foreign currency exchange activity;

4) the trading prices of financial products that are tied to baskets
of foreign securities;

5) factors relating to the event that precipitated the pricing
problem;

6) whether the event is likely to recur; and

7) whether the effects of the event are isolated or whether they
affect entire markets, countries or regions.

The Fund is subject to fair value accounting standards that define fair value,
establish the framework for measuring fair value and provide a three-level
hierarchy for fair valuation based upon the inputs to the valuation as of the
measurement date. The three levels of the fair value hierarchy are as follows:

o Level 1 - Level 1 inputs are quoted prices in active markets for
identical investments. An active market is a market in which
transactions for the investment occur with sufficient frequency and
volume to provide pricing information on an ongoing basis.

o Level 2 - Level 2 inputs are observable inputs, either directly or
indirectly, and include the following:

o Quoted prices for similar investments in active markets.

o Quoted prices for identical or similar investments in markets
that are non-active. A non-active market is a market where
there are few transactions for the investment, the prices are
not current, or price quotations vary substantially either
over time or among market makers, or in which little
information is released publicly

o Inputs other than quoted prices that are observable for the
investment (for example, interest rates and yield curves
observable at commonly quoted intervals, volatilities,
prepayment speeds, loss severities, credit risks, and default
rates).

o Inputs that are derived principally from or corroborated by
observable market data by correlation or other means.

o Level 3 - Level 3 inputs are unobservable inputs. Unobservable
inputs may reflect the reporting entity's own assumptions about the
assumptions that market participants would use in pricing the
investment.

The inputs or methodology used for valuing investments are not necessarily an
indication of the risk associated with investing in those investments. A summary
of the inputs used to value the Fund's investments as of December 31, 2012, is
included with the Fund's Portfolio of Investments.

B. SECURITIES TRANSACTIONS AND INVESTMENT INCOME:

Securities transactions are recorded as of the trade date. Realized gains and
losses from securities transactions are recorded on the identified cost basis.
Dividend income is recorded on the ex-dividend date. Interest income is recorded
on the accrual basis, including amortization of premiums and accretion of
discounts.

Page 21

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012

The Fund may hold publicly-traded real estate investment trusts ("REITs").
Distributions from such investments may include a return of capital component
from the REIT to the extent of the cost basis of such REIT investments. The
actual character of amounts received during the year is not known until after
the fiscal year end. The Fund records the character of distributions received
from REITs during the year based on estimates available. The Fund's
characterization may be subsequently revised based on information received from
the REITs after their tax reporting periods conclude.

C. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:

Distributions from net investment income, if any, are declared and paid annually
by the Fund. The Fund distributes its net realized capital gains, if any, to
shareholders at least annually. All dividends payable by the Fund will be
reinvested in the Fund.

Distributions from income and capital gains are determined in accordance with
income tax regulations, which may differ from U.S. GAAP. Certain capital
accounts in the financial statements are periodically adjusted for permanent
differences in order to reflect their tax character. These permanent differences
are primarily due to the varying treatment of income and gain/loss on portfolio
securities held by the Fund and have no impact on net assets or NAV per share.
Temporary differences, which arise from recognizing certain items of income,
expense and gain/loss in different periods for financial statement and tax
purposes, will reverse at some point in the future. There were no permanent
differences incurred during the period ended December 31, 2012.

The tax character of distributions paid during the period ended December 31,
2012 was as follows:

Distributions paid from: 2012
Ordinary income................................. $ 313,025
Long-term capital gain.......................... 2,111
Return of capital............................... 49,832

As of December 31, 2012, the distributable earnings and net assets on a tax
basis were as follows:

Undistributed ordinary income................... $ --
Undistributed capital gains..................... --
--------------
Total undistributed earnings.................... --
Accumulated capital and other losses............ --
Net unrealized appreciation (depreciation)...... 176,508
--------------
Total accumulated earnings (losses)............. 176,508
Other........................................... --
Paid-in capital................................. 31,999,862
--------------
Net assets...................................... $ 32,176,370
==============

D. INCOME TAXES:

The Fund intends to qualify as a regulated investment company by complying with
the requirements under Subchapter M of the Internal Revenue Code of 1986, as
amended, which includes distributing substantially all of its net investment
income and net realized gains to shareholders. The Fund intends to comply with
the provisions of Section 817(h) of the Internal Revenue Code, which impose
certain diversification requirements upon variable contracts that are based on
segregated asset accounts. Accordingly, no provision has been made for federal
or state income taxes.

The Fund intends to utilize provisions of the federal income tax laws which
allow it to carry realized capital losses forward indefinitely following the
year of the loss and offset such loss against any future realized capital gains.
The Fund is subject to certain limitations under U.S. tax rules on the use of
capital loss carryforwards and net unrealized built-in losses. These limitations
apply when there has been a 50% change in ownership. At December 31, 2012, the
Fund had no capital loss carryforward for federal income tax purposes.

The Fund is subject to accounting standards that establish a minimum threshold
for recognizing, and a system for measuring, the benefits of a tax position
taken or expected to be taken in a tax return. As of December 31, 2012,
management has evaluated the application of these standards to the Fund and has
determined that no provision for income tax is required in the Fund's financial
statements for uncertain tax positions.

E. EXPENSES:

The Fund will pay all expenses directly related to its operations.

Each Participating Insurance Company performs certain administrative services
for the Fund, its Account and the variable annuity and variable life insurance
Contracts. The Fund pays an administrative services fee of 0.20% of average
daily net assets to cover expenses incurred by Participating Insurance Companies
in connection with these services.

Page 22

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012

First Trust has entered into various licensing agreements, which allow First
Trust to use certain trademarks and trade names of the applicable licensors (see
Licensing Information in the Additional Information section of this report). The
Fund is a sub-licensee to these license agreements and is required to pay
licensing fees, which are shown on the Statement of Operations.

3. INVESTMENT ADVISORY FEE AND OTHER AFFILIATED TRANSACTIONS

First Trust, the investment advisor to the Fund, is a limited partnership with
one limited partner, Grace Partners of DuPage L.P., and one general partner, The
Charger Corporation. The Charger Corporation is an Illinois corporation
controlled by James A. Bowen, Chief Executive Officer of First Trust. First
Trust provides the Fund with discretionary investment services and certain
administrative services necessary for the management of the Fund. For its
investment advisory and management services, First Trust is entitled to a
monthly fee calculated at an annual rate of 0.60% of the Fund's average daily
net assets. First Trust also provides fund reporting services to the Fund for a
flat annual fee in the amount of $9,250.

First Trust has agreed to waive fees and/or pay the Fund's expenses to the
extent necessary to prevent the operating expenses of the Fund (excluding
interest expense, brokerage commissions and other trading expenses, taxes and
extraordinary expenses) from exceeding 1.20% (the "Expense Cap") of its average
daily net assets per year at least until May 1, 2014. Expenses borne and fees
waived by First Trust are subject to reimbursement by the Fund for up to three
years from the date the fee or expense was incurred by the Fund, but no
reimbursement payment will be made by the Fund at any time if it would result in
the Fund's expenses exceeding the Expense Cap. These amounts would be included
in "Expenses previously waived or reimbursed" on the Statement of Operations.
The advisory fee waivers and expense reimbursements for the period ended
December 31, 2012 and the expenses borne by First Trust subject to recovery from
the Fund at December 31, 2012 are as follows:

EXPENSES SUBJECT TO RECOVERY
---------------------------------------
ADVISORY FEE EXPENSE PERIOD ENDED
WAIVER REIMBURSEMENT DECEMBER 31, 2012 TOTAL
------------ -------------- ----------------- ---------------
$ 50,338 $ 74,882 $ 125,220 $ 125,220

BNY Mellon Investment Servicing (US) Inc. serves as the Fund's Administrator,
Fund Accountant and Transfer Agent in accordance with certain fee arrangements.
The Bank of New York Mellon serves as the Fund's Custodian in accordance with
certain fee arrangements.

Each Trustee who is not an officer or employee of First Trust, any sub-advisor
or any of their affiliates ("Independent Trustees") is paid a fixed annual
retainer of $125,000 per year and an annual per fund fee of $4,000 for each
closed-end fund or other actively managed fund and $1,000 for each index fund in
the First Trust Fund Complex. The fixed annual retainer is allocated pro rata
among each fund in the First Trust Fund Complex based on net assets.

Additionally, the Lead Independent Trustee is paid $15,000 annually, the
Chairman of the Audit Committee is paid $10,000 annually, and each of the
Chairmen of the Nominating and Governance Committee and the Valuation Committee
is paid $5,000 annually to serve in such capacities, with such compensation
allocated pro rata among each fund in the First Trust Fund Complex based on net
assets. Trustees are reimbursed for travel and out-of-pocket expenses in
connection with all meetings. The Lead Independent Trustee and each Committee
chairman will serve two-year terms until December 31, 2013, before rotating to
serve as chairman of another committee or as Lead Independent Trustee. After
December 31, 2013, the Lead Independent Trustee and Committee chairmen will
rotate every three years. The officers and "Interested" Trustee receive no
compensation from the funds for acting in such capacities.

4. 12B-1 SERVICE PLAN

The Trust has adopted a plan (the "Plan") pursuant to Rule 12b-1 under the 1940
Act, which provides that Shares of the Fund will be subject to an annual service
fee.

First Trust Portfolios L.P. ("FTP"), an affiliate of First Trust, serves as the
selling agent and distributor of Shares of the Fund. In this capacity, FTP
manages the offering of the Fund's Shares and is responsible for all sales and
promotional activities. The Plan reimburses FTP for its costs in connection with
these activities. FTP also uses the service fee to compensate each Participating
Insurance Company for providing account services to policy owners. These
services include establishing and maintaining Contract owners' accounts,
supplying information to Contract owners, delivering fund materials to Contract
owners, answering inquiries, and providing other personal services to Contract
owners. The Fund may spend up to 0.25% per year of the average daily net assets
of its Shares as a service fee under the Plan. In addition, the Plan permits
First Trust to use a portion of its advisory fee to compensate FTP for expenses
incurred in connection with the sale of the Fund's Shares including, without
limitation, compensation of its sales force, expenses of printing and
distributing the Prospectus to persons other than Contract owners, expenses of
preparing, printing and distributing advertising and sales literature and
reports to Contract owners used in connection with the sale of the Fund's
Shares, certain other expenses associated with the servicing of Shares of the
Fund, and any service-related expenses that may be authorized from time to time
by the Board of Trustees.

Page 23

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012

During the period ended December 31, 2012, all service fees received by FTP were
paid to the Participating Insurance Companies, with no portion of such fees
retained by FTP. The Plan may be renewed from year to year if approved by a vote
of the Trust's Board of Trustees and a vote of the Independent Trustees, who
have no direct or indirect financial interest in the Plan, cast in person at a
meeting called for the purpose of voting on the Plan.

5. PURCHASES AND SALES OF SECURITIES

Cost of purchases and proceeds from sales of investment securities, excluding
short-term investments, for the period ended December 31, 2012, were $35,755,354
and $4,715,229, respectively.

6. INDEMNIFICATION

The Trust has a variety of indemnification obligations under contracts with its
service providers. The Trust's maximum exposure under these arrangements is
unknown. However, the Trust has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.

7. RISK CONSIDERATIONS

Risks are inherent in all investing. The following summarizes some of the risks
that should be considered for the Fund. For additional information about the
risks associated with investing in the Fund, please see the Fund's prospectus
and statement of additional information, as well as other regulatory filings.

EQUITY SECURITIES RISK: There is the risk that the value or price of a
particular stock or other equity or equity-related security owned by the Fund
could go down and you could lose money. In addition to an individual stock
losing value, the value of the equity markets or a sector of those markets in
which the Fund invests could go down.

SMALLER COMPANY RISK: The Fund invests in small and/or mid-capitalization
companies. Such companies may be more vulnerable to adverse general market or
economic developments, and their securities may be less liquid and may
experience greater price volatility than larger, more established companies as a
result of several factors, including limited trading volumes, products or
financial resources, management inexperience and less publicly available
information. Accordingly, such companies are generally subject to greater market
risk than larger, more established companies.

FIXED INCOME SECURITIES RISK: Investment in fixed income securities involves a
variety of risks, including the risk that an issuer or guarantor of a security
will be unable to pay some or all of the principal and interest when due (credit
risk); the risk that the Fund may not be able to sell some or all of the
securities its holds, either at the price at which it values the security or at
any price (liquidity risk); and the risk that the rates of interest income
generated by the fixed income investments of the Fund may decline due to a
decrease in market interest rates and that the market prices of the fixed income
investments of the Fund may decline due to an increase in market interest rates
(interest rate risk).

MARKET AND MANAGEMENT RISK: Markets in which the Fund invests may experience
volatility and go down in value, and possibly sharply and unpredictably. All
decisions by the Advisor require judgment and are based on imperfect
information. Additionally, the investment techniques, risk analysis and
investment strategies used by the Advisor in making investment decisions for the
Fund may not produce the desired results.

ETF RISK: ETFs in which the Fund may invest are index funds bought and sold on a
securities exchange. An ETF trades like a common stock and represents a
portfolio of securities designed to track a particular market index. The ETFs in
which the Fund may invest will generally track a corporate or government bond
index. The risks of owning an ETF generally reflect the risks of owning the
underlying securities they are designed to track, although lack of liquidity in
an ETF could result in it being more volatile and ETFs have management fees that
increase their costs.

MORTGAGE-BACKED SECURITIES AND PREPAYMENT RISK: Unscheduled or early payments of
principal and interest on the mortgages underlying mortgage-backed securities in
which the Fund may invest may make the securities' effective maturity shorter
than stated. Rising interest rates tend to extend the duration of
mortgage-backed securities, making them more sensitive to changes in interest
rates, and may reduce the market value of the securities. In addition,
mortgage-backed securities are subject to prepayment risk, the risk that
borrowers may pay off their mortgages sooner than expected, particularly when
interest rates decline.

8. SUBSEQUENT EVENTS

Management has evaluated the impact of all subsequent events on the Fund through
the date the financial statements were issued, and has determined that there
were no subsequent events requiring recognition or disclosure in the financial
statements that have not already been disclosed.

Page 24

--------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF FIRST TRUST VARIABLE INSURANCE
TRUST:

We have audited the accompanying statement of assets and liabilities of First
Trust Variable Insurance Trust (the "Trust"), comprised of First Trust/Dow Jones
Dividend & Income Allocation Portfolio (the "Fund"), including the portfolio of
investments, as of December 31, 2012 and the related statement of operations,
statement of changes in net assets, and financial highlights for the period
presented. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. The Trust
is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Trust's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of December 31, 2012 by correspondence with the Fund's
custodian and brokers. We believe that our audit provides a reasonable basis for
our opinion.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of First
Trust/Dow Jones Dividend & Income Allocation Portfolio included in the First
Trust Variable Insurance Trust as of December 31, 2012, and the results of its
operations, changes in its net assets, and financial highlights for the period
presented, in conformity with accounting principles generally accepted in the
United States of America.

/s/ Deloitte & Touche LLP

Chicago, Illinois
February 12, 2013

Page 25

--------------------------------------------------------------------------------
ADDITIONAL INFORMATION
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012 (UNAUDITED)

PROXY VOTING POLICIES AND PROCEDURES

A description of the policies and procedures that the Fund uses to determine how
to vote proxies and information on how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June 30 is
available (1) without charge, upon request, by calling (800) 988-5891; (2) on
the Fund's website located at http://www.ftportfolios.com; and (3) on the
Securities and Exchange Commission's website at http://www.sec.gov.

PORTFOLIO HOLDINGS

The Fund files its complete schedule of portfolio holdings with the SEC for the
first and third quarters of each fiscal year on Form N-Q. The Fund's Forms N-Q
are available (1) by calling (800) 988-5891; (2) on the Fund's website located
at http://www.ftportfolios.com; (3) on the SEC's website at http://www.sec.gov;
and (4) for review and copying at the SEC's Public Reference Room ("PRR") in
Washington, DC. Information regarding the operation of the PRR may be obtained
by calling (800) SEC-0330.

LICENSING INFORMATION

Standard & Poor's and S&P are registered trademarks of Standard & Poor's
Financial Services LLC ("S&P") and Dow Jones is a registered trademark of Dow
Jones Trademark Holdings LLC ("Dow Jones"). The trademarks have been licensed to
S&P Dow Jones Indices LLC and have been sublicensed for use for certain purposes
by First Trust Advisors L.P. ("First Trust"). THE DOW JONES CORPORATE BOND
INDEX(SM), DOW JONES U.S. TOTAL STOCK MARKET INDEX(SM) AND DOW JONES INDUSTRIAL
INDEX(SM) are products of S&P Dow Jones Indices LLC and has been licensed for
use by First Trust. The First Trust/Dow Jones Dividend & Income Allocation
Portfolio is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices
LLC, Dow Jones, S&P, or any of their respective affiliates (collectively, "S&P
Dow Jones Indices"). Neither S&P Dow Jones Indices nor its affiliates make any
representation or warranty, express or implied, to the owners of the First
Trust/Dow Jones Dividend & Income Allocation Portfolio or any member of the
public regarding the advisability of investing in securities generally or in the
First Trust/Dow Jones Dividend & Income Allocation Portfolio particularly or the
ability of the DOW JONES CORPORATE BOND INDEX(SM), DOW JONES U.S. TOTAL STOCK
MARKET INDEX(SM) AND DOW JONES INDUSTRIAL INDEX(SM) to track general market
performance. S&P Dow Jones Indices only relationship to First Trust with respect
to the DOW JONES CORPORATE BOND INDEX(SM), DOW JONES U.S. TOTAL STOCK MARKET
INDEX(SM) AND DOW JONES INDUSTRIAL INDEX(SM) is the licensing of the Index and
certain trademarks, service marks and/or trade names of S&P Dow Jones Indices.
The DOW JONES CORPORATE BOND INDEX(SM), DOW JONES U.S. TOTAL STOCK MARKET
INDEX(SM) AND DOW JONES INDUSTRIAL INDEX(SM) is determined, composed and
calculated by S&P Dow Jones Indices without regard to First Trust or the First
Trust/Dow Jones Dividend & Income Allocation Portfolio. S&P Dow Jones Indices
has no obligation to take the needs of First Trust or the owners of the First
Trust/Dow Jones Dividend & Income Allocation Portfolio into consideration in
determining, composing or calculating the DOW JONES CORPORATE BOND INDEX(SM),
DOW JONES U.S. TOTAL STOCK MARKET INDEX(SM) AND DOW JONES INDUSTRIAL INDEX(SM).
Neither S&P Dow Jones Indices nor its affiliates are responsible for and have
not participated in the determination of the prices, and amount of the First
Trust/Dow Jones Dividend & Income Allocation Portfolio or the timing of the
issuance or sale of the First Trust/Dow Jones Dividend & Income Allocation
Portfolio or in the determination or calculation of the equation by which the
First Trust/Dow Jones Dividend & Income Allocation Portfolio is to be managed.
S&P Dow Jones Indices has no obligation or liability in connection with the
administration, marketing or trading of the First Trust/Dow Jones Dividend &
Income Allocation Portfolio. There is no assurance that investment products
based on the DOW JONES CORPORATE BOND INDEX(SM), DOW JONES U.S. TOTAL STOCK
MARKET INDEX(SM) AND DOW JONES INDUSTRIAL INDEX(SM) will accurately track index
performance or provide positive investment returns. S&P Dow Jones Indices LLC is
not an investment advisor. Inclusion of a security within an index is not a
recommendation by S&P Dow Jones Indices to buy, sell, or hold such security, nor
is it considered to be investment advice.

NEITHER S&P DOW JONES INDICES NOR ITS AFFILIATES GUARANTEES THE ADEQUACY,
ACCURACY, TIMELINESS AND/OR THE COMPLETENESS OF THE DOW JONES CORPORATE BOND
INDEX(SM), DOW JONES U.S. TOTAL STOCK MARKET INDEX(SM) AND DOW JONES INDUSTRIAL
INDEX(SM) OR ANY DATA RELATED THERETO OR ANY COMMUNICATION, INCLUDING BUT NOT
LIMITED TO, ORAL OR WRITTEN COMMUNICATION (INCLUDING ELECTRONIC COMMUNICATIONS)
WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL NOT BE SUBJECT TO ANY DAMAGES
OR LIABILITY FOR ANY ERRORS, OMISSIONS, OR DELAYS THEREIN. S&P DOW JONES INDICES
MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES,
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR AS TO RESULTS
TO BE OBTAINED BY FIRST TRUST, OWNERS OF THE FIRST TRUST/DOW JONES DIVIDEND &
INCOME ALLOCATION PORTFOLIO, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE
DOW JONES CORPORATE BOND INDEX(SM), DOW JONES U.S. TOTAL STOCK MARKET INDEX(SM)
AND DOW JONES INDUSTRIAL INDEX(SM) OR WITH RESPECT TO ANY DATA RELATED THERETO.
WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL S&P DOW
JONES INDICES BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, OR
CONSEQUENTIAL DAMAGES INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING
LOSSES, LOST TIME OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBLITY
OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE.
THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN
S&P DOW JONES INDICES AND FIRST TRUST, OTHER THAN THE LICENSORS OF S&P DOW JONES
INDICES.

Page 26

--------------------------------------------------------------------------------
BOARD OF TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012 (UNAUDITED)

The Trust's statement of additional information includes addition information
about the Trustees and is available, without charge, upon request, by calling
(800) 988-5891.

NUMBER OF
PORTFOLIOS IN
THE FIRST TRUST OTHER
NAME, ADDRESS, TERM OF OFFICE FUND COMPLEX TRUSTEESHIPS OR
DATE OF BIRTH AND AND LENGTH OF PRINCIPAL OCCUPATIONS OVERSEEN BY DIRECTORSHIPS
POSITION WITH THE TRUST SERVICE DURING PAST 5 YEARS TRUSTEE HELD BY TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
------------------------------------------------------------------------------------------------------------------------------------

Richard E. Erickson, Trustee o Indefinite Term Physician; President, Wheaton Orthopedics; 98 None
c/o First Trust Advisors L.P. Co-Owner and Co-Director (January 1996
120 East Liberty Drive, o Since Inception to May 2007), Sports Med Center for
Suite 400 Fitness; Limited Partner, Gundersen Real
Wheaton, IL 60187 Estate Limited Partnership; Member,
D.O.B.: 04/51 Sportsmed LLC

Thomas R. Kadlec, Trustee o Indefinite Term President (March 2010 to Present), Senior 98 Director of ADM
c/o First Trust Advisors L.P. Vice President and Chief Financial Officer Investor
120 East Liberty Drive, o Since Inception (May 2007 to March 2010), Vice President Inc. Services,
Suite 400 and Chief Financial Officer (1990 to May and ADM Investor
Wheaton, IL 60187 2007), ADM Investor Services, Inc. (Futures Services
D.O.B.: 11/57 Commission Merchant) International

Robert F. Keith, Trustee o Indefinite Term President (2003 to Present), Hibs 98 Director of
c/o First Trust Advisors L.P. Enterprises (Financial and Management Trust Company
120 East Liberty Drive, o Since Inception Consulting) of Illinois
Suite 400
Wheaton, IL 60187
D.O.B.: 11/56

Niel B. Nielson, Trustee o Indefinite Term President and Chief Executive Officer (June 98 Director of
c/o First Trust Advisors L.P. 2012 to Present), Dew Learning LLC Covenant
120 East Liberty Drive, o Since Inception (Educational Products and Services); President Transport Inc.
Suite 400 (June 2002 to June 2012), Covenant College
Wheaton, IL 60187
D.O.B.: 03/54

------------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
James A. Bowen(1), Trustee o Indefinite Term Chief Executive Officer (December 2010 98 None
and Chairman of the Board to Present), President (until December
120 East Liberty Drive, o Since Inception 2010), First Trust Advisors L.P. and First
Suite 400 Trust Portfolios L.P.; Chairman of the
Wheaton, IL 60187 Board of Directors, BondWave LLC
D.O.B.: 09/55 (Software Development Company/ Investment
Advisor) and Stonebridge Advisors LLC
(Investment Advisor)

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

(1) Mr. Bowen is deemed an "interested person" of the Trust due to his
position as Chief Executive Officer of First Trust Advisors L.P.,
investment advisor of the Trust.

Page 27

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BOARD OF TRUSTEES AND OFFICERS - (CONTINUED)
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012 (UNAUDITED)

NAME, ADDRESS POSITION AND OFFICES TERM OF OFFICE AND PRINCIPAL OCCUPATIONS
AND DATE OF BIRTH WITH TRUST LENGTH OF SERVICE DURING PAST 5 YEARS

------------------------------------------------------------------------------------------------------------------------------------
OFFICERS (2)
------------------------------------------------------------------------------------------------------------------------------------

Mark R. Bradley President and Chief o Indefinite Term Chief Operating Officer (December 2010 to Present)
120 E. Liberty Drive, Executive Officer and Chief Financial Officer, First Trust Advisors
Suite 400 o President and Chief L.P. and First Trust Portfolios L.P.; Chief
Wheaton, IL 60187 Executive Officer Financial Officer, BondWave LLC (Software
D.O.B.: 11/57 Since Inception Development Company/Investment Advisor) and
Stonebridge Advisors LLC (Investment Advisor)

James M. Dykas Treasurer, Chief Financial o Indefinite Term Controller (January 2011 to Present), Senior Vice
120 E. Liberty Drive, Officer and Chief President (April 2007 to January 2011), Vice
Suite 400 Accounting Officer o Treasurer, Chief President (January 2005 to April 2007), First
Wheaton, IL 60187 Financial Officer and Trust Advisors L.P. and First Trust Portfolios
D.O.B.: 01/66 Chief Accounting Officer L.P.
Since Inception

W. Scott Jardine Secretary and Chief o Indefinite Term General Counsel, First Trust Advisors L.P., First
120 E. Liberty Drive, Legal Officer Trust Portfolios L.P. and BondWave LLC
Suite 400 o Since Inception (Software Development Company/Investment
Wheaton, IL 60187 Advisor); Secretary of Stonebridge Advisors LLC
D.O.B.: 05/60 (Investment Advisor)

Daniel J. Lindquist Vice President o Indefinite Term Senior Vice President (September 2005 to Present),
120 E. Liberty Drive, First Trust Advisors L.P. and First Trust
Suite 400 o Since Inception Portfolios L.P.
Wheaton, IL 60187
D.O.B.: 02/70

Kristi A. Maher Assistant Secretary and o Indefinite Term Deputy General Counsel (May 2007 to Present),
120 E. Liberty Drive, Chief Compliance Officer First Trust Advisors L.P. and First Trust
Suite 400 o Assistant Secretary Portfolios L.P.
Wheaton, IL 60187 Since Inception
D.O.B.: 12/66
o Chief Compliance Officer
Since Inception

Roger F. Testin Vice President o Indefinite Term Senior Vice President, First Trust
120 E. Liberty Drive, Advisors L.P. and First Trust
Suite 400 o Since Inception Portfolios L.P.
Wheaton, IL 60187
D.O.B.: 06/66

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

(2) Officers of the Trust have an indefinite term. The term "officer" means
the president, vice president, secretary, treasurer, controller or any
other officer who performs a policy making function.

Page 28

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PRIVACY POLICY
--------------------------------------------------------------------------------

FIRST TRUST VARIABLE INSURANCE TRUST
DECEMBER 31, 2012 (UNAUDITED)

First Trust values our relationship with you and considers your privacy an
important priority in maintaining our relationship. We are committed to
protecting the security and confidentiality of your personal information.

SOURCES OF INFORMATION

We collect nonpublic personal information about you from the following sources:

o Information we receive from you and your broker-dealer, investment
advisor or financial representative through interviews,
applications, agreements or other forms;

o Information about your transactions with us, our affiliates or
others;

o Information we receive from your inquiries by mail, e-mail or
telephone; and

o Information we collect on our website through the use of "cookies".
For example, we may identify the pages on our website that your
browser requests or visits.

INFORMATION COLLECTED

The type of data we collect may include your name, address, social security
number, age, financial status, assets, income, tax information, retirement and
estate plan information, transaction history, account balance, payment history,
investment objectives, marital status, family relationships and other personal
information.

DISCLOSURE OF INFORMATION

We do not disclose any nonpublic personal information about our customers or
former customers to anyone, except as permitted by law. In addition to using
this information to verify your identity (as required by law), the permitted
uses may also include the disclosure of such information to unaffiliated
companies for the following reasons:

o In order to provide you with products and services and to effect
transactions that you request or authorize, we may disclose your
personal information as described above to unaffiliated financial
service providers and other companies that perform administrative or
other services on our behalf, such as transfer agents, custodians
and trustees, or that assist us in the distribution of investor
materials such as trustees, banks, financial representatives and
printers.

o We may release information we have about you if you direct us to do
so, if we are compelled by law to do so, or in other legally limited
circumstances (for example to protect your account from fraud).

In addition, in order to alert you to our other financial products and services,
we may share your personal information within First Trust.

PRIVACY ONLINE

We allow third-party companies, including AddThis (a social media sharing
service), to collect certain anonymous information when you visit our website.
These companies may use non-personally identifiable information during your
visits to this and other websites in order to provide advertisements about goods
and services likely to be of greater interest to you. These companies typically
use a cookie, third party web beacon or pixel tags, to collect this information.
To learn more about this behavioral advertising practice, you can visit
www.networkadvertising.org.

CONFIDENTIALITY AND SECURITY

With regard to our internal security procedures, First Trust restricts access to
your nonpublic personal information to those First Trust employees who need to
know that information to provide products or services to you. We maintain
physical, electronic and procedural safeguards to protect your nonpublic
personal information.

POLICY UPDATES AND INQUIRIES

As required by federal law, we will notify you of our privacy policy annually.
We reserve the right to modify this policy at any time, however, if we do change
it, we will tell you promptly. For questions about our policy, or for additional
copies of this notice, please go to www.ftportfolios.com, or contact us at (800)
621-1675 (First Trust Portfolios) or (800) 222-6822 (First Trust Advisors).

Page 29

This Page Left Blank Intentionally.

FIRST TRUST

INVESTMENT ADVISOR
First Trust Advisors L.P.
120 E. Liberty Drive, Suite 400
Wheaton, IL 60187

ADMINISTRATOR,
FUND ACCOUNTANT &
TRANSFER AGENT
BNY Mellon Investment Servicing (US) Inc.
301 Bellevue Parkway
Wilmington, DE 19809

CUSTODIAN
The Bank of New York Mellon
101 Barclay Street, 20th Floor
New York, NY 10286

INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Deloitte & Touche LLP
111 S. Wacker Drive
Chicago, IL 60606

LEGAL COUNSEL
Chapman and Cutler LLP
111 W. Monroe Street
Chicago, IL 60603

[BLANK BACK COVER]

ITEM 2. CODE OF ETHICS.

(a) The registrant, as of the end of the period covered by this report,
has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by
the registrant or a third party.

(c) There have been no amendments, during the period covered by this
report, to a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial
officer, principal accounting officer or controller, or persons
performing similar functions, regardless of whether these
individuals are employed by the registrant or a third party, and
that relates to any element of the code of ethics description.

(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial
officer, principal accounting officer or controller, or persons
performing similar functions, regardless of whether these
individuals are employed by the registrant or a third party, that
relates to one or more of the items set forth in paragraph (b) of
this item's instructions.

(e) Not applicable.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

As of the end of the period covered by the report, the Registrant's board of
trustees has determined that Thomas R. Kadlec and Robert F. Keith are qualified
to serve as audit committee financial experts serving on its audit committee and
that each is "independent," as defined by Item 3 of Form N-CSR.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees -- The aggregate fees billed for the period from inception
(May 1, 2012) through the fiscal year ended 2012 for professional services
rendered by the principal accountant for the audit of the registrant's annual
financial statements or services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements were $25,750.00.

(b) Audit-Related Fees (Registrant) -- The aggregate fees billed for the
period from inception (May 1, 2012) through the fiscal year ended 2012 for
assurance and related services by the principal accountant that are reasonably
related to the performance of the audit of the registrant's financial statements
and are not reported under paragraph (a) of this Item were $0.

Audit-Related Fees (Investment Adviser and Distributor) -- The aggregate
fees billed for the period from inception (May 1, 2012) through the fiscal year
ended 2012 for assurance and related services by the principal accountant that
are reasonably related to the performance of the audit of the registrant's
financial statements and are not reported under paragraph (a) of this Item were
$10,500 for the Advisor and $0 for Distributor. Specifically, Advisor paid
$7,000 in fees relating to the seed audit and $3,500 in fees relating to the
required consent.

(c) Tax Fees (Registrant) -- The aggregate fees billed for the period from
inception (May 1, 2012) through the fiscal year ended 2012 for professional
services rendered by the principal accountant for tax compliance, tax advice,
and tax planning to the registrant were $0.

Tax Fees (Investment Adviser and Distributor) -- The aggregate fees billed
for the period from inception (May 1, 2012) through the fiscal year ended 2012
for professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning to the registrant's adviser and
distributor were $0.

(d) All Other Fees (Registrant) -- The aggregate fees for the period from
inception (May 1, 2012) through the fiscal year ended 2012 for products and
services provided by the principal accountant to the registrant, other than the
services reported in paragraphs (a) through (c) of this Item were $0.

All Other Fees (Investment Adviser and Distributor) -- The aggregate fees
billed for the period from inception (May 1, 2012) through the fiscal year ended
2012 for products and services provided by the principal accountant to the
registrant's investment adviser and distributor, other than the services
reported in paragraphs (a) through (c) of this Item were $0.

(e)(1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.

Pursuant to its charter and its Audit and Non-Audit Services Pre-Approval
Policy, the Audit Committee (the "Committee") is responsible for the
pre-approval of all audit services and permitted non-audit services (including
the fees and terms thereof) to be performed for the registrant by its
independent auditors. The Chairman of the Committee is authorized to give such
pre-approvals on behalf of the Committee up to $25,000 and report any such
pre-approval to the full Committee.

The Committee is also responsible for the pre-approval of the independent
auditor's engagements for non-audit services with the registrant's adviser (not
including a sub-adviser whose role is primarily portfolio management and is
sub-contracted or overseen by another investment adviser) and any entity
controlling, controlled by or under common control with the investment adviser
that provides ongoing services to the registrant, if the engagement relates
directly to the operations and financial reporting of the registrant, subject to
the de minimis exceptions for non-audit services described in Rule 2-01 of
Regulation S-X. If the independent auditor has provided non-audit services to
the registrant's adviser (other than any sub-adviser whose role is primarily
portfolio management and is sub-contracted with or overseen by another
investment adviser) and any entity controlling, controlled by or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to its policies, the Committee
will consider whether the provision of such non-audit services is compatible
with the auditor's independence.

(e)(2) The percentage of services described in each of paragraphs (b) through
(d) for the registrant and the registrant's investment adviser of this
Item that were approved by the audit committee pursuant to the
pre-approval exceptions included in paragraph (c)(7)(i)(c) or paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X are as follows:

(b) 0%

(d) 0%

(f) The percentage of hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most
recent fiscal year that were attributed to work performed by persons
other than the principal accountant's full-time, permanent employees was
less than fifty percent.

(g) The aggregate non-audit fees billed by the registrant's accountant for
services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen by
another investment adviser), and any entity controlling, controlled by,
or under common control with the adviser that provides ongoing services
to the registrant for the period from inception (May 1, 2012) through
the fiscal year ended 2012 were $0 for the registrant, $0 for the
registrant's investment adviser and $6,250.00 for the registrant's
distributor. These fees pertain to sales tax and related services in the
states of Iowa and Missouri.

(h) The registrant's audit committee of its Board of Trustees has determined
that the provision of non-audit services that were rendered to the
registrant's investment adviser (not including any sub-adviser whose
role is primarily portfolio management and is subcontracted with or
overseen by another investment adviser), and any entity controlling,
controlled by, or under common control with the investment adviser that
provides ongoing services to the registrant that were not pre-approved
pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is
compatible with maintaining the principal accountant's independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

ITEM 6. INVESTMENTS.

(a) Schedule of Investments in securities of unaffiliated issuers as of the
close of the reporting period is included as part of the report to
shareholders filed under Item 1 of this form.

(b) Not applicable.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)),
or this Item.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant's principal executive and principal financial
officers, or persons performing similar functions, have concluded
that the registrant's disclosure controls and procedures (as defined
in Rule 30a-3(c) under the Investment Company Act of 1940, as
amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of
a date within 90 days of the filing date of the report that includes
the disclosure required by this paragraph, based on their evaluation
of these controls and procedures required by Rule 30a-3(b) under the
1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b)
under the Securities Exchange Act of 1934, as amended (17 CFR
240.13a-15(b) or 240.15d-15(b)).

(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the registrant's second
fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect,
the registrant's internal control over financial reporting.

ITEM 12. EXHIBITS.

(a)(1) Code of ethics, or any amendment thereto, that is the subject of
disclosure required by Item 2 is attached hereto.

(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section
302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

(a)(3) Not applicable.

(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and Section
906 of the Sarbanes- Oxley Act of 2002 are attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

(registrant) First Trust Variable Insurance Trust
----------------------------------------------------------

By (Signature and Title)* /s/ Mark R. Bradley
------------------------------------------------
Mark R. Bradley, President and
Chief Executive Officer
(principal executive officer)

Date February 12, 2013
----------------------

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

By (Signature and Title)* /s/ Mark R. Bradley
------------------------------------------------
Mark R. Bradley, President and
Chief Executive Officer
(principal executive officer)

Date February 12, 2013
----------------------

By (Signature and Title)* /s/ James M. Dykas
------------------------------------------------
James M. Dykas, Treasurer,
Chief Financial Officer and
Chief Accounting Officer
(principal financial officer)

Date February 12, 2013
----------------------

* Print the name and title of each signing officer under his or her signature.