With recent advances in genotyping and sequencing technologies, many disease susceptibility loci have been identified. However, much of the genetic heritability remains unexplained and the replication rate between independent studies is still low. Meanwhile, there have been increasing efforts on functional annotations of the entire human genome, such as the Encyclopedia of DNA Elements (ENCODE) project and other similar projects. It has been shown that incorporating these functional annotations to prioritize genome wide association signals may help identify true association signals. However, to our knowledge, the extent of the improvement when functional annotation data are considered has not been studied in the literature. In this article, we propose a statistical framework to estimate the improvement in replication rate with annotation data, and apply it to Crohn's disease and DNase I hypersensitive sites. The results show that with cell line specific functional annotations, the expected replication rate is improved, but only at modest level.