SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
REGISTRATION STATEMENT TO
FORM S-6
FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2
A. Exact name of trust: IDS Life of New York Account 8
B. Name of depositor: IDS LIFE INSURANCE COMPANY OF NEW YORK
C. Complete address of depositor's principal executive offices:
20 Madison Avenue Ext. Albany, NY 12203
D. Name and complete address of agent for service:
Mary Ellyn Minenko, Esq.
IDS Life Insurance Company
IDS Tower 10
Minneapolis, Minnesota 55440-0010
E. Title and amount of securities being registered:
Flexible Premium Survivorship Variable Life Insurance Policy
F. Proposed maximum aggregate offering price to the public of the
securities being registered:
Registration of Indefinite Amount of Securities Pursuant to Rule 24f-2
under the Investment Company Act of 1940.
G. Amount of filing fee: N/A
H. Approximate date of proposed public offering: as soon as practicable
It is proposed that this filing will become effective (check appropriate
box):
immediately upon filing pursuant to paragraph (b)
on (date) pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a)(1)
on (date) pursuant to paragraph (a)(1) of Rule 485
this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
CROSS REFERENCE TO ITEMS REQUIRED
BY FORM N-8B-2
N-8B-2 Item Caption in Prospectus
1 Cover Page; The variable account
2 IDS Life of New York
3 Not applicable
4 Distribution of the policy
5 The variable account
6 The variable account
7 Not applicable
8 Annual financial information
9 Legal proceedings
10 Surrender charge; Total surrenders; Partial
surrenders; Taxation of policy proceeds;
Reinstatement; Transfers between the fixed
account and the subaccounts; Keeping the
policy in force; Grace period; Voting
rights; Substitution of investments; Payment
of premiums; The fixed account; Allocation
of premiums; Transfers between the fixed
account and the subaccounts; Right to
examine policy
11 The fund
12 The fund; Cover page
13 Loads, fees, and charges; Keeping the policy
in force
14 Purchasing your policy; Application
15 Premiums; Payment of premiums; Transfers
between the fixed account
and the subaccounts; The fund
16 Premiums; Payment of premiums; Transfers
between the fixed account and the
subaccounts; The fund
17 Two ways to request a transfer, loan or
surrender; Policy surrenders
18 The fund
19 Reports
20 Not applicable
21 Policy loans; fixed account and subaccounts;
Two ways to request a transfer, loan or
surrender
22 Not applicable
23 Management of IDS Life of New York
24 Policy value; Proceeds payable upon death;
Payment of policy proceeds
25 IDS Life of New York
26 Annual financial information
27 IDS Life of New York
28 Management of IDS Life of New York
29 Ownership
30 Not applicable
31 Not applicable
32 Not applicable
33 Not applicable
34 Not applicable
35 IDS Life of New York
36 Not applicable
37 Not applicable
38 Distribution of the policy
39 IDS Life of New York; Distribution of the
policy
40 Annual financial information
41 Distribution of the policy; IDS Life of
New York
42 Management of IDS Life of New York
43 Not applicable
44 Premiums; Transfers between the fixed
account and subaccounts;
Subaccount values
45 Not applicable
46 Subaccount values
47 Relationship between portfolios and
subaccounts
48 IDS Life of New York
49 Not applicable
50 Not applicable
51 The variable account
52 Substitution of investments
53 IDS Life of New York's tax status
54 Not applicable
55 Policy illustrations
56 Not applicable
57 Not applicable
58 Not applicable
59 Annual financial information
Flexible Premium Survivorship Variable Life Insurance Policy
Prospectus __________, 1997
The Flexible Premium Survivorship Variable Life Insurance Policy described in
this prospectus is designed to provide life insurance coverage on two insureds,
with a death benefit payable when the last surviving insured dies while the
policy is in force. The policy is intended to qualify as a life insurance policy
under Sections 72, 101 and 7702 of the Internal Revenue Code.
You may allocate policy value to one or more of eight subaccounts of IDS Life of
New York Account 8. The subaccounts invest in the portfolios of IDS Life Series
Fund: Equity, Income, Money Market, Managed, Government Securities and
International Equity. One subaccount invests in the AIM V.I. Growth and Income
Fund. One subaccount invests in Putnam VT New Opportunities Fund. Policy values
increase and decrease with investment experience and reflect certain deductions
and charges. There is no guaranteed minimum policy value with respect to the
subaccounts and you bear the entire investment risk. You may also allocate
policy value to the fixed account which earns at least a guaranteed minimum
interest rate. The fixed account is the general investment account of IDS Life
Insurance Company of New York (IDS Life of New York).
You may withdraw a portion of the policy's cash surrender value after the first
policy year or surrender it in full at any time for its cash surrender value.
Surrender charges are described under "Loads, fees and charges." You may also
take out policy loans.
The frequency and amount of premium payments are flexible, subject to certain
restrictions and conditions. Payment of the scheduled premium will not
necessarily keep a policy from lapsing if the cash surrender value is less than
the amount needed to pay the monthly deduction. (See "Loads, fees and charges.")
However, a policy will not lapse if the premiums needed to keep the death
benefit guarantee to age 100 (DBG-100) or the minimum initial premium period in
effect, are paid.
This prospectus contains detailed information about these and other policy
features, including certain restrictions and limitations that apply. As in the
case of other life insurance policies, it may not be advantageous to purchase
flexible premium survivorship variable life insurance as a replacement for, or
in addition to an existing flexible premium variable or other life insurance
policy.
IDS Life of New York Account 8
Flexible Premium Survivorship Variable Life Insurance Policy
Issued and sold by: IDS Life Insurance Company of New York, 20 Madison Avenue
Extension, Albany, New York 12203. Telephone: (518) 869-8613, (800) 541-2251
This prospectus is valid only when accompanied or preceded by the prospectuses
of the IDS Life Series Fund, Inc., AIM Variable Insurance Funds, Inc. and the
Putnam Variable Trust. All prospectuses should be retained for future reference.
These securities have not been approved or disapproved by the securities and
exchange commission or any state securities commission, nor has the securities
and exchange or any state securities commission passed upon the accuracy or
adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
IDS LIFE OF NEW YORK IS NOT A BANK OR FINANCIAL INSTITUTION AND THE SECURITIES
IT OFFERS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY ANY
BANK OR FINANCIAL INSTITUTION NOR ARE THEY INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY.
INVESTMENTS IN THIS POLICY INVOLVE INVESTMENT RISK INCLUDING THE POSSIBLE LOSS
OF PRINCIPAL.
Table of contents
Key terms
The policy in brief
The variable account
The funds
IDS Life Series Fund - Equity Portfolio
IDS Life Series Fund - Income Portfolio
IDS Life Series Fund - Money Market Portfolio
IDS Life Series Fund - Managed Portfolio
IDS Life Series Fund - Government Securities Portfolio
IDS Life Series Fund - International Equity Portfolio
AIM V.I. Growth and Income Fund
Putnam VT New Opportunities Fund
Fund objectives
Relationship between funds and subaccounts
Rates of return of the funds and subaccounts
The fixed account
Purchasing your policy
Application
Right to examine policy
Premiums
Keeping the policy in force
Death benefit guarantee to age 100
Minimum initial premium period
Grace period
Reinstatement
Loads, fees and charges
Premium expense charge
Monthly deduction
Surrender charge
Partial surrender fee
Mortality and expense risk charge
Fund expenses
Policy value
Fixed account value
Subaccount values
Proceeds payable upon death
Change in death benefit option
Changes in specified amount
Misstatement of age or sex
Suicide
Beneficiary
Transfers between the fixed account and subaccounts
Fixed account transfer policies
Minimum transfer amounts
Maximum transfer amounts
Maximum number of transfers per year
Two ways to request a transfer, loan or surrender
Automated transfers
Automated dollar-cost averaging
Policy loans
Policy surrenders
Total surrenders
Partial surrenders
Allocation of partial surrenders
Effects of partial surrenders
Taxes
Optional insurance benefits
Four-Year Term Insurance Rider
Policy Split Option Rider
Payment of policy proceeds
Federal taxes
IDS Life of New York's tax status
Taxation of policy proceeds
Modified endowment contracts
Other tax considerations
IDS Life of New York
Ownership
State regulation
Distribution of the policy
Legal proceedings
Experts
Management of IDS Life of New York
A I M Advisors, Inc. and Putnam Investment Management, Inc.
Other information
Substitution of investments
Voting rights
Reports
Policy illustrations
Key terms
These terms can help you understand details about your policy.
Accumulation unit: An accounting unit used to calculate the policy value of the
subaccounts. It is a measure of the net investment results of each of the
subaccounts.
Attained insurance age: Each insured's insurance age plus the number of policy
anniversaries since the policy date. Attained insurance age changes only on a
policy anniversary.
Cash surrender value: Proceeds received if the policy is surrendered in full, or
the amount payable on the youngest insured's attained insurance age 100. The
cash surrender value equals the policy value minus indebtedness, minus any
applicable surrender charges.
Code: The Internal Revenue Code of 1986, as amended.
Close of business: Closing time of the New York Stock Exchange, normally 4 p.m.,
Eastern time.
Death benefit guarantee to age 100 (DBG-100): A feature of the policy
guaranteeing that the policy will not lapse before the youngest insured's
attained insurance age 100. This feature is in effect if you meet certain
premium payment requirements.
Death benefit guarantee to age 100 (DBG-100) premium: The premium required to
keep the DBG-100 in effect. The DBG-100 premium is shown in your policy. It
depends on each insured's sex, insurance age, risk classification, optional
insurance benefits added by rider and the initial specified amount.
Fixed account: The general investment account of IDS Life of New York. The fixed
account is made up of all of IDS Life of New York's assets other than those held
in any separate account.
Fixed account value: The portion of the policy value that is allocated to the
fixed account, including indebtedness.
Funds: Mutual funds or portfolios, each with a different investment objective.
You may allocate your premiums into variable subaccounts investing in shares of
any or all of these funds. The following funds are available:
o Under the IDS Life Series Fund, Inc. - Equity Portfolio, Income
Portfolio, Money Market Portfolio, Managed Portfolio, Government
Securities Portfolio and International Equity Portfolio;
o Under the AIM Variable Insurance Funds, Inc. - AIM V.I. Growth and
Income Fund;
o Under the Putnam Variable Trust - Putnam VT New Opportunities Fund.
IDS Life of New York: In this prospectus, "we," "us," "our" and "IDS Life of New
York" refer to IDS Life Insurance Company of New York.
Indebtedness: All existing loans on the policy plus interest that has either
been accrued or added to the policy loan.
Insurance age: Each insured's age based upon his or her last birthday on the
date of the application.
Insureds: The persons whose lives are insured by the policy.
Minimum initial premium period: A period of time during the early years of the
policy when the policy will not lapse even if the cash surrender value is less
than the amount needed to pay the monthly deduction. This feature is in effect
if you meet certain premium payment requirements.
Monthly date: The same day each month as the policy date. If there is no monthly
date in a calendar month, the monthly date is the first day of the next calendar
month.
Net amount at risk: A portion of the death benefit, equal to the total current
death benefit minus the policy value. This is the amount to which cost of
insurance rates are applied in determining the monthly cost of insurance.
Net premium: The premium paid minus the premium expense charge.
Owner: The entity(ies) to which, or individual(s) to whom, the policy is issued,
or to whom ownership is subsequently transferred. In the prospectus "you" and
"your" refer to the owner.
Policy anniversary: The same day and month as the policy date each year the
policy remains in force.
Policy date: The date the policy is issued and from which policy anniversaries,
policy years and policy months are determined.
Policy value: The sum of the fixed account value plus the variable account
value.
Proceeds: The amount payable under the policy as follows:
o Upon death of the last surviving insured prior to the youngest insured's
attained insurance age 100, proceeds will be the death benefit in effect
as of the date of that insured's death, minus any indebtedness.
o Upon the youngest insured's attained insurance age 100, proceeds will be
the cash surrender value.
o On surrender of the policy the proceeds will be the cash surrender
value.
Risk classification: A group of insureds that IDS Life of New York expects will
have similar mortality experience.
Scheduled premium: A premium, selected by the owner at the time of application,
of a level amount, at a fixed interval of time.
Specified amount: An amount used to determine the death benefit and
the proceeds payable upon death of the last surviving insured prior to the
youngest insured's attained insurance age 100. The initial specified amount is
shown in your policy.
Subaccount(s): One or more of the investment divisions of the variable account,
each of which invests in a particular fund.
Surrender charge: A contingent deferred issue and administration expense charge
assessed against the policy value at the time of surrender during the first 15
years of the policy.
Valuation date: A normal business day, Monday through Friday, on which the New
York Stock Exchange is open.
Valuation period: The interval commencing at the close of business on each
valuation date and ending at the close of business on the next valuation date.
Variable account: IDS Life Variable Life of New York Account 8 consisting of
subaccounts, each of which invests in a particular fund. The policy value in
each subaccount depends on the performance of the particular fund.
Variable account value: The sum of the values that are allocated to the
subaccounts of the variable account.
The policy in brief
The Flexible Premium Survivorship Variable Life Insurance Policy (the policy) is
designed to provide insurance protection on two insureds and to build policy
value. The policy provides a death benefit that is payable to the beneficiary
upon the last surviving insured's death. The policy allows you, as the owner, to
allocate your net premiums or transfer policy value, to:
The variable account, consisting of subaccounts, each of which invests in a fund
with a particular investment objective. You may direct premiums to any or all of
eight of these subaccounts. Your policy's value may increase or decrease daily,
depending on the investment return. No minimum amount is guaranteed. (p. )
The fixed account, which earns interest at rates that are adjusted periodically
by IDS Life of New York. This rate will never be lower than 4%. (p. )
The funds: Six subaccounts of the variable account invest in IDS Life Series
Fund, Inc. which includes Equity, Income, Money Market, Managed, Government
Securities and
International Equity Portfolios. One subaccount invests in AIM Variable
Insurance Funds, Inc. - AIM V.I. Growth and Income Fund. One subaccount invests
in Putnam Variable Trust - Putnam VT New Opportunities Fund.(p. )
Purchasing your policy: To apply, send a completed application and premium
payment to IDS Life of New York's home office. For your application to be
accepted, you will need to provide medical and other evidence that the persons
you propose to insure meet the requirements of our underwriting rules. (p. )
Right to examine policy: You may return your policy for any reason and receive a
full refund of your premiums by mailing us the policy and a written request for
cancellation within a specified period. (p. )
Premiums: In applying for your policy, you state how much you intend to pay and
whether you will pay quarterly, semiannually or annually. You may make
additional unscheduled premium payments subject to certain limits. No premium
payments can be made on or after the youngest insured's attained insurance age
100. We may refuse premiums in order to comply with the Code. (p. )
DBG-100: A feature of the policy guaranteeing that the policy will not lapse
before the youngest insured's attained insurance age 100. This feature is in
effect if you meet certain premium payment requirements. (p. )
Minimum initial premium period: A period of time during the early years of the
policy when the policy will not lapse even if the cash surrender value is less
than the amount needed to pay the monthly deduction. This feature is in effect
if you meet certain premium payment requirements. (p. )
Grace period: If the cash surrender value of your policy becomes less than the
amount needed to pay the monthly deduction, and neither the DBG-100 nor the
minimum initial premium period is in effect, you will have 61 days to pay the
premium needed so that the next three monthly deductions can be paid. If you
don't, the policy will lapse. (p. )
Reinstatement: If your policy lapses, it can be reinstated within five years.
The reinstatement is subject to certain conditions including evidence of
insurability satisfactory to IDS Life of New York and the payment of a
sufficient premium. The DBG-100 can not be reinstated. (p. )
Loads, fees and charges: Your policy is subject to the following charges, which
compensate IDS Life of New York for administering and distributing the policy as
well as paying policy benefits and assuming related risks:
o Premium expense charge -- charge deducted from each premium payment to cover
some distribution expenses, state and local premium taxes and federal taxes. (p.
)
o Monthly deduction -- charged against the value of your policy each month
(prior to the youngest insured's attained insurance age 100), covering the cost
of insurance, cost of issuing the policy, certain administrative expenses and
optional insurance benefits. (p. )
o Surrender charge -- applies if you surrender your policy for its full cash
surrender value, or the policy lapses, during the first 15 years. The surrender
charge is a deferred charge for costs of issuing the policy. It is based on the
initial specified amount. (p. )
o Partial surrender fee -- applies if you surrender part of the value of your
policy; equals $25 or 2% of the amount surrendered, whichever is less. (p. )
o Mortality and expense risk charge -- applies only to the subaccounts; equals,
on an annual basis, 0.9% of the average daily net asset value of the
subaccounts. (p. )
o Fund expenses -- applies only to the funds. The investment management fee
equals, on an annual basis, 0.5% of the average daily net assets of the IDS Life
Series Fund - Money Market Portfolio; 0.95% of IDS Life Series Fund -
International Equity Portfolio; 0.63% of the daily net assets of Putnam VT New
Opportunities Fund; 0.65% of the daily net assets of the AIM V.I. Growth and
Income Fund, and 0.7% of the average daily net assets of the IDS Life Series
Fund - Equity, Income, Managed and Government Securities Portfolio. Each fund
also pays taxes, brokerage commissions and nonadvisory expenses. IDS Life
Insurance Company (IDS Life) has agreed to a voluntary limit of 0.1%, on an
annual basis, of the average daily net assets of each IDS Life Series Fund
Portfolio for these nonadvisory expenses. (p. )
Proceeds payable upon death: Prior to the youngest insured's attained insurance
age 100, your policy's death benefit can never be less than the specified
amount, less outstanding indebtedness. The relationship between the policy value
and the death benefit depends on which of two options you choose:
o Option 1 level amount: The death benefit is the greater of the specified
amount or a percentage of policy value.
o Option 2 variable amount: The death benefit is the greater of the specified
amount plus the policy value or a percentage of policy value.
You may change the death benefit option or specified amount within certain
limits; doing so will generally affect policy charges.
On the youngest insured's attained insurance age 100, the proceeds payable will
be the cash surrender value. (p. )
Transfers between the fixed account and subaccounts: You may, at no charge,
transfer policy value from one subaccount to another or between subaccounts and
the fixed account. (Certain restrictions apply to transfers involving the fixed
account.) We reserve the right to limit transfers to no more than five transfers
per year by phone or mail. You can also arrange for automated transfers on a
monthly, quarterly, semiannual or annual basis. (p. )
Policy loans: You may borrow against your policy's cash surrender value. A
policy loan, even if repaid, can have a permanent effect on the death benefit
and policy value. A loan may also have tax consequences if your policy lapses or
you surrender it. (p. )
Policy surrenders: You may cancel this policy while it is in force and receive
its cash surrender value. The cash surrender value is the policy value minus
indebtedness, minus any applicable surrender charges. (p. )
Exchange right: For two years after the policy is issued, you can exchange it
for one that provides benefits that do not vary with the investment return of
the subaccounts. Because the policy itself offers a fixed return option, all you
need to do is transfer all of the policy value in the subaccounts to the fixed
account. (p. )
Payment of policy proceeds: Proceeds will be paid when you surrender the policy;
the last surviving insured dies; or upon the youngest insured's attained
insurance age 100. You or the beneficiary may choose whether payment is to be
made in a lump sum or under one or more of certain options. (p. )
Federal taxes: The death benefit is not considered part of the beneficiary's
income and thus is not subject to federal income taxes. When the proceeds are
paid on the youngest insured's attained insurance age 100, if the amount
received plus any indebtedness exceeds your investment in the policy, the excess
may be taxable as ordinary income. Part or all of any proceeds received through
full or partial surrender, lapse, policy loan or assignment of policy value may
be subject to federal income tax as ordinary income. Proceeds other than death
benefits from certain policies, classified as "modified endowments," are taxed
differently from proceeds of conventional life insurance contracts and may also
be subject to an additional 10% IRS penalty tax if you are younger than 59 1/2.
A policy is considered to be a modified endowment if it was applied for or
materially changed after June 21, 1988, and premiums paid in the early years
exceed certain modified endowment limits. (p. )
The variable account
You can direct your premiums to any or all of eight subaccounts of the variable
account. These subaccounts invest in the following funds:
Subaccount invests exclusively in shares of
Equity IDS Life Series Fund - Equity Portfolio
Income IDS Life Series Fund - Income Portfolio
Money Market IDS Life Series Fund - Money Market Portfolio
Managed IDS Life Series Fund - Managed Portfolio
Government Securities IDS Life Series Fund - Government Securities
Portfolio
International Equity IDS Life Series Fund - International Equity
Portfolio
YGI AIM V.I. Growth and Income Fund
YNO Putnam VT New Opportunities Fund
The variable account was established on Sept. 12, 1985, under New York law and
is registered as a single unit investment trust under the Investment Company Act
of 1940. Such registration does not involve any SEC supervision of the account's
management or investment practices or policies. International Equity Subaccount
was added to the variable account on Oct. 28, 1994. YGI and YNO subaccounts were
added to the variable account on Nov. 22, 1996.
The variable account meets the definition of a "separate account" under federal
securities laws. Income, capital gains or capital losses of each subaccount are
credited to or charged against the assets of that subaccount alone. No
subaccount will be charged with liabilities of any other subaccount or of any
other business conducted by IDS Life of New York. The variable account's net
assets are held in relation to the policies described in this prospectus as well
as other variable life insurance policies that we issue that are not described
in this prospectus.
At all times, IDS Life of New York will maintain assets in the subaccounts with
total market value at least equal to the reserves and other liabilities required
to cover insurance benefits under all contracts participating in the subaccount.
The funds
IDS Life Series Fund, Inc., a Minnesota corporation, is a diversified, open-end
management investment company incorporated on May 8, 1985. The International
Equity portfolio was added to the fund on October 28, 1994. IDS Life Series Fund
currently consists of six portfolios:
IDS Life Series Fund - Equity Portfolio
Objective: capital appreciation. Invests primarily in common stocks and other
securities convertible into common stock.
IDS Life Series Fund - Income Portfolio
Objective: to maximize current income while attempting to conserve the value of
the investment and to continue the high level of income for the longest period
of time. At least 50% of net assets will normally be invested in high-quality,
lower-risk corporate bonds, unrated corporate bonds believed to have the same
investment qualities and government bonds. Other investments may include
lower-rated corporate bonds, bonds and common stocks sold together as a unit,
preferred stock and foreign securities.
IDS Life Series Fund - Money Market Portfolio
Objective: to provide maximum current income consistent with liquidity and
conservation of capital. Invests in relatively short-term money market
securities, such as marketable debt securities issued or guaranteed as to
principal and interest by the U.S. government or its agencies or
instrumentalities, bank certificates of deposit, bankers' acceptances, letters
of credit and high-grade commercial paper.
IDS Life Series Fund - Managed Portfolio
Objective: to maximize total investment return through a combination of capital
appreciation and current income. If the investment manager believes the stock
market will be moving higher, it can emphasize stocks that offer potential for
appreciation. At other times, the manager may increase the portfolio's holdings
in bonds and money-market securities providing high current income.
IDS Life Series Fund - Government Securities Portfolio
Objective: to provide a high current return and safety of principal. Invests
primarily in debt obligations issued or guaranteed as to principal and interest
by the U.S. government, its agencies and instrumentalities.
IDS Life Series Fund - International Equity Portfolio
Objective: capital appreciation. Invests primarily in common stocks of foreign
issuers and foreign securities convertible into common stock. Other investments
may include certain international bonds if the portfolio manager believes they
have greater potential for capital appreciation than equities.
AIM Variable Insurance Funds, Inc., a Maryland corporation, is an open-end,
series, management investment company incorporated on January 22, 1993. The
variable account invests in the following fund:
AIM V.I. Growth and Income Fund
Objective: to seek growth of capital with current income as a secondary
objective. The Fund seeks to achieve its objective by generally investing at
least 65% of its net assets in stocks of companies believed by management to
have the potential for above average growth in revenues and earnings.
Putnam Variable Trust is a Massachusetts business trust organized on September
24, 1987. The variable account invests in the following fund:
Putnam VT New Opportunities Fund
Objective: seeks long-term capital appreciation by investing principally in
common stocks of companies in sectors of the economy Putnam Investment
Management, Inc. ("Putnam Management") believes possess above-average long-term
growth potential.
Fund objectives
Fund objectives for all funds except Putnam VT New Opportunities Fund can be
changed only if holders of a majority of outstanding shares agree. The objective
of Putnam VT New Opportunities Fund may be changed by the Trustees without
shareholders, but as a matter of policy, the Trustees would not materially
change the fund's objective without shareholder approval. Because fund
investments are subject to the risk of changing economic conditions and the
ability of the investment manager to anticipate such changes, there can be no
guarantee that the investment objectives of a fund will be achieved.
Relationship between funds and subaccounts
Shares of each fund are sold to the appropriate subaccount at net asset value
without a sales charge. Dividends and capital gain distributions from a fund are
reinvested at net asset value without a sales charge and retained as an asset of
the appropriate subaccount. Fund shares will be redeemed by the appropriate
subaccount, without fee to the subaccount, to the extent necessary to make death
benefit or other payments under the policy.
Currently, shares of the IDS Life Series Fund Portfolios are available to serve
as the underlying investment for variable life insurance. Shares of the AIM V.I.
Growth and Income Fund and Putnam VT New Opportunities Fund are available to
serve as the underlying investment for variable life insurance contracts,
variable annuities and qualified plans. In the future, shares of the IDS Life
Series Fund Portfolios may be available to serve as the underlying investment
for variable life insurance contracts, variable annuities and qualified plans.
It is conceivable that in the future it may be disadvantageous for variable life
insurance separate accounts, variable annuity separate accounts and/or qualified
plans to invest in the available funds simultaneously. Although IDS Life of New
York and the funds do not currently foresee any such disadvantages, the boards
of directors or trustees of the appropriate funds will monitor events in order
to identify any material conflicts between such policy owners, contract owners
and qualified plans to determine what action, if any, should be taken in
response to a conflict. If a board were to conclude that separate funds should
be established for variable life insurance, variable annuity and qualified plan
separate accounts, the variable life insurance policyholders would not bear any
expenses associated with establishing separate accounts.
IDS Life acts as the investment manager and American Express Financial
Corporation acts as the investment advisor for IDS Life Series Fund, Inc.
American Express Trust Company acts as custodian of the IDS Life Series Fund,
Inc.'s investments.
AIM Advisors, Inc. acts as the investment advisor for AIM V.I. Growth and Income
Fund. Putnam Management acts as the investment manager for Putnam VT New
Opportunities Fund.
The investment managers or advisors receive fees for their services as described
under "Loads, fees and charges."
Detailed information about the funds, their investment objectives, policies and
risks, may be found in the fund prospectuses.
Diversification: The Internal Revenue Service (IRS) has issued final regulations
relating to the diversification requirements under Section 817(h) of the Code.
Each fund intends to comply with these requirements.
Ownership rules: The U.S. Treasury and the IRS have indicated they may provide
additional guidance concerning how many subaccounts may be offered and how many
exchanges among subaccounts may be allowed before the owner is considered to
have investment control and thus is currently taxed on income earned within
subaccount assets. We do not know at this time what the additional guidance will
be or when action will be taken. We reserve the right to modify the policy, as
necessary, to ensure that the owner will not be subject to current taxation as
the owner of the subaccount assets.
Rates of return of the funds and subaccounts
This section presents rates of return, first for the funds and then for the
corresponding subaccounts. Rates of return are different in the two cases
because those of the subaccounts reflect additional charges. This section shows
the actual rates of return for the six IDS Life Series Fund portfolios and
subaccounts. This section shows hypothetical rates of return for the AIM V.I.
Growth and Income Fund and Putnam VT New
Opportunities Fund until November 22, 1996 when the subaccounts began investing
in those funds. After this date, the section shows actual rates of return. All
charges and expenses mentioned in the section are explained fully under "Loads,
fees and charges."
Rates of return of funds
In the following table are average annual rates of return based on the actual
investment performance of the funds after deduction of applicable portfolio
expenses (including the investment management fees and nonadvisory expenses) for
the periods indicated. These rates do not reflect charges that apply to the
subaccounts or the policy and therefore do not illustrate how actual investment
performance will affect policy benefits. Moreover, these rates of return are not
an estimate or guarantee of future performance.
Period ending [to be filed by amendment]
10 years or
Fund 1 year 3 years 5 years Since inception*
IDS Life Series Fund - Equity (Beta **)
IDS Life Series Fund - Income
IDS Life Series Fund - Money Market
IDS Life Series Fund - Managed (Beta **)
IDS Life Series Fund - Government Securities
IDS Life Series Fund - International Equity
AIM V.I. Growth and Income Fund
Putnam VT New Opportunities Fund
*IDS Life Series Fund - Equity, Income, Money Market, Managed and Government
Securities Portfolios commenced operations on January 20, 1986. IDS Life Series
Fund - International Equity Portfolio commenced operations on Oct. 28, 1994. AIM
V.I. Growth and Income Fund and Putnam VT New Opportunities Fund each commenced
operations on May 2, 1994.
**Beta is a volatility measure based on calculations of the fund's monthly
returns compared to the S&P 500 Index. A beta less than 1 indicates performance
that is less volatile than the market; a beta more than 1 indicates performance
that is more volatile than the market.
Rates of return of subaccounts
Average annual rates of return in the following table reflect all charges
incurred by the funds and charges against the subaccounts (including the
mortality and expense risk charge). The rates do not reflect the premium expense
charge, surrender charge or monthly deduction.
Period Ending [to be filed by amendment]
10 years or
Subaccount Investment 1 year 3 years 5 years Since inception*
Equity Equity
Income Income
Money Market Money Market
Managed Managed
Government Securities Government Securities
International Equity International Equity
YGI Growth and Income Fund
YNO New Opportunities Fund
*Equity, Income, Money Market, Managed and Government Securities subaccounts
commenced on Aug. 31, 1987. International Equity subaccount each commenced
operations on Oct. 28, 1994. YGI and YNO subaccounts each commenced operations
on Nov. 22, 1996.
The fixed account
You can allocate premiums to the fixed account or transfer policy value from the
subaccounts to the fixed account (with certain restrictions, explained in
"Transfers between the fixed account and subaccounts").
The fixed account is the general investment account of IDS Life of New York. It
includes all assets owned by IDS Life of New York other than those in the
variable account and other separate accounts. Subject to applicable law, IDS
Life of New York has sole discretion to decide how assets of the fixed account
will be invested.
Placing policy value in the fixed account does not entitle you to share in the
fixed account's investment experience, nor does it expose you to the account's
investment risk. Instead, IDS Life of New York guarantees that the policy value
you place in the fixed account will accrue interest at an effective annual rate
of at least 4%, independent of the actual investment experience of the account.
IDS Life of New York bears the full investment risk for amounts allocated to the
fixed account.
IDS Life of New York is not obligated to credit interest at any rate higher than
4%, although we may do so at our sole discretion. Interest in excess of 4% will
not be credited on any portion of policy value in the fixed account against
which you have a policy loan outstanding.
Because of exemptive and exclusionary provisions, interests in the fixed account
have not been registered under the Securities Act of 1933 and the fixed account
has not been registered as an investment company under the Investment Company
Act of 1940.
Accordingly, neither the fixed account nor any interests in it are subject to
the provisions of these Acts and the staff of the SEC has not reviewed the
disclosures in this prospectus relating to the fixed account. Disclosures
regarding the fixed account may, however, be subject to certain generally
applicable provisions of the federal securities laws relating to the accuracy
and completeness of statements made in prospectuses.
Purchasing your policy
Application
To apply for coverage, complete an application and send it with your premium
payment to IDS Life of New York's home office. In your application, you:
o select a specified amount of insurance;
o select a death benefit option;
o designate a beneficiary; and
o state how premiums are to be allocated among the fixed
account and/or the subaccounts.
Insurability: Before issuing your policy, IDS Life of New York requires
satisfactory evidence of the insurability of the persons whose lives you propose
to insure. Our underwriting department will review your application and any
medical information or other data required to determine whether the proposed
individuals are insurable under our underwriting rules. Your application may be
declined if a person fails to meet the underwriting requirements and any
premiums you have paid will be returned.
Age limit: The policy is available only to persons age 35 and older. In
addition, IDS Life of New York generally will not issue a policy to persons over
the insurance age of 85. It may, however, do so at its sole discretion.
Risk classification: The risk classification for each insured is based on that
insured's health, occupation or other relevant underwriting standards. This
classification will affect the monthly deduction. (See "Loads, fees and charges"
and "Optional insurance benefits.")
Other conditions: In addition to proving insurability, you and the insureds must
also meet certain conditions, stated in the application form, before coverage
will become effective and your policy is issued to you. The lives insured may be
covered under the terms of a conditional insurance agreement prior to a policy
being issued.
Incontestability: IDS Life of New York will have two years from the effective
date of your policy to contest the truth of statements or representations in
your application. After the policy has been in force during the lifetime of
either insured for two years from the policy date, IDS Life of New York cannot
contest the policy.
Right to examine policy
You may return your policy for any reason and receive a full refund of all
premiums paid. To do so, you must mail or deliver the policy to IDS Life of New
York or your financial advisor, with a written request for cancellation, by the
latest of:
o the 10th day after you receive it
o the 10th day after IDS Life of New York mails or personally
delivers a written notice of withdrawal right
o the 45th day after you sign your application.
On the date your request is postmarked or received, the policy will immediately
be considered void from the start.
Premiums
Payment of premiums:
In applying for your policy, you decide how much you intend to pay and how often
you will make payments. During the early policy years until the policy value is
sufficient to cover the surrender charge, IDS Life of New York requires that you
pay the minimum initial premiums.
You may schedule payments annually, semiannually or quarterly. (Payment at any
other interval must be approved by IDS Life of New York.) This premium schedule
is shown in your policy.
The scheduled premium serves only as an indication of your intent as to the
frequency and amount of future premium payments. You may skip scheduled premium
payments at any time if your cash surrender value is sufficient to pay the
monthly deduction, or if you have paid sufficient premium to keep the DBG-100 or
the minimum initial premium period in effect.
You may also change the amount and frequency of scheduled premium payments by
written request. IDS Life of New York reserves the right to limit the amount of
such changes. Any change in the premium amount is subject to applicable tax laws
and regulations.
Although you have flexibility in paying premiums, the amount and frequency of
your payments will affect the policy value, cash surrender value and length of
time your policy will remain in force, as well as affect whether the DBG-100 or
the minimum initial premium period remain in effect.
Premium limitations:
You may make unscheduled premium payments at any time and in an amount of at
least $50. IDS Life of New York reserves the right to limit the number and
amount of unscheduled premium payments.
No premium payments, scheduled or unscheduled, are allowed on or after the
youngest insured's attained insurance age 100.
Also, in order to receive favorable tax treatment under the Code, premiums paid
during the life of the policy must not exceed certain limitations. To comply
with the Code, IDS Life of New York can either refuse excess premiums as they
are paid, or refund excess premiums with interest no later than 60 days after
the end of the policy year in which they were paid.
Allocation of premiums:
Until the policy date, we hold all premiums in the fixed account, and we credit
interest on the net premiums (gross premiums minus premium expense charge) at
the current fixed account rate. As of the policy date, we will allocate the net
premiums plus accrued interest to the account(s) you have selected in your
application. At that time, we will begin to assess the various loads, fees and
charges.
Any amount allocated to a subaccount is converted into accumulation units of
that subaccount, as explained under "Policy value." Similarly, when transferring
value between subaccounts, accumulation units in one subaccount are converted
into a cash value, which is then converted into accumulation units of the second
subaccount.
Keeping the policy in force
This section includes a description of the policy provisions that determine if
the policy will remain in force or lapse (terminate). It is important that you
understand them so the appropriate premium payments are made to ensure that
insurance coverage meets your objectives.
If you wish to have a guarantee that the policy will remain in force until the
youngest insured's attained insurance age 100 regardless of investment
performance, you should pay at least the DBG-100 premiums.
If you wish to pay a lower premium and are not concerned with a long-term
guarantee that the policy will remain in force regardless of investment
performance, you can pay premiums so that the cash surrender value on each
monthly date is sufficient to pay the monthly deduction. However, during the
minimum initial premium period, you must pay at least the minimum initial
premium until the policy value is greater than the surrender charge and the cash
surrender value is sufficient to pay the monthly deduction.
Death benefit guarantee to age 100
The DBG-100 provides that your policy will remain in force until the youngest
insured's attained insurance age 100 even if the cash surrender value is
insufficient to pay the monthly deduction. The DBG-100 will remain in effect, as
long as:
the sum of premiums paid minus partial surrenders minus outstanding
indebtedness
equals or exceeds the DBG-100 premiums due since the policy date.
The DBG-100 premium is shown in the policy.
If, on a monthly date, you have not paid enough premiums to keep the DBG-100 in
effect, an additional period of 61 days will be allowed for you to pay a premium
sufficient to bring your total up to the required minimum. If you do not pay
this amount within 61 days, the DBG-100 will terminate. If the DBG-100 is not in
effect, your policy will lapse (terminate) if the cash surrender value is less
than the amount needed to pay the monthly deduction and the minimum initial
premium period is not in effect. Although the policy can be reinstated as
explained below, the DBG-100 cannot be reinstated.
Minimum initial premium period
To allow you to purchase this policy for the lowest premium possible, you may
choose to pay only the minimum initial premium during the minimum initial
premium period as long as the policy value minus indebtedness equals or exceeds
the monthly deduction. The policy will not enter the grace period during the
minimum initial premium period as shown in your policy under "Policy Data," if:
1. on a monthly date, the policy value minus indebtedness equals or exceeds the
monthly deduction for the policy month following such monthly date; and 2. the
sum of all premiums paid, minus any partial surrenders, and minus any
indebtedness equals or exceeds the minimum initial premium, as shown in your
policy under "Policy Data," times the number of months since the policy date,
including the current month.
The minimum initial period is
4 years if the youngest insured's insurance age is 20-29
3 years if the youngest insured's insurance age is 30-39
2 years if the youngest insured's insurance age is 40-49
1 year if the youngest insured's insurance age is 50 and over
Grace period
If the cash surrender value of the policy becomes less than that needed to pay
the monthly deduction and neither the DBG-100 nor the minimum initial premium
period is in effect, you will have 61 days to pay the required premium amount.
If the required premium is not paid, the policy will lapse.
IDS Life of New York will mail a notice to your last known address, requesting
payment of the premium needed so that the next three monthly deductions can be
made. If we receive this premium before the end of the 61-day grace period, we
will use the payment to pay all monthly deductions and any other charges then
due. Any balance will be added to the policy value and allocated in the same
manner as other premium payments.
If a policy lapses with outstanding indebtedness, any excess of the outstanding
indebtedness over the premium paid generally will be taxable to the owner. (See
"Federal taxes.") If the last surviving insured dies during the grace period,
any overdue monthly deductions will be deducted from the death benefit.
Reinstatement
Your policy may be reinstated within five years after it lapses, unless you
surrendered it for cash. To reinstate, IDS Life of New York will require:
o a written request;
o evidence satisfactory to IDS Life of New York that both insureds remain
insurable or evidence for the last surviving insured and due proof that
the first death occurred before the date of lapse;
o payment of a premium that will keep the policy in force for at least
three months;
o payment of the monthly deductions that were not collected during the
grace period; and
o payment or reinstatement of any indebtedness.
The effective date of a reinstated policy will be the monthly date on or next
following the day IDS Life of New York accepts your application for
reinstatement. The suicide period (see "Proceeds payable upon death") will apply
from the effective date of reinstatement. Surrender charges will also be
reinstated.
IDS Life of New York will have two years from the effective date of
reinstatement to contest the truth of statements or representations in the
reinstatement application.
Loads, fees and charges
Policy charges compensate IDS Life of New York for:
o providing the insurance benefits of the policy;
o issuing the policy;
o administering the policy;
o assuming certain risks in connection with the policy; and
o distributing the policy.
Some of these charges are deducted from your premium payments. Others are
deducted periodically from your policy value in the fixed account and/or
subaccounts. You may also be assessed a charge if you surrender your policy or
the policy lapses.
Premium expense charge
We deduct this charge from each premium payment. The amount remaining after the
deduction, called the net premium, is credited to the account(s) you have
selected. The premium expense charge has three parts:
Sales charge: 7.25% of all premiums paid. Partially compensates IDS Life of New
York for expenses in distributing the policy, including agents' commissions,
advertising and printing of prospectuses and sales literature.
Premium tax charge: 1.0% of each premium payment. Compensates IDS Life of New
York for paying taxes imposed by the State of New York on premiums received by
insurance companies.
Federal tax charge: 1.25% of each premium payment. Compensates IDS Life of New
York for paying Federal taxes resulting from the sale of the policy and is a
reasonable charge in relation to IDS Life of New York's federal tax burden. IDS
Life of New York reserves the right to change the amount of this charge if
applicable federal law changes IDS Life of New York's federal tax burden subject
to the approval of the Superintendent of Insurance.
Monthly deduction
On each monthly date we deduct from the value of your policy in the fixed
account and/or subaccounts an amount equal to the sum of:
1. the cost of insurance for the policy month;
2. the policy fee shown in your policy; and
3. charges for any optional insurance benefits provided by rider for the
policy month.
Each of the three components is explained below.
You specify, in your policy application, what percentage of the monthly
deduction from 0% to 100% will be taken from the fixed account and from each of
the subaccounts. You may change these percentages for future monthly deductions
by written request.
Monthly deductions will be taken from the fixed account and the subaccounts on a
pro rata basis if:
o you do not specify the accounts from which the monthly deduction is to
be taken; or
o the value in the fixed account or any subaccount is insufficient to pay
the portion of the monthly deduction you have specified.
If the cash surrender value of your policy is not enough to pay the monthly
deduction on a monthly anniversary, the policy may lapse. However, the policy
will not lapse if the DBG-100 or the minimum initial premium period is in
effect. (See Death benefit guarantee to age 100, Minimum initial premium
period;" also "Grace period" and "Reinstatement.")
Components of the monthly deduction:
1. Cost of insurance: the cost providing the death benefit under your policy.
The cost of insurance for a policy month is calculated as:
[a x (b - c)] + d
where:
(a) is the monthly cost of insurance rate based on each insureds insurance age,
duration of coverage, sex and risk classification. Generally, the cost of
insurance rate will increase as the attained insurance age of each insured
increases.
Rates are set by IDS Life of New York, based on its expectations as to future
mortality experience. We may change the rates from time to time; any change will
apply to all individuals of the same risk classification. However, rates will
not exceed the Guaranteed Annual Maximum Cost of Insurance Rates shown in your
policy, which are based on the 1980 Commissioners Standard Ordinary Smoker or
Nonsmoker Mortality Tables, Age Last Birthday.
(b) is the death benefit on the monthly date divided by 1.0032737 (which reduces
IDS Life of New York's net amount at risk, solely for computing the cost of
insurance, by taking into account assumed monthly earnings at an annual rate of
4%);
(c) is the policy value on the monthly date. At this point, the policy value
has been reduced by the policy fee and any charges for optional riders;
(d) is any flat extra insurance charges assessed as a result of special
underwriting considerations.
2. Policy fee: $30 per month for the first 15 policy years. This charge
reimburses IDS Life of New York for expenses of issuing the policy, such as
processing the application (primarily underwriting) and setting up computer
records; and of administering the policy, such as processing claims, maintaining
records, making policy changes and communicating with owners. We reserve the
right to change the charge in the future, but guarantee that it will never
exceed $30 per month.
3. Optional insurance benefit charges: charges for any optional benefits added
to the policy by rider. See "Optional insurance benefits."
Surrender charge
If you surrender your policy or the policy lapses during the first 15 policy
years, a surrender charge will be assessed. The surrender charge is a contingent
deferred issue and administration expense charge. It reimburses IDS Life of New
York for costs of issuing the policy, such as processing the application
(primarily underwriting) and setting up computer records. This charge is $4 per
thousand dollars of initial specified amount. It remains level during the first
five policy years and then decreases monthly until it is zero at the end of 15
policy years.
Partial surrender fee
If you surrender part of the value of your policy, you will be charged $25 (or
2% of the amount surrendered, if less). This fee is guaranteed not to increase
for the duration of your policy.
Mortality and expense risk charge
This charge applies only to the subaccounts and not to the fixed account. It is
equal, on an annual basis, to 0.9% of the daily net asset value of the
subaccounts -- a level guaranteed for the life of the policy. Computed daily,
the charge compensates IDS Life of New York for:
o Mortality risk -- the risk that the cost of insurance charge will be
insufficient to meet actual claims.
o Expense risk -- the risk that the policy fee and the contingent deferred
issue and administration expense charge (described above) may be
insufficient to cover the cost of administering the policy.
Any profit from the mortality and expense risk charge would be available to IDS
Life of New York for any proper corporate purpose including, among others,
payment of sales and distribution expenses, which we do not expect to be covered
by the sales charge discussed earlier. Any further deficit will have to be made
up from IDS Life of New York's general assets.
Fund expenses
The investment managers receive fees for their services to the funds. The funds
also pay taxes, brokerage commissions and nonadvisory expenses. IDS Life has
agreed to a voluntary limit of 0.1%, on an annual basis, of the average daily
net assets of each of the IDS Life Series Fund Portfolios for these nonadvisory
expenses, such as custodian and trustee fees, registration fees for shares,
postage, fidelity and security bond costs, legal fees and other miscellaneous
fees and charges, even though actual expenses on IDS Life Series Fund-Government
Securities Portfolio ranged up to 0.18%, IDS Life Series Fund-Money Market
Portfolio ranged up to 0.23% and IDS Life Series Fund-International Equity
Portfolio ranged up to 0.37%. IDS Life reserves the right to discontinue
limiting these nonadvisory expenses at 0.1%. However, its present intention is
to continue the limit until the time that actual expenses are less than the
limit. Other expenses for the year ended Dec. 31, 1996 were 0.09% for Putnam VT
New Opportunities Fund. For AIM V.I. Growth and Income Fund other expenses
(annualized) were 0.13% for the period ended Dec. 31, 1996.
The investment management fee is deducted from the IDS Life Series Fund -
Equity, Income, Money Market, Managed, Government Securities, International
Equity Portfolios and the Putnam VT New Opportunities Fund and AIM V.I. Growth
and Income Fund daily.
The investment management fee equals, on an annual basis:
o IDS Life Series Fund - Money Market Portfolio -- 0.5% of average daily
net assets o Putnam VT New Opportunities Fund -- 0.63% of average daily net
assets o AIM V.I. Growth and Income Fund -- 0.65% of average daily net
assets o IDS Life Series Fund - Equity, Income, Managed and Government
Securities
Portfolios -- 0.7% of average daily net assets
o IDS Life Series Fund - International Equity Portfolio -- 0.95% of
average daily net assets
IDS Life of New York has entered into certain agreements under which it is
compensated by the advisors and/or distributors of the AIM V.I. Growth and
Income Fund and Putnam VT New Opportunities Fund for the administrative services
it provides to these funds.
Other information on charges:
IDS Life of New York may reduce or eliminate various fees and charges when we
incur lower sales costs and/or perform fewer administrative services than usual.
Policy value
The value of your policy is the sum of values in the fixed account and each
subaccount of the variable account.
Fixed account value
The value in the fixed account on the policy date (when the policy is issued)
equals the portion of your initial net premium that you have allocated to the
fixed account, plus interest accrued before the policy date, minus the portion
of the monthly deduction for the first policy month that you have allocated to
the fixed account.
On any later date, the value in the fixed account equals:
o the value on the previous monthly date; plus
o net premiums allocated to the fixed account since the last monthly
date; plus
o any transfers to the fixed account from the subaccounts, including
loan transfers, since the last monthly date; plus
o accrued interest on all of the above; minus
o any transfers from the fixed account to the subaccounts, including loan
repayment transfers, since the last monthly date; minus
o any partial surrenders or partial surrender fees allocated to the fixed
account since the last monthly date; minus
o interest on any transfers or partial surrenders, from the date of the
transfer or surrender to the date of calculation; minus
o any portion of the monthly deduction for the coming month that is
allocated to the fixed account if the date of calculation is a monthly
date.
Subaccount values
The value in each subaccount changes daily, depending on the investment
performance of the fund in which that subaccount invests and on other factors
detailed below. There is no guaranteed minimum subaccount value. You, as owner,
bear the entire investment risk.
Calculation of subaccount value: The value in each subaccount on the policy date
equals the portion of your initial net premium allocated to that subaccount plus
interest accrued before the policy date, minus the portion of the monthly
deduction for the first policy month that you have allocated to that subaccount.
The value of each subaccount on each subsequent valuation date equals:
o the value of the subaccount on the preceding valuation date, multiplied by
the net investment factor for the current valuation period (explained below);
plus
o net premiums received and allocated to the subaccount during the current
valuation period; plus
o any transfers to the subaccount (from the fixed account or other subaccounts,
including loan repayment transfers) during the period; minus
o any transfers from the subaccount including loan transfers during the
current valuation period; minus
o any partial surrenders and partial surrender fees allocated to the subaccount
during the period; minus
o any portion of the monthly deduction allocated to the subaccount during the
period.
The net investment factor measures the investment performance of a subaccount
from one valuation period to the next. Because performance may fluctuate, the
value of a subaccount may increase or decrease from day to day.
Accumulation units: The policy value allocated to each subaccount is converted
into accumulation units. Each time you direct a premium payment or transfer
policy value into one of the subaccounts, a certain number of accumulation units
are credited to your policy for that subaccount. Conversely, each time you take
a partial surrender or transfer value out of a subaccount, a certain number of
accumulation units are subtracted.
Accumulation units are the true measure of investment value in each subaccount.
For subaccounts investing in the funds, they're related to, but not the same as,
the net asset value of the corresponding fund. The dollar value of each
accumulation unit can rise or fall daily, depending on the investment
performance of the underlying fund and on certain charges. Here's how unit
values are calculated:
Number of units: To calculate the number of units for a particular subaccount,
we divide your investment (net premium or transfer amount) by the current
accumulation unit value.
Accumulation unit value: The current value for each subaccount equals the last
value times the current net investment factor.
Net investment factor: Determined at the end of each valuation period, this
factor equals (a divided by b) - c, where:
(a) equals:
o net asset value per share of the fund; plus
o per-share amount of any dividend or capital gain distribution made by the
relevant fund to the subaccount; plus
o any credit or minus any charge for reserves to cover any tax liability
resulting from the investment operations of the subaccount.
(b) equals:
o net asset value per share of the fund at the end of the preceding valuation
period; plus
o any credit or minus any charge for reserves to cover any tax liability in the
preceding valuation period.
(c) is a percentage factor representing the mortality and expense risk charge,
as described in "Loads, fees and charges," above.
Factors that affect subaccount accumulation units:
Accumulation units may change in two ways; in number and in value. Here are the
factors that influence those changes:
The number of accumulation units you own may fluctuate due to:
o additional purchase payments allocated to the subaccounts;
o transfers into or out of the subaccount(s);
o partial surrenders and partial surrender fees;
o surrender charges; and/or o monthly deductions
Accumulation unit values may fluctuate due to:
o changes in underlying funds(s) net asset value;
o dividends distributed to the subaccount(s);
o capital gains or losses of underlying funds;
o fund operating expenses; and/or o mortality and expense risk charges.
Proceeds payable upon death
We will pay a benefit to the beneficiary of the policy when the last surviving
insured dies.
If that death is prior to the youngest insured's attained insurance age 100, the
amount payable is based on the specified amount and death benefit option you
have selected, as described below, less any indebtedness.
On the youngest insured's attained insurance age 100, the amount payable is the
cash surrender value.
Option 1 (level amount): Under this option, the policy's value is part of the
specified amount. The Option 1 death benefit is the greater of:
o the specified amount on the date of the last surviving insured's death; or
o the applicable percentage of the policy value on the date of the last
surviving insured's death, if that death occurs on a valuation date, or
on the next valuation date following the date of death. (See table
below.)
Youngest insured's attained insurance age in the table below refers to the
youngest life insured or the age such person would have reached.
Applicable percentage table
Youngest Applicable Youngest Applicable
Insured's percentage of Insured's percentage of
attained policy attained policy
insurance value insurance value
age age
40 or younger 250% 61 128%
41 243 62 126
42 236 63 124
43 229 64 122
44 222 65 120
45 215 66 119
46 209 67 118
47 203 68 117
48 197 69 116
49 191 70 115
Applicable percentage table
Youngest Applicable Youngest Applicable
Insured's percentage of Insured's percentage of
attained policy attained policy
insurance value insurance value
age age
50 185 71 113
51 178 72 111
52 171 73 109
53 164 74 107
54 157 75-95 105
55 150 96 104
56 146 97 103
57 142 98 102
58 138 99 101
59 134 100 100
60 130
The percentage is designed to ensure that the policy meets the provisions of
Federal tax law, which require a minimum death benefit in relation to policy
value for your policy to qualify as life insurance.
Option 2 (variable amount): Under this option, the policy value is added to the
specified amount. The Option 2 death benefit is the greater of:
o the policy value plus the specified amount; or
o the applicable percentage of policy value on the date of the last
surviving insured's death, if that death occurs on a valuation date, or
on the next valuation date following the date of death.(See table above.)
Examples: Option 1 Option 2
specified amount $1,000,000 $1,000,000
policy value $ 50,000 $ 50,000
death benefit $1,000,000 $1,050,000
policy value increases to $ 80,000 $ 80,000
death benefit $1,000,000 $1,080,000
policy value decreases to $ 30,000 $ 30,000
death benefit $1,000,000 $1,030,000
If you want to have premium payments and favorable investment
performance reflected partly in the form of an increasing death benefit, you
should consider Option 2. If you are satisfied with the specified amount of
insurance protection and prefer to have premium payments and favorable
investment performance reflected to the maximum extent in the policy value, you
should consider Option 1. Under Option 1, the cost of insurance is lower because
IDS Life of New York's net amount at risk is generally lower; for this reason,
the monthly deduction is less, and a larger portion of your premiums and
investment returns is retained in the policy value.
Change in death benefit option
You may make a written request to change the death benefit option once per
policy year. A change in the death benefit option also will change the specified
amount. You do not need to provide additional evidence of insurability.
If you change from Option 1 to Option 2: The specified amount will
decrease by an amount equal to the policy value on the effective date of the
change. You cannot change from Option 1 to Option 2 if the resulting specified
amount would fall below the minimum specified amount shown in policy.
If you change from Option 2 to Option 1: The specified amount will increase by
an amount equal to the policy value on the effective date of the change.
An increase or decrease in specified amount resulting from a change in the death
benefit option will affect the monthly deduction because the cost of insurance
charge depends on the specified amount. The charge for certain optional
insurance benefits may also change. The surrender charge, however, will not be
affected.
Changes in specified amount
Subject to certain limitations, you may make a written request to decrease the
specified amount once each policy year after the first. Decreases in specified
amount may have tax implications, discussed in the section "Modified endowment
contracts" under "Federal taxes."
Decreases: Any decrease in specified amount will take effect on the monthly
anniversary on or next following our receipt of your written request. The
specified amount remaining after the decrease may not be less than the minimum
specified amount shown in the policy. If, following a decrease in specified
amount, the policy would no longer qualify as life insurance under federal tax
law, the decrease may be limited to the extent necessary to meet these
requirements.
A decrease in specified amount will affect your costs as follows:
o Your monthly deduction will decrease because the cost of insurance charge
depends on the specified amount.
o Charges for certain optional insurance benefits may
decrease.
o The surrender charge will not change.
No surrender charge is imposed when you request a decrease in the specified
amount.
Increases: Increases in specified amount are not permitted. If you wish to
purchase additional insurance, you should purchase an additional policy.
Currently, we do not charge the policy fee for the additional policy.
Misstatement of age or sex
If an insured's age or sex has been misstated, the proceeds payable upon the
last surviving insured's death will be:
o the policy value on the date of death; plus
o the amount of insurance that would have been purchased by the cost of
insurance deducted for the policy month during which death occurred,
if that cost had been calculated using rates for the correct age and
sex; minus
o the amount of any outstanding indebtedness on the date of death.
Suicide
If either of the insureds die by suicide within two years from the policy date,
the only amount payable by us will be the premium paid, minus any indebtedness
and partial surrenders. The policy will terminate as of the date of the first
death by suicide. We will pay any amount payable to you, if living, otherwise to
your estate.
You may purchase a new life insurance policy from us on the life of the
surviving insured. You must request, in writing, the new policy no later than 60
days after the date
of the first death by suicide. If you are not living, the request and purchase
may be made by the surviving insured. The new policy must be an individual
permanent plan of insurance we are then issuing. The initial death benefit of
the new policy cannot exceed one half of the death benefit of this policy. The
new policy will be issued using the rates in effect, the surviving insured's
attained insurance age, and the risk classification as this policy for the
surviving insured.
Beneficiary
Initially, the beneficiary will be the person you designate in your
application for the policy. You may change the beneficiary by giving written
notice to IDS Life of New York, subject to requirements and restrictions stated
in the policy. If you do not designate a beneficiary, or if the designated
beneficiary dies before the last surviving insured, the beneficiary will be you
or your estate.
Transfers between the fixed account and subaccounts
You may transfer policy values from one subaccount to another or between
subaccounts and the fixed account. For most transfers, if we receive your
request before the close of business, we will process it that day. Requests
received after the close of business will be processed the next business day.
There is no charge for transfers. Before transferring policy value, you should
consider the risks involved in switching investments.
We may suspend or modify the transfer privilege at any time with the necessary
approval of the SEC and the New York Superintendent of Insurance. Transfers
involving the fixed account are subject to the restrictions below.
Fixed account transfer policies
o Transfers from the fixed account must be made during a 30-day period starting
on a policy anniversary, except for automated transfers, which can be set up for
monthly, quarterly or semiannual transfer periods.
o If we receive your request to transfer amounts from the fixed account within
30 days before the policy anniversary, the transfer will become effective on the
anniversary.
o If we receive your request on or within 30 days after the policy anniversary,
the transfer will be effective on the day we receive it.
o We will not accept requests for transfers from the fixed account at any other
time.
o If you have made a transfer from the fixed account to one or more subaccounts,
you may not make a transfer from any subaccount back to the fixed account until
the next policy anniversary. We will waive this limitation once during the first
two policy years if you exercise the policy's right to exchange provision. (See
"Exchange right.")
Minimum transfer amounts
From a subaccount to another subaccount or the fixed account:
For mail and phone transfers, $250 or the entire subaccount balance, whichever
is less.
For automated transfers, $50.
From the fixed account to a subaccount: $250 or the entire fixed account balance
minus any outstanding indebtedness, whichever is less.
For automated transfers, $50.
Maximum transfer amounts
From a subaccount to another subaccount or the fixed account: None.
From the fixed account to a subaccount: Entire fixed account balance minus any
outstanding indebtedness.
Maximum number of transfers per year
We reserve the right to limit transfers to twelve per policy year.
Two ways to request a transfer, loan or surrender
Provide your name, policy number, Social Security Number or Taxpayer
Identification Number when you request a transfer, loan or partial surrender.
1 By letter
Regular mail:
IDS Life Insurance Company of New York
P.O. Box 5144
Albany, NY 12205
Express mail:
IDS Life Insurance Company of New York
20 Madison Ave. Extension
Albany, NY 12203
2 By phone
Call between 8 a.m. and 6 p.m. Eastern Time:
1-800-541-2251 (toll free) or
(518) 869-8613 (Albany area)
o We answer phone requests promptly, but you may experience delays when
call volume is unusually high. If you are unable to get through, use
mail procedure as an alternative.
o We will honor any telephone transfer, loan or partial surrender requests
believed to be authentic and will use reasonable procedures to confirm
that they are. These include asking identifying questions and tape
recording calls. As long as these procedures are followed, neither IDS
Life of New York nor its affiliates will be liable for any loss
resulting from fraudulent requests.
o Telephone transfers, loans and partial surrenders are automatically
available. You may request that telephone transfers, loans and partial
surrenders not be authorized from your account by writing IDS Life of
New York.
Automated transfers
In addition to written and phone requests, you can arrange to have policy value
transferred from one account to another automatically. Your financial advisor
can help you set up an automated transfer.
Automated transfer policies:
o Minimum automated transfer: $50
o Frequency: monthly, quarterly, semiannually or annually
o Only one automated transfer arrangement can be in effect at any time. Policy
values may be transferred to one or more subaccounts and the fixed account, but
can be transferred from only one account.
o You can start or stop this service by written request. You must allow seven
days for us to change any instructions that are currently in place.
o Automated transfers from the fixed account may not exceed an amount that, if
continued, would deplete the fixed account within 12 months.
o If you have made a transfer from the fixed account to one or more
subaccounts, you may not make a transfer from any subaccount back to the fixed
account until the next policy anniversary.
o If your request is submitted with an application for a policy, it will not
take effect until the policy is issued.
o If the value of the account from which policy value is being transferred is
less than the $50 minimum, the transfer arrangement will automatically be
stopped.
o Automated transfers are subject to all other policy provisions and terms
including provisions relating to the transfer of money between the fixed account
and the subaccounts.
Automated dollar-cost averaging
You can use automated transfers to take advantage of dollar-cost averaging --
investing a fixed amount at regular intervals. For example, you might have a set
amount transferred monthly from a relatively conservative subaccount to a more
aggressive one, or to several others.
This systematic approach can help you benefit from fluctuations in accumulation
unit value, caused by fluctuations in the market value(s) of the underlying
fund. Since you invest the same amount each period, you automatically acquire
more units when the market value falls, fewer units when it rises. The potential
effect is to lower your average cost per unit.
How dollar-cost averaging works
Amount Accumulation Number of units
Month invested unit value purchased
Jan $100 $20 5.00
Feb 100 16 6.25
Mar 100 9 11.11
Apr 100 5 20.00
May 100 7 14.29
June 100 10 10.00
July 100 15 6.67
Aug 100 20 5.00
Sept 100 17 5.88
Oct 100 12 8.33
(footnotes to table) By investing an equal number of dollars each month...
(arrow in table pointing to April) you automatically buy more units when the per
unit market price is low.
(arrow in table pointing to August) and fewer units when the per unit market
price is high.
You have paid an average price of only $10.81 per unit over the 10 months, while
the average market price actually was $13.10.
Dollar-cost averaging does not guarantee that any subaccount will gain in value,
nor will it protect against a decline in value if market prices fall. Because
this strategy involves continuous investing, your success with dollar-cost
averaging will depend upon your willingness to continue to invest regularly
through periods of low price levels. Dollar-cost averaging can be an effective
way to help meet your long-term goals.
Policy loans
You may borrow against your policy by written or telephone request. (See chart
under "Transfers between the fixed account and subaccounts" for address and
phone numbers for your requests.) A loan request received before close of
business will be processed the same day. A request received after close of
business will be processed the following business day. (Loans by telephone are
limited to $50,000.)
Interest rate: The interest rate for policy loans is 6% per year. After the
policy's 10th anniversary we expect to reduce the loan interest rate to 4% per
year. Interest is charged daily and due at the end of the policy year.
Minimum loan: $500 or the remaining loan value, whichever is less.
Maximum loan:
o 85% of the policy value minus surrender charges.
We will compute the maximum loan value as of the end of the
valuation period during which we receive your loan request. The amount available
at any time for a new loan is the maximum loan value less any existing
indebtedness. In doing so, we reserve the right to deduct from the loan value
interest for the period until the next policy anniversary and monthly deductions
that will be taken until the next policy anniversary.
Payment of loaned funds: Generally, we will pay loans within seven days after we
receive your request (with certain exceptions -- see "Deferral of payments,"
under "Payment of policy proceeds").
Allocation of loans to accounts: If you do not specify whether the loan is to
come from the fixed account or the subaccounts, it will be made from the
subaccounts and the fixed account in proportion to their values, minus
indebtedness. When a loan is made from a subaccount, accumulation units are
redeemed and the proceeds transferred into the fixed account. We will credit the
policy value loaned with 4% annual interest.
Repayments: Loan repayments will be allocated to subaccounts and/or
the fixed account using the premium allocation percentages in effect unless you
tell us otherwise. Repayments must be in amounts of at least $50.
Overdue interest: If accrued interest is not paid when due, we will increase the
amount of indebtedness in the fixed account to cover the amount due. Interest
added to a policy loan will be charged the same interest rate as the loan
itself. We will take such interest from the fixed account and/or subaccounts,
using the monthly deduction allocation percentages. If the value in the fixed
account or any subaccount is not enough to pay the interest so allocated, all of
the interest will be taken from all of the accounts in proportion to their
value, minus indebtedness.
Effects of policy loans: If you do not repay your loan, it will reduce the death
benefit and policy value. Even if you do repay it, your loan can have a
permanent effect on death benefits and policy values, because money borrowed
against the subaccounts will not share in the investment results of the relevant
portfolio(s).
A loan may terminate the DBG-100 or the minimum initial premium period. The loan
amount is deducted from total premiums paid, which may reduce the total below
the level required to keep the DBG-100 or the minimum initial premium period in
effect.
Taxes: If your policy lapses or you surrender it with an outstanding
indebtedness, and the amount of outstanding indebtedness plus the cash surrender
value is more than the sum of premiums you paid, you will generally be liable
for taxes on the excess. (See "Federal taxes.")
Policy surrenders
You may surrender your policy in full or in part by written or telephone
request. (See chart under "Transfers between the fixed account and
subaccounts.") A surrender request received before close of business will be
processed the same day. A request received after close of business will be
processed the following business day. We may require that you return your
policy.
We will normally process your payment within seven days; however, we reserve the
right to defer payment. (See "Deferral of payments," under "Payment of policy
proceeds.")
Total surrenders If you surrender your policy totally, you receive its cash
surrender value -- the policy value minus outstanding indebtedness and
applicable surrender charges. (See "Loads, fees and charges.") We will compute
the value of each subaccount as of the end of the valuation period during which
your request is received.
Partial surrenders After the first policy year, you may surrender any amount
from $500 up to 85% of the policy's cash surrender value. (Partial surrenders by
telephone are limited to $50,000.) You will be charged a partial surrender fee,
described under "Loads, fees and charges."
Allocation of partial surrenders Unless you specify otherwise, IDS
Life of New York will make partial surrenders from the fixed account and
subaccounts in proportion to their values at the end of the valuation period
during which your request is received. In determining these proportions, we
first subtract the amount of any outstanding indebtedness from the fixed account
value.
Effects of partial surrenders
o The policy value will be reduced by the amount of the partial surrender
and fee.
o The death benefit will be reduced by the amount of the partial surrender
and fee, or, if the death benefit is based on the applicable percentage
of policy value, by an amount equal to the applicable percentage times
the amount of the partial surrender.
o A partial surrender may terminate the DBG-100 or the minimum initial
premium period. The surrender amount is deducted from total premiums
paid, which may reduce the total below the level required to keep the
DBG-100 or the minimum initial premium period in effect.
o If Option 1 is in effect, the specified amount will be reduced by the
amount of the partial surrender and fee.
Because they reduce the specified amount, partial surrenders may affect the cost
of insurance. IDS Life of New York will not allow a partial surrender if it
would reduce the specified amount below the required minimum. (See "Decreases"
under "Proceeds payable upon death.")
o If Option 2 is in effect, a partial surrender does not affect the
specified amount.
Taxes Upon surrender, you will generally be liable for taxes on any excess of
the cash surrender value plus outstanding indebtedness over the premium paid.
(See "Federal taxes.")
Exchange right
For two years after the policy is issued, you can exchange it for one that
provides benefits that do not vary with the investment return of the
subaccounts. Because the policy itself offers a fixed return option, all you
need to do is transfer all of the policy value in the subaccounts to the fixed
account. We will automatically credit all future premium payments to the fixed
account unless you request a different allocation.
Such transfer will not count against the five-transfers-per-year limit. Also,
any restrictions on transfers into the fixed account will be waived.
There will be no effect on the policy's death benefit, specified amount, net
amount at risk, risk classification(s) or issue age. Only the method of funding
the policy value will be affected.
Optional insurance benefits
You may choose to add the following benefits to your policy at an additional
cost, in the form of riders (if certain requirements are met). More detailed
information on these benefits are in your policy.
Four-Year Term Insurance Rider (FYT) FYT provides four-year term insurance. An
additional death benefit is paid if both insureds die during the first four
years of the policy.
Policy Split Option Rider (PSO) PSO permits a policy to be split into two
individual permanent plans of life insurance then offered by IDS Life of New
York for exchange, one on the life of each insured, upon the occurrence of a
divorce of the insureds or certain changes in federal estate tax law. (See
"Federal taxes.")
Payment of policy proceeds
Proceeds will be paid when:
o you surrender the policy;
o the last surviving insured dies; or
o the youngest insured's attained insurance age 100.
All proceeds will be paid by check. We will compute the amount of the death
benefit and pay it in a single sum unless you select one of the payment options
below. We will pay interest at a rate not less than 4% per year on single sum
death proceeds, from the date of the last surviving insured's death to the
settlement date (the date on which proceeds are paid in a lump sum or first
placed under a payment option). You will be charged a fee if you request express
mail delivery.
Payment options:
During an insured's lifetime, you may request in writing that we pay policy
proceeds under one or more of the three payment options below. (The beneficiary
may also select a payment option, unless you say that he or she can't.) You
decide how much of the
proceeds will be placed under each option (minimum: $5,000). Any such amount
will be transferred to IDS Life of New York's general account. Unless we agree
otherwise, payments under all options must be made to a natural person.
You may also, by written request, change a prior choice of payment option or
elect a payment option other than the three below, if we agree.
If you elect a payment option for pre-death proceeds, payments under this option
may be subject to federal income tax as ordinary income. If you elect Option A,
the full pre-death proceeds will be taxed as a full surrender as described in
"Taxation of policy proceeds" and may also be subject to an additional 10%
penalty tax if the policy is a modified endowment. The interest paid under
Option A will be ordinary income subject to income tax in the year earned. The
interest payments will not be subject to the 10% penalty tax.
If you elect Option B or Option C for payment of pre-death proceeds, any
indebtedness at the time of election will be taxed as a partial surrender as
described in "Taxation of policy proceeds" and may also be subject to an
additional 10% penalty tax if the policy is a modified endowment. The remainder
of the proceeds will be used to make payments under the option elected. A
portion of each payment will be taxed as ordinary income and a portion of each
payment will be considered a return of the investment in the policy and will not
be taxed. An owner's investment in the policy is described in "Taxation of
policy proceeds." All payments made after the investment in the policy is fully
recovered will be subject to tax. Amounts paid under Option B or Option C that
are subject to tax may also be subject to an additional 10% penalty tax. (See
"Penalty tax.")
Death benefit proceeds applied to any payment option are not considered part of
the beneficiary's income and thus are not subject to federal income tax.
Payments of interest under Option A will be ordinary income subject to tax.
Under Option B or Option C, a portion of each payment will be ordinary income
subject to tax, and a portion of each payment will be considered a return of the
beneficiary's investment in the policy. The beneficiary's investment in the
policy is the death benefit proceeds applied to the payment option. All payments
made after the investment in the policy is fully recovered will be subject to
tax.
Option A -- Interest payments We will pay interest on any proceeds placed under
this option at a rate of 3% per year compounded annually, at regular intervals
and for a period that is agreeable to both you and us. At the end of any payment
interval, you may withdraw proceeds in amounts of at least $100. At any time,
you may withdraw all of the proceeds that remain, or you may place them under a
different payment option approved by us.
Option B -- Payments for a specified period: We will make fixed monthly payments
for any number of years you specify. Here are examples of monthly payments for
each $1,000 placed under this option:
Payment period Monthly payment per $1,000
(years) placed under Option B
10 $9.61
15 6.87
20 5.51
25 4.71
30 4.18
Monthly amounts for other payment periods will be furnished at your request,
free of charge.
Option C -- Lifetime income: We will make monthly payments for the life of the
person (payee) who is to receive the income. Payment will be guaranteed for 10,
15 or 20 years. The amount of each monthly payment per $1,000 placed under this
option will be based on the table of settlement rates in effect at the time of
the first payment. The amount depends on the sex and adjusted age of the payee
on that date. Adjusted age means the age of the payee (on the payee's last
birthday) minus an adjustment as follows:
Calendar year of Adjustment Calendar year of Adjustment
payee's birth payee's birth
Before 1920 0 1945-1949 6
1920-1924 1 1950-1959 7
1925-1929 2 1960-1969 8
1930-1934 3 1970-1979 9
1935-1939 4 1980-1989 10
1940-1944 5 After 1989 11
The amount of each monthly payment per $1,000 placed under this option will not
be less than amounts shown in the next table.
Monthly amounts for any adjusted age not shown will be furnished at your
request, without charge.
Adjusted
age Life income per $1,000 with
payee payments guaranteed for
10 years 15 years 20 years
Male Female Male Female Male Female
50 $4.22 $3.89 $4.17 $3.86 $4.08 $3.82
55 4.62 4.22 4.53 4.18 4.39 4.11
60 5.14 4.66 4.96 4.57 4.71 4.44
65 5.81 5.22 5.46 5.05 5.02 4.79
70 6.61 5.96 5.96 5.60 5.27 5.12
75 7.49 6.89 6.38 6.14 5.42 5.35
Deferral of payments:
We reserve the right to defer payments of cash surrender value, policy loans or
variable death benefits in excess of the specified amount if:
o the payments derive from a premium payment made by a check that has not
cleared the banking system (good payment has not been collected); o the NYSE is
closed (other than customary weekend and holiday closings);
o in accordance with SEC rules, trading on the NYSE is restricted or, because of
an emergency, it is not practical to dispose of securities held in the
subaccount or determine the value of the subaccount's net assets.
Any loans or surrenders from the fixed account may be delayed up to six months
from the date we receive the request. If we postpone the payment of surrender
proceeds more than 10 days, we will pay you interest on the amount surrendered
at an annual rate of 4% for the period of postponement.
Federal taxes
The following is a general discussion of the policy's federal income tax
implications. It is not intended as tax advice. Because the effect of taxes on
the value and benefits of your policy depends on your individual situation as
well as IDS Life of New York's tax status, YOU SHOULD CONSULT A TAX ADVISOR TO
FIND OUT HOW THESE GENERAL CONSIDERATIONS APPLY TO YOU. The discussion is based
on our understanding of federal income tax laws as currently interpreted by the
Internal Revenue Service (IRS); both the laws and their interpretation may
change.
The policy is intended to qualify as a life insurance policy for federal income
tax purposes. To that end, the provisions of the policy are to be interpreted to
ensure or maintain this tax qualification. IDS Life of New York reserves the
right to change the policy in order to ensure that it will continue to qualify
as life insurance for tax purposes. We will send you a copy of any changes.
IDS Life of New York's tax status
IDS Life of New York is taxed as a life insurance company under the Code. For
federal income tax purposes, the subaccounts are considered a part of IDS Life
of New York, although their operations are treated separately in accounting and
financial statements. Investment income from the subaccounts is reinvested and
becomes part of the subaccounts' value. This investment income, including
realized capital gains, is not taxed to IDS Life of New York, and therefore no
charge is made against the subaccounts for federal income taxes. IDS Life of New
York reserves the right to make such a charge in the future if there is a change
in the tax treatment of variable life insurance contracts or in IDS Life of New
York's tax status as we currently understand it.
Taxation of policy proceeds
The death benefit is not considered part of the beneficiary's income and thus is
not subject to federal income taxes. When the proceeds are paid on the youngest
insured's attained insurance age 100, if the amount received plus any
indebtedness exceeds your investment
in the policy, the excess may be taxable as ordinary income. Part or all of any
pre-death proceeds received through full surrender, lapse, partial surrender,
policy loan or assignment of policy value, or payment options may be subject to
federal income tax as ordinary income. (See the following table.) In some cases,
the tax liability depends on whether the policy is a modified endowment
(explained following the table). The taxable amount may also be subject to an
additional 10% penalty tax if the policy is a modified endowment.
Source of proceeds Taxable portion of pre-death proceeds
Full surrender: Amount received plus any
indebtedness, minus your
investment in the policy.*
Lapse Any outstanding indebtedness minus
your investment in the policy.*
Partial surrenders Lesser of:
(modified endowments): the amount received or policy
value minus your investment in the policy.*
Policy loans and Lesser of:
assignments the amount of the loan/assignment
(modified endowments): or policy value minus your
investment in the policy.*
Partial surrenders Generally, if the amount received
(other policies): is greater than your investment in
the policy,* the amount in excess of your
investment is taxable. However, during the
first 15 policy years, a different amount
may be taxable if the partial surrender
results in or is necessitated by a
reduction in benefits.
Policy loans and None
assignments
(other policies):
Payment options: If proceeds of the policy will be
paid under one of the payment options, see
the "Payment option" section for tax
information.
* The owner's investment is equal to premiums paid, minus the nontaxable portion
of any previous partial surrenders, plus the taxable portion of any previous
policy loans.
Modified endowment contracts
In 1988, Congress created a new class of life insurance policies called
"Modified Endowment Contracts," which are taxed differently from conventional
life insurance contracts. Policies applied for, or materially changed, on or
after June 21, 1988, are considered to be modified endowments if premiums paid
in the first seven years of the policy, or the first seven years following a
material change, exceed certain limits. (Also, any life insurance policy
received in exchange for a modified endowment is itself a modified endowment.)
We have established procedures for monitoring whether a contract may become a
modified endowment contract.
Modified endowment limits are calculated when the policy is issued, and are
based on the benefits provided and on the risk classification of the insureds.
They are later recalculated if certain reductions in benefits occur.
Reductions in benefits: When benefits are reduced, the limits are recalculated
as if the reduced level of benefits had always been in effect. In most cases,
this recalculation will further restrict the amount of premium that can be paid
without exceeding modified endowment limits. If premiums already paid exceed the
recalculated limits, the policy becomes a modified endowment even if no further
premiums are paid.
Distributions affected: Modified endowment rules apply to distributions in the
year the policy becomes a modified endowment and in all subsequent years. In
addition, the rules apply to distributions taken two years before the policy
becomes a modified endowment, which are presumed to be taken in anticipation of
that event.
Serial purchase of modified endowments: All modified endowments
issued by the same insurer (or affiliated companies of the insurer) to the same
owner during any calendar year are treated as one policy in determining the
amount of any loan or distribution that is taxable.
Penalty tax: If a policy is a modified endowment, the taxable portion of
pre-death proceeds from a full surrender, lapse, partial surrender, policy loan
or assignment of policy value, or certain payment options may be subject to a
10% penalty tax unless:
o the distribution occurs after the owner attains age 59-1/2;
o the distribution is attributable to the owner becoming disabled
(within the meaning of Code Section 72(m)(7);
or
o the distribution is part of a series of substantially equal
periodic payments made at least once a year over the life (or
life expectancy) of the owner or over the joint lives (or life
expectancies) of the owner and the owner's beneficiary.
Other tax considerations
Policy Split Option Rider: The Policy Split Option Rider permits a policy to be
split into two individual permanent plans of insurance then offered by IDS Life
of New York for exchange, one on the life of each insured, upon the occurrence
of a divorce of the insureds or certain changes in federal estate tax law. A
policy split could have adverse tax consequences; for example, it is not clear
whether a policy split will be treated as a nontaxable exchange under Sections
1031 through 1043 of the Code. If a policy split is not treated as a nontaxable
exchange, a split could result in the recognition of taxable income in an amount
up to any gain in the policy at the time of the split. In addition, it is not
clear whether, in all circumstances, the individual contracts that result from a
policy split would be treated as life insurance contracts for federal income tax
purposes and, if so treated, whether the individual contracts would be
classified as modified endowment contracts. Before you exercise rights provided
by the policy split option, it is important that you consult with a competent
tax advisor regarding the possible consequences of a policy split.
Interest paid on policy loans: If the loan is used for personal purposes, such
interest is not tax-deductible. Other rules apply if the loan is used for trade
or business or investment purposes, or if the policy is owned by a business or a
corporation.
Policy changes: Changing ownership, exchanging or assigning the policy may have
tax consequences, depending on the circumstances.
Other taxes: Federal estate tax, state and local estate tax, inheritance tax,
gift tax and other tax consequences of ownership or receipt of policy proceeds
will also depend on the circumstances.
Qualified retirement plans: The policy may be used in conjunction with certain
qualified plans. Since the rules governing such use are complex, a purchaser
should consult a competent pension consultant.
On July 6, 1983, the Supreme Court held in Arizona Governing
Committee v. Norris that optional annuity benefits provided under
an employee's deferred compensation plan could not, under Title VII of the Civil
Rights Act of 1964, vary between men and women on the basis of sex. Since the
policy's cost of insurance rates and purchase rates for certain settlement
options distinguish between men and women, employers and employee organizations
should consult with legal counsel before purchasing the policy for any
employment-related insurance or benefit program.
IDS Life of New York
IDS Life is a stock life insurance company organized under the laws of the State
of New York in 1972. Our address is 20 Madison Ave. Extension, Albany, NY 12203.
IDS Life of New York is licensed in New York and North Dakota, and it conducts a
conventional life insurance business in the state of New York. All annuity
contracts and insurance policies issued by IDS Life of New York, including the
policy described in this prospectus, are non-participating.
Ownership
IDS Life of New York, a New York Corporation, is a wholly-owned subsidiary of
IDS Life, a Minnesota Corporation, which is a wholly-owned subsidiary of
American Express Financial Corporation (AEFC). AEFC, a Delaware Corporation, is
a wholly-owned subsidiary of American Express Company.
State regulation
IDS Life of New York is subject to the laws of New York governing insurance
companies and to regulation by the New York Department of Insurance. An annual
statement in a prescribed form is filed with New York's Department of Insurance.
IDS Life of New York's books and accounts are subject to review by the New York
Department of Insurance at all times and a full examination of its operations is
conducted periodically. Such regulation does not, however, involve any
supervision of management or investment practices or policies.
Distribution of the policy
American Express Financial Advisors Inc., a registered broker/dealer and an
affiliate of IDS Life of New York, is the sole distributor of the policy. IDS
Life of New York pays its representatives a commission of up to 50% of the
initial target premium (annualized) when the policy is sold, plus 2% of all
premiums in excess of the target premium. IDS Life of New York also pays
approximately 27% of the total representative's commission to the field vice
presidents and district sales managers of the selling representative.
Legal proceedings
There are no material legal proceedings to which the variable account is a party
or to which the assets of the variable account are subject. IDS Life of New York
is engaged in various kinds of routine litigation that, in IDS Life of New
York's judgment, are not of material importance in relation to its total assets.
None of such litigation relates to the variable account.
Experts
The financial statements of IDS Life of New York at Dec. 31, 1996 and 1995, and
for each of the three years in the period ended Dec. 31, 1996, and the
individual and combined financial statements of the segregated asset subaccounts
of IDS Life of New York Account 8 for Flexible Premium Variable Life Insurance,
at Dec. 31, 1996, and for each of the three years in the period ended Dec. 31,
1996, except for the following subaccounts: YIT subaccount which is for each of
the two years in the period ended Dec. 31, 1996 and the period Oct. 28, 1994
(commencement of operations) to Dec. 31, 1996, YGI and YNO subaccounts which are
for the period Nov. 22, 1996 (commencement of operations) to Dec. 31, 1996,
appearing in this prospectus have been audited by Ernst & Young LLP, independent
auditors, as set forth in their reports thereon appearing elsewhere herein, and
are included in reliance upon such reports given upon the authority of such firm
as experts in accounting and auditing.
Actuarial matters included in the prospectus have been examined by Eugene C.
Chen, Chief Actuary, as stated in his opinion filed as an exhibit to the
Registration Statement.
Management of IDS Life of New York
Directors
John C. Boeder
Vice president, Mature Market Group, AEFC, since March 1994; president and chief
operating officer, IDS Life of New York, from 1991 to 1994; vice president and
chief operating officer, IDS Life of New York, from 1989 to 1991.
Roger C. Corea
Group vice president, Upstate New York, AEFA, since January 1995; vice
president, Northeast Region, AEFA, from May 1987 to December 1994.
Charles A. Cuccinello
Retired since 1982; former senior vice president, American Express Company.
Robert R. Grew
Lawyer and Partner, Carter, Ledyard & Milburn, NYC, 1957 - present
Robert A. Hatton
Vice president and chief operating officer, IDS Life of New York since June
1994; special assignment/Project leader, AEFA, December 1992 to June 1994;
manager/Analyst operations, AEFA, August 1989 to December 1992.
Richard W. Kling
President and chairman of the board, IDS Life of New York, since April 1994;
director, IDS Life, since February 1984; President, IDS Life, since March 1994;
executive vice president, Marketing and Products, IDS Life, from January 1988 to
March 1994; senior vice president, Risk Management Products, AEFC, since May
1994; vice president, AEFC, from January 1988 to May 1994; director and
president of IDS Life Series Fund, Inc.; chairman of the board of managers and
president of IDS Life Variable Annuity Funds A and B.
Edward Landes
Retired, former Development Consultants; director, IDS Life Series Fund Inc.
since September 1985; member of the board of Managers of IDS Life Variable
Annuity Funds A and B since October 1988. Director of IDS Life Insurance Company
of New York; vice President of Financial YMCA Development, YMCA, since 1985.
Thomas V. Nicolosi
Director since October 1996; group vice president, AEFA, from January 1995 to
present; field vice president, AEFA, from January 1988 to December 1994.
Stephen P. Norman
Secretary, American Express, since 1982.
Carl N. Platou
Retired since 1990; member of the board of directors, St. Thomas University,
since 1990; chief financial officer, Fairview Hospital, from 1953 to 1990.
Gordon H. Ritz
President, Con Rad Broadcasting Corporation (Minneapolis), since 1975.
Richard M. Starr
Director since October 1996; managing counsel, American Express Company, since
March 1995; senior counsel, American Express Company, from May 1992 to March
1995; counsel, American Express Company, from June 1989 to May 1992.
Michael R. Woodward
Senior vice president, Field Management, AEFC, since June 1991; region vice
president, Atlantic Region, AEFC, from 1988 to June 1991.
Principal officers other than directors
Mario Alaia
Claims officer and assistant secretary since 1988.
Darrell C. Beckstrom
Underwriting officer since 1994; underwriting technical manager, IDS Life, since
1990; senior underwriter, IDS Life, from 1987 to 1992.
Eugene C. Chen
Chief actuary since November 1996; manager of Life Planning and Analysis, AEFA,
from May 1995 to November 1996; senior staff actuary - Product Development Risk
Management, IDS Life, from August 1992 to May 1995.
Darlene S. Farron
Treasurer since June 1996; financial project manager - Finance Department from
September 1994 to June 1996; team leader of Premium, Investment and External
Reporting - Finance Department from March 1988 to September 1994.
Donna M. Gaglione
Secretary since 1995; manager of Administrative Services since 1992; treasurer
from 1985 to 1992.
Margaret M. Grogan, M.D.
Medical director since 1986.
Lorraine R. Hart
Investment officer since March 1992; vice president, Insurance Investments, IDS
Life, since October 1989.
F. Dale Simmons
Vice president and assistant treasurer since 1994; vice president and senior
portfolio manager, Insurance Investments, AEFC, since 1990.
William A. Stoltzmann
Counsel and assistant secretary since March 1990.
The officers, employees and sales force of IDS Life of New York are bonded, in
the amount of $100 million, by virtue of a blanket fidelity bond issued to
American Express Company by Saint Paul Fire and Marine, the leading underwriter.
AIM Advisors, Inc. and Putnam Investment Management, Inc.
AIM Advisors, Inc.
A I M Advisors, Inc. ("AIM") was organized in 1976 and is headquartered in
Houston, Texas. AIM is a wholly owned subsidiary of A I M Management Group Inc.,
an indirect subsidiary of AMVESCO plc, (formerly INVESCO plc). As of March 18,
1997, total assets advised or managed by AIM and its subsidiaries were
approximately $68 billion.
Putnam Management
Putnam Management has been managing mutual funds since 1937. Today, the firm
serves as the investment manager for the funds in the Putnam Family, with nearly
$141 billion in assets under management in over 7 million shareholder accounts
at December 31, 1996.
Other information
A registration statement has been filed with the Securities and Exchange
Commission (SEC) under the Securities Act of 1933, as amended. For further
information concerning the policy, its separate account (the variable account)
and IDS Life of New York, please refer to the registration statement, as
amended, with exhibits.
Substitution of investments
If shares of any fund are unavailable for purchase by the appropriate subaccount
or if, in the judgment of IDS Life of New York's management, further investment
in such shares is no longer appropriate, shares of another registered, open-end
management investment company may be substituted. IDS Life of New York also
reserves the right to change the funds in which the subaccounts invest and to
create new subaccounts that invest in additional funds.
In the event of any such substitution or change, IDS Life of New York may,
without the consent or approval of owners, amend the policy and take whatever
action is necessary and appropriate. However, no such substitution or change
will be made without any necessary approval of the SEC or state insurance
departments. IDS Life of New York will notify owners within five days of any
substitution or change.
Voting rights
All shares issued by the fund are the same class (kind) -- capital stock. They
are fully paid and nonassessable and can be redeemed or transferred. They can be
issued as full shares or fractions. All shares have equal voting rights; a
fraction of a share has the same kind of rights and privileges as a full share.
Each of the funds issues its own series of common stock. The shares of each fund
represent an interest only in that fund's assets (and profits or losses) and in
the event of liquidation, each share of a fund would have the same rights to
dividends and assets as every other share of that fund.
Each share of a fund has one vote. On some issues, such as election of directors
of IDS Life Series Fund, all shares of the IDS Life Series Fund Portfolios vote
together as one series. When electing directors, all shares of IDS Life Series
Fund Portfolios have cumulative voting rights. Cumulative voting means that
shareholders are entitled to a number of votes equal to the number of shares
they hold multiplied by the number of directors to be elected and they have the
right to divide votes among candidates.
On an issue affecting only one fund -- for example, a fundamental investment
restriction pertaining only to that fund -- its shares vote as a separate
series. If shareholders of a particular fund vote approval of an agreement, the
agreement becomes effective with respect to that fund, whether or not it is
approved by shareholders of the other funds.
IDS Life of New York is the owner of all fund shares and as such holds all
voting rights. However, IDS Life of New York will vote the shares of each fund
in accordance with instructions received from owners. If we do not receive
timely instructions from you, we will vote your shares in the same proportion as
the shares for which instructions are received. Fund shares that are not
otherwise attributable to owners will also be voted by IDS Life of New York in
the same proportion as those shares in that subaccount for which instructions
are received.
We determine the number of fund shares in each subaccount for which you may give
instructions by applying your percentage interest in the subaccount to the
total number of votes attributable to the subaccount. The number will be
determined as of a date chosen by IDS Life of New York, but not more than 60
days before the meeting of the fund.
Fractional votes are counted. You will receive notice of each shareholder
meeting, together with any proxy solicitation materials and a statement of the
number of votes for which you are entitled to give instructions.
If required by state insurance officials, IDS Life of New York may disregard
voting instructions that would change the goals of one or more of the funds or
would result in approval or disapproval of an investment advisory contract. In
addition, IDS Life of New York itself may disregard voting instructions that
would require changes in the investment policy or investment advisor of one or
more of the funds, if IDS Life of New York reasonably disapproves such changes
in accordance with applicable federal regulations. If IDS Life of New York does
disregard voting instructions, it will, in its next report to owners, advise
them of that action and the reasons for it.
Reports
At least once a year IDS Life of New York will mail to you, at your last known
address of record, a report containing all information required by law or
regulation, including a statement showing the current policy value.
Policy illustrations
The following tables illustrate how policy values, cash surrender values and
death benefits may change with the investment experience of the subaccount. The
tables show how these amounts might vary, for a male insurance age 55 and a
female insurance age 55, both nonsmokers, if:
o the annual rate of return of the fund is 0%, 6% or 12%.
o the cost of insurance rates are current rates or guaranteed
rates.
Any such illustration involves a number of detailed assumptions. (See chart,
"Understanding the illustrations.") To the extent that your own circumstances
differ from those assumed in the illustrations, your expected results would also
differ.
Upon request, you will be furnished with comparable tables illustrating death
benefits, policy values and cash surrender values based on the actual ages of
the persons you propose to insure and on an initial specified amount and premium
payment schedule. In addition, after you have purchased a policy, you may
request illustrations based on policy values at the time of request.
Understanding the illustrations:
Rates of return: assumed to be uniform, gross, after-tax, annual rates of 0%,
6%, or 12% for the fund. Results would differ depending on allocations among the
subaccounts, if returns averaged 0%, 6% and 12% for the funds as a whole, but
differed across individual funds.
Insureds: assumed to be a male insurance age 55 and a female insurance age 55,
in a standard risk classification, qualifying for the nonsmoker rate. Results
would be lower if one or both of the insureds were in a substandard risk
classification or did not qualify for the non-smoker rate.
Premiums: A $15,000 premium is assumed to be paid in full at the beginning of
each policy year. Results would differ if premiums were paid on a different
schedule.
Policy loans and partial withdrawals: It is assumed that none have been made.
(Since indebtedness is assumed to be zero, the cash surrender value in all cases
equals the policy value minus the surrender charge.)
Effect of expenses and charges: The net investment return of the subaccounts,
shown in the tables, is lower than the gross, after-tax return of the fund
because expenses paid by the fund and charges made against the subaccounts have
been deducted. These include:
o the daily investment management fee paid by the funds, assumed to be
equivalent to an annual rate of 0.7% of the fund's aggregate average daily net
assets;
o the daily mortality and expense risk charge, equivalent to 0.9%
of the daily net asset value of the subaccounts annually; and
o a nonadvisory expense charge paid by the funds, assumed to be equivalent to an
annual rate of 0.1% of each funds aggregate average daily net assets for
direct expenses incurred by the fund.
The nonadvisory expense charge for the IDS Life Series Fund is capped by IDS
Life at 0.1%, even though actual expenses on IDS Life Series Fund-Government
Securities Portfolio ranged up to 0.18%, IDS Life Series-Money Market Portfolio
ranged up to 0.23% and IDS Life Series Fund-International Equity Portfolio
ranged up to 0.37%. Although IDS Life reserves the right to discontinue capping
these expenses, our present intent is to continue the cap indefinitely until
actual expenses are less than the cap. Should IDS Life discontinue the cap prior
to that time, the policy values and death benefits in the tables generally would
be less. Other expenses for the year ended Dec. 31, 1996 were 0.09% for Putnam
VT New Opportunities Fund. For AIM V.I. Growth and Income Fund other expenses
(annualized) were 0.13% for the period ended Dec. 31, 1996.
(After deduction of the above expenses and charges, the illustrated gross annual
investment rates of return of 0%, 6% and 12% correspond to approximate net
annual rates of -1.69%, 4.21% and 10.11%, respectively.)
Taxes: Results shown in the tables reflect the fact that IDS Life of New York
does not currently charge the subaccounts for federal income tax. If such a
charge is taken in the future, the funds will have to earn more than they do now
in order to produce the death benefits and policy values illustrated.
Illustration
Initial specified amount $1,000,000 Male - Insurance age 55 - Nonsmoker Current costs assumed
Death benefit Option 1 Female - Insurance age 55 - Nonsmoker annual premium $15,000
Premium Death benefit (1)(2) Policy value (1)(2) Cash surrender value (1)(2)
accumulated assuming hypothetical gross assuming hypothetical gross assuming hypothetical gross
End of with annual annual investment return of annual investment return of annual investment return of
policy interest
year at 5% 0% 6% 12% 0% 6% 12% 0% 6% 12%
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
20
25
30
35
40
45
(1) Assumes no policy loans or partial withdrawals have been made.
(2) Assumes a $15,000 premium is paid at the beginning of each policy year.
Values will be different if premiums are paid in different amounts or with a
different frequency.
The above hypothetical investment results are illustrative only and should not
be deemed a representation of past or future investment results. Actual
investment results may be more or less than those shown. The death benefit,
policy value and cash surrender value would be different from those shown if
returns averaged 0%, 6% and 12% over a period of years, but fluctuated above and
below those averages for individual policy years. No representation can be made
that these hypothetical rates of return can be achieved for any one year or
sustained over any period of time.
Illustration
Initial specified amount $1,000,000 Male - Insurance age 55 - Nonsmoker Current costs assumed
Death benefit Option 1 Female - Insurance age 55 - Nonsmoker annual premium $15,000
Premium Death benefit (1)(2) Policy value (1)(2) Cash surrender value (1)(2)
accumulated assuming hypothetical gross assuming hypothetical gross assuming hypothetical gross
End of with annual annual investment return of annual investment return of annual investment return of
policy interest
year at 5% 0% 6% 12% 0% 6% 12% 0% 6% 12%
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
20
25
30
35
40
45
(1) Assumes no policy loans or partial withdrawals have been made.
(2) Assumes a $15,000 premium is paid at the beginning of each policy year.
Values will be different if premiums are paid in different amounts or with a
different frequency.
The above hypothetical investment results are illustrative only and should not
be deemed a representation of past or future investment results. Actual
investment results may be more or less than those shown. The death benefit,
policy value and cash surrender value would be different from those shown if
returns averaged 0%, 6% and 12% over a period of years, but fluctuated above and
below those averages for individual policy years. No representation can be made
that these hypothetical rates of return can be achieved for any one year or
sustained over any period of time.
Illustration
Initial specified amount $1,000,000 Male - Insurance age 55 - Nonsmoker Current costs assumed
Death benefit Option 1 Female - Insurance age 55 - Nonsmoker annual premium $15,000
Premium Death benefit (1)(2) Policy value (1)(2) Cash surrender value (1)(2)
accumulated assuming hypothetical gross assuming hypothetical gross assuming hypothetical gross
End of with annual annual investment return of annual investment return of annual investment return of
policy interest
year at 5% 0% 6% 12% 0% 6% 12% 0% 6% 12%
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
20
25
30
35
40
45
(1) Assumes no policy loans or partial withdrawals have been made.
(2) Assumes a $15,000 premium is paid at the beginning of each policy year.
Values will be different if premiums are paid in different amounts or with a
different frequency.
The above hypothetical investment results are illustrative only and should not
be deemed a representation of past or future investment results. Actual
investment results may be more or less than those shown. The death benefit,
policy value and cash surrender value would be different from those shown if
returns averaged 0%, 6% and 12% over a period of years, but fluctuated above and
below those averages for individual policy years. No representation can be made
that these hypothetical rates of return can be achieved for any one year or
sustained over any period of time.
Illustration
Initial specified amount $1,000,000 Male - Insurance age 55 - Nonsmoker Current costs assumed
Death benefit Option 1 Female - Insurance age 55 - Nonsmoker annual premium $15,000
Premium Death benefit (1)(2) Policy value (1)(2) Cash surrender value (1)(2)
accumulated assuming hypothetical gross assuming hypothetical gross assuming hypothetical gross
End of with annual annual investment return of annual investment return of annual investment return of
policy interest
year at 5% 0% 6% 12% 0% 6% 12% 0% 6% 12%
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
20
25
30
35
40
45
(1) Assumes no policy loans or partial withdrawals have been made.
(2) Assumes a $15,000 premium is paid at the beginning of each policy year.
Values will be different if premiums are paid in different amounts or with a
different frequency.
The above hypothetical investment results are illustrative only and should not
be deemed a representation of past or future investment results. Actual
investment results may be more or less than those shown. The death benefit,
policy value and cash surrender value would be different from those shown if
returns averaged 0%, 6% and 12% over a period of years, but fluctuated above and
below those averages for individual policy years. No representation can be made
that these hypothetical rates of return can be achieved for any one year or
sustained over any period of time.
PART II
UNDERTAKINGS TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission hereto or hereafter duly adopted pursuant to
authority conferred in that section.
RULE 484 UNDERTAKING
The By-Laws of IDS Life Insurance Company of New York provide that:
To the extent permitted and in the manner prescribed by law, the Corporation
shall indemnify any person made, or threatened to be made, a party to any
action, suit or proceeding, civil or criminal, by reason of the fact that he,
his testator or intestate, is or was Director or officer of the Corporation or
of any other corporation of any type or kind, domestic or foreign, which he
served in any capacity at the request of the Corporation, against judgments,
fines, amounts paid in settlement and reasonable expenses (which the Corporation
may advance), including attorney's fees, actually and necessarily incurred as a
result of such action, suit or proceeding, or any appeal therein.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
REPRESENTATION PURSUANT TO SECTION 205 OF THE NATIONAL SECURITIES MARKET
IMPROVEMENT ACT OF 1996
The sponsoring insurance company represents that the fees and charges deducted
under the contract, in the aggregate, are reasonable in relation to the services
rendered, the expenses expected to be incurred, and the risks assumed by the
insurance company.
REPRESENTATIONS PURSUANT TO RULE 6e-3 (T)
This filing is made pursuant to Rule 6c-3 and 6e-3 (T) under the Investment
Company Act of 1940.
CONTENTS OF THE REGISTRATION STATEMENT
This Registration Statement comprises the following papers and documents:
The facing sheet.
The prospectus consisting of 54 pages.
The undertakings to file reports.
The signatures.
The following exhibits:
1.A. Copies of all exhibits required by paragraph A of instructions for
Exhibits in Form N-8B-2 to the Registration Statement.
(1) Resolution of Board of Directors of IDS Life of New York authorizing
the Trust, adopted September 12, 1985, filed as Exhibit 1.A.(1) to
Registrant's Form N-8B-2 with Port-Effective Amendment No. 11 ,File
No. 33-15290 is incorporated herein by reference.
(2) Not applicable.
(3) (a) Not applicable.
(b) (1) Form of Explanation of New York Sales Agreement*
(2) Form of Personal Financial Planner's Agreement with
IDS Financial Services Inc.*
(3) Form of Personal Financial Planner's Agreement with
IDS Life Insurance Company of New York*
(4) Form of Field Trainer's Rider to Personal Financial
Planner's Agreement.*
(5) Form of District Manager's Rider to Personal Financial
Planner's Agreement.*
(6) Form of New York District Manager - Insurance Rider to
Personal Financial Planner Agreement.*
(7) Form of Division Manager's Agreement with IDS Financial
Services Inc.*
(8) Form of New York Division Manager - Insurance Rider to
Division Manager's Agreement with IDS Financial
Services Inc.*
(9) Form of Field President Agreement with American Express
Financial Advisors Inc.**
(10) Form of Recruiting and Training Manager License
Agreement with IDS Life Insurance Company
of New York.**
(11) Form of Group Vice President Agreement with American
Express Financial Advisors Inc.**
(12) Form of IDS Paraplanner License Agreement with IDS Life
Insurance Company of New York.**
(13) Form of Variable Annuity and Life
Insurance Distribution Agreement is
filed electronically herewith.
(c) Schedules of Sales Commissions to be filed by
Amendment.
(4) Not applicable.
(5) Flexible Premium Survivorship Variable Life Insurance Policy.**
(6) (a) Certificate of Incorporation of IDS Life Insurance Company of New York,
dated July 23, 1957.*
(b) Amended By-Laws of IDS Life Insurance Company of New York.*
(7) Not applicable.
(8)(a) Form of Investment Management and Services Agreement dated
December 17, 1985, between IDS Life of New York and IDS Life of New
York Series Fund, Inc.*
(b) Form of Investment Advisory Agreement dated July 11, 1984, between
IDS Life of New York and IDS Financial Services Inc. relating to the
Variable Account.*
(c) Addendum to Investment Management and Services Agreement is filed
electronically herewith.
(d) Addendum to Investment Advisory Agreement is filed electronically
herewith.
(9) None.
(10) (a) Application form for the Flexible Premium Survivorship
Variable Life Insurance Policy.**
(b) Application form for Life and Disability Income Insurance.**
(11) IDS Life Insurance Company of New York's Description of Transfer and
Redemption Procedures and Method of Conversion to Fixed Benefit
Policies is filed electronically herewith.
B. (1) Not applicable.
(2) Not applicable.
C. Not applicable.
2. Opinion and consent of counsel as to the legality of the securities
registered is filed electronically herewith.
3. No financial statement will be omitted from the prospectus pursuant
to Instruction 1(b) or (c) of Part I.
4. Not applicable.
5. Financial Data Schedule is not applicable at this time.
6. Actuarial Opinion in support of the 1.25% federal tax charge to be
filed by amendment.
7. Opinion of the Chief Actuary will be filed by amendment.
8. Written consent of the Chief Actuary will be filed by amendment.
9. Written consent of Ernst & Young LLP will be filed by amendment.
10. Directors' Power of Attorney dated March 12, 1997, is filed
electronically herewith.
* All of these exhibits are incorporated by reference to Amendment No. 3
to the Registration Statement to form N-8B-2 File No. 811-05213.
** All of these exhibits are incorporated by reference to Amendment No. 4
to the Registration Statement to form N-8B-2 File No. 811-05213.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, IDS Life Insurance Company of New York, on behalf of the
Registrant, has duly caused this Registration Statement to be signed on behalf
of the Registrant by the undersigned, thereunto duly authorized, in this City of
Minneapolis, and State of Minnesota on the 12th day of December, 1997.
IDS Life of New York Account 8
(Registrant)
By IDS Life Insurance Company of New York
(Sponsor)
By /s/ Richard W. Kling*
Richard W. Kling, President
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following Officers and Directors of IDS Life
Insurance Company of New York in the capacities indicated on the 12th day of
December, 1997:
Signature Title
/s/ Richard W. Kling* Director, Chairman of the Board and President
Richard W. Kling
/s/ John C. Boeder* Director
John C. Boeder
/s/ Roger C. Corea* Director
Roger C. Corea
/s/ Charles A. Cuccinello* Director
Charles A. Cuccinello
/s/ Darlene S. Farron* Treasurer
Darlene S. Farron
/s/ Robert A. Hatton* Director, Vice President and Chief Operating Officer
Robert A. Hatton
/s/ Edward Landes* Director
Edward Landes
/s/ Thomas V. Nicolosi* Director
Thomas V. Nicolosi
/s/ Stephen P. Norman* Director
Stephen P. Norman
/s/ Carl N. Platou* Director
Carl N. Platou
Signature Title
/s/ Gordon H. Ritz* Director
Gordon H. Ritz
/s/ Richard M. Starr* Director
Richard M. Starr
/s/ Michael R. Woodward* Director
Michael R. Woodward
*Signed pursuant to Power of Attorney dated March 12, 1997 and is filed
electronically as Exhibit No. 10 to this Registration Statement.
By:
- ---------------------------------
Mary Ellyn Minenko