Registration No. 333-58703 November 17, 1998
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pre-Effective Amendment No. 1
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:
American Skandia Life Assurance Corporation Separate Account F
B. Name of depositor:
American Skandia Life Assurance Corporation
C. Complete address of depositor's principal executive offices:
One Corporate Drive, Shelton, CT 06484
D. Name and complete address of agent for service:
Scott K. Richardson, Esq.
American Skandia Life Assurance Corporation
One Corporate Drive
Shelton, CT 06484
It is proposed that this filing will become effective
(check appropriate box)
[ ] immediately upon filing pursuant to paragraph (b)
[ ] on ____________ pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on 5/1/98 pursuant to paragraph (a)(1) of rule 485
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment
E. Title and amount of securities being registered:
Modified Single Premium Variable Life Insurance.
The Registrant elects to register an indefinite number of securities by
this registration statement in accordance with Rule 24f-2 under the
Investment Company Act of 1940.
F. Proposed maximum aggregate offering price to the public of the
securities being registered:
G. Amount of filing fee:
None
H. Approximate date of proposed public offering
As soon as practicable after the effective date of this Registration
Statement.
[ ] Check box if it is proposed that this filing will become effective
on ______________ at ____________ pursuant to Rule 487.
The Registrant hereby amends this Registration Statement on such date as may be
necessary to delay its effective date until the Registrant shall file a further
amendment which specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a) of the Securities
Act of 1933 or until the Registration Statement shall become effective on such
date as the Commission, acting pursuant to said Section 8(a), may determine.
RECONCILIATION AND TIE BETWEEN
FORM N-8B-2 AND PROSPECTUS
ITEM NO. OF
FORM N-8B-2 CAPTION IN PROSPECTUS
1. Face page
2. Face page
3. Not applicable
4. Distribution of this Offering
5. The Separate Account
6. The Separate Account
7. Not Applicable
8. Not Applicable
9. Legal Proceedings
10. Face page; Variable Investment Options; The Separate
Account; Voting; Modification of the Separate
Account; Additional Tax Considerations; Loans;
Partial Withdrawals; Surrenders; Transfers and
Allocation Services; Safekeeping of the Assets
11. Face page; Variable Investment Options
12. Face page; Variable Investment Options
13. Costs; Variable Investment Options; Taxes;
Additional Tax Considerations
14. Buying a Policy - How do I buy a Policy?
15. Account Value and Cash Value; Buying a Policy - How
and When is my Premium Invested?
16. Buying a Policy - How and When is my Initial
Premium Invested? Variable Investment Options
17. Partial Withdrawals; Surrenders; Reinstatement;
Account Value and Cash Value; Buying a Policy;
Pricing Transactions
18. Account Value and Cash Value; Variable Investment
Options; The Separate Account; Safekeeping of the
Assets
19. Reports
20. Voting; Safekeeping of the Assets
21. Loans
22. Not applicable
23. Safekeeping of the Assets
24. Not applicable
25. Regulation; The Insurance Company
26. Not applicable
27. The Insurance Company
28. Appendix H - Executive Officers and Directors
29. The Insurance Company
30. Not applicable
31. Not applicable
32. Not applicable
33. Not applicable
34. Not applicable
35. The Insurance Company; Regulation
36. Not applicable
37. Not applicable
38. Distribution of this Offering
39. Distribution of this Offering
40. Not applicable
41. The Insurance Company; Distribution of this Offering
42. Not applicable
43. Not applicable
44. Account Value and Cash Value; Pricing Transactions;
Additional Tax Considerations; Net Investment Factor
45. Not applicable
46. Account Value and Cash Value; Pricing Transactions;
Additional Tax Considerations; Net Investment Factor
47. Variable Investment Options; The Separate Account
48. Face Page; The Insurance Company
49. Not applicable
50. The Separate Account; Safekeeping of the Assets
51. Face Page; The Insurance Company; Benefits at the
Insured's Death; Designations
52. Modification of the Separate Account
53. Additional Tax Considerations
54. Not applicable
55. Not applicable
56. Not applicable
57. Not applicable
58. Not applicable
59. Appendix I
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SUBJECT TO COMPLETION
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such state.
================================================================================
This Prospectus describes a flexible premium variable life insurance policy
being offered by American Skandia Life Assurance Corporation ("we," "our," "us,"
"American Skandia," or "the Company"), One Corporate Drive, P.O. Box 883,
Shelton, Connecticut, 06484. This policy may be offered as individual coverage
or as an interest in a group policy. This Prospectus provides a detailed
discussion of matters you should consider before buying a policy. This policy or
certain of its investment options may not be available in all jurisdictions.
Various rights and benefits may differ between jurisdictions to meet applicable
law and/or regulations. This Prospectus is made up of the following general
sections: Cover Page, Table of Contents, Definitions, Description of the
Offering, Miscellaneous Provisions and Additional Details. On this cover page
and in the Description of the Offering section, we use a "question and answer"
format to assist you in understanding this offering. The questions are numbered
for easy reference.
What is American Skandia offering? We are offering a type of cash value life
insurance coverage. This life insurance coverage is called a "flexible premium
variable life insurance policy". These technical terms can be explained as
follows:
(1) The coverage is "life insurance" because a death benefit becomes
payable to a beneficiary upon the death of the insured person (if
coverage is issued on two insureds, the death benefit is payable upon
the death of the second of the insureds to die). It is "cash value"
life insurance because, in addition to a death benefit, it also
provides living benefits for the owner, such as the right to take
withdrawals and the right to take loans from us using the value of the
policy as collateral.
(2) The coverage is a "flexible premium" plan because it offers
considerable flexibility regarding the timing and amount of premium
payments after the first. No additional premium must be paid unless it
is required to pay the ongoing monthly charges. However, there is a
minimum amount we accept, both for initial and subsequent premiums.
There is also a maximum total amount you can pay. In order to achieve
certain beneficial tax treatment for withdrawals and loans, you may
need to limit the amounts you pay. If you pay the maximum allowable
amount, you may not be able to pay any additional premiums without
applying for, and our agreeing to issue, additional insurance.
(3) The coverage is "variable" because you can allocate all or part of your
premiums to variable investment options that invest in an underlying
mutual fund or a portfolio of an underlying mutual fund. The following
underlying mutual funds or portfolios of the following underlying
mutual funds are being offered: American Skandia Trust, The Alger
American Fund and Montgomery Variable Series. The performance of the
variable investment options is not guaranteed. You bear the investment
risk if you allocate funds to these investment options because the
benefits that depend on the investment performance of these investment
options can decrease or increase.
(4) The coverage allows you to allocate all or part of your premiums to a
fixed option to which we credit a fixed rate of interest. We guarantee
the rate of return on this option. These obligations are supported by
our general account. We bear the investment risk if you allocate funds
to this option.
(continued on the next page)
The variable life insurance policy described in this Prospectus is not a deposit
of or guaranteed by, any bank or bank subsidiary, and is not insured by the
Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other
agency. The Policy is subject to investment risks, including the possible loss
of the principal amount invested.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. PLEASE
READ THIS PROSPECTUS AND THE CURRENT PROSPECTUSES FOR THE UNDERLYING FUNDS. KEEP
IT FOR FUTURE REFERENCE.
FPVLI-PROS (1/99) CALL 1-800-752-6342 FOR FURTHER INFORMATION
Prospectus Dated: December 31, 1998
(5) As life insurance, generally your beneficiary will owe no Federal
income tax on the death proceeds. Depending on whether the policy
satisfies a test outlined in the Internal Revenue Code (the "Code"),
distributions taken by the owner while the insured person is alive will
be treated differently for Federal income tax purposes. This test is
commonly known as the "7-pay test". In general, this test compares the
amount of premiums paid to the amount of insurance purchased. If your
policy "passes" the 7-pay test, it will not be treated as a "modified
endowment contract" or "MEC" for income tax purposes. As a "non-MEC",
most distributions while the insured is alive, such as any withdrawals
and a surrender, are taxable, but amounts are deemed to be distributed
first from any tax basis in the policy. Also, loans from such a policy
are not treated as taxable distributions. However, if at any time the
policy "fails" the 7-pay test, the policy must be treated as a MEC for
income tax purposes. If and when that occurs, subsequent distributions
from a policy are deemed for tax purposes to come first from any gain
in the policy, and loans and assignments are deemed to be
distributions. Whether or not a policy is considered a MEC, any
distribution deemed a distribution of gain is taxable as ordinary
income.
(6) During the first ten (10) years the coverage has a limited amount of
liquidity. During that period, you can only make withdrawals under
certain medically-related circumstances or from premium amounts made in
excess of certain limits. However, you can access a portion of the
policy's value through policy loans using a portion of its value as
collateral. Assuming that the policy is not treated as a MEC, policy
loans receive favorable tax treatment. Policy loans are currently
available at no net cost. Loans can have an impact on benefits that can
be positive or negative.
This page is intentionally left blank.
TABLE OF CONTENTS
DEFINITIONS........................................................................................................................6
SUMMARY OF COSTS...................................................................................................................9
DESCRIPTION OF THE OFFERING.......................................................................................................10
Purchasers.....................................................................................................................10
The Insurance Company..........................................................................................................10
Benefits at the Insured's Death................................................................................................10
Account Value and Cash Value...................................................................................................14
Cash Value Credits.............................................................................................................15
Costs..........................................................................................................................16
Buying a Policy................................................................................................................19
Variable Investment Options....................................................................................................21
Additional Premiums............................................................................................................26
Keeping the Policy In Force....................................................................................................26
Transfers and Allocation Services..............................................................................................27
Loans..........................................................................................................................27
Partial Withdrawals............................................................................................................29
Surrenders.....................................................................................................................29
Accelerated Death Benefit......................................................................................................30
Medically-Related Waiver.......................................................................................................30
Risks..........................................................................................................................30
Other Rights...................................................................................................................31
The Separate Account...........................................................................................................31
Taxes..........................................................................................................................31
Available Information..........................................................................................................32
MISCELLANEOUS PROVISIONS AND ADDITIONAL DETAILS...................................................................................32
Providing Services to You......................................................................................................32
Designations...................................................................................................................33
Net Investment Factor..........................................................................................................33
Allocation Programs............................................................................................................33
Limitations on Transfers.......................................................................................................34
Death During the Grace Period..................................................................................................34
Reinstatement..................................................................................................................34
Maturity.......................................................................................................................34
Pricing Transactions...........................................................................................................34
Delaying Transactions..........................................................................................................35
Voting.........................................................................................................................35
Transfers, Assignments, Pledges................................................................................................36
Reports........................................................................................................................36
Incontestability...............................................................................................................36
Suicide........................................................................................................................36
Misstatement...................................................................................................................36
Policy Loans on Exchanges......................................................................................................36
Resolving Material Conflicts...................................................................................................37
Modification of the Separate Account...........................................................................................37
Entire Contract................................................................................................................38
Additional Tax Considerations..................................................................................................38
Safekeeping of the Assets......................................................................................................39
Regulation.....................................................................................................................39
Legal Matters..................................................................................................................40
Legal Proceedings..............................................................................................................40
Experts........................................................................................................................40
Distribution of this Offering..................................................................................................40
Illustrations..................................................................................................................41
Executive Officers and Directors...............................................................................................42
Financial Statements..................................................................................
Executive Officers and Directors...............................................................................................
Financial Statements for American Skandia Life Assurance Corporation and American Skandia Life Assurance Corporation Separate
Account F
Appendix A.....................................................................................................................45
Hypothetical Illustrations of Death Benefits, Account Values and Cash Values...................................................45
Appendix B.....................................................................................................................48
Multiple Factors for Determination of Minimum Required Death Benefits..........................................................48
Appendix C.....................................................................................................................50
Premium Tax Rates..............................................................................................................50
Appendix D.....................................................................................................................51
Guaranteed Maximum Monthly Cost of Insurance Charges...........................................................................51
Appendix E.....................................................................................................................53
Current Monthly Cost of Insurance Rates........................................................................................53
Appendix F.....................................................................................................................55
Description of the Calculation of Current Monthly Cost of Insurance Charges....................................................55
Appendix G
Maximum Annual Assessable Premiums per $1,000 of Specified Amount..............................................................56
Appendix H.....................................................................................................................58
Hypothetical Illustration of Accelerated Death Benefit.........................................................................58
DEFINITIONS
The following are key terms used in this Prospectus. Other terms are defined in
this Prospectus as they appear.
ACCOUNT VALUE is the value of your allocation to each Sub-account and any Fixed
Allocation, plus any earnings and less any losses, distributions and charges
thereon, plus the value of any amounts in the Loan Account, plus any earnings
and less any distributions and charges thereon, all before assessment of any
contingent deferred sales charge or Debt. Account Value is determined separately
for each Sub-account and each Fixed Allocation, as well as for any amounts in
the Loan Account, and then totaled to determine the Account Value of your entire
Policy.
AGE is the age of an Insured for purposes of this Policy. Initially, and for the
first Policy Year, it is the age last birthday of an Insured as of the Policy
Date. In each following Policy Year, it is the age last birthday of an Insured
as of the preceding Policy Anniversary.
APPLICATION is the form or combination of forms you must submit to apply for a
Policy. If there are two Insureds, the Application must be completed for both
Insureds.
ASSESSABLE PREMIUM is the portion of Premiums paid against which we assess any
applicable contingent deferred sales charge upon a surrender of the Policy.
BENEFICIARY is a person or entity you designate for us to pay any Death
Proceeds. Unless otherwise specified, Beneficiary refers to all persons or
entities so designated.
CASH VALUE is the Account Value less any contingent deferred sales charge, less
any unpaid charges and Debt.
CASH VALUE CREDITS are amounts we credit to your Account Value. We credit these
amounts if your total Cash Value on a Policy Anniversary equals or exceeds a
Cash Value trigger.
CODE is the Internal Revenue Code of 1986, as amended from time to time, and the
regulations thereunder.
DEATH BENEFIT is the amount payable as a result of an Insured's death before any
reduction due to Debt and any unpaid charges due and before addition of any
interest due pursuant to law. If there is a second Insured, the Death Benefit is
payable upon the death of the last surviving Insured.
DEATH PROCEEDS equals the Death Benefit less any reduction due to Debt and any
unpaid charges due and after addition of any interest due pursuant to law.
DEBT is the total of any outstanding loan and loan interest.
EXCHANGE POLICY is a Policy: (a) purchased as part of an exchange of life
insurance policies that does not incur any current taxation pursuant to Section
1035 of the Code or any successor provision; and (b) into which the surrender
value of one or more prior policies is contributed to the Policy in conjunction
with such exchange.
EXEMPT PREMIUM is the portion of Premiums paid against which we do not assess
any contingent deferred sales charge upon surrender or withdrawal and the amount
of any loans we establish in conjunction with your purchase of an Exchange
Policy.
FIXED ALLOCATION is an allocation of Account Value to our general account that
is credited a fixed rate of interest.
GUARANTEED MINIMUM DEATH BENEFIT is the minimum amount we guarantee is payable
as a result of the Insured's death, before we assess any unpaid charges due and
any reduction for Debt. However, this benefit does not apply once the Insured
reaches Age 100, or if there are two Insureds, when the younger Insured reaches
Age 100 or would have reached that Age if the younger Insured dies before the
older Insured.
IN WRITING is in a written form, in a manner we accept, that is satisfactory to
us and filed at our Office. We retain the right to specifically agree in advance
to accept communication regarding a specific matter by telephone or by some
other form of electronic transmission, in a manner we prescribe.
INSURED is the person upon whose life coverage is issued and as a result of
whose death the Death Proceeds are payable. If there is more than one Insured,
Insured means the last surviving Insured, unless otherwise stated.
ISSUE DATE is the date we issue your Policy.
LOAN ACCOUNT is where we maintain Account Value as collateral for a loan to you
from us.
MAXIMUM ANNUAL ASSESSABLE PREMIUM is the maximum amount of Premium against which
we will assess any contingent deferred sales charge upon surrender of the
Policy. We do not assess any contingent deferred sales charge upon surrender
against any portion of the Premium you pay that exceeds the maximum amount for
that Policy Year.
MEC is a modified endowment contract as defined in Section 7702A of the Code or
any successor provision thereto.
MEC THRESHOLD AMOUNT is the annual level amount of Premium which, if exceeded,
would cause the Policy to become a MEC.
MINIMUM REQUIRED DEATH BENEFIT is the minimum amount due as a result of the
Insured's death pursuant to the applicable test we apply in accordance with the
Code, prior to any reduction for Debt.
MONTHLY PROCESSING DAY/DATE is the Valuation Day each month when we deduct
charges from the Account Value. The first Monthly Processing Date is the Policy
Date. After that, the Monthly Processing Dates generally occur on the same day
of the month as the Policy Date. If the Monthly Processing Date occurs on a day
that is not a Valuation Day, the Monthly Processing Date that month will be the
next Valuation Day.
NET AMOUNT AT RISK is the difference between the Death Benefit, discounted to
the beginning of the applicable Policy Month at the rate of 4% per year, and the
Account Value.
NET PREMIUM is a Premium less the deduction for premium taxes, "DAC" taxes and
any amount deductible from Premium for an optional additional benefit should you
elect such benefits.
NET SINGLE PREMIUM is the amount that would be required, according to the Code
and the regulations based on the Code, to fund: (a) the Policy's Minimum
Required Death Benefit, assuming the current Minimum Required Death Benefit
would not change; and (b) future benefits and charges using assumptions about:
(i) growth of Account Value so that it would equal the current Minimum Required
Death Benefit as of the Policy Anniversary the Insured would turn Age 100; and
(ii) charges, as provided pursuant to the Code. The Net Single Premium depends
on the attained age, gender (where permitted) and risk class of the Insured. The
Net Single Premium changes as the Insured ages. The applicable Net Single
Premiums would change if required under the Code.
NEW POLICY is a Policy that is not an Exchange Policy.
OFFICE is our administrative office: American Skandia Life Assurance
Corporation, P.O. Box 290698, Wethersfield, Connecticut 06129-0698.
OWNER is either an entity or person who may exercise the ownership rights
provided by a Policy. If we issue a certificate representing interests in a
group life insurance policy, the rights, benefits, and requirements of and the
events relating to an Owner, as described in this Prospectus, will be your
rights as participant in such group policy. Unless later changed, Owner refers
to all persons or entities designated as such in your Policy.
POLICY is the insurance contract or certificate we issue as evidence of our
commitment to pay the Death Proceeds upon the death of the Insured.
POLICY ANNIVERSARY is the anniversary of the Policy Date.
POLICY DATE is the effective date of your Policy.
POLICY MONTH is the period from one Monthly Processing Day to the next.
POLICY YEARS are continuous 12-month periods that begin on the Policy Date and
each Policy Anniversary thereafter.
PORTFOLIO is a portfolio of an underlying mutual fund.
PREMIUM is each consideration you give to us for the rights, privileges and
benefits provided by a Policy according to its terms. This includes Premium paid
as of the Policy Date, as shown in the Policy, and any additional consideration
we choose to accept.
SEPARATE ACCOUNT is our separate account to which we allocate assets in relation
to our obligations for benefits based on the variable investment options.
American Skandia Life Assurance Corporation Separate Account F (also referred to
as Separate Account F)is the separate account utilized for the Policy.
SPECIFIED AMOUNT is a measure we use in determining the Death Benefit.
SUB-ACCOUNT is a division of the Separate Account.
UNIT is a measure used to calculate Account Value in a Sub-account.
UNIT PRICE is used for calculating: (a) the number of Units allocated to a
Sub-account; and (b) the value of transactions into or out of a Sub-account or
benefits based on Account Value in a Sub-account. Each Sub-account has its own
Unit Price, which will vary each Valuation Period to reflect the investment
experience of that Sub-account.
VALUATION DAY/DATE is every day the New York Stock Exchange is open for trading
or any other day that the Securities and Exchange Commission requires mutual
funds or unit investment trusts to be valued.
VALUATION PERIOD is the period of time between the close of business of the New
York Stock Exchange on successive Valuation Days.
"we," "us," "our," "American Skandia," or "the Company" means American Skandia
Life Assurance Corporation.
"you" or "your" means the Owner.
SUMMARY OF COSTS
The following is a summary of the cost of the Policies being offered, or, in the
case of costs that vary from Policy to Policy, a short description of how such
costs are determined. All of these costs are described in more detail within
this Prospectus.
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COST WHEN DEDUCTED AMOUNT DEDUCTED/
DESCRIPTION OF COST
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- ----------------------------------- --------------------------------- --------------------------------------------------------------
Premium Tax From each Premium payment Generally from 0% to 3.5% of Premium
- ----------------------------------- --------------------------------- --------------------------------------------------------------
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"DAC" Tax From each Premium payment 1.15% of Premium
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Mortality & Expense Risk Charge Daily 0.90% per year of the value of each Sub-account
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Administration Charge Daily 0.25% per year of the value of each Sub-account
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- ----------------------------------- --------------------------------- --------------------------------------------------------------
Cost of Insurance
Monthly Charge varies depending on a number of factors, including,
the Age, gender (where permitted) and risk class of
each Insured. (See Appendix D for information (Pro-rata
from the variable and The charge is assessed as an amount
per $1,000 of Net Amount at on guaranteed cost of
insurance fixed investment options in Risk. The rate per
$1,000 of Net Amount at Risk generally rates and Appendix E
for which you maintain Account increases as the Insured(s)
age(s). Current Cost of Insurance information on current
cost of Value) rates can be changed during the life of a
Policy, but are insurance rates) subject to guaranteed
maximum charges.
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- ----------------------------------- --------------------------------- --------------------------------------------------------------
Sales Charge Monthly for the 1st 10 Policy 0.40% per year of the Account Value
Years
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- ----------------------------------- --------------------------------- ------ ----- ----- ----- ----- ----- ----- ----- ----- ----- -
Contingent Deferred Sales Charge Upon Surrender Year 1 2 3 4 5 6 7 8 9 10
(Policy Years 1 through 10)
- ----------------------------------- --------------------------------- ------ ----- ----- ----- ----- ----- ----- ----- ----- ----- -
- ----------------------------------- --------------------------------- ------ ----- ----- ----- ----- ----- ----- ----- ----- ----- -
% 10 9 8 7 6 5 4 3 2 1
- ----------------------------------- --------------------------------- ------ ----- ----- ----- ----- ----- ----- ----- ----- ----- -
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Contingent Deferred Sales Charges are only assessed
against Assessable Premium. No Contingent Deferred Sales
Charge is assessed against Exempt Premium.
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Transfer Fee After the 12th transfer each $10.00
Policy Year
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Partial Withdrawal Transaction Fee Upon Partial Withdrawal $25.00
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Underlying Portfolio Expenses Daily Each Portfolio has different fees and charges as provided in
the "Variable Investment Options" section of this Prospectus.
Total Portfolio expenses range from 0.69% to 1.81%. More
detailed information about fees and charges can be found in
the prospectuses for the Portfolios.
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DESCRIPTION OF THE OFFERING
This Policy is described using a "question and answer" format that assumes you,
the prospective purchaser, are asking the questions. The description below is
divided into the following sections: Purchasers, The Insurance Company, Benefits
at the Insured's Death, Account Value and Cash Value, Cash Value Credits, Costs,
Buying a Policy, Variable Investment Options, Additional Premiums, Keeping the
Policy In Force, Transfers and Allocation Services, Loans, Partial Withdrawals,
Surrenders, Accelerated Death Benefit, Medically-Related Waiver, Risks, Other
Rights, The Separate Account, Taxes and Available Information. A section
addressing Miscellaneous Provisions and Additional Details about American
Skandia follows this description.
Purchasers
[1] .....Who should buy this Policy? Life insurance can be bought to meet a
number of needs of individuals or entities, such as corporations or trusts.
Different types of life insurance are designed to address certain needs more
than others. This Policy may be appropriate for a number of persons or entities,
but it may be especially useful for persons addressing a range of estate
planning needs who also may need access to some or all of the Cash Value to meet
supplemental retirement income needs or for emergency expenses. For estate tax
purposes, purchasers may want to consider placing this type of coverage in a
trust or transferring ownership of the Policy in an effort to remove the asset
from their estate, particularly if, at any point, the purchaser believes the
Cash Value may not be needed as a resource for other purposes. This Policy may
also be useful for persons seeking to make a sizable donation to a charity or
eligible non-profit organization, where the charity is named both Owner and
Beneficiary of the Policy, and the donor is named as the Insured. You should
carefully evaluate with your financial representative whether this Policy is
right for your specific needs in light of your entire situation and your
personal and financial goals. In particular, you should evaluate the advantages
and disadvantages of replacing any existing life insurance or annuity coverage
with this Policy. If you are seeking specific tax consequences, you should
consult with a competent tax advisor as to whether and how your goals may best
be achieved.
The Insurance Company
[2] .....Who is American Skandia? American Skandia Life Assurance Corporation is
organized as a stock insurance company domiciled in Connecticut. The predecessor
company of American Skandia was originally incorporated on May 21, 1969. We are
licensed as a life insurer in all 50 states and the District of Columbia. We are
a wholly owned subsidiary of American Skandia Investment Holding Corporation,
whose indirect parent is Skandia Insurance Company Ltd. Skandia Insurance
Company Ltd. is part of a group of companies whose predecessor began operations
in 1855. Two of our affiliates, American Skandia Marketing, Incorporated, and
American Skandia Information Services and Technology Corporation, may provide
certain administrative functions for us. We may also engage various independent
firms to provide various administrative functions for us. Another affiliate,
American Skandia Investment Services, Incorporated, currently acts as the
investment manager to American Skandia Trust, one of the underlying mutual funds
whose Portfolios are available as variable investment options. We currently
engage Skandia Investment Management, Inc., an affiliate whose indirect parent
is Skandia Insurance Company Ltd., as investment manager for our general
account. We are under no obligation to engage or continue to engage any
investment manager.
Benefits at the Insured's Death
[3] .....What benefits are due as a result of the Insured's death? The benefits
due as a result of the Insured's death are the Death Proceeds. If there are
joint Insureds, the benefits are due as a result of the death of the last
surviving Insured.
[4] .....What are the Death Proceeds? The Death Proceeds are based on the Death
Benefit as of the date we receive all our requirements for paying a death claim
and are satisfied that the death claim can be paid. These requirements include,
but are not limited to, receipt of a valid death certificate and information we
need to make payments to all Beneficiaries.
We determine the Death Proceeds by first subtracting any Debt and any unpaid
charges due from the Death Benefit. We then add any interest amount required by
law.
[5] .....What is the Death Benefit? The Death Benefit depends on the Death
Benefit option you select. Initially you select an option on your Application.
The Death Benefits options are Option A (Level) and Option B (Variable), as
discussed below.
[6] .....How is the Death Benefit determined under Option A? Under Option A
(Level), the Death Benefit on the Policy Date is the Specified Amount. After
that, the Death Benefit is the highest of the Specified Amount, the Minimum
Required Death Benefit and the Guaranteed Minimum Death Benefit, each as of the
date we receive due proof of death.
[7] .....How is the Death Benefit determined under Option B? Under Option B
(Variable), the Death Benefit on the Policy Date is the Specified Amount plus
the Account Value. After that, the Death Benefit is the highest of: the sum of
the Account Value plus the Specified Amount, the Minimum Required Death Benefit
and the Guaranteed Minimum Death Benefit, each as of the date we receive due
proof of death.
[8] .....Is there any age limit on the Death Benefit? Yes. On a single life
Policy, the Death Benefit equals the Account Value on or after the Policy
Anniversary the Insured attains Age 100. On a joint life Policy, the Death
Benefit equals the Account Value on or after the Policy Anniversary the younger
Insured, attains or, if that person is deceased, would have been, Age 100.
[9] .....What is the Specified Amount? The Specified Amount is a measuring
device we use in determining the Death Benefit before the Insured's Age 100. On
your Application, you indicate the Specified Amount you want us to issue. We may
issue that amount, or we may offer to issue a lower Specified Amount if the
Insured(s) do(es) not qualify for the amount you seek. The Specified Amount
remains level unless you request an increase or decrease and we agree to such a
change. Under certain circumstances, a partial withdrawal may also reduce the
Specified Amount, as discussed in the section on Partial Withdrawals.
[10] .....What is the Minimum Required Death Benefit? The Minimum Required Death
Benefit is the minimum amount that must be payable at the Insured's death,
before reduction for any Debt, for the Policy to be treated as life insurance
under the Code. The Minimum Required Death Benefit is determined by treating the
Account Value as if it were a Net Single Premium. We determine the Minimum
Required Death Benefit by multiplying the Account Value by a factor that varies
by the attained Age, gender (where permitted) and risk class of the Insured, as
shown in Appendix B. The gender and risk class of the Insured do not change, so
the only element that changes the factor after the Policy Date is the aging of
the Insured. The following are representative examples of the factors for
different Ages, genders and risk classes, as well as the amount of the Minimum
Required Death Benefit if the Account Value were $100,000.
Female, Age 45, not a tobacco user: The factor is 3.410489. $100,000
multiplied by 3.410489 results in a Minimum Required Death Benefit of
$341,048.90.
Male, Age 50, a tobacco user: The factor is 2.194450. $100,000
multiplied by 2.194450 results in a Minimum Required Death Benefit of
$219,445.00.
Female, Age 55, a tobacco user:
The factor is 2.298001. $100,000 multiplied by 2.298001 results in a
Minimum Required Death Benefit
of $229,800.10.
Male, Age 60, not a tobacco user: The factor is 1.919420. $100,000
multiplied by 1.919420 results in a Minimum Required Death Benefit of
$191,942.
The following example illustrates the effect of aging on the Minimum Required
Death Benefit.
The Insured is a woman, Age 60, for whom coverage was issued at her Age 50 in
the "not a tobacco user" risk class. On the Valuation Day before the Policy
Anniversary following the Insured's 60th birthday, the Account Value is
$100,000. The Minimum Required Death Benefit as required under the Code for this
Insured's age, gender, risk class and Account Value is $100,000 multiplied by
the applicable factor of 2.217943, which results in a Minimum Required Death
Benefit of $221,794.30. For the sake of this example, assume that the next
Valuation Day, which is the Policy Anniversary after the Insured's 60th birthday
(the day the Insured turns Age 60 for purposes of the Policy), the Account Value
remains $100,000. At the higher Age of 60, the Minimum Required Death Benefit on
the Policy Anniversary is $100,000 multiplied by the applicable factor of
2.153574, which results in a Minimum Required Death Benefit of $215,357.40.
We use a standard insurance industry method to determine the applicable factors
for Policies with two Insureds.
[11] .....What else can affect the Minimum Required Death Benefit? The Minimum
Required Death Benefit changes as the Account Value changes. This is because the
Minimum Required Death Benefit is calculated based on the Account Value. A few
examples may help show what this means. Assume for purposes of these examples
that the Insured is a woman, Age 60, for whom coverage was issued at her Age 50
in the "not a tobacco user" risk class.
(a) On a particular Monthly Processing Date, the Account Value of the
Policy is $100,000. The Minimum Required Death Benefit as of that
Valuation Day is $100,000 multiplied by the then applicable factor of
2.153574, or $215,357.40. As of the next Valuation Day, assume the
Account Value has grown to $100,010. The Minimum Required Death Benefit
is $100,010 multiplied by the same factor of 2.153574, or $215,378.94.
(b) On a particular Monthly Processing Date, the Account Value of the
Policy is $100,000. The Minimum Required Death Benefit as of that
Valuation Day is $100,000 multiplied by the then applicable factor of
2.153574, or $215,357.40. As of the next Valuation Day, assume the
Account Value has decreased to $99,990. The Minimum Required Death
Benefit is $99,990 multiplied by the same factor of 2.153574, or
$215,335.86.
(c) On a particular Monthly Processing Date, the Account Value of the
Policy before any partial withdrawal is $100,000. The Minimum Required
Death Benefit as of that Valuation Day is $100,000 multiplied by the
then applicable factor of 2.153574, or $215,357.40. On that same day,
assume $20,000 is taken as a partial withdrawal, and the $25.00 partial
withdrawal transaction fee is charged. Immediately after the partial
withdrawal, the Minimum Required Death Benefit is $79,975 multiplied by
the same factor of 2.153574, or $172,232.08.
[12] .....What is the Guaranteed Minimum Death Benefit? We use the Guaranteed
Minimum Death Benefit to determine the Death Proceeds under certain
circumstances. Under Option A, we use the Guaranteed Minimum Death Benefit when
it is higher than both the Specified Amount and the Minimum Required Death
Benefit. Under Option B, we use the Guaranteed Minimum Death Benefit when it is
higher than both the sum of the Account Value plus the Specified Amount, and the
Minimum Required Death Benefit. There is no Guaranteed Minimum Death Benefit
beyond Age 100 of the Insured, or if the policy terminates before the Insured's
death. The Guaranteed Minimum Death Benefit is determined as follows:
(a) On the Policy Date, the Guaranteed Minimum Death Benefit equals the
initial Premium.
(b) After the Policy Date and until the first Policy Anniversary, the
Guaranteed Minimum Death Benefit is the total of all Premiums paid less
any partial withdrawals.
(c) After the first Policy Anniversary but before the "target date," (the
Policy Anniversary when the Insured is Age 75), the Guaranteed Minimum
Death Benefit is the higher of (1) or (2), where: (1) is the total of
all Premiums paid less all partial withdrawals; and (2) is the highest
"Anniversary Value." "Anniversary Value" is the Account Value on any
Policy Anniversary less all subsequent partial withdrawals.
(d) On or after the "target date", the Guaranteed Minimum Death Benefit is
the higher of (1) or (2), where: (1) is the total of all Premiums paid
less all partial withdrawals and (2) is the highest Anniversary Value,
as defined above in (c), as of the "target date," less all partial
withdrawals after the "target date." If there are two Insureds, the
Guaranteed Minimum Death Benefit ends based on the Age of the younger
Insured, or what would have been the age of the younger Insured if the
younger Insured predeceases the older Insured.
(e) Notwithstanding items (a) through (d) above, if the Insured is Age 75
or older on the Policy Date, the Guaranteed Minimum Death Benefit is
the total of all Premiums paid less all partial withdrawals.
(f) If the Policy is issued for two (2) Insureds, the "target date" is
based on the age of the younger Insured, or what would have been the
age of the younger Insured if the younger Insured predeceases the older
Insured. This also applies if, as of the Policy Date, the younger
Insured is younger than Age 75.
[13] .....Would you please provide examples of how the Death Benefit is
determined? Below are six examples of how the Death Benefit is determined. Each
example assumes the death claim becomes payable exactly on the stated Policy
Anniversary. Values shown are hypothetical, including the amount of Premiums
paid, the Account Values shown as of the date the death claim is payable and the
Guaranteed Minimum Death Benefit then applicable.
The first three examples illustrate death benefit Option A. The first example is
a situation where the Death Benefit equals the Specified Amount. The second is
an example where the Death Benefit is the Minimum Required Death Benefit. The
third is an example where the Death Benefit is the Guaranteed Minimum Death
Benefit.
Examples four through six illustrate death benefit Option B. The fourth example
is a situation where the Death Benefit is the Specified Amount plus the Account
Value. The fifth is an example where the Death Benefit is the Minimum Required
Death Benefit. The sixth example is a situation where the Death Benefit is the
Guaranteed Minimum Death Benefit. In reviewing the examples for Option B, please
remember that the sum of the Specified and the Account Value is compared to the
Minimum Required Death Benefit and the Guaranteed Minimum Death Benefit.
The third and sixth examples assume that positive investment performance
significantly increased Account Value, which was then followed by a period of
substantial negative investment performance.
Each example assumes that we issue a Policy to a 50 year old man who qualifies
for the No Tobacco use class, we issued the Policy 6 months after his 50th
birthday, the Policy has a Specified Amount of $100,000 and there have been no
withdrawals. Please remember that these examples show the Death Benefit, and
that the Death Proceeds equal the Death Benefit reduced by any Debt and
increased by any required interest.
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
Death Total Policy Account Value Specified Minimum Guaranteed Death Benefit
Benefit Premiums Paid Anniversary Amount Required Minimum Death
Option Claim is Death Benefit Benefit
Payable
--------------- --------------- --------------- --------------- --------------- --------------- ---------------
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
A $15,000 1 $15,500 $100,000 $40,018 $15,500 $100,000
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
A $105,000 12 $185,000 $100,000 $345,527 $200,000 $345,527
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
A $105,000 20 $50,000 $100,000 $76,653 $200,000 $200,000
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
B $15,000 1 $15,500 $100,000 $40,018 $15,500 $115,500
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
B $105,000 20 $200,000 $100,000 $306,611 $200,000 $306,611
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
B $105,000 25 $50,000 $100,000 $69,169 $200,000 $200,000
------------ --------------- --------------- --------------- --------------- --------------- --------------- ---------------
[14] .....Does choosing between Options A and B affect anything other than the
Death Benefit? Yes. Choosing Option A or Option B affects the Net Amount at Risk
which will have an impact on the amount you pay in cost of insurance charges.
Option B initially has a higher Net Amount at Risk which will result in a higher
cost of insurance charge. It may also have an impact on what you might pay upon
surrender. How these charges work are discussed in more detail below in the
section on Costs. An increase in charges has a negative impact on the growth of
your Account Value. A decrease in charges has a positive impact on the growth of
your Account Value.
[15] .....Who chooses which option to use? You choose the option on your
Application for a Policy. If you do not elect a Death Benefit option on your
Application we will review the Application to determine if our underwriting
requirements are met. However, we will require you to elect either Option A or
Option B prior to issuing a Policy.
[16] .....May I change the Death Benefit option or the Specified Amount? While
the Insured is alive, you may request to change the Death Benefit option or to
increase or decrease the Specified Amount to meet changing needs or goals.
Any change to the Death Benefit option is subject to our acceptance and our
rules, which include, but are not limited to the following:
1. Any change must take effect after the first Policy Year.
2. We only permit one such change per Policy Year.
3. We must receive the request In Writing at our Office.
4. We may require satisfactory evidence of insurability for any change that
prospectively increases the Net Amount at Risk.
5. If evidence of insurability is required, we will not accept the request
if the Insured(s) is over our then current maximum age for issuing a
Policy.
6. We may require you to sign an acknowledgment that you understand the
impact or potential impact of the change on the tax treatment of your
Policy, particularly if the change results or may result in your Policy
becoming a MEC. Changing between Option A and Option B also may have an
impact on whether a Policy is treated as a MEC. Therefore, you should
consult with a competent tax advisor before requesting a change.
7. If we grant any such request, it will take effect on the Monthly
Processing Day occurring on or immediately following the date we agree
to such a change.
8. On the date the change takes effect, there will be no change in the
Death Benefit. That means that, if you change from Option A to Option
B, the Specified Amount will be reduced.
Any change to the Specified Amount is subject to our rules, which include, but
are not limited to the seven rules outlined above for changing the Death Benefit
option, plus the following additional rules:
1. The amount of any increase or decrease may not be less than $5,000.
2. The Specified Amount after any decrease may not be less than $50,000 (single
life Policy) or $100,000 (joint life Policy).
3. No decrease in the Specified Amount is permitted during the first five Policy
Years or during the five calendar years subsequent to any increase in Specified
Amount.
[17] .....What other parts of the Policy are affected if I change the Specified
Amount? Increasing the Specified Amount initially results in a higher Death
Benefit, unless the increased Specified Amount would then not exceed the Minimum
Required Death Benefit or the Guaranteed Minimum Death Benefit. When the Death
Benefit is increased in this way, it initially increases the Net Amount at Risk,
and therefore, the cost of insurance charge. Decreasing the Specified Amount
generally has the opposite effects. Changing the Specified Amount could affect
the maximum Premiums you may pay, as well as the Maximum Annual Assessable
Premium. Also, if your policy is not deemed to be a MEC, changing the Specified
Amount may affect how much Premium you may subsequently pay without the Policy
becoming a MEC.
[18] .....How are Death Proceeds paid? We pay the Death Proceeds as a lump sum
or in accordance with the terms of whatever settlement options we then make
available to Beneficiaries. Generally, Beneficiaries can choose a lump sum or
one of the settlement options we make available. However, you, rather than the
Beneficiaries, may choose the method of payment from among those we make
available if you let us know In Writing before the Insured's death how you want
the Death Proceeds to be paid.
Account Value and Cash Value
[19] .....What is the Account Value? The Account Value is the value of a Policy
while the Insured is alive before any deduction for any contingent deferred
sales charge and before any reduction for any Debt. It is the total of the
Account Value allocated to each Sub-account and any Fixed Allocations plus any
Account Value in the Loan Account. You may allocate Account Value to the
variable investment options, which are each of the Sub-accounts of the Separate
Account, or to Fixed Allocations. Any portion of the Account Value maintained in
the Loan Account serves as collateral for outstanding Policy loans.
[20] .....How does American Skandia determine the Account Value in the variable
investment options? On each Valuation Date, the Account Value in any variable
investment option you utilize equals the number of Units you then maintain in
that investment option multiplied by that investment option's then current Unit
Price. When you allocate all or a portion of the Premium to an investment option
or when you transfer Account Value into a variable investment option, Units are
purchased using the then current Unit Price. When you take all or a portion of a
distribution or benefit from a variable investment option or you transfer
Account Value from a variable investment option, Units are sold at the then
current Unit Price in order to fund that distribution, benefit or transfer.
[21] .....How does American Skandia determine the Account Value for Fixed
Allocations? We credit a fixed rate of interest to Fixed Allocations. From time
to time we declare interest rates applicable to new Fixed Allocations. If you
make a Fixed Allocation, we credit the rate then in effect to that Fixed
Allocation until the next Policy Anniversary. Once that Policy Anniversary is
reached, we credit, for the next Policy Year, the then current rate applicable
to new Fixed Allocations. This applies to all your Fixed Allocations then in
effect. During each subsequent Policy Year, the rate we credit for that Policy
Year is the one then in effect for new Fixed Allocations.
The Policy offered pursuant to this Prospectus includes Fixed Allocations. These
Fixed Allocations are not registered as a security with the Securities and
Exchange Commission under either the Securities Act of 1933 or the Investment
Company Act of 1940. The Fixed Allocations are not subject to these Acts.
Information about the Fixed Allocations is included in this Prospectus to help
with your understanding of the features of the Policy. The staff of the
Securities and Exchange Commission has not reviewed this information. However,
the information may be subject to certain generally applicable provisions of the
Federal securities laws regarding accuracy and completeness. The assets
supporting Fixed Allocations are held in American Skandia's general account.
[22] .....How does American Skandia determine the interest rate for Fixed
Allocations? We determine the interest rate applied to Fixed Allocations based
on our assessment of the earnings we expect to achieve when investing to support
these obligations, our costs, competition, profit targets and other factors. We
have sole discretion to determine the rates. However, the interest rate will
never be less than 3.0% per year, compounded yearly.
[23] .....How does American Skandia determine the Account Value in the Loan
Account? As of the date of this Prospectus, we currently credit interest to
Account Value in the Loan Account at the rate of 6.0% per year, compounded
yearly. However, to the extent permitted by law, we retain the right to credit
less, but never less than [ ]% per year, compounded yearly.
[24] .....What is the Cash Value? The Cash Value is the total Account Value less
any contingent deferred sales charge, unpaid charges and Debt.
[25] .....Do I have to maintain a minimum Cash Value? There must always be
enough Cash Value so that, on any Monthly Processing Date, the Cash Value is
sufficient to pay for the charges then due. If the Cash Value is insufficient to
pay for the charges, we send you a notice giving you a 61-day "grace period" to
send us a required amount. If the Cash Value at the end of the grace period,
after deduction for all previously unpaid charges, is zero or less, the Policy
ends without value, unless the guaranteed continuation provision applies. This
provision is discussed in the section "Keeping the Policy In Force".
Cash Value Credits
[26] .....What are Cash Value Credits, and how do I get them? Cash Value Credits
are amounts we credit to your Account Value, where permitted by law. We provide
these amounts if your total Cash Value on a Policy Anniversary equals or exceeds
a Cash Value trigger. We determine if your Policy is eligible for a Cash Value
Credit on each Policy Anniversary. Your Policy's eligibility for Cash Value
Credits may change from year to year. The Cash Value trigger depends on the
total amount of Premiums paid. Whether your Cash Value meets or exceeds the
trigger depends on the investment performance of the investment options, partial
withdrawals, Debt and whether you pay back any loans or loan interest.
[27] .....What is the Cash Value trigger? The Cash Value trigger is 200% of the
Premiums you pay. Please note, even if your Account Value is greater than the
Cash Value trigger, you may not have reached the trigger amount, since the Cash
Value may be less than the Account Value due to the contingent deferred sales
charge and any Debt.
[28] .....How much is added to my Account Value? The Cash Value Credit, if any,
added to your Account Value equals 0.50% of the Cash Value on the applicable
Policy Anniversary. The following examples illustrate how this works:
(a) Assume that the total amount of Premiums paid is $70,000. Assume
that on the 14th Policy Anniversary the Cash Value is $150,000.
The Cash Value trigger is 200% of $70,000, which is $140,000. The
amount to be added to the Account Value is 0.50% of $150,000,
which is $750.
(b) For the same Policy, assume that the Cash Value on the 15th Policy
Anniversary is $115,000, due to a combination of investment
performance and a loan of $25,000 in the middle of the Policy
Year. The Cash Value trigger for this Policy remains $140,000.
Therefore, no Cash Value Credit is provided on the 15th Policy
Anniversary.
(c) For the same Policy, assume that the Cash Value on the 16th Policy
Anniversary is $160,000, due to a combination of investment
performance and repayment of the loan and loan interest. The Cash
Value trigger remains $140,000. The amount to be added is 0.50% of
$160,000, which is $800.
[29] .....Who pays for the Cash Value Credits, and how are they paid? We pay for
any Cash Value Credits out of our general account. We allocate any Cash Value
Credits due on the applicable Policy Anniversary to the variable investment
options and Fixed Allocations in which you then maintain Account Value. We make
the allocations pro-rata based on the Account Value in the variable investment
options and any Fixed Allocations on the applicable Policy Anniversary. No
allocation is made to the Loan Account. Cash Value Credits cannot be used to
repay Debt.
Costs
[30] .....What kinds of charges are there for this Policy? The Policy has five
(5) different kinds of charges: (1) charges we deduct from Premiums; (2) charges
we assess daily against assets maintained in the Separate Account, which only
apply to the Account Value you allocate to the variable investment options; (3)
charges we deduct monthly from the Account Value and which are due in all Policy
Years to Age 100; (4) charges we deduct monthly from the Account Value for a
specified number of Policy Years; and (5) "contingent" charges, which are those
charges that you only pay in certain specified circumstances. There also are
fees and expenses charged by the Portfolios.
[31] .....What charges are deducted from Premiums? We deduct a percentage of
each Premium in relation to state and local premium taxes we may incur on that
Premium, and an amount in relation to our Federal taxes. We deduct these charges
before we allocate the net amount to the investment options.
[32] .....How much is charged for premium taxes? The amount we charge is based
on the rates determined by state and local governments. In most jurisdictions
these rates range for 0% to 3.5% of each Premium. The actual percentages we
charge for the states and the District of Columbia as of the date of this
Prospectus are found in Appendix C.
[33] .....What is the charge in relation to the Company's Federal taxes? The
Code requires a life insurer to capitalize an imputed acquisition expense,
thereby increasing its tax liability over what it would be without this special
provision. The tax liability created by this imputed acquisition expense is
sometimes referred to as a "deferred acquisition cost" tax, or "DAC" tax. To
reimburse us for this special insurance company tax at a rate we believe to be
reasonable in relation to the liability, we deduct an amount equal to 1.15% of
each Premium.
[34] .....What are the charges assessed against the Separate Account and when
are they paid? We assess a mortality and expense risk charge and an
administration charge against the assets in the Separate Account. The mortality
and expense risk charge is 0.90% per year. The mortality risk we assume is that
cost of insurance charges under the Policy will be insufficient to meet our
claims paying obligations. The expense risk we assume is that overall expenses
incurred in issuing and administering the Policy will exceed the charges and
fees stated in the Policy. The charge for the administrative expenses connected
with operating the Separate Account is 0.25% per year. We assess these charges
each Valuation Period against the daily value of each Sub-account. We reserve
the right to assess the Separate Account for any taxes that may be attributed to
it. Currently, no such charge for taxes is assessed.
[35] .....What monthly charge applies in all Policy Years to Age 100? We deduct
the cost of insurance charge until the Policy Anniversary on or immediately
after the Insured's 100th birthday. For Policies with two Insureds, this is the
Policy Anniversary on or after the 100th birthday of the younger Insured, or if
that person is deceased, what would have been that Insured's 100th birthday. We
take this charge from your Account Value each Monthly Processing Day.
[36] .....How much is the cost of insurance charge? The monthly cost of
insurance charge is determined by multiplying the current monthly cost of
insurance rate by the Net Amount at Risk. To that amount we add a cost of
insurance fee. The current cost of insurance rates and cost of insurance fee are
subject to change; however, the combination will not exceed the product of the
guaranteed maximum cost of insurance charge multiplied by the Net Amount at
Risk. The cost of insurance charge is not a constant dollar amount.
Please note that in calculating the Net Amount at Risk, the Death Benefit that
would then apply is the highest of the Minimum Required Death Benefit, the
Guaranteed Minimum Death Benefit or, the Specified Amount (for Option A), or the
sum of the Specified Amount plus the Account Value (for Option B). The cost of
insurance rates increase as the Insured ages, although the rates may not
increase each Policy Year. We reserve the right to vary the rates per thousand
of Net Amount at Risk based on either the Net Amount at Risk or on the Specified
Amount.
We reserve the right to adjust current monthly cost of insurance rates by an
underwriting factor. As of the date of this Prospectus, we were not making any
such adjustments.
The guaranteed maximum monthly cost of insurance charges for Policies with one
Insured are shown in Appendix D. The current monthly cost of insurance rates as
of the date of this Prospectus for Policies with one Insured are shown in
Appendix E. Corresponding rates for two proposed Insureds are available from us
upon request. A detailed explanation of how we calculate the current monthly
cost of insurance charges and a sample calculation are provided in Appendix F.
[37] .....What is the guaranteed maximum cost of insurance charge? The
guaranteed maximum cost of insurance charge is different at each Age. The
guaranteed maximum cost of insurance charge depends on the risk class of each
Insured. We base the guaranteed maximum charges on the sex distinct 1980
Commissioners Standard Ordinary Ultimate Mortality Smoker/Non-Smoker Table, age
last birthday. However, if required by law, unisex charges will apply, and we
will use a unisex variation of that table.
[38] .....What monthly charges apply only for a specified number of Policy
Years? We deduct a sales charge for a specified number of Policy Years.
[39] .....How much is the sales charge and when do I pay it? We deduct the sales
charge during the first ten (10) Policy Years. It is a percentage of your
Account Value and is the equivalent of 0.40% per year. We deduct this charge
from your Account Value each Monthly Processing Day.
There are certain circumstances which may result in reduction or elimination of
the sales charge. These are exactly the same circumstances that may result in
reduction or elimination of the contingent deferred sales charge, as described
below in response to the question "How much is the contingent deferred sales
charge and when must I pay it?"
[40] .....What are the contingent charges? The contingent charges are: (1) the
contingent deferred sales charge; (2) the transfer fee; and (3) the partial
withdrawal transaction fee.
[41] .....How much is the contingent deferred sales charge, and when must I pay
it? The contingent deferred sales charge is a percentage of the Assessable
Premium paid. It is charged if you surrender the Policy during the first ten
(10) Policy Years, unless the Policy qualifies for a medically-related waiver of
these charges, as discussed in the section of this Prospectus entitled
"Medically-Related Waiver".
The percentages that we assess against Assessable Premium upon a surrender are
as follows:
---------------------- -------------------
Policy Year Percentage (%)
---------------------- -------------------
---------------------- -------------------
1 10
---------------------- -------------------
---------------------- -------------------
2 9
---------------------- -------------------
---------------------- -------------------
3 8
---------------------- -------------------
---------------------- -------------------
4 7
---------------------- -------------------
---------------------- -------------------
5 6
---------------------- -------------------
---------------------- -------------------
6 5
---------------------- -------------------
---------------------- -------------------
7 4
---------------------- -------------------
---------------------- -------------------
8 3
---------------------- -------------------
---------------------- -------------------
9 2
---------------------- -------------------
---------------------- -------------------
10 1
---------------------- -------------------
---------------------- -------------------
11+ 0
---------------------- -------------------
[42] .....How does American Skandia determine the Assessable Premium? The
Assessable Premium equals the total Premiums less the total Exempt Premiums.
[43] .....What are Exempt Premiums? Exempt Premiums are the amounts against
which we will not charge a contingent deferred sales charge upon surrender or
withdrawal.
[44] .....How does American Skandia determine which Premium amounts are Exempt
Premiums? Exempt Premiums are that portion of Premiums paid in any Policy Year
that exceeds the Maximum Annual Assessable Premium.
[45] .....What is the Maximum Annual Assessable Premium? The Maximum Annual
Assessable Premium is an amount per thousand of Specified Amount. The amount is
cumulative from year to year. For example, if your Maximum Annual Assessable
Premium is $5,000 and you make a Premium payment of $4,000 in Policy Year 1, in
Policy Year 2 your Maximum Annual Assessable Premium is $5,000 plus $1,000 from
Policy Year 1, or $6,000. The Maximum Annual Assessable Premium depends on the
Age, risk class and, where permitted, gender of the Insured. The Maximum Annual
Assessable Premium is increased if you increase the Specified Amount, and is
decreased if you decrease the Specified Amount. We have provided a table in
Appendix G of the Maximum Annual Assessable Premium for Policies with one
Insured and two Insureds.
[46] .....Please provide examples of what it would cost to surrender the Policy
The following are two hypothetical examples of how much it would cost to
surrender the Policy. In each example, it is assumed that neither the Specified
Amount nor the Death Benefit option is changed after the Policy Date.
(1) In this first example, assume that the Policy is a New Policy.
Assume also: (a) the Maximum Annual Assessable Premium is $10,000;
(b) $10,000 of Premium was paid in each of Policy Years 1 through
5, for a total of $50,000; (c) the Policy is being surrendered in
Policy Year 6; and (d) at the time of surrender, the Account Value
is $75,000.
Given these facts, the Assessable Premium equals the Premiums
paid. No amount paid in any Policy Year exceeded the Maximum
Annual Assessable Premium. The contingent deferred sales charge
for a surrender in Policy Year 6 is 5% of the Assessable Premium
(5% of $50,000 or $2,500). The amount payable upon surrender would
be $75,000 less $2,500, which equals $72,500
(2) In this second example, assume that the Policy is an Exchange
Policy. Assume also: (a) the Maximum Annual Assessable Premium is
$10,000; (b) the proceeds of the exchange were $50,000, which was
the initial Premium, and $5,000 of subsequent Premium was paid in
the second Policy Year; (c) the Policy is being surrendered in
Policy Year 6; and (d) at the time of surrender, the Account Value
is $85,000.
Given these facts, the Assessable Premium is less than the
Premiums paid. The amount of Premium paid in the first Policy Year
over $10,000 is Exempt Premium. Since $50,000 was paid in the
first Policy Year, the amount of the Exempt Premium paid in that
Policy Year was $50,000 minus $10,000, which is $40,000. There was
no Exempt Premium in the second Policy Year, since $5,000 is less
than the applicable Maximum Annual Assessable Premium for the
second Policy Year, which is $10,000. Since there has not been a
change to the Specified Amount or Death Benefit option, the
percentage to be assessed will be assessed against $55,000 of
Premium less $40,000 of Exempt Premium, which equals $15,000. The
contingent deferred sales charge for a surrender in Policy Year 6
is 5% of the Assessable Premium (5% of $15,000 or $750). The
amount payable upon surrender would be $85,000 less $750, which is
$84,250.
[47] .....Are there any situations in which the sales charge and the contingent
deferred sales charge are reduced or eliminated? From time to time, and to the
extent permitted by law, we may reduce the amount of the sales charge and the
contingent deferred sales charge, the period during which such charges apply, or
both, when Policies are sold to persons or groups of persons in a manner that
reduces sales expenses. We would consider such factors as: (a) the size and type
of group; (b) the amount of Premiums; and/or (c) other transactions where sales
expenses are likely to be reduced.
No sales charge or contingent deferred sales charge is imposed when, as of the
Policy Date, the Owner or the Insured of a Policy issued pursuant to this
Prospectus is: (a) any parent company, affiliate or subsidiary of ours; (b) an
officer, director, employee, retiree, sales representative, or in the case of an
affiliated broker-dealer, registered representative of such company; (c) a
director, officer or trustee of any underlying mutual fund; (d) a director,
officer or employee of any investment manager, sub-advisor, transfer agent,
custodian, auditing, legal or administrative services provider that is providing
investment management, advisory, transfer agency, custodianship, auditing, legal
and/or administrative services to an underlying mutual fund or any affiliate of
such firm; (e) a director, officer, employee or registered representative of a
broker-dealer or insurance agency that has a then current selling agreement with
us and/or with American Skandia Marketing, Incorporated; (f) a director,
officer, employee or authorized representative of any firm providing us or our
affiliates with regular legal, actuarial, auditing, underwriting, claims,
administrative, computer support, marketing, office or other services; (g) the
then current spouse of any such person noted in (b) through (f) above; (h) the
parents of such person noted in (b) through (g) above; (i) such person's
child(ren) or other legal dependent under the age of 21; and (j) the siblings of
any such persons noted in (b) through (h) above.
[48] .....How much is the transfer fee and when must I pay it? We charge $10.00
for every transfer after the 12th in each Policy Year. That includes transfers
into a Fixed Allocation and any transfers from a Fixed Allocation unless the
transfer occurs on a Policy Anniversary. It does not include transfers made as
part of any dollar cost averaging program we offer. For this purpose, all
transfers occurring during the same Valuation Period are considered one
transfer. We assess the transfer fee at the time of any transfer which is
subject to the fee.
[49] .....How much is the partial withdrawal transaction fee, and when must I
pay it? We charge $25.00 as a transaction fee for each partial withdrawal unless
the partial withdrawal qualifies as a medically-related withdrawal. This amount
is deducted separately from your Account Value.
[50] .....How are charges deducted from Account Value? We deduct charges from
your investment options pro-rata based on the Account Value in each investment
option. If you maintain Account Value in more than one Fixed Allocation in a
Policy Year, any applicable charges will be deducted on a "last-in, first-out"
basis, starting with the last Fixed Allocation that was made prior to the
Monthly Processing Date the deduction is made. Upon surrender or withdrawal, we
assess charges against the investment options pro-rata in the same ratio as
Account Value is being withdrawn from such investment options.
[51] .....What are the charges for the Portfolios? We do not assess any charges
against the Portfolios. However, each Portfolio charges a total annual fee
comprised of an investment management fee and operating expenses. Expenses for
the Portfolios are provided in the "Variable Investment Options" section below.
More detailed information about fees and charges can be found in the
prospectuses for the Portfolios.
Buying a Policy
[52] .....How do I buy a Policy? We require that our standards be met and that
we receive a Premium before we issue a Policy. We need information to determine
if those standards have been met. We require you to submit an Application as
part of our effort to gather the needed information. We may require additional
information, including, but not limited to, some of the Insured's medical
records. We may also require the Insured to take certain medical tests. As part
of our standards, we will not issue a Policy if, as of the Policy Date, the
Insured would be younger than Age 18 or older than Age 80. If our standards are
not met and we received a Premium, we will return an amount equal to the Premium
to you. No interest will be paid.
To the extent permitted by law, we reserve the right to apply differing
standards of insurability to persons who may be part of a group or who may
qualify, for some other reason, as part of a different class. Such classes may
include, but are not limited to, persons seeking a Policy who are applying all
or a portion of proceeds from an insurance or annuity contract, or proceeds of a
redemption from another financial product, such as mutual funds. One of the
criteria we may apply in such a situation is that such differing standards of
insurability apply only after maintaining funds in such policy, contract, or
financial product for a specified period of time.
[53] .....When do I pay the initial Premium? You may submit Premium with the
Application if the Insured meets certain medical underwriting criteria.
If any portion of any Premium is to be received as part of a replacement of a
life insurance policy (whether or not a tax-free exchange), endowment or annuity
policy then we must receive all our requirements In Writing for all such
replacements as of the same date. This date must be prior to the date we decide
to issue a Policy. Replacements are subject to our acceptance.
If we do not accept Premium with the Application or you chose not to submit a
Premium with the Application, we will notify you if and when we have accepted
the Application and agreed, subject to submission of the Premium, to issue a
Policy. We will let you know at that time the minimum and maximum amounts we
accept as the initial Premium. We will not issue a Policy until we receive at
least the minimum initial Premium at our Office.
You may choose to use our funds transfer authorization procedures as part of
buying a Policy. If you elect this procedure, you authorize us to redeem funds
from one or more financial institutions with which you currently maintain funds
and use those funds to pay Premium. You must do so In Writing using a form that
authorizes us to obtain such funds only if and when we have determined that the
Application meets our standards for issuing a Policy. If you use this procedure,
you must provide us with all such authorizations simultaneously.
[54] .....What is the initial Premium? There is not a fixed amount of initial
Premium. Instead, we accept a range of initial Premium between a minimum and a
maximum. The minimum and maximum depends on the Specified Amount and the
Insured's age, risk class and gender, where permitted, as of the Policy Date.
[55] .....What is the maximum initial Premium I can pay? The maximum initial
Premium we accept equals the maximum amount that can be paid without increasing
the Death Benefit on the Policy Date. However, if you submit any Premium before
we have determined whether you meet our requirements for issuing a Policy, we
will not accept more than $500,000 without prior Home Office approval.
[56] .....What is the minimum initial Premium I can pay? The minimum Premium we
generally accept as an initial Premium is one fourth (1/4th) of the Maximum
Annual Assessable Premium. We may accept less under certain circumstances, such
as when you authorize periodic withdrawals from an account you may have with a
bank or other financial institution in amounts designed to cumulatively pay
amounts equal to at least one fourth (1/4th) of the MEC Threshold Amount.
[57] .....Will you accept my initial Premium if it causes my Policy to be
treated as a MEC? We will not apply the portion of an initial Premium that we
believe would require us to treat your Policy as a MEC unless you acknowledge In
Writing before the Policy Date that we will treat the Policy as a MEC. If we do
not receive such notification, we will return to you the difference between the
amount you submitted and the amount we will apply as the initial Premium.
However, this will not apply in the case of an Exchange Policy where we receive
information we believe requires us to treat the Exchange Policy as a MEC in any
case.
[58] .....Am I covered while my Application is being reviewed? We may issue you
a temporary insurance agreement during the "underwriting period." The
"underwriting period" is the period between the time you first apply for a
Policy and the time we either issue the Policy or decide not to issue one. A
temporary insurance agreement may be issued if: (a) the Application is completed
in full; (b) the Insured answers "no" to certain questions on the Application
(these are questions we use as indicators of whether we will issue temporary
insurance); (c) no Insured is under age 18; and (d) a Premium is submitted with
the Application. If we issue a temporary insurance agreement and the Insured
(both Insureds if there are two Insureds) dies during the underwriting period,
the temporary insurance benefit will be payable if all the conditions of the
temporary insurance agreement are satisfied. If the Insured(s) die(s) during the
underwriting period and no temporary insurance agreement was in effect, no
benefit is payable.
We will return any Premium submitted with the Application if we cannot complete
underwriting within 60 days from the date the Application is signed. If you
notify us promptly, we will continue the underwriting process and notify you if
and when you meet our standards for issuing a Policy, at which time you may once
again send us a Premium. Temporary insurance lasts no longer than 90 days.
[59] .....What is the temporary insurance benefit? If the Insured dies while
temporary insurance is in effect, we pay the Beneficiary the lesser of the Death
Benefit that would be in effect on the Policy Date if a Policy had been issued
or $250,000. This $250,000 maximum applies to all temporary insurance then in
effect with us. Premium amounts in excess of this benefit are returned to you,
without interest or earnings.
[60] .....What happens if I change my mind about buying a Policy? You have a
"free-look" period during which you can change your mind about buying a Policy.
The free-look period is never less than 10 days from the date you receive your
Policy. It may be longer depending on the applicable state law and the
circumstances of your purchase. If you return your Policy to us within the
free-look period, we generally will return the greater of (1) the Premiums paid,
or (2) your Account Value plus an amount that equals any premium tax and DAC tax
deducted and any charges deducted from your Account Value. However, if you have
submitted a "return waiver," we will return only your Account Value plus any
premium and DAC taxes deducted and any charges deducted from your Account Value.
This may be more or less than the Premiums paid.
[61] .....How and when is my initial Premium invested? We invest your Net
Premium, which is the Premium less the charges deducted from each Premium and
any charge for optional additional benefits (should you elect such benefits). We
invest the initial Net Premium on the Policy Date. You can request that we
allocate the initial Net Premium using one or more variable investment options
and/or a Fixed Allocation. However, we initially invest the portion of the
initial Net Premium that you indicate you want invested in variable investment
options in the AST Money Market Sub-account, unless you submit a "return waiver"
In Writing before the Policy Date, where permitted by law. This also applies to
any additional Premium we receive during the "free-look" period discussed below.
A return waiver is an election by you to invest as soon as possible in the
variable investment options of your choice. If you submit a "return waiver" and
then decide to return your Policy during the "free-look" period, you may receive
back less than the Premium. Generally, we transfer the Account Value in the AST
Money Market Sub-account to the variable investment options you request as of
the Valuation Date which is on or immediately after the 15th day after the date
we issue a Policy. However, we will make the transfer as of a later date if your
"free-look" period is longer than 10 days to meet state law requirements.
[62] .....How do I choose how much of this type of life insurance to buy, which
Death Benefit Option to use and how much Premium to pay? The Death Benefit
Option, Specified Amount and the program of Premium payments that is right for
your needs depends on your particular circumstances and the reasons you are
buying a Policy. You and your financial representative should discuss your needs
and financial goals before applying for a Policy.
Variable Investment Options
[63] .....What are the investment objectives and policies of the variable
investment options? What charges are made by the Portfolios in which these
options invest? Each variable investment option is a Sub-account of the Separate
Account. Each Sub-account invests exclusively in an underlying mutual fund or
one portfolio of an underlying mutual fund. Details about the investment
objectives, policies, risks, costs and management of the Portfolios are found in
the prospectuses for the underlying mutual funds. You should carefully read the
prospectuses for any Portfolio in which you are interested. To assist you in
determining which Portfolios may be of interest to you, we have provided below a
list of the Portfolios, their investment objectives (in italics) and a short,
summary description of their key policies. Next to each Portfolio's investment
objective and policies is the investment management fee, other expenses, and the
total annual expense for such Portfolio. The total annual expense is the sum of
the investment management fee and other expenses. Each figure is stated as a
percentage of the Portfolio's average daily net assets. Except as noted, all
expenses shown are after any applicable reimbursement or waiver of fees. These
percentages are fees for the calendar year that ended December 31, 1997. Those
Portfolios below that are marked with an asterisk (*) have not been in operation
for a full year. Therefore, the expenses shown are estimated and annualized. The
underlying mutual fund portfolio information was provided by the underlying
mutual funds and has not been independently verified by the Company.
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Investment Other Total
Style/ Investment Objectives/Policies Management Expenses Annual
Type Fee Expenses
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
AST JanCap Growth: growth of capital in a manner consistent with the
preservation of capital. The Portfolio pursues its objective by 0.88% 0.18% 1.06%(1)
emphasizing investments in common stocks.
LARGE CAP
GROWTH
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AST Marsico Capital Growth*: to seek capital growth. Income realization
is not an investment objective and any income realized on the Portfolio's
investments, therefore, will be incidental to the Portfolio's objective.
The Portfolio will pursue its objective by investing primarily in common 0.90% 0.21% 1.11%
stocks in industries and companies the sub-advisor believes are
experiencing favorable demand for their products and services, and which
operate in a favorable competitive and regulatory environment.
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Alger American Growth: long-term capital appreciation. Except during
temporary defensive periods, the Portfolio invests at least 65% of its 0.75% 0.04% 0.79%
total assets in equity securities of companies that, at the time of
purchase, have total market capitalization of $1 billion or greater.
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Alger American MidCap Growth: long-term capital appreciation. Except
during temporary defensive periods, the Portfolio invests at least 65%
of its total assets in equity securities of companies that, at the time 0.80% 0.04% 0.84%
of purchase of the securities, have total market capitalization
within the range of companies included in the S&P MidCap 400 Index,
updated quarterly.
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AST Bankers Trust Enhanced 500*: to outperform the Standard & Poor's 500
Composite Stock Price Index (the "S&P 500(R)") through stock selection
resulting in different weightings of common stocks relative to the index.
The Portfolio will include the common stocks of companies included in the 0.60% 0.20% 0.80%(2)
S&P 500(R). While the majority of the issues held by the Portfolio will
the S&P 500, approximately 100 will be over- or
have neutral weightings to under-weighted relative to the index.
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AST Oppenheimer Large-Cap Growth: seeks capital appreciation. The
Portfolio does not invest to seek current income. The Portfolio
emphasizes investment in common stocks issued by established large- 0.90% 0.23% 1.13%(3)
capitalization growth companies. For purposes of the Portfolio,
large-cap companies have market capitalizations greater than $5 billion.
Investment opportunities may be sought among securities of smaller, less
well-known companies. This Portfolio is not intended for investors
seeking assuredincome or preservation of capital.
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Investment Other Total
Style/ Investment Objectives/Policies Management Expenses Annual
Type Fee Expenses
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- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
AST Lord Abbett Growth and Income: long-term growth of capital and income
while attempting to avoid excessive fluctuations in market value.
Normally, investments will be made in common stocks of seasoned compa 0.75% 0.18% 0.93%
which are expected to show above-average growth and which the Portfolio's
sub-advisor believes to be in sound financial condition.
LARGE CAP
VALUE
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AST Putnam Value Growth & Income: to seek capital growth with current
income as a secondary objective. The Portfolio invests primarily in
common stocks that offer potential for capital growth, and may, consistent 0.75% 0.48% 1.23%
with its investment objectives, invest in stocks that offer potential
for current income. The Portfolio may invest up to 20% of its
assets in securities traded in foreign markets.
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AST INVESCO Equity Income: to seek high current income while following
sound investment practices. Capital growth is a secondary consideration.
The Portfolio seeks to achieve its objective by investing in securities
which will provide arelatively high-yield and stable return and which, 0.75% 0.20% 0.95%
over the years, may also provide capital appreciation. The Portfolio
normally will invest at least 65% of itsassets in dividend-paying,
marketable common stocks of domestic and foreign industrial issuers.
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AST Neuberger&Berman Mid-Cap Growth*: to seek capital appreciation. The
Portfolio invests in a diversified portfolio of common stocks believed to
MID CAP GROWTH have the maximum potential for long-term above-average capital 0.90% 0.24% 1.14%(4)
appreciation. Under normal conditions, the Portfolio primarily invests
in the common stocks of companies with equity market capitalizations from
$300 million to $10 billion at the time of investment. The Portfolio
does not seek to invest in securities that pay dividends or interest,
and any such income is incidental.
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AST T. Rowe Price Natural Resources: to seek long-term growth of capital
through investment primarily in common stocks of companies which own or
develop natural resources and other basic commodities. The Portfolio 0.90% 0.26% 1.16%
will invest primarily (at least 65% of its total assets) in common stocks
of companies which own or develop natural resources and other basic
commodities.
MID CAP VALUE
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AST Neuberger&Berman Mid-Cap Value*: to seek capital growth. The
Portfolio seeks capital growth through an investment approach that is
designed to increase capital with reasonable risk. The Portfolio invests 0.90% 0.25% 1.15%(5)
principally in common stocks of medium to large capitalization
established companies, using a value-oriented investment approach.
The Sub-advisor looks for securities believed to be undervalued based
on strong fundamentals, including a low price-to-earnings ratio,
consistent cash flow, and the company's track record through all
parts of the market cycle.
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AST Cohen & Steers Realty*: to maximize total return through
investment in real estate securities. The Portfolio pursues
its investment objective of maximizing total return by
seeking, with approximately equal emphasis, capital
appreciation (both realized and unrealized) and current
income. Under normal circumstances, the Portfolio will
invest substantially all of its assets in the equity
securities of
"real estate companies". Real estate companies include those companies 1.00% 0.29% 1.29%
that derive at least 50% of its revenues from the ownership,
construction, financing, management or sale of commercial,
industrial, or residential real estate or that has at least
50% of its assets in such real estate.
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- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
AST Kemper Small-Cap Growth*: seeks maximum appreciation of investors'
capital from a portfolio primarily of growth stocks of smaller companies.
The Portfolio seeks maximum appreciation of investors' capital. Current 0.95% 0.40% 1.35%(6)
income will not be a significant factor. The Portfolio's investment
SMALL CAP GROWTH portfolio will normally consist primarily of common stocks and securities
convertible into or exchangeable for common stocks, including warrants
and rights. The Portfolio is designed as a long-term investment
involving substantial financial risk commensurate with potential
substantial gains.
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AST Janus Small-Cap Growth: seeks capital appreciation. The Portfolio
pursues its objective by normally investing at least 65% of its total 0.90% 0.23% 1.13%(7)
assets in securities issued by small-sized companies. The Portfolio
may also invest in stocks of larger companies with potential for
capital appreciation.
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
Investment Other Total
Style/ Investment Objectives/Policies Management Expenses Annual
Type Fee Expenses
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
AST T. Rowe Price Small Company Value: to provide long-term capital
appreciation by investing primarily in small-capitalization stocks that
appear to be undervalued. The Portfolio will invest at least 65% of its
total assets in companies with a market capitalization of $1 billion or 0.90% 0.26% 1.16%
SMALL CAP VALUE less that appear undervalued by various measures, such as price/earnings
or price/book value ratios. Investing in small companies involves
greater risk, as well as greater opportunity, than is
customarily associated with more established companies.
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AST Lord Abbett Small Cap Value*: to seek long-term capital appreciation.
Investments will be primarily made in equity securities which are believed
to be undervalued. Under normal circumstances, the Portfolio will invest 0.95% 0.37% 1.32%
at least 65% of its assets in common stocks issued by smaller, less
well-known companies, with market capitalizations of less than $1
billion. Smaller companies may carry more risk than larger companies.
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AST Janus Overseas Growth: to seek long-term growth of capital. The
Portfolio pursues its objective primarily through investments in common 1.00% 0.35% 1.35%
stocks of issuers located outside the United States.
INTER-NATIONAL
EQUITY
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AST Twentieth Century International Growth: to seek capital growth. The
Portfolio will invest primarily in issuers in developed markets. Under
normal conditions, the Portfolio will invest at least 65% of its assets 1.00% 0.75% 1.75%
in equity and equity equivalent securities of issuers from at
least three different countries outside the United States.
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AST Putnam International Equity: to seek capital appreciation. The
Portfolio seeks its objective by investing primarily in equity securities
of companies located in a country other than the United States. The 0.88% 0.27% 1.15%
Portfolio will, under normal circumstances, invest at least 65% of its
total assets in issuers located in at least three different countries
other than the United States.
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AST T. Rowe Price International Equity: to seek total return of its assets
from long-term growth of capital and income, principally through
investments in common stock of established, non-U.S. companies. The 1.00% 0.26% 1.26%
Portfolio intends to diversify broadly among countries and to normally
have at least three different countries represented in the Portfolio.
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
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AST Founders Passport: to seek capital appreciation. The Portfolio
invests primarily in securities issued by foreign companies which have
market capitalizations or annual revenues of $1 billion or less. At
least 65% of the Portfolio's assets will normally be invested in foreign
securities representing a minimum of three countries. The Portfolio will 1.00% 0.35% 1.35%
normally invest a significant proportion of its assets in the securities
of small and medium-sized companies, which involves greater risk than is
customarily associated with more established companies.
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Montgomery Variable Series - Emerging Markets: capital appreciation,
which under normal conditions it seeks by investing at least 65% of its
total assets in equity securities of companies in countries having 1.25% 0.50% 1.75(8)
emerging markets. Under normal conditions, investments are maintained in
at least six emerging market countries at all times and no more than 35%
of total assets are invested in any one emerging market country.
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- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
AST Twentieth Century Strategic Balanced: to seek capital growth and
current income. It is the intention of the Portfolio's sub-advisor to
maintain approximately 60% of the Portfolio's assets in common stocks 0.85% 0.40% 1.25%(9)
that are considered by the sub-advisor to have better-than-average
prospects for appreciation and the remainder in bonds and other fixed
income securities.
BALANCED/
ASSET ALLOCATION
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AST Putnam Balanced: to provide a balanced investment composed of a
well-diversified portfolio of stocks and bonds which will produce both
capital growth and current income. The Portfolio may invest in almost
any type of security or negotiable instrument, including cash or money
market instruments. The portion of the Portfolio's assets invested in 0.74% 0.29% 1.03%
equity securities and fixed income securities will vary from time to time
in light of the Portfolio's investment objective, changes in interest
rates and economic of other factors. Under normal market conditions,
it is expected that at least 25% of thePortfolio's total assets
will be invested in fixed income securities.
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AST T. Rowe Price Asset Allocation: to seek a high level of total return
by investing primarily in a diversified group of fixed income and equity
securities. Under normal conditions over the long-term, the Portfolio 0.85% 0.28% 1.13%
expects to allocate its assets so that approximately 40% of its assets
will be infixed income securities and approximately 60% in equity
securities.
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
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Investment Other Total
Style Investment Objectives/Policies Management Expenses Annual
Type/ Fee Expenses
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
AST PIMCO Total Return Bond: to seek to maximize total return consistent
with preservation of capital. The Portfolio will invest in a diversified 0.65% 0.21% 0.86%
portfolio of fixed-income securities of varying maturities with a portfolio
duration from three to six years.
FIXED INCOME
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AST PIMCO Limited Maturity Bond: to seek to maximize total return,
consistent with preservation of capital and prudent investment management.
The Portfolio will invest in a diversified portfolio of fixed income 0.65% 0.23% 0.88%
securities of varying maturities with a portfolio duration from one to
three years.
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AST T. Rowe Price International Bond: seeks to provide high current income
and capital appreciation by investing in high-quality, non dollar-
denominated government and corporate bonds outside the United States.
The Portfolio will invest at least 65% of its assets in high-quality,
non dollar-denominated government and corporate bonds outside the United 0.80% 0.31% 1.11%
States. The Portfolio may also invest up to 20% of its assets in below
investment-grade, high-risk bonds, including bonds in default or those
with the lowest rating (commonly referred to as "junk bonds").
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AST Federated High Yield: to seek high current income by investing
primarily in a diversified portfolio of fixed income securities. The
Portfolio will invest at least 65% of its assets in lower-rated
(BBB or lower) fixed rate corporate debt obligations. Investments of this 0.75% 0.23% 0.98%
type are subject to a greater risk of loss of principal and interest than
investments in higher rated securities and are generally considered high
risk. Lower-rated or unrated bonds are commonly referred to as
"junk bonds."
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AST Money Market: to maximize current income and maintain high levels of
liquidity. The Portfolio attempts to accomplish its objective by
maintaining a dollar-weighted average maturity of not more than 90 days 0.45% 0.15% 0.60%(10)
and by investing in securities which have effective maturities of not
more than 397 days.
- ------------------- -------------------------------------------------------------------------- ---------- ----------- -----------
1 The investment management fee without any voluntary waiver would have been
0.90%; the total annual expenses without any waiver or reimbursement would
have been 1.08%.
2 The other expenses without any reimbursement would have been 0.29%; the
total annual expenses without any waiver or reimbursement would have been
0.89%.
3 Prior to January 1, 1999, the Investment Manager had engaged Robertson,
Stephens & Company Investment Management, L.P. as Sub-advisor for the
Portfolio (formerly the Robertson Stephens Value + Growth portfolio), and
the total Investment Management fee was at the annual rate of 1.00% of the
average daily net assets of the Portfolio. As of January 1, 1998, the
Investment Manager engaged OppenheimerFunds, Inc. as Sub-advisor for the
Portfolio, and the Investment Management fee is payable at the annual rate
of 0.90% of the first $1 billion of the average daily net assets of the
Portfolio, plus .85% of the Portfolio's average daily net assets in excess
of $1 billion. The Management Fee in the above chart reflects the current
Investment Management fee payable to the Investment Manager.
4 Prior to May 1, 1998, the Investment Manager had engaged Berger Associates,
Inc. as Sub-advisor for the Portfolio (formerly, the Berger Capital Growth
portfolio), for a total Investment Management fee payable at the annual
rate of .75% of the average daily nets assets of the Portfolio. As of May
1, 1998, the Investment Manager engaged Neuberger&Berman Management
Incorporated as Sub-advisor for the Portfolio, for a total Investment
Management fee payable at the annual rate of 0.90% of the first $1 billion
of the average daily net assets of the Portfolio plus .85% of the
Portfolio's average daily net assets in excess of $1 billion. The
Management Fee in the above chart reflects the current Investment
Management fee payable to the Investment Manager.
5 Prior to May 1, 1998, the Investment Manager had engaged Federated
Investment Counseling as Sub-advisor for the Portfolio (formerly, the
Federated Utility Income portfolio), for a total Investment Management fee
payable at the annual rate of .75% of the first $50 million of the average
daily net assets of the Portfolio, plus .60% of the Portfolio's average
daily net assets in excess of $50 million. As of May 1, 1998, the
Investment Manager engaged Neuberger&Berman Management Incorporated as
Sub-advisor for the Portfolio, for a total Investment Management fee
payable at the annual rate of 0.90% of the first $1 billion of the average
daily net assets of the Portfolio plus .85% of the Portfolio's average
daily net assets in excess of $1 billion. The Management Fee in the above
chart reflects the current Investment Management fee payable to the
Investment Manager.
6 This portfolio commenced operations in January 1999. "Other Expenses" shown
are based on estimated expenses for the fiscal year ending December 31,
1999 with a voluntary expense reimbursement. Estimated other expenses
without any reimbursement would be 0.59%.
7 Prior to January 1, 1999, the Investment Manager had engaged Founders Asset
Management, LLC as Sub-advisor for the Portfolio (formerly the Founders
Capital Appreciation portfolios).
8 The other expenses without any reimbursement would have been 0.56%; the
total annual expenses without any waiver or reimbursement would have been
1.81%.
9 The other expenses without any reimbursement would have been 0.50%; the
total annual expenses without any waiver or reimbursement would have been
1.35%.
10 The investment management fee without any voluntary waiver would have been
0.50%; the other expenses without any reimbursement would have been 0.19%;
the total annual expenses without any waiver or reimbursement would have
been 0.69%.
Additional Premiums
[64] When may I contribute additional Premiums and how much may I pay? You may
send us additional Premiums at any time before the Insured's Age 100 and while
the Insured is alive unless the amount you have paid to-date equals the then
current maximum we permit. The amount you may pay is flexible within the limits
discussed below.
[65] When do you allocate additional Premiums? We allocate Net Premium resulting
from an additional Premium payment to the investment options as of the Valuation
Period we receive that Premium at our Office.
[66] How do you allocate additional Premiums among the investment options? We
allocate Net Premiums resulting from additional Premium payments according to
your most recent instructions to us. If you are participating in any allocation
programs we agree to support, such as any program of periodic rebalancing of
your Account Value among various investment options, we will allocate additional
Premiums in accordance with such a program unless we receive alternate
instructions.
[67] What is the most I may pay in total while I own a Policy? The maximum you
may pay changes. At any particular time, it is the amount which, at that time,
would not cause the Death Benefit to increase by more than the amount of the
Premium. We reserve the right to require new evidence satisfactory to us that
the Insured meets our underwriting standards before we agree to accept such
Premium. We discuss in the section on Loans what we do if there is any
outstanding Debt.
[68] What is the least amount I may pay at any one time? Unless you must make a
payment to keep the Policy in force, as discussed below, the minimum amount we
accept as an additional Premium depends on whether you have arranged to make
periodic withdrawals from a bank or other financial institution ($100), or
whether you make additional Premium payments directly ($500).
[69] Will you accept an additional Premium if it causes my Policy to be treated
as a MEC? We will not apply the portion of any Premium that we believe would
require us to treat your Policy as a MEC if it was not previously a MEC.
However, if you provide us with a notice In Writing that you understand that the
additional Premium will require us to treat your Policy as a MEC, we will accept
the Premium. If you do not give us such notice, we will return the difference
between the amount you submitted and any amount we apply as a Premium.
[70] How much may I pay as additional Premium if I don't want the Policy treated
as a MEC? If your Policy is not being treated as a MEC, the amount of additional
Premium you can pay at any time without your Policy subsequently being treated
as a MEC depends on the following factors:
(a) The Policy Year in which you want to make the payment and the
Premiums previously paid: The maximum additional Premium you can pay equals the
cumulative MEC Threshold Amount for the current Policy Year plus the prior
Policy Years, less the cumulative total amount previously paid. For example,
assume that as of the Policy Date, the MEC Threshold Amount was $10,000. Also
assume that you gave us $8,000 in each of the first three Policy Years. In the
fourth Policy Year, the maximum premium you can pay without the Policy being
treated as a MEC equals 4 X $10,000 ($40,000) minus 3 X $8,000 ($24,000), which
equals $16,000.
(b) The Specified Amount as of the time you make the payment: How much
you may pay without your Policy being treated as a MEC changes after any
increase or decrease to the Specified Amount. You may pay more after an increase
to the Specified Amount, subject to the maximum Premium rules noted above. You
may be able to pay less in additional Premium, or may not be able to pay any
further additional Premium after a change to the Specified Amount if you do not
want your Policy treated as a MEC. Whether you may pay anything further will
depend on the extent of the reduction to the Specified Amount.
(c) The amount of any proceeds contributed from any prior policy if you
purchased an Exchange Policy: Any proceeds contributed to an Exchange Policy
reduce the MEC Threshold Amount.
Keeping the Policy In Force
[71] What is the least amount I must pay so that the Policy doesn't end? We
cannot know in advance any minimum amount that will be required to keep the
Policy from ending without value. This is because: (1) the charges we deduct
each month are based on your Account Value, which may increase or decrease due
to the performance of the investment options; (2) we retain the right to
decrease or increase the current cost of insurance rates, subject to the
guaranteed maximums in the Policy; and (3) you may request and we may agree to a
change in the Death Benefit Option and/or the Specified Amount. If, on any
Monthly Processing Day, your Cash Value is insufficient to pay the current
deductions, a 61-day "grace period" begins unless the guaranteed continuation
provision is then applicable, as discussed below. If you enter the grace period,
we will send you a notice of how much you have to pay before the end of the
grace period to keep the Policy in force.
[72] Can the Policy end because of poor investment performance? The Policy could
enter the grace period because of poor investment performance combined with the
deduction of the Policy's fees and charges. If that were to occur and, by the
end of the grace period, there was not enough Cash Value to deduct the unpaid
charges, the Policy would end, unless the guaranteed continuation provision
applies.
[73] What is the guaranteed continuation provision? During the first ten Policy
Years, you may qualify for a guaranteed continuation provision if: (1) the total
amount of Premium you have paid is not less than a specified minimum for each
Policy Month times the number of Policy Months since the Policy Date; and (2)
there is no Debt. We call the specified minimum for each Policy Month the
"monthly continuation amount". This amount is 1/24th of the Maximum Annual
Assessable Premium. If you qualify for continuation under this provision, we
guarantee that your Policy will not enter into a grace period until the 10th
Policy Anniversary. For example, if the Maximum Annual Assessable Premium is
$12,000, then the monthly continuation amount is $500. If your Policy was in its
20th Policy Month, the sum of the monthly continuation amounts would be $10,000.
Therefore, for purposes of this example, the guaranteed continuation provision
would apply in the 20th Policy Month if you had paid at least $10,000 to that
point, and would apply in the 21st Policy Month if you had paid at least $10,500
up to the 21st Policy Month, assuming there is no Debt. We adjust the monthly
continuation amount going forward after any increase or decrease to the
Specified Amount in the first 10 Policy Years.
The Death Benefit while the Policy is kept in force by this provision is the
Death Benefit in effect as of the Monthly Processing Day the grace period
otherwise would have begun.
Transfers and Allocation Services
[74] May I transfer Account Value between investment options? You may transfer
Account Value between investment options, but there are limits, as well as
potential charges, which are discussed above in the question "How much is the
transfer fee, and when must I pay it?" We permit the agent of record to make
transfers on your behalf unless you give us other instructions.
[75] Are there any limits on transfers? No transfers are permitted when the
Policy is in its "grace period." In order to maintain Account Value in an
investment option after transferring a portion of your Account Value out of that
investment option, we reserve the right to require that there be at least
$500.00 in such investment option after the transfer. If, as a result of the
transfer, there would be less than $500.00 in an investment option, we reserve
the right to transfer the remaining Account Value pro rata to the investment
option(s) that you were transferring to. We retain the right to impose a limit
of not more than 12 transfers per Policy Year, including transfers involving
Fixed Allocations. Unless such a limit is in effect, there is no limit on the
number of transfers that only involve variable investment options, or the number
of transfers from variable investment options to make Fixed Allocations.
However, we do limit each transfer from Fixed Allocations that are to be
effective on any day other than a Policy Anniversary to the greater of 25% of
the Account Value in your Fixed Allocations or $1,000. If you make such a
transfer from your Fixed Allocations, you cannot make another such transfer
until either 90 days has passed or the next Policy Anniversary occurs. We also
retain the right to refuse or limit transfers, either for one Owner or a group
of Owners, if we believe there may be adverse consequences for other Owners.
[76] What are `allocation services'? Allocation services are programs that
automatically transfer Account Value between investment options. We may waive or
reduce the minimum amounts required for transfers noted above when your Policy
is participating in certain allocation programs, including, but not limited to,
static rebalancing programs. However, any limitations on transfers from Fixed
Allocations also apply if any allocation services are being utilized.
[77] What allocation services does American Skandia provide? We support dollar
cost averaging and static rebalancing.
Loans
[78] When can I take a loan? We offer loans using Account Value as collateral.
Where permitted by law, we reserve the right to limit the number of loans in
each Policy Year. The Insured must be alive when you take a loan (if there are
two Insureds, at least one must be alive when a loan is taken). Subject to our
rules, on the Policy Date we will establish a loan equal to the outstanding
indebtedness on previous life insurance exchanged for a Policy.
[79] Is this type of loan tax-free? A loan is not treated as a distribution and
does not result in any taxable income unless, for any reason, we believe your
Policy must be treated as a MEC.
[80] How much is available for a loan? You can receive loans equal to 90% of
your current Account Value less any applicable contingent deferred sales charge.
At the time you take any loan, the amount then available for a new loan is the
maximum otherwise available less any Debt. The minimum amount you may borrow is
$1,000.
[81] What happens to the Account Value if I take a loan? When you take a loan,
we transfer Account Value equal to the amount of the loan into the Loan Account.
Account Value in the Loan Account is maintained in our general account. Unless
you give us different instructions, we move Account Value from the variable
investment options and the Fixed Allocations in the same proportion as your
Account Value in the investment options on the Valuation Date we move such
Account Value.
The impact of a loan on your Account Value may be positive or negative. At the
time a loan is taken, there is no impact. However, if the interest rate credited
to Account Value in the Loan Account is greater than what would be earned in the
investment options, the loan will have a positive impact on your Account Value.
If the interest rate credited to Account Value in the Loan Account is less than
what would be earned in the investment options, the loan will have a negative
impact on your Account Value. Because a loan can impact the Account Value, it
may also have an impact on the Minimum Required Death Benefit and, possibly, the
Death Benefit.
[82] What is the interest rate charged on any loan? You owe us interest on any
loan at the rate of 6.0% per year, compounded yearly, in arrears. Each Policy
Anniversary that the loan is not repaid, we add an amount equal to any unpaid
interest to your Debt.
[83] Does Account Value in the Loan Account earn interest? We credit interest to
Account Value in the Loan Account. We currently credit interest at the rate of
6.0% per year, compounded yearly, to the Account Value maintained in the Loan
Account. We may change this rate, but it will not be less than 5.5% per year,
compounded yearly.
[84] Once a loan is taken, does American Skandia ever require more `collateral'
in the Loan Account? The Loan Account acts as collateral for any loans from us.
We monitor the Debt and the Account Value in the Loan Account to assure that
they are equal to each other. Therefore, on each Policy Anniversary we equalize
the Debt and the Account Value in the Loan Account. If the Debt is larger due to
outstanding loan interest, we transfer Account Value equal to the difference
pro-rata from the investment options and add it to the Loan Account.
We also match up the Debt and the Loan Account when you repay any portion of the
Debt. If the Account Value in the Loan Account then exceeds the Debt, we
transfer the excess pro-rata to the investment options which you are utilizing
at that time. Any amount then allocated to the fixed option will be treated as a
separate Fixed Allocation.
[85] When must I repay the loan? You are not required to repay the loan while
the Insured is alive, except if you request reinstatement if the Policy lapses.
[86] What happens at the Insured's death if I have not repaid the loan? If there
is any outstanding Debt when Death Proceeds are due, we subtract the Debt from
the Death Benefit as part of the calculation of the Death Proceeds.
[87] What happens if I repay any portion of the loan? The amount of Debt is
reduced by the amount of any loan repayment. Loan repayments reduce the amount
of principal and loan interest proportionately based on the ratio between
principal and loan interest as of the Valuation Date the loan repayment is
applied. We allocate any loan repayment to the variable investment and fixed
options pro-rata based on the Account Value in each investment option as of the
Valuation Period we receive your loan repayment. Any amount then allocated to
the fixed option will be treated as a separate Fixed Allocation.
[88] May I borrow from the Policy to make Premium payments? We will not accept
instructions to borrow from your Policy and use the loan to make Premium
payments.
[89] If I have an outstanding loan and send in money, do you use it to repay the
loan or do you consider it a Premium payment? We treat such funds as Premium or
loan repayment in accordance with your instructions, to the extent such
instructions comply with limitations such as the then applicable maximum Premium
for the Policy. If you send us funds and do not specify whether the money is to
be used as a Premium or to repay a loan, we treat the money as a Premium payment
to the extent such amount does not exceed the maximum Premium then allowed. We
will return to you any amount that exceeds the maximum Premium then allowed.
Partial Withdrawals
[90] When can I make a partial withdrawal? We allow partial withdrawals while
the Insured is alive, subject to the following limitations:
(a) In the first ten Policy Years, we permit a partial withdrawal if
such a withdrawal meets the requirements for a medically-related waiver, as
described in the section "Medically Related Waiver".
(b) After the tenth Policy Year, you may take up to the maximum partial
withdrawal amount as discussed below.
(c) At any time, you may withdraw amounts that cumulatively do not
exceed the total of any Exempt Premiums less the Exempt Premiums previously
withdrawn.
(d) No partial withdrawal may be less than $1,000.
[91] How much is available as a partial withdrawal? The maximum partial
withdrawal is up to 90% of the Cash Value. As a consequence of any partial
withdrawal, the Specified Amount must be at least a specified minimum and your
Cash Value must be at least $1,000. The specified minimum for Policies with one
Insured is $50,000. The specified minimum for Policies with two Insureds is
$100,000.
[92] What happens to the Account Value if I take a partial withdrawal? When you
take a partial withdrawal, we reduce your Account Value by an amount equal to
the amount of the partial withdrawal. Unless you give us different instructions,
we take Account Value from the variable investment options and the Fixed
Allocations in the same proportion as your Account Value in the investment
options on the Valuation Date we take such Account Value. If you have multiple
Fixed Allocations, amounts are taken on a "last in, first out" basis. Any
Account Value in the Loan Account is not available for a partial withdrawal.
[93] Is there a charge for a partial withdrawal? We charge a $25.00 transaction
fee on any partial withdrawal.
[94] Does a partial withdrawal affect the Death Benefit? A partial withdrawal
will have an immediate impact on the Death Benefit. A partial withdrawal always
reduces the Minimum Required Death Benefit, because the Minimum Required Death
Benefit is based on the Account Value. A partial withdrawal also results in a
reduction to the Guaranteed Minimum Death Benefit. If you are using Option B,
the Specified Amount is not reduced by a partial withdrawal. If you are using
Option A, the Specified Amount is reduced by the lesser of: (1) the amount of
the partial withdrawal, including the amount of the transaction fee; or (2) the
extent required such that, immediately after such reduction, the Specified
Amount equals the higher of the recalculated Minimum Required Death Benefit and
the recalculated Guaranteed Minimum Death Benefit.
If a partial withdrawal occurs on or after Age 100, it reduces the Death Benefit
by the exact amount of the partial withdrawal plus the partial withdrawal
transaction fee, because on or after that Age the Death Benefit equals the
Account Value.
Surrenders
[95] When can I surrender my Policy? You can surrender your Policy after the end
of the free-look period as long as the Insured is alive.
[96] What is paid out when a Policy is surrendered? If you surrender the Policy,
we will pay you the Cash Value.
Accelerated Death Benefit
[97] What is an accelerated death benefit? An accelerated death benefit is
pre-payment to the Owner of a portion of the Death Proceeds. The maximum we will
pay, before any reductions, is the lesser of 50% of the Death Benefit or
$250,000. The actual amount is reduced by a 12-month interest rate discount
(currently 6.0%) and a pro-rata portion of any Debt, based on the ratio by which
the Death Benefit is reduced as a result of the payment of the accelerated death
benefit. We reserve the right to change the interest rate discount percentage.
[98] When will American Skandia make such a payment? We will make such a payment
one time, where allowed by law, based on the Owner's request. The Insured may
not request such a payment unless the Insured is also the Owner. We only make
the payment if we receive all our requirements. Our requirements include, but
are not limited to, proof satisfactory to us In Writing that the Insured (the
last surviving Insured if there are two Insureds) became terminally ill, as
defined in your Policy: (a) at least 30 days after the Issue Date; or (b) as a
result of an accident that occurred after the Issue Date. To the extent
permitted by law, we will change our procedures in relation to this benefit or
the definition of terminally ill or any other applicable term in order to
maintain the tax-free status of any amounts paid out under this provision.
[99] What happens to the remaining benefits if American Skandia makes such a
payment? If we make such a payment, we first reduce the Policy's benefits and
any Debt proportionately. For example, if the Death Benefit before such a
payment is $200,000 and we make an accelerated Death Benefit payment of $50,000,
we reduce the Death Benefit by the ratio of the payment to the then current
Death Benefit, which in this case is by 25%, to $150,000. We also reduce the
Maximum Annual Assessable Premium. You should consult a tax advisor on the tax
consequences of such a payment. Please refer to Appendix F for a hypothetical
illustration of the accelerated death benefit provision.
Medically-Related Waiver
[100] What is a medically-related waiver? A medically-related waiver is a waiver
of the contingent deferred sales charge that would otherwise apply to a
surrender. A medically-related waiver also is the only context in which we
permit a partial withdrawal in the first ten Policy Years of amounts other than
Exempt Premium. No contingent deferred sales charge or partial withdrawal
transaction fee applies to such a partial withdrawal.
[101] When would American Skandia waive the contingent deferred sales charge? We
will waive the contingent deferred sales charge, where allowed by law, if you
provide us with all of our requirements. Our requirements include, but are not
limited to, proof satisfactory to us In Writing that the Insured (the last
surviving Insured if there is more than one Insured) has continuously been
confined to a long term care facility, such as a nursing home or a hospital, as
defined in the rider, for at least a specified amount of time, and that such
confinement started after the Issue Date.
[102] Are there any restrictions on medically-related waivers? We will only
consider providing this benefit on amounts up to $500,000. The $500,000 maximum
will apply regardless of when taken, on any life insurance policy or annuity
contract issued by American Skandia where the Insured under this Policy is named
as the Insured, Owner or Annuitant under the other policy or contract. However,
once we have approved a medically-related waiver, should you choose to only take
a partial withdrawal, the waiver will apply to any subsequent withdrawals or
surrender, subject to the $500,000 cumulative limit.
[103] What happens to the remaining benefits if American Skandia makes such a
payment in connection with a partial withdrawal? A partial withdrawal during the
first ten Policy Years for which we grant a medically-related waiver has the
same impact on the remaining benefits that results from any other partial
withdrawal.
Risks
[104] What are the risks, and who takes the risks? We bear the risk that, for
all the Policies we issue, when considered together, our expenses exceed our
charges, including the expense of providing the difference at death between the
Account Value and the Death Benefit. We also bear the investment and
reinvestment risk in providing interest crediting guarantees to Fixed
Allocations and to the Loan Account, as well as for any settlement options that
assume a fixed rate of return. We also bear the risk of having to waive monthly
charges we would otherwise deduct under the guaranteed continuation provision.
You bear the investment risk when allocating Account Value to any variable
investment option, since that will affect the amount available for any loans,
partial withdrawals or surrender. You bear a liquidity risk because you may not
make partial withdrawals except under limited circumstances and in limited
amounts during the first ten (10) Policy Years, although amounts are available
as loans. Any irrevocable beneficiary bears the risk as to the Death Proceeds,
which may be affected by investment performance of the investment options, the
age at which the Insured dies (if at such time the amount paid is based on the
Minimum Required Death Benefit), any loan or withdrawal activity by the Owner
prior to the Insured's death or payment of an accelerated death benefit.
Other Rights
[105] Do I have any other rights if I buy a Policy? There are certain other
ownership rights you may exercise under a Policy. You may name one or more
Beneficiaries. You may make that designation "irrevocable," which means it
cannot be changed. If you do not designate the Beneficiary as irrevocable, you
retain the right to change the Beneficiary before the Insured dies. However, all
Beneficiary designations are subject to our acceptance, to the extent permitted
by law. You also may transfer, pledge or assign your Policy, which may trigger a
currently taxable event. You should only transfer, pledge or assign your Policy
after consulting with a competent tax advisor. You may exercise voting rights in
relation to the applicable Portfolios. Some of these rights may be limited
depending on the usage of your Policy, especially if we permit it to be held in
connection with certain retirement plans designed to be "qualified" plans under
the Code.
The Separate Account
[106] What supports American Skandia's obligation to me if I buy a Policy? The
benefits provided by the Policy are our obligations. The assets supporting our
obligations equaling the Account Value allocated to the variable investment
options are held in our Separate Account F. We maintain assets in our general
account to support our obligations: (1) equal to the Account Value allocated to
the fixed option; (2) equal to the Account Value in the Loan Account; (3) for
the portion of the Death Proceeds greater than the Account Value; (4) for any
settlement option; and (5) for any other obligation we may have in relation to a
Policy.
The Separate Account was established under the laws of Connecticut. Assets in
the Separate Account may support obligations created in relation to the Policies
described in this Prospectus or other policies we offer. We are the legal owner
of the assets in the Separate Account. Income, gains and losses, whether or not
realized, are credited or charged to the Separate Account according to the terms
of the Policies and any other policies supported by the assets in the Separate
Account without regard to our other income, gains or losses or to the income,
gains or losses in any other of our separate accounts. We will maintain assets
in the Separate Account with a total market value at least equal to the reserves
and other liabilities we must maintain in relation to the life insurance
policies supported by such assets. These assets may only be charged with
liabilities that arise from such life insurance policies.
Separate Account F is registered with the U.S. Securities and Exchange
Commission (the "SEC") under the Investment Company Act of 1940 as a unit
investment trust, which is a type of investment company. This does not involve
any supervision by the SEC of the investment policies, management or practices
of the Separate Account or of us. The Separate Account meets the definition of
"separate account" under the federal securities law.
The only Sub-accounts available to you are those offered in this Prospectus.
These Sub-accounts are available as investment options for other policies we
offer. Sub-accounts are permitted to invest in Portfolios we consider suitable.
The Portfolios in which the Sub-accounts invest are available to Sub-accounts of
other separate accounts, including separate accounts we use in relation to a
number of variable annuities. Separate accounts of other insurers and of various
qualified retirement plans may also invest in the Portfolios.
Taxes
[107] What are the taxes connected to the Policy? Federal and state tax laws, as
well as the interpretations of those laws, change. In addition, we do not know
your particular circumstances, which is one of a number of reasons we cannot
give you tax advice. You should consult a professional tax advisor for tax
advice for your particular situation. You should also be sure to read the
"Additional Tax Considerations" section appearing later in this Prospectus,
which includes, but is not limited to, information regarding estate taxes. What
we do provide are some brief summary answers to the following questions about
Federal income taxes.
[108] Will my Beneficiary pay taxes on the Death Proceeds? Under most
circumstances, the Beneficiary does not pay any income tax on the Death
Proceeds.
[109] Is gain in the Policy taxed every year? Generally, any gain in the Policy
is not taxed currently. However, the treatment of gain when a MEC is assigned is
discussed below.
[110] How are amounts that I receive before the Insured's death taxed? If your
Policy is not being treated as a MEC, amounts you receive as a partial
withdrawal or if you surrender the Policy are deemed for income tax purposes to
come first from your basis in the Policy. That means you may withdraw your basis
before you are considered to have withdrawn any gain. Any gain withdrawn is
taxed as ordinary income. Under most circumstances, taking a loan does not
result in any income tax consequences.
[111] Under what circumstances might the Policy or any amounts taken out be
treated differently for income tax purposes? The tax treatment of any life
insurance policy and any distribution while the Insured is alive will be
different if the policy is deemed: (1) not to qualify as life insurance under
the Code; or (2) to be a MEC. The Code defines life insurance in such a way as
to limit the amount of money that can be put into a life insurance policy and
receive the tax preferences provided for life insurance. We expect to administer
the Policies such that the death benefits will always receive the treatment
accorded life insurance death benefits under the Code. However, the Code has a
second, more restrictive limit as to how much money may be contributed if the
taxpayer is to receive all the tax benefits for life insurance policies under
the Code, such as tax-free loans and "first-in/first-out" treatment of
distributions. If the amount contributed violates this second, more restrictive
limit, the Policy will be treated as a MEC and will not receive many of the tax
preferences of life insurance policies. This second limit, sometimes known as
the "7-pay test", is defined as paying more during the first seven years of a
policy than the amount that would be paid if the policy provided for paid up
benefits after seven level annual premiums. Any changes to a Policy which is
considered, for tax purposes, to be a "material" change, including, but not
limited to, a change in the Specified Amount, require us to test the Policy
again for compliance with the 7-pay test based on the changes to the Policy.
[112] How is a "MEC" treated differently from other life insurance policies?
Some of the key ways in which a MEC is treated differently from other life
insurance policies are: (a) amounts you receive as a partial withdrawal, loan,
or if you surrender the Policy are deemed for income tax purposes to come first
from any gain in the tax year received ("last in/first out" treatment); (b)
distributions of gain before the taxpayer's age 59 1/2 are subject to a 10%
penalty unless an exception applies; and (c) assignments or pledges as
collateral for a loan are deemed a distribution. Gain subsequent to an
assignment or pledge may be treated as if it is distributed each year. However,
death benefits paid from a MEC are treated the same as from other life insurance
policies.
Available Information
[113] How can I find out more about this offer? You first should review the rest
of this Prospectus for additional information. This Prospectus is part of the
registration statement we filed with the Securities and Exchange Commission
regarding this offering. Additional information on American Skandia and this
offering is available in that registration statement and accompanying exhibits.
You may obtain copies of these materials at the prescribed rates from the SEC's
Public Reference Section, 450 Fifth Street N.W., Washington, D.C., 20549. You
may inspect and copy the registration statement and the accompanying exhibits at
the SEC's public reference facilities at the above address, Room 1024, and at
the SEC's Regional Offices, 7 World Trade Center, New York, NY, and the Everett
McKinley Dirksen Building, 219 South Dearborn Street, Chicago, IL. These
documents, as well as documents incorporated by reference, may also be obtained
through the SEC's Internet Website (http://www.sec.gov) for this registration
statement as well as for other registrants that file electronically with the
SEC.
MISCELLANEOUS PROVISIONS AND ADDITIONAL DETAILS
The following sections provide additional information you should consider before
purchasing a Policy.
Providing Services to You
You can reach us by telephone at 1-888-554-3348 or through our Internet Website
at http://www.americanskandia.com. We may require that you provide us with
proper identification before we release information about your Policy or accept
instructions received over the phone, the Internet or via any other electronic
means. We may require that you provide your Social Security or tax
identification number. We also may require you to present the personal
identification number ("PIN") we provide you after we issue a Policy. To the
extent permitted by law or regulation, neither we nor any person authorized by
us will be responsible for any claim, loss, liability or expense in connection
with a transaction, including but not limited to a transfer between investment
options, over the phone, the Internet or via any other electronic means.
However, this will only be the case if we or such authorized person acted: (a)
in good faith reliance that you authorized the transaction; and (b) on
reasonable procedures to identify you or your designee though a number of
verification methods. These methods may include recording phone conversations,
requesting Social Security or tax identification numbers, PINs, confirming
electronic mail addresses, or similar means. We may be liable for losses due to
unauthorized or fraudulent instructions should we not follow such reasonable
procedures.
We may require that you submit forms In Writing for certain transactions. We
require the written consent of all joint Owners for any transaction for which we
require the Owner's written consent.
Designations
Certain designations apply to a Policy - the Owner, the Insured and the
Beneficiary. All designations are subject to our rules and our acceptance. We
assume all designations, other than the Insured, are revocable unless you tell
us otherwise. You should consult with a competent tax advisor on the income tax,
estate and inheritance tax implications of various designations. You should also
consult with a competent legal advisor as to the implications of certain
designations in relation to an estate, bankruptcy and community property, where
applicable, as well as other matters.
We assume the Insured(s) is/are the Owner(s) unless you tell us otherwise. If
you name more than one Owner, all rights reserved to Owners are then held as
joint tenants with rights of survivorship unless you provide alternative
instructions. Naming someone to be the Owner other than the payor of the Premium
may have gift, estate or other tax implications.
We assume the Beneficiary is you or your estate unless you tell us otherwise.
You may name more than one primary and more than one contingent Beneficiary.
Net Investment Factor
For each Sub-account the initial Unit Price was $10.00. The Unit Price for each
subsequent Valuation Period is the net investment factor for that Valuation
Period, multiplied by the Unit Price for the immediately preceding Valuation
Period. The net investment factor is (1) divided by (2), less (3), where:
(1) is the net result of:
(a) the net asset value per share of the underlying Portfolio at
the end of the current Valuation Period plus the per share
amount of any dividend or capital gain distribution declared
and unpaid (accrued) by the Portfolio; plus or minus
(b) any per share charge or credit during the Valuation Period as
a provision for taxes attributable to the operation or
maintenance of that Sub-account.
(2) is the net result of:
(a) the net asset value per share of the underlying Portfolio at
the end of the preceding Valuation Period plus the per share
amount of any dividend or capital gain distribution declared and
unpaid (accrued) by the Portfolio; plus or minus
(b) any per share charge or credit during the preceding Valuation
Period as a provision for taxes attributable to the operation or
maintenance of the Sub-account.
(3) is the mortality and expense risk charges and the administration charge.
Allocation Programs
We may provide administrative support for various programs that automatically
transfer Account Value between certain investment options at scheduled times.
These include dollar cost averaging and static rebalancing (periodic rebalancing
of Account Values between investment options to conform to preset percentages).
However, we only offer to support such allocation programs according to our
rules. While we are offering to support these programs as of the date of this
Prospectus, we do not guarantee to support these programs at all times.
We may also provide administrative support for various allocation programs that
may be made available by your financial professional. These may include various
asset allocation and market timing programs. We only offer to support such
programs according to our rules. These rules may include, but are not limited
to, receipt of your authorization In Writing permitting a financial professional
to make transfers between investment options on your behalf, or to enroll your
Policy in one of the allocation programs for which we provide administrative
support. We permit the agent of record to make transfers on your behalf unless
you give us other instructions.
Any financial professional you authorize may or may not be appointed by us as
our agent for the sale of Policies. However, we do not engage any agent of
record or any third parties to offer investment allocation services of any type,
so that persons or firms offering such services do so independent from any
agency relationship they may have with us for the sale of Policies. We therefore
take no responsibility for the investment allocations and transfers transacted
on your behalf by such third parties, in accordance with any allocation programs
employed by such third parties or any investment allocation recommendations made
by such third parties. While we offer support for a number of these programs as
of the date of this Prospectus, we do not support all such programs and do not
guarantee to always continue support for those programs we currently support or
may support in the future. We do not charge you for the administrative support
we provide to these third parties.
Limitations on Transfers
We retain the right to refuse transfers, either for one Owner or a group of
Owners, if we believe that: (a) excessive trading or a specific transfer request
or group of transfer requests may have a detrimental effect on Unit Prices or
the share prices of the Portfolios; or (b) we are informed by one or more of the
Portfolios that the purchase or redemption of shares is to be restricted because
of excessive trading or a specific transfer or group of transfers is deemed to
have a detrimental effect on the share prices of affected Portfolios. Under such
a circumstance, we will process transfers according to our rules then in effect
and provide notice if your transfer request was denied. If a transfer request is
denied, a new transfer request may be required.
Death During the Grace Period
We deduct the unpaid charges from the Death Benefit when calculating the Death
Proceeds if the Insured dies during a grace period.
Reinstatement
You may apply for reinstatement of the Policy if it lapses. We must receive this
application In Writing at our Office within 5 years of the date the lapse
occurred as measured from the end of the grace period. We may require evidence
of insurability satisfactory to us. In order to reinstate your Policy, you also
must pay us a reinstatement amount, including any applicable charges and any
Debt.
Maturity
We currently do not require that the Cash Value of the Policy be paid out as of
any "maturity date". There is an assumed maturity date for purposes of
compliance with various state insurance requirements and for purposes of meeting
certain tests under the Code. Should we come to believe that the Cash Value must
be paid out as of the assumed maturity date in order to comply with state or
Federal requirements, then a Policy will mature as of the Policy Anniversary on
which the Insured is Age 100. If there are two Insureds, a Policy "matures" as
of the Policy Anniversary on which the younger Insured is Age 100 or would have
been Age 100 if the younger Insured is then deceased. If we must implement a
maturity date, we will pay out the Cash Value once the Policy matures. The
Policy will then end, and we will not have any more obligations under the
Policy. Certain rights and benefits under the Policy may be restricted after Age
100.
Pricing Transactions
We "price" charges, transfers, distributions and payments on the date indicated
below. If such transactions are scheduled to occur on other than a Valuation
Day, we price such transactions as of the following Valuation Period:
(1) "Scheduled" transactions such as monthly deductions, transfers and
distributions are "priced" according to the Unit Price next computed
after the date such transactions scheduled to occur. However, if a
transaction is "scheduled" to occur on a day other than a Valuation
Day, such transaction will be processed and priced on the next
Valuation Day following the scheduled transaction. "Scheduled"
transactions include, but are not limited to, all charges deducted on a
Monthly Processing Date, equalization of Debt and the Account Value in
the Loan Account on a Policy Anniversary, transfers under a dollar cost
averaging program or transfers previously scheduled with us at our
Office as part of any rebalancing, asset allocation or similar program,
or any program of scheduled distributions. However, we price scheduled
periodic payments which you authorize to be transferred from an account
at another financial institution for additional Premiums or loan
repayments as "unscheduled" transactions, because we cannot control the
administrative processing of the other financial institution.
(2) "Unscheduled" transactions such as transfers, loans or partial
withdrawals that are not subject to any medical waiver are "priced"
according to the Unit Price next computed after we receive the request
for such transactions at our Office. "Unscheduled" transfers include
any transfers processed in conjunction with any market timing program,
or transfers not previously scheduled with us at our Office pursuant to
any rebalancing, asset allocation or similar program which you employ
or you authorize to be employed on your behalf. "Unscheduled" transfers
received pursuant to an authorization to accept transfer instructions
using voice or data transmission over the phone are priced as of the
Valuation Period we receive the request at our Office for such
transactions. We price unscheduled payments sent to us as of the date
we receive such amounts at our Office. These include additional
Premiums, loan repayments, and payments to keep a Policy in effect
during a grace period or a reinstatement payment.
(3) We price surrenders, withdrawals subject to a medical waiver,
accelerated death benefit payments and payment of Death Proceeds as of
the date we receive at our Office all materials we require for such
transactions and such materials are satisfactory to us.
Delaying Transactions
We may defer any distribution or transfer from a Fixed Allocation or any payment
under a fixed settlement option for a period not to exceed the lesser of six (6)
months or the period permitted by law. If we defer a distribution or transfer
from any Fixed Allocation or any payment under a settlement option for more than
thirty days, or less where required by law, we pay interest at the minimum rate
required by law but not less than 3% per year on the amount deferred. We may
defer payment of proceeds of any distribution from any Sub-account or any
transfer from a Sub-account for a period not to exceed seven (7) calendar days
from the date the transaction is effected. This is a delay in payment only, and
is not a delay in the pricing of any such distribution or transfer. Any deferral
period begins on the date such distribution or transfer would otherwise have
been transacted.
All procedures, including distributions, based on the valuation of the
Sub-accounts may be postponed during the period: (1) the New York Stock Exchange
is closed (other than customary holidays or weekends) or trading on the New York
Stock Exchange is restricted as determined by the SEC; (2) the SEC permits
postponement and so orders; or (3) the SEC determines that an emergency exists
making valuation or disposal of securities not reasonably practical.
Voting
You have voting rights in relation to Account Value maintained in the
Sub-accounts. You do not have voting rights in relation to Account Value
maintained in any Fixed Allocations, in the Loan Account or in relation to fixed
payments under a settlement option.
We will vote shares of the Portfolios in which the Sub-accounts invest in the
manner directed by Owners, unless we, in our sole discretion, determine that we
are required by law or regulation to vote otherwise. Owners have voting rights
equal to the number of shares represented by the Sub-account Units attributable
to their Policy.
We will vote the shares attributable to assets held in the Sub-accounts solely
for us rather than on behalf of Owners, or any share as to which we have not
received instructions, in the same manner and proportion as the shares for which
we have received instructions. We will do so separately for each Sub-account
from various classes that may invest in the same underlying mutual fund
portfolio.
The number of votes for a Portfolio will be determined as of the record date for
such Portfolio as chosen by its board of trustees or board of directors, as
applicable. We will furnish Owners with proper forms and proxies to enable them
to instruct us how to vote.
You may instruct us how to vote on the following matters: (a) changes to the
board of trustees or board of directors, as applicable; (b) changing the
independent accountant; (c) approval of changes to the investment advisory
agreement or adoption of a new investment advisory agreement; (d) any change in
the fundamental investment policy; and (e) any other matter requiring a vote of
the shareholders.
With respect to approval of changes to the investment advisory agreement,
approval of a new investment advisory agreement or any change in fundamental
investment policy, only Owners maintaining Account Value as of the record date
in a Sub-account investing in the applicable Portfolio will instruct us how to
vote on the matter, pursuant to the requirements of Rule 18f-2 under the
Investment Company Act of 1940.
Transfers, Assignments, Pledges
Generally, your rights in a Policy may be transferred, assigned or pledged at
any time. These transactions may be subject to income taxes and certain penalty
taxes, depending in part on whether your Policy is treated as a MEC. You may
transfer, assign or pledge your rights to another person at any time, prior to
the death upon which the Death Benefit is payable. You must request a transfer
or provide us a copy of the assignment In Writing. A transfer or assignment is
subject to our acceptance. We will not be deemed to know of or be obligated
under any assignment prior to our receipt and acceptance thereof. We assume no
responsibility for the validity or sufficiency of any assignment.
Reports
We send any statements and reports required by applicable law or regulation to
you at your last known address of record. You should therefore give us prompt
notice of any address change. We reserve the right, to the extent permitted by
law and subject to your consent, to provide any prospectus, prospectus
supplements, confirmations, statements and reports required by applicable law or
regulation to you through our Internet Website at http://www.americanskandia.com
or any other electronic means. We send a confirmation statement to you each time
an unscheduled transaction is made affecting Account Value. Such transactions
will generally include changes in investment allocation or transfers among
investment options, loans and loan repayments, partial surrenders or
withdrawals, and any charges associated with such unscheduled transactions. We
also send quarterly statements detailing the activity affecting your Policy
during the prior quarter, including all scheduled and unscheduled transactions.
To the extent permitted by law, some types of scheduled transactions will only
be confirmed on a quarterly basis. Such transactions will generally include
those pre-authorized charges deducted on the Monthly Processing Date. You may
request additional reports. We reserve the right to charge up to $50 for each
such additional report. You should review the information in these statements
carefully. You must report all errors or corrections to us at our Office
immediately to assure proper crediting to your Policy. For transactions that are
confirmed immediately, we assume all transactions are accurate unless you notify
us otherwise within 10 days after the date of the transaction. For transactions
that are only confirmed on the quarterly statement, we assume all transactions
are accurate unless you notify us within 10 days of the end of the calendar
quarter. We may also send you or make available electronically through our
Internet Website an annual report and a semi-annual report containing financial
statements for the applicable Sub-accounts, as of December 31 and June 30,
respectively.
Incontestability
We may not contest the validity of a Policy after it has been in effect during
the Insured's lifetime for two years from the Issue Date. If there are two
Insureds, this applies to the lifetime of either Insured. If the Policy is
reinstated, to the extent permitted by law, we may not contest the validity of a
Policy after it has been in effect for two years from the date of the
reinstatement.
Suicide
If an Insured commits suicide within two years of the Policy Date (or whatever
maximum period is permitted under law) or the date of a reinstatement if allowed
by law, the Death Benefit will be the greater of: (a) Premium paid less any
outstanding Debt and any partial withdrawals; or (b) the Cash Value. All other
requirements as to calculation and payment of Death Proceeds will apply.
Misstatement
We will adjust the amount of the Death Proceeds to conform to the facts if the
age or gender of an Insured is incorrectly stated. We will do so as specified in
the Policy and as permitted by law.
Policy Loans on Exchanges
Subject to our rules, we will establish a loan on a Policy that you purchase as
part of an exchange that is not subject to current taxation in accordance with
Section 1035 of the Code. However, we will charge the premium tax and DAC tax on
the amount of this "inherited" loan as if it was received as Premium. For
purposes of determining the Assessable Premium, the amount of the inherited loan
will not be treated as commissionable Premium.
The amount of this inherited loan in your Policy when established will be equal
to the loan that was in effect before you surrendered your prior policy. As of
the Policy Date, your Account Value will reflect any transferred "Premium" plus
the amount of the inherited loan. That portion of your Account Value equal to
the inherited loan amount will be allocated to the Loan Account as collateral
for the loan. By reflecting the inherited loan amount in the Account Value, the
sum of the Specified Amount and the Account Value initially will be more under
Option B than it would be without the loan. Also, there will be a corresponding
increase in the Minimum Required Death Benefit. In addition, for purposes of
determining the Guaranteed Minimum Death Benefit, we will deem the "Premium" to
be the amounts paid plus the loan amount as of the Policy Date. All charges that
are calculated as a percentage of your Account Value will increase because the
Account Value will reflect the amount of the loan allocated to the Loan Account.
Withdrawals of amounts to pay loans transferred to an Exchange Policy from any
prior policy may have adverse taxable consequences. You should consult your tax
advisor before purchasing an Exchange Policy with the intention to make such a
withdrawal or before requesting such a withdrawal.
Resolving Material Conflicts
The Portfolios may be available to registered separate accounts offering either
or both life and annuity contracts of insurance companies not affiliated with
us. We also may offer life insurance policies and/or annuity contracts that
offer different variable investment options from those offered under this
Policy, but which invest in the same Portfolios. It is possible that differences
might arise between our Separate Account F and one or more accounts of other
insurance companies which offer a Portfolio as a Sub-account. It is also
possible that differences might arise between a Sub-account offered under this
Policy and variable investment options offered under different life insurance
policies or annuities we offer, even though such different variable investment
options invest in the same Portfolio. In some cases, it is possible that the
differences could be considered "material conflicts." Such a "material conflict"
could also arise due to changes in the law (such as state insurance law or
Federal tax law) which affect either these different life and annuity separate
accounts or differing life insurance policies and annuities. It could also arise
by reason of differences in voting instructions of persons with voting rights
under our policies and/or annuities and those of other companies, persons with
voting rights under annuities and those with rights under life policies, or
persons with voting rights under one of our life policies or annuities with
those under other life policies or annuities we offer. It could also arise for
other reasons. We will monitor events so we can identify how to respond to such
conflicts. If such a conflict occurs, we will take the necessary action to
protect persons with voting rights under our life policies or annuities
vis-a-vis those with rights under life policies or annuities offered by other
insurance companies. We will also take the necessary action to treat equitably
persons with voting rights under this Policy and any persons with voting rights
under any other life policy or annuity we offer.
Modification of the Separate Account
We reserve the right to do any or all of the following: (a) combine any
Sub-account(s) with any other Sub-account(s); (b) combine Separate Account F or
a portion thereof with other separate accounts; (c) deregister Separate Account
F under the Investment Company Act of 1940; (d) operate Separate Account F as a
management investment company under the Investment Company Act of 1940 or in any
other form permitted by law; (e) make changes required by any change in the
Securities Act of 1933, the Securities Exchange Act of 1934 or the Investment
Company Act of 1940; (f) make changes that are necessary to maintain the tax
status of your Policy under the Code; and (g) make changes required by any
change in other Federal or state laws relating to life insurance policies in
general or variable life insurance policies in particular.
We also may make additional Sub-accounts available to you from time to time.
These Sub-accounts will invest in Portfolios we believe to be suitable for the
Policy. We may or may not make a new Sub-account available to invest in any new
portfolio of one of the current underlying mutual funds should such a portfolio
be made available to Separate Account F.
We may eliminate Sub-accounts, combine two or more Sub-accounts or substitute
one or more new underlying mutual funds or portfolios for the one in which a
Sub-account is invested. Substitutions may be necessary if we believe a
Portfolio no longer suits the purpose of the Policy. This may happen due to a
change in laws or regulations, or a change in the investment objectives or
restrictions of a Portfolio, or because the Portfolio is no longer available for
investment, or for some other reason. We would obtain prior approval from the
insurance department of our state of domicile, if so required by law, before
making such a substitution, combination, deletion or addition. We also would
obtain prior approval from the SEC so long as required by law, and any other
required approvals before making such a substitution, combination, deletion or
addition.
Entire Contract
For any Policy issued, the entire contract between you and us includes the
Policy form and any of the following which may be attached to the Policy: riders
or endorsements, the copy of any Application and endorsements. All statements
made in any Application are deemed to be representations and not warranties. No
statement is used to void a Policy or defend a claim unless it is contained in
any Application attached to the Policy.
Only our President, one of our Vice Presidents or our Secretary may change or
waive any provisions of a Policy. Any change or waiver must be In Writing. To
the extent permitted by law, we are not bound by any promises or representations
made by or to any other person.
Additional Tax Considerations
The following is a brief summary of certain Federal tax laws as they are
currently interpreted. No one can be certain that the laws or interpretations
will remain unchanged or that agencies or courts will always agree as to how the
tax law or regulations are to be interpreted. This discussion is not intended as
tax advice. You may wish to consult a professional tax advisor for tax advice as
to your particular situation.
We are taxed as a life insurance company under Part I, subchapter L, of the
Code.
Under most circumstances, the Beneficiary does not pay any Federal income tax on
the Death Proceeds.
Under most circumstances: (a) any gain in the Policy is not taxed currently; and
(b) any amounts you receive as a partial withdrawal or if you surrender the
Policy are deemed for income tax purposes to come first from your basis in the
Policy, with any gain withdrawn taxed as ordinary income; and (c) if you assign
or pledge any portion of the Policy, the transaction is not treated as a
distribution subject to taxation.
The tax treatment of the Policy and any distribution while the Insured is alive
will be different if the Policy is deemed to be a MEC. Some of the key ways in
which a MEC is treated differently from other life insurance Policies are: (a)
amounts your receive as a partial withdrawal, loan, or if you surrender the
Policy are deemed for income tax purposes to come first from any gain in the tax
year received; (b) distributions of gain before the taxpayer's age 59 1/2 are
subject to a 10% penalty unless an exception applies; and (c) assignments or
pledges as collateral for a loan are deemed a taxable distribution to the extent
of any gain.
Exchanges: Section 1035 of the Code permits certain income tax-free exchanges of
life insurance policies. You must comply with various requirements for such
exchanges to be treated as tax-free, which include, but are not limited to: (a)
the need for the insured to be the same individual or individuals before and
after the exchange; (b) the need for the owner(s) to be the same before and
after the exchange; and (c) the need to have the Debt on a Policy as of the date
all premium is received equal to any outstanding indebtedness on the life
insurance exchanged for the Policy.
Transfers between investment options: Transfers between investment options are
not subject to taxation. The Treasury Department may promulgate guidelines under
which a variable life insurance policy will not be treated as life insurance for
tax purposes if persons with ownership rights have excessive control over the
investments underlying such a policy. Such guidelines may or may not address the
number of investment options or the number of transfers between investment
options offered. It is not known whether such guidelines, if in fact
promulgated, would have retroactive effect. It is also not known what effect, if
any, such guidelines may have on transfers between the investment options of the
Policy offered pursuant to this Prospectus. We will take any action, including
modifications to your Policy or the Sub-accounts, required to comply with such
guidelines if promulgated.
Generation skipping transfers: Under the Code certain taxes may be due when all
or part of a life insurance policy is transferred to or a death benefit is paid
to an individual two or more generations younger than the policy holder. These
generation-skipping transfers generally include those subject to federal estate
or gift tax rules. There is an aggregate $1 million exemption from tax on all
such transfers. We may be required to determine whether a transaction is a
direct skip as defined in the Code and the amount of the resulting tax. We will
deduct from your Policy or from any applicable payment treated as a direct skip
any amount of tax we are required to pay. You should consult with competent tax
counsel for more information on generation skipping transfers.
Diversification: Section 817(h) of the Code provides that a variable life
insurance policy, in order to qualify as life insurance, must have an
"adequately diversified" segregated asset account (including investments in a
mutual fund by the segregated asset account of insurance companies). The
Treasury Department's regulations prescribe the diversification requirements for
variable life insurance policy. We believe the underlying mutual fund portfolios
should comply with the terms of these regulations.
Withholding: Section 3405 of the Code provides for Federal income tax
withholding on the portion of a distribution which is includible in the gross
income of the recipient. Amounts to be withheld depend upon the nature of the
distribution. However, under most circumstances a recipient may elect not to
have income taxes withheld or have income taxes withheld at a different rate by
filing a completed election form with us. A withholding form may be required.
Accelerated Death Benefits: Payments of amounts that otherwise would be payable
to the Beneficiary as a result of an Insured's death can qualify for the same
tax-free treatment as death benefits if certain requirements are met. These
include requirements regarding the terminal illness of the Insured. We believe
payments under the provisions of the accelerated death benefit of the Policy
will meet the requirements of the Code and the regulations in order to qualify
as tax-free payments.
Continuing the Policy Beyond the Implied Maturity Date: We believe that a Policy
will continue to be treated as life insurance and, if applicable, as a MEC, if
it remains in force beyond the Policy's assumed maturity date. However, this tax
treatment is not certain, so you should consult your tax advisor before taking
this step. If the Policy is not treated as life insurance after such date, gain
in the Policy may no longer be taxed deferred, and all or a portion of the Death
Proceeds may be taxable to the Beneficiary.
Survivorship Policies: The Code does not directly address how certain features
of a policy paying on the death of a surviving insured should be treated. We
believe such a Policy should be treated as other life insurance policies, but
there is some uncertainty as to whether that is the case. If the surviving
Insured is an Owner, the Death Proceeds payable as a result of the death of the
last surviving Insured generally will be treated as part of the Owner's estate
for purposes of the Federal estate tax. If the surviving Insured was not an
Owner, the replacement cost of the Policy would be included in the estate of the
Owner upon his or her death and Death Proceeds payable as a result of the death
of the surviving Insured are includible in the person's estate if the proceeds
are payable to or for the benefit of that person's estate or if the surviving
Insured held incidents of ownership in the Policy within three years prior to
death.
Other taxes: Amounts received or deemed received from a Policy that may be
subject to Federal income tax also may be subject to state income taxes. The
fair market value of a Policy or the Death Proceeds may be included under
certain circumstances in an estate for purposes of state inheritance taxes or
Federal estate taxes. Federal estate and gift taxes are integrated for various
purposes. An unlimited marital deduction may apply for purposes of Federal
estate and gift taxes, which would allow deferral of taxes until the death of
the surviving spouse.
Safekeeping of the Assets
We maintain the assets of the Separate Account and those in our general account.
The assets of the Separate Account are segregated from those in our general
account.
Regulation
We are organized as a Connecticut stock life insurance company, and are subject
to Connecticut law governing insurance companies. We are regulated and
supervised by the Connecticut Commissioner of Insurance. By March 1 of every
year, we must prepare and file an annual statement, in a form prescribed by the
Connecticut Insurance Department, which covers our operations for the preceding
calendar year, and must prepare and file our statement of financial condition as
of December 31 of such year. The Commissioner and his or her agents have the
right at all times to review or examine our books and assets. A full examination
of our operations will be conducted periodically according to the rules and
practices of the National Association of Insurance Commissioners ("NAIC"). We
are subject to the insurance laws and various Federal and state securities laws
and regulations and to regulatory agencies, such as the Securities and Exchange
Commission and the Connecticut Banking Department, which administer those laws
and regulations.
We can be assessed up to prescribed limits for policyholder losses incurred by
insolvent insurers under the insurance guaranty fund laws of most states. We
cannot predict or estimate the amount any such future assessments we may have to
pay. However, the insurance guaranty laws of most states provide for deferring
payment or exempting a company from paying such an assessment if it would
threaten such insurer's financial strength.
Several states, including Connecticut, regulate insurers and their affiliates
under insurance holding company laws and regulations. This applies to us and our
affiliates. Under such laws, inter-company transactions, such as dividend
payments to parent companies and transfers of assets, may be subject to prior
notice and approval, depending on factors such as the size of the transaction in
relation to the financial position of the companies.
Currently, the federal government does not directly regulate the business of
insurance. However, federal legislative, regulatory and judicial decisions and
initiatives often have significant effects on our business. Types of changes
that are most likely to affect our business include changes to: (a) the taxation
of life insurance companies; (b) the tax treatment of insurance products; (c)
the securities laws, particularly as they relate to insurance and annuity
products; (d) the "business of insurance" exemption from many of the provisions
of the anti-trust laws; (e) the barriers preventing most banks from selling or
underwriting insurance: and (f) any initiatives directed toward improving the
solvency of insurance companies. We would also be affected by federal
initiatives that have impact on the ownership of or investment in United States
companies by foreign companies or investors.
Legal Matters
The law firm of Werner & Kennedy has passed on the legal matters relating to the
offering of these Policies.
Legal Proceedings
As of the date of this Prospectus, neither we nor American Skandia Marketing,
Incorporated were involved in any litigation outside of the ordinary course of
business, and know of no material claims.
Experts
The audited financial statement included in this Prospectus and Registration
Statement are presented in accordance with generally accepted accounting
principles. These statements were audited by Ernst & Young LLP, independent
auditors for the period ended December 31, 1997, and by Deloitte & Touche LLP
for the periods ended December 31, 1996, 1995, 1994 and 1993. We rely on their
respective authority as experts in accounting and auditing.
William H. Strong, Vice President, FSA, MAAA, has approved the hypothetical
illustration included in this Prospectus and Registration Statement. We have
included them relying on his opinion that they are reasonable.
Distribution of this Offering
American Skandia Marketing, Incorporated ("ASM, Inc."), a wholly-owned
subsidiary of American Skandia Investment Holding Corporation, acts as the
principal underwriter of the Policies. ASM was incorporated under the laws of
the State of Delaware on September 8, 1987. ASM, Inc.'s principal business
address is One Corporate Drive, Shelton, Connecticut 06484. ASM, Inc. is a
broker-dealer registered with the SEC under the 1934 Act and a member of the
National Association of Securities Dealers, Inc. ("NASD").
ASM, Inc. will enter into distribution agreements with certain broker-dealers
registered under the Securities and Exchange Act of 1934 or with entities which
may otherwise offer the Policies that are exempt from such registration. In
addition, ASM, Inc. may offer Policies directly to potential purchasers. The
maximum initial concession to be paid on premiums received is [ ]% and a portion
of compensation may be paid from time to time based on all or a portion of
either the Account Value or the Cash Value. We reserve the right to base
concessions from time-to-time on the investment options chosen by Owners,
including investment options that may be deemed our "affiliates" or "affiliates"
of ASM, Inc. under the Investment Company Act of 1940.
As of the date of this Prospectus, we expect to pay an on-going service fee in
relation to providing certain statistical information upon request by Owners
about the investment options and the Portfolios. We may make the fee payable to
the service providers based on either the Account Value or Cash Value of
Policies. Under most circumstances, we will engage the broker-dealer of record
for your Policy, or the entity of record if such entity could offer Policies
without registration as a broker-dealer (i.e. certain banks), to be your
resource for the statistical information, and to be available upon your request
to both provide and explain such information to you. The broker-dealer of record
or the entity of record is the firm which sold you the Policy, unless later
changed. Some portion of the fee we pay for this service may be payable to your
representative.
We may structure on-going sales compensation and the on-going service fees such
that no fee is payable based on the value in Fixed Allocations. If that were to
occur, it is possible that your representative may receive on-going service fee
compensation, but only in relation to value maintained in variable investment
options.
From time to time we may promote the sale of our products such as the Policies
offered pursuant to this Prospectus through programs of non-cash rewards to
registered representatives of participating broker-dealers. We may withdraw or
alter such promotions at any time.
To the extent permitted, we may advertise certain information regarding the
performance of the investment options that does not take into consideration the
effect of the deductions for taxes, the cost of insurance charges or the
contingent deferred sales charge. This performance information may help you
review the performance of the investment options and provide a basis for
comparison between the Policy's investment options. This information may be less
useful when comparing the performance of the investment options with the
performance of investment options provided in other variable life policies
because each plan of life insurance will have its own applicable charges. This
information is even less useful in comparing performance to that of any savings
or investment vehicle, rather than variable life insurance.
Performance information on the Sub-accounts is based on past performance only
and is no indication of future performance. Actual performance will depend on
the type, quality and, for some of the Sub-accounts, the maturities of the
investments held by the Portfolios and upon prevailing market conditions and the
response of the Portfolios to such conditions. Actual performance will also
depend on changes in the expenses of the Portfolios. Such changes are reflected,
in turn, in the Sub-accounts which invest in such Portfolios. In addition, the
charges deducted from your Account Value and those assessed against each
Sub-account will affect performance.
Certain of the Portfolios existed prior to the inception of the Sub-accounts
available under the Policy. To the extent permitted by applicable law,
performance quoted in advertising regarding such Sub-accounts may indicate
periods during which the Portfolios have been in existence but prior to the
inception of the Sub-account(s) or the initial offering of the Policies. Such
performance is considered hypothetical historical performance because the
Sub-accounts did not exist during the period the performance was achieved. Such
hypothetical historical performance is calculated using the same assumptions
employed in calculating historical performance since inception of the
Sub-accounts. Any such historical performance will be based on assumptions.
These include assumptions regarding: (a) the Age, risk class and gender, where
applicable, of an Insured or Insureds; (b) the amount and timing of Premium
payments, the Specified Amount, the Death Benefit option and the Policy Date;
and (c) assumptions about a lack of transfers, loans, loan repayments and
withdrawals as well as no changes to the Specified Amount and Death Benefit
option during the period for which performance is quoted.
American Skandia Life Assurance Corporation may advertise its rankings and/or
ratings by independent financial ratings services. Such rankings may help you in
evaluating our ability to meet our obligations in relation to Fixed Allocations,
pay Death Proceeds, make payments under any settlement options or administer
Policies. Such rankings and ratings do not reflect or relate to the performance
of Separate Account F or the underlying Portfolios.
Illustrations
In Appendix A we provide examples of the kind of hypothetical illustrations
available to help you better understand how a Policy works. In that Appendix, we
also provide information on how you may obtain additional hypothetical
illustrations. In Appendix G, we provide hypothetical illustrations of how
exercise of the accelerated death benefit provision affects the values of a
Policy.
Executive Officers and Directors
Our executive officers, directors and certain significant employees, their ages,
positions with us and principal occupations are indicated below. The immediately
preceding work experience is provided for officers that have not been employed
by us or an affiliate for at least five years as of the date of this Prospectus.
Name/ Position with American Skandia
Age Life Assurance Corporation Principal Occupation
Gordon C. Boronow* Deputy Chief Executive Deputy Chief Executive
45 Officer and President Officer and President:
Director (since July, 1991), American Skandia Life
Assurance Corporation
Nancy F. Brunetti Director (since February, 1996) Executive Vice President and
36 Chief Operating Officer:
American Skandia Information
Services and Technology Corporation
Malcolm M. Campbell Director (since April, 1991) Director of Operations and
42 Chief Actuary, Assurance and
Financial Services Division:
Skandia Insurance Company Ltd.
Jan R. Carendi* Chief Executive Senior Executive Vice President and
53 Officer and Member of Corporate Management Group:
Chairman of the Skandia Insurance Company Ltd.
Board of Directors
Director (since May, 1988)
Lincoln R. Collins Executive Vice President and Executive Vice President, and
37 Chief Operating Officer Chief Operating Officer:
Director (since February, 1996) American Skandia Life
Assurance Corporation
Henrik Danckwardt Director (since July, 1991) Director of Finance
44 and Administration,
Assurance and Financial
Services Division:
Skandia Insurance Company Ltd.
Wade A. Dokken Director (since July, 1991) President and Deputy
38 Chief Executive Officer:
American Skandia Marketing, Incorporated
Brian L. Hirst Vice President, Vice President,
50 Corporate Actuary Corporate Actuary:
American Skandia Life
Assurance Corporation
Mr. Hirst joined us in 1996. He previously held the positions of Vice President
from 1993 to 1996 and Second Vice President from 1987 to 1992 at Allmerica
Financial.
N. David Kuperstock Vice President, Vice President,
46 Product Development Product Development:
American Skandia Life
Assurance Corporation
Thomas M. Mazzaferro Executive Vice President and Executive Vice President and
45 Chief Financial Officer, Chief Financial Officer:
Director (since October, 1994) American Skandia Life
Assurance Corporation
Gunnar J. Moberg Director (since November, 1994) Director - Marketing and Sales,
43 Assurances and Financial
Services Division:
Skandia Insurance Company Ltd.
David R. Monroe Treasurer, Vice President Treasurer, Vice President
36 and Controller and Controller:
American Skandia Life
Assurance Corporation
Mr. Monroe joined us in 1996. He previously held positions of Assistant Vice
President and Director at Allmerica Financial from August, 1994 to July, 1996
and Senior Manager at KPMG Peat Marwick from July, 1983 to July, 1994.
Rodney D. Runestad Vice President Vice President:
48 American Skandia Life
Assurance Corporation
Anders O. Soderstrom Director (since October, 1994) President and
38 Chief Information Officer:
American Skandia Information
Services and Technology Corporation
Amanda C. Sutyak Director (since July, 1991) Vice President:
40 American Skandia
Marketing, Incorporated
C. Ake Svensson Director (since December, 1994) Vice President, Corporate
47 Controller and Treasurer:
American Skandia Investment
Holding Corporation
Mr. Svensson joined us in 1994. He previously held the position of Senior Vice
President with Nordenbanken.
Bayard F. Tracy Director (since October, 1994) Senior Vice President,
50 National Sales Manager:
American Skandia
Marketing, Incorporated
Jeffrey M. Ulness Vice President, Vice President,
37 Product Management Product Management:
American Skandia Life
Assurance Corporation
Mr. Ulness joined us in 1994. He previously held the positions of Counsel at
North American Security Life Insurance Company from March, 1991 to July, 1994
and Associate at LeBoeuf, Lamb, Leiby, Green and MacRae from January, 1990 to
March 1991.
- --------
* Trustees of American Skandia Trust, one of the underlying mutual funds in
which the Sub-accounts offered pursuant to this Prospectus invest.
Financial Statements for American Skandia Life Assurance Corporation and
American Skandia Life Assurance Corporation Separate Account F
[To be Provided by Amendment]
Appendix A
Hypothetical Illustrations of Death Benefits, Account Values and Cash Values
It is impossible to illustrate exactly how a Policy will perform in the future.
However, you may better understand how a Policy works, and may be able to better
compare a Policy with other life insurance plans, using hypothetical
illustrations based on personal characteristics of the Insured(s) as well as
certain assumptions about the future. You can do this using the hypothetical
illustrations provided in this Appendix A. You can also do this by requesting
from us personalized hypothetical illustrations based on: (a) the Age(s) of the
Insured(s); (b) the expected risk class(es) of the Insured(s); (c) the gender of
the Insured(s), where permitted; (d) the Specified Amount you seek; (e) which
Death Benefit option (A or B) is to apply; and (f) the amount and timing of
Premiums you intend to pay. Please forward any such request to us at our address
as shown on the first page of this Prospectus.
As of the date of this Prospectus, we only provide such personalized
hypothetical illustrations on paper. We reserve the right to make such
illustrations available in the future via electronic transmission or as part of
a multi-media presentation.
As of the date of this Prospectus, we may not provide personalized hypothetical
illustrations that assume future loans, withdrawals, loan repayments, Premium
payments on other than the Policy Date and Policy Anniversaries, changes after
the Policy Date in the Death Benefit option on in the Specified Amount or
varying assumed rates of return. However, we reserve the right to make such
illustrations available in the future.
The hypothetical illustrations that follow show the changes in the Death
Benefit, Account Value and Cash Value over time based on certain assumptions.
All values are provided as of the end of each Policy Year shown. Hypothetical
illustrations are shown for both Death Benefit options. The assumptions used are
as follows:
1. Hypothetical average annual gross rates of return in the
Portfolios of 0%, 6% and 12%. Of course, actual investment
performance is not a constant rate. If the hypothetical gross
rate of return were to fluctuate above or below the 0%, 6% or
12% average over a period of years, the Death Benefit, Account
Value and Cash Value may be different. For hypothetical rates
of return 0% and 6%, the illustrations will indicate if a
Policy would lapse. HYPOTHETICAL RATES OF RETURN ARE FOR
ILLUSTRATIVE PURPOSES ONLY AND ARE NOT A REPRESENTATION OF
PAST OR FUTURE PERFORMANCE.
2. Hypothetical constant expense ratios of 1.10% for the
Portfolios. The total annual expenses for the underlying
mutual funds are shown in the section entitled "Variable
Investment Options." The 1.10% hypothetical expense ratio is
the average of the actual total annual expenses for all
available Portfolios as of December 31, 1997. Certain of the
Portfolios have not been in existence for a full year and,
therefore, the total annual expenses for those Portfolios are
estimated and annualized. The 1.10% hypothetical expense
ratio, when deducted from the hypothetical average gross rates
of return equals a hypothetical average net rate of return of
-1.10%, 4.90% and 10.90%, respectively.
3. The mortality and expense risk charge assessed against the
assets in the Separate Account at an annualized rate of 0.90%.
The charge for administrative expenses connected with
operating the Separate Account is 0.25% per year. It is also
assumed that there is no tax charge assessed against the
Separate Account.
4. The charges under the Policy, including the current cost of
insurance charges that differ by gender, risk class and
attained age. It is assumed that there are no transfer fees
applicable. The hypothetical illustrations are presented based
on both the current and guaranteed cost of insurance charges.
5 Premium taxes are assessed at the rate of 2.5%
6. There are no loans, loan repayments, withdrawals, accelerated
death benefit payments or amounts paid to maintain the Policy
in effect during a grace period. The hypothetical values will
include Cash Value Credits if applicable.
7. The Age(s) and, where applicable, gender of the Insured(s)
shown in each illustration.
8. The Insured(s) is/are eligible for the no tobacco use risk
class.
9. The Premium payments and Specified Amount are as shown in each
illustration. It is assumed that Premium payments are
allocated on the first day of the Policy Year shown.
10. Neither the Death Benefit Option nor the Specified Amount is
changed after the Policy Date.
{The following page shows the form of the illustrations to be provided upon
amendment. A number of illustrations using the two different death benefit
options, different ages, risk classes, etc. will be filed by amendment.}
- ------------------------------------------------------------------------------------------------------------------------------------
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
Flexible Premium Variable Life Insurance
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Illustration Assumptions:
Issue State:
- --------------------- ----------------- ----------------- ----------------- ---------------- ------------------ ------------------
Death Benefit Option Specified Issue Age(s) Male/Female Single Life/ Hypothetical Rate Tobacco Usage
Amount Joint Life of Return Classification
- --------------------- ----------------- ----------------- ----------------- ---------------- ------------------ ------------------
- --------------------- ----------------- ----------------- ----------------- ---------------- ------------------ ------------------
A/B $[ ] [ ] [ ] [ ] [ ]% [ ]
- --------------------- ----------------- ----------------- ----------------- ---------------- ------------------ ------------------
- ------------- ----------------- ----------------------------------------------- -------------------------------------------------
Policy Year Premium Current Charges Guaranteed Charges
Payments*
----------------------------------------------------
----------------- ---------------- ----------------- ---------------- ---------------- -------------
Death Benefit Account Value Cash Value Death Benefit Account Value Cash Value
- ------------- ----------------- ----------------- ---------------- ----------------- ---------------- ---------------- -------------
- ------------- -----------------
1 $
- ------------- ----------------- ----------------- ---------------- ----------------- ---------------- ---------------- -------------
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2
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3
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4
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5
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6
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7
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8
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9
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10
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11
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12
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13
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14
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15
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16
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17
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18
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19
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20
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25
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30
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35
- ------------- ----------------- ----------------- ---------------- ----------------- ---------------- ---------------- -------------
* It is assumed that Premiums are applied at the beginning of the Policy Year
shown.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS PROSPECTUS
ARE FOR ILLUSTRATIVE PURPOSES ONLY AND ARE NOT A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS WILL DEPEND ON INVESTMENT
ALLOCATIONS MADE BY THE POLICY OWNER AND MAY BE MORE OR LESS THAN THOSE SHOWN.
THE DEATH BENEFIT, ACCOUNT VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN APPLICABLE TO THE POLICY FLUCTUATED
ABOVE OR BELOW THE AVERAGE AMOUNT DURING A PERIOD OF POLICY YEARS. THE DEATH
BENEFIT, ACCOUNT VALUE AND CASH VALUE FOR A POLICY WOULD ALSO VARY DEPENDING ON
THE TIMING AND AMOUNT OF PREMIUM PAYMENTS, THE INVESTMENT ALLOCATIONS MADE TO
THE SUB-ACCOUNTS AND THE RATES OF RETURN OF THE SUB-ACCOUNTS. NO REPRESENTATION
CAN BE MADE THAT THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE
YEAR OR SUSTAINED OVER ANY PERIOD OF TIME.
Appendix B
Multiple Factors for Determination of Minimum Required Death Benefits
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Attained Male Male Female Female Unisex Unisex
Age No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
0 12.397150 10.326608 14.422882 12.900426 12.752665 10.747003
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
1 12.281011 10.173837 14.219565 12.682064 12.622613 10.584213
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
2 11.944420 9.873755 13.822804 12.312452 12.275281 10.272427
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
3 11.608026 9.576235 13.425879 11.944611 11.928125 9.963139
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
4 11.275017 9.283405 13.033047 11.581885 11.584496 9.658649
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
5 10.943625 8.994070 12.646363 11.225854 11.243683 9.358448
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
6 10.613523 8.708009 12.264732 10.875640 10.904071 9.061429
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
7 10.285545 8.425756 11.888608 10.531568 10.567564 8.768864
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
8 9.960465 8.147792 11.518416 10.193939 10.234821 8.481165
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
9 9.640696 7.875658 11.155708 9.863913 9.907346 8.199307
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
10 9.328187 7.610564 10.800626 9.541559 9.587222 7.924630
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
11 9.024495 7.353454 10.453314 9.226944 9.276084 7.658162
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
12 8.732865 7.106340 10.116701 8.922270 8.976663 7.401637
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
13 8.455766 6.870706 9.791287 8.627858 8.691024 7.156329
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
14 8.194431 6.647223 9.477396 8.343893 8.420677 6.923124
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
15 7.948562 6.435568 9.175211 8.070450 8.165496 6.701818
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
16 7.714094 6.246422 8.883354 7.811850 7.921336 6.502004
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
17 7.490138 6.067126 8.601325 7.562219 7.687389 6.311977
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
18 7.274496 5.895056 8.328033 7.321110 7.461943 6.129648
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
19 7.065325 5.728867 8.063146 7.088105 7.243557 5.953258
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
20 6.861498 5.567158 7.806353 6.861998 7.030582 5.781913
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
21 6.661689 5.409013 7.556857 6.642566 6.822482 5.614335
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
22 6.464827 5.253449 7.314462 6.429238 6.617668 5.449969
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
23 6.270740 5.099678 7.078536 6.222198 6.416306 5.287912
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
24 6.079311 4.947887 6.849383 6.021253 6.218203 5.128317
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
25 5.890773 4.797878 6.626824 5.826215 6.023851 4.971129
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
26 5.705061 4.649694 6.410687 5.636912 5.832787 4.816319
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
27 5.522918 4.504047 6.201135 5.453667 5.645733 4.664588
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
28 5.344702 4.361361 5.997646 5.276008 5.463015 4.516169
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
29 5.170696 4.221976 5.800350 5.103956 5.284886 4.371391
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
30 5.001118 4.086280 5.609316 4.937495 5.111533 4.230649
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
31 4.836129 3.954443 5.424064 4.776572 4.942883 4.093967
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
32 4.676007 3.826576 5.244646 4.620762 4.779230 3.961464
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
33 4.520784 3.702740 5.070851 4.470023 4.620609 3.833206
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
34 4.370604 3.583050 4.902678 4.324427 4.467172 3.709211
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
35 4.225402 3.467472 4.740086 4.183858 4.318852 3.589463
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
36 4.085093 3.356027 4.583009 4.048184 4.175562 3.474000
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
37 3.949574 3.248695 4.431658 3.917849 4.037194 3.362813
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
38 3.818948 3.145558 4.286008 3.792821 3.903859 3.256009
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
39 3.693047 3.046509 4.145854 3.673023 3.775382 3.153481
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
40 3.571699 2.951480 4.010985 3.558248 3.651587 3.055171
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
41 3.454905 2.860432 3.881423 3.448543 3.532475 2.960985
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
42 3.342463 2.773188 3.756916 3.343654 3.417839 2.870809
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
43 3.234173 2.689614 3.637126 3.243178 3.307470 2.784405
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
44 3.129912 2.609567 3.521744 3.146758 3.201170 2.701641
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
45 3.029545 2.532933 3.410489 3.054071 3.098812 2.622375
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
46 2.932987 2.459510 3.303265 2.964946 3.000322 2.546415
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
47 2.840080 2.389070 3.199885 2.879159 2.905491 2.473500
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
48 2.750664 2.321493 3.100236 2.796501 2.814223 2.403493
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
49 2.664624 2.256655 3.004135 2.716871 2.726361 2.336322
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
50 2.581837 2.194450 2.911517 2.640207 2.641791 2.271834
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Attained Male Male Female Female Unisex Unisex
Age No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
51 2.502248 2.134815 2.822301 2.566385 2.560472 2.209993
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
52 2.425813 2.077737 2.736388 2.495281 2.482339 2.150760
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
53 2.352497 2.023196 2.653759 2.426911 2.407370 2.094125
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
54 2.282259 1.971185 2.574320 2.361226 2.335514 2.040067
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
55 2.215004 1.921608 2.497847 2.298001 2.266658 1.988479
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
56 2.150642 1.874324 2.424206 2.237062 2.200708 1.939205
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
57 2.089042 1.829175 2.353160 2.178161 2.137500 1.892075
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
58 2.030021 1.786006 2.284468 2.121005 2.076847 1.846924
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
59 1.973500 1.744665 2.217943 2.065412 2.018657 1.803580
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
60 1.919420 1.705055 2.153574 2.011324 1.962862 1.761948
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
61 1.867716 1.667166 2.091397 1.958835 1.909431 1.722036
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
62 1.818314 1.631023 2.031523 1.908129 1.858319 1.683884
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
63 1.771223 1.596648 1.974085 1.859458 1.809549 1.647549
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
64 1.726411 1.564046 1.919205 1.812976 1.763101 1.613051
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
65 1.683806 1.533171 1.866819 1.768644 1.718910 1.580343
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
66 1.643300 1.503897 1.816773 1.726292 1.676876 1.549292
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
67 1.604764 1.476075 1.768842 1.685680 1.636838 1.519731
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
68 1.568051 1.449538 1.722784 1.646485 1.598627 1.491461
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
69 1.533054 1.424158 1.678405 1.608508 1.562130 1.464331
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
70 1.499720 1.399895 1.635655 1.571689 1.527285 1.438291
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
71 1.468047 1.376751 1.594582 1.536121 1.494089 1.413351
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
72 1.438063 1.354779 1.555314 1.502053 1.462589 1.389586
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
73 1.409834 1.334059 1.518005 1.469679 1.432868 1.367100
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
74 1.383379 1.314626 1.482760 1.439131 1.404950 1.345937
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
75 1.358636 1.296498 1.449578 1.410430 1.378783 1.326116
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
76 1.335469 1.279631 1.418378 1.383477 1.354239 1.307580
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
77 1.313718 1.263864 1.388992 1.358100 1.331154 1.290152
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
78 1.293202 1.248999 1.361233 1.334088 1.309345 1.273628
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
79 1.273759 1.234861 1.334950 1.311271 1.288648 1.257826
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
80 1.255309 1.221364 1.310065 1.289565 1.268984 1.242660
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
81 1.237839 1.208496 1.286574 1.268966 1.250340 1.228120
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
82 1.221387 1.196307 1.264515 1.249510 1.232759 1.214254
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
83 1.206024 1.184882 1.243944 1.231249 1.216310 1.201144
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
84 1.191790 1.174263 1.224859 1.214302 1.201025 1.188858
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
85 1.178654 1.164403 1.207192 1.198599 1.186864 1.177349
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
86 1.166512 1.155169 1.190822 1.184011 1.173721 1.166496
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
87 1.155226 1.146356 1.175596 1.170379 1.161453 1.156126
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
88 1.144611 1.137856 1.161343 1.157508 1.149880 1.146117
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
89 1.134451 1.129578 1.147875 1.145194 1.138803 1.136350
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
90 1.124540 1.121277 1.134998 1.133196 1.128023 1.126599
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
91 1.114649 1.112675 1.122488 1.121417 1.117328 1.116680
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
92 1.104523 1.103442 1.110106 1.109599 1.106476 1.106325
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
93 1.093858 1.093346 1.097598 1.097460 1.095193 1.095309
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
94 1.082392 1.082252 1.084722 1.084722 1.083237 1.083449
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
95 1.070054 1.070054 1.071362 1.071362 1.070535 1.070696
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
96 1.057074 1.057074 1.057701 1.057701 1.057307 1.057384
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
97 1.044319 1.044319 1.044548 1.044548 1.044405 1.044433
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
98 1.034629 1.034629 1.034629 1.034629 1.034629 1.034629
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
99 1.025648 1.025648 1.025648 1.025648 1.025648 1.025648
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
- ------------------------------------------------------------------------------------------------------------------------------------
The Minimum Required Death Benefit is determined by treating the Account Value
as if it were a net single premium. We determine the Minimum Required Death
Benefit by multiplying the Account Value by factors that are determined as of
the Policy Date. These factors vary by the attained Age, gender (where
permitted) and risk class of the Insured. Factors for joint life cases depend
upon a standard insurance industry method to derive the applicable rate for both
Insureds.
- --------------------------------------------------------------------------------
Appendix C
Premium Tax Rates
--------------------------- ----------------- -------------------------- ----------------
STATE TAX RATE STATE TAX RATE
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Alabama 2.70% Nebraska 1.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Alaska 2.70% Nevada 3.50%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Arizona 2.00% New Hampshire 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Arkansas 2.50% New Jersey 2.10%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
California 2.35% New Mexico 3.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Colorado 2.15% New York 0.70%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Connecticut 1.75% North Carolina 1.90%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Delaware 2.00% North Dakota 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
District of Columbia 2.25% Ohio 2.50%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Florida 1.75% Oklahoma 2.25%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Georgia 2.25% Oregon 2.25%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Hawaii 2.75% Pennsylvania 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Idaho 2.75% Rhode Island 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Illinois 2.00% South Carolina 0.75%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Indiana 2.00% South Dakota 2.50%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Iowa 2.00% Tennessee 1.90%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Kansas 2.00% Texas 1.75%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Kentucky 2.00% Utah 2.25%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Louisiana 2.25% Vermont 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Maine 2.00% Virginia 2.25%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Maryland 2.00% Washington 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Massachusetts 2.00% West Virginia 3.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Michigan N/A Wisconsin 2.00%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Minnesota 2.00% Wyoming 0.75%
--------------------------- ----------------- ------ -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Mississippi 3.00% Puerto Rico 4.00%
--------------------------- ----------------- -------------------------- ----------------
--------------------------- ----------------- ------ -------------------------- ----------------
Missouri 2.00% Virgin Islands 5.00%
--------------------------- ----------------- -------------------------- ----------------
--------------------------- ----------------- ------
Montana 2.75%
--------------------------- -----------------
Appendix D
Guaranteed Maximum Monthly Cost of Insurance Charges
(Per $1,000 of Net Amount at Risk)
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
Male Male Female Female Unisex Unisex
Attained No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
Age
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
0 N/A 0.21943 N/A 0.15680 N/A 0.20690
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
1 N/A 0.08587 N/A 0.07002 N/A 0.08253
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
2 N/A 0.08253 N/A 0.06669 N/A 0.07920
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
3 N/A 0.08086 N/A 0.06502 N/A 0.07753
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
4 N/A 0.07753 N/A 0.06418 N/A 0.07503
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
5 N/A 0.07336 N/A 0.06252 N/A 0.07086
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
6 N/A 0.06919 N/A 0.06085 N/A 0.06752
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
7 N/A 0.06502 N/A 0.05918 N/A 0.06418
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
8 N/A 0.06252 N/A 0.05835 N/A 0.06168
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
9 N/A 0.06168 N/A 0.05751 N/A 0.06085
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
10 N/A 0.06252 N/A 0.05668 N/A 0.06168
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
11 N/A 0.06752 N/A 0.05835 N/A 0.06585
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
12 N/A 0.07669 N/A 0.06085 N/A 0.07336
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
13 N/A 0.08921 N/A 0.06418 N/A 0.08420
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
14 N/A 0.10339 N/A 0.06835 N/A 0.09671
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
15 N/A 0.14678 N/A 0.08003 N/A 0.13343
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
16 0.12341 0.16348 0.07503 0.08420 0.11340 0.14761
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
17 0.13092 0.17516 0.07753 0.08837 0.12007 0.15847
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
18 0.13593 0.18435 0.08003 0.09254 0.12508 0.16598
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
19 0.13927 0.19019 0.08253 0.09504 0.12758 0.17182
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
20 0.14010 0.19353 0.08420 0.09755 0.12925 0.17433
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
21 0.13843 0.19353 0.08587 0.09922 0.12758 0.17516
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
22 0.13593 0.19019 0.08670 0.10172 0.12592 0.17266
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
23 0.13259 0.18685 0.08837 0.10422 0.12341 0.17015
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
24 0.12925 0.18184 0.09004 0.10672 0.12174 0.16681
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
25 0.12508 0.17600 0.09171 0.10923 0.11841 0.16264
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
26 0.12258 0.17266 0.09421 0.11340 0.11674 0.16097
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
27 0.12091 0.17099 0.09588 0.11674 0.11590 0.16014
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
28 0.12007 0.17099 0.09838 0.12091 0.11590 0.16097
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
29 0.12007 0.17349 0.10172 0.12592 0.11674 0.16431
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
30 0.12091 0.17767 0.10422 0.13176 0.11757 0.16848
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
31 0.12341 0.18351 0.10756 0.13676 0.12007 0.17433
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
32 0.12675 0.19103 0.11090 0.14261 0.12341 0.18184
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
33 0.13176 0.20105 0.11507 0.15012 0.12842 0.19103
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
34 0.13760 0.21274 0.12007 0.15847 0.13426 0.20189
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
35 0.14428 0.22694 0.12592 0.16765 0.14094 0.21525
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
36 0.15179 0.24365 0.13426 0.18184 0.14845 0.23112
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
37 0.16181 0.26455 0.14428 0.19855 0.15847 0.25118
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
38 0.17266 0.28795 0.15513 0.21776 0.16932 0.27374
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
39 0.18435 0.31471 0.16681 0.23864 0.18101 0.29966
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
40 0.19855 0.34565 0.18101 0.26371 0.19520 0.32892
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
41 0.21358 0.37912 0.19604 0.29046 0.21024 0.36155
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
42 0.22945 0.41595 0.21107 0.31721 0.22611 0.39586
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
43 0.24700 0.45614 0.22611 0.34398 0.24282 0.43353
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
44 0.26622 0.50054 0.24115 0.37075 0.26120 0.47457
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
45 0.28795 0.54747 0.25786 0.39920 0.28210 0.51814
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
46 0.31136 0.59611 0.27541 0.42850 0.30384 0.56257
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
47 0.33645 0.64897 0.29464 0.45865 0.32809 0.61037
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
48 0.36406 0.70606 0.31471 0.49132 0.35402 0.66324
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
49 0.39418 0.76823 0.33729 0.52736 0.38247 0.71950
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
50 0.42850 0.83717 0.36238 0.56592 0.41511 0.78252
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
51 0.46786 0.91542 0.39000 0.60702 0.45195 0.85315
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
52 0.51311 1.00385 0.42181 0.65401 0.49467 0.93310
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
Male Male Female Female Unisex Unisex
Attained No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
Age
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
53 0.56508 1.10418 0.45698 0.70606 0.54328 1.02323
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
54 0.62296 1.21390 0.49300 0.75899 0.59695 1.12105
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
55 0.68759 1.33137 0.53155 0.81363 0.65653 1.22488
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
56 0.75815 1.45576 0.57011 0.86746 0.72034 1.33390
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
57 0.83297 1.58711 0.60786 0.91795 0.78756 1.44814
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
58 0.91627 1.72544 0.64562 0.96763 0.86157 1.56676
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
59 1.00975 1.87419 0.68843 1.02071 0.94405 1.69402
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
60 1.11430 2.04023 0.73882 1.08393 1.03756 1.83677
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
61 1.23079 2.22793 0.80101 1.16324 1.14299 1.99933
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
62 1.36520 2.43997 0.87839 1.26543 1.26543 2.18524
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
63 1.51760 2.67741 0.97352 1.38974 1.40497 2.39462
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
64 1.68723 2.93784 1.08056 1.52861 1.56082 2.62421
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
65 1.87334 3.21456 1.19617 1.67535 1.73224 2.86728
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
66 2.07518 3.50512 1.31615 1.82487 1.91589 3.12050
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
67 2.29200 3.80704 1.43883 1.96952 2.11100 3.37961
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
68 2.52819 4.12480 1.56591 2.11612 2.32277 3.64901
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
69 2.79077 4.47081 1.70761 2.27577 2.55733 3.94097
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
70 3.08859 4.85418 1.87419 2.46480 2.82343 4.26531
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
71 3.42979 5.28688 2.07774 2.70487 3.13085 4.63554
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
72 3.82529 5.77849 2.32790 2.99983 3.49039 5.06102
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
73 4.27492 6.32638 2.62850 3.35194 3.90095 5.53811
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
74 4.77158 6.93067 2.97572 3.75491 4.35707 6.06583
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
75 5.30544 7.58071 3.36491 4.19721 4.84979 6.63340
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
76 5.87268 8.25007 3.78792 4.66975 5.37438 7.21630
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
77 6.46947 8.92720 4.24348 5.16594 5.92694 7.80752
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
78 7.09996 9.61687 4.73909 5.69326 6.51244 8.40996
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
79 7.78481 10.34362 5.29130 6.27099 7.15044 9.04868
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
80 8.54724 11.13282 5.92338 6.92258 7.86386 9.74764
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
81 9.40950 12.00893 6.65582 7.66774 8.67463 10.53067
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
82 10.39222 12.98984 7.50735 8.52251 9.60297 11.41509
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
83 11.49454 14.06239 8.47766 9.51961 10.64778 12.40384
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
84 12.69876 15.19327 9.55942 10.61310 11.79409 13.46161
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
85 13.98062 16.34562 10.74439 11.78934 13.02257 14.56335
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
86 15.32651 17.49176 12.02797 13.04182 14.32180 15.69269
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
87 16.71801 18.68355 13.41230 14.36087 15.68277 16.87966
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
88 18.15088 19.94243 14.90282 15.75618 17.10606 18.14273
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
89 19.64755 21.21197 16.51661 17.23007 18.61282 19.45081
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
90 21.23307 22.51166 18.27329 18.89299 20.23099 20.86976
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
91 22.94951 23.88390 20.22265 20.71856 22.00462 22.41430
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
92 24.87000 25.50217 22.45280 22.78828 24.01445 24.21829
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
93 27.20132 27.62219 25.14857 25.28210 26.46176 26.49646
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
94 30.42887 30.59761 28.73601 28.73601 29.81058 29.68976
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
95 35.49221 35.49221 34.15814 34.15814 34.99881 34.83495
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
96 44.51507 44.51507 43.54279 43.54279 44.15278 44.03236
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
97 62.83141 62.83141 62.19404 62.19404 62.59184 62.51382
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
98 83.33333 83.33333 83.33333 83.33333 83.33333 83.33333
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
99 83.33333 83.33333 83.33333 83.33333 83.33333 83.33333
-------------- ---------------- ---------------- ----------------- ---------------- ---------------- ----------------
- ------------------------------------------------------------------------------------------------------------------------------------
The guaranteed maximum cost of insurance charge depends on the risk class of the
Insured(s). We base the guaranteed maximum charges on the sex distinct 1980
Commissioners Standard Ordinary Ultimate Mortality Smoker/Non-Smoker Table, age
last birthday unless unisex charges apply. If unisex charges apply, a unisex
variation of that table is used. The amounts shown are per $1,000 of Net Amount
at Risk.
- --------------------------------------------------------------------------------
We derive the cost of insurance charges for joint life cases using a standard
insurance industry method based on the applicable cost of insurance charge for
both Insureds. Guaranteed maximum cost of insurance charges for specific
proposed joint Insureds are available upon request.
Appendix E
Current Monthly Cost of Insurance Rates
(per $1,000 of Net Amount at Risk)
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Male Male Female Female Unisex Unisex
Attained No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
Age
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
0 N/A 0.05834 N/A 0.02167 N/A 0.05250
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
1 N/A 0.05834 N/A 0.02167 N/A 0.05250
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
2 N/A 0.05834 N/A 0.02167 N/A 0.05250
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
3 N/A 0.05834 N/A 0.02167 N/A 0.05250
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
4 N/A 0.05834 N/A 0.02167 N/A 0.05250
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
5 N/A 0.05834 N/A 0.02167 N/A 0.05250
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
6 N/A 0.05884 N/A 0.02233 N/A 0.05300
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
7 N/A 0.05934 N/A 0.02300 N/A 0.05350
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
8 N/A 0.05984 N/A 0.02367 N/A 0.05400
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
9 N/A 0.06034 N/A 0.02433 N/A 0.05450
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
10 N/A 0.06084 N/A 0.02500 N/A 0.05500
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
11 N/A 0.06550 N/A 0.02667 N/A 0.05934
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
12 N/A 0.07017 N/A 0.02833 N/A 0.06367
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
13 N/A 0.07484 N/A 0.03000 N/A 0.06800
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
14 N/A 0.07951 N/A 0.03167 N/A 0.07234
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
15 N/A 0.08417 N/A 0.03333 N/A 0.07667
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
16 0.05017 0.08451 0.02350 0.03350 0.04600 0.07701
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
17 0.05034 0.08484 0.02367 0.03367 0.04617 0.07734
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
18 0.05050 0.08517 0.02383 0.03383 0.04634 0.07767
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
19 0.05067 0.08551 0.02400 0.03400 0.04650 0.07801
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
20 0.05084 0.08584 0.02417 0.03417 0.04667 0.07834
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
21 0.05100 0.08634 0.02417 0.03417 0.04684 0.07884
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
22 0.05117 0.08684 0.02417 0.03417 0.04700 0.07934
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
23 0.05134 0.08734 0.02417 0.03417 0.04717 0.07984
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
24 0.05150 0.08784 0.02417 0.03417 0.04734 0.08034
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
25 0.05167 0.08834 0.02417 0.03417 0.04750 0.08084
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
26 0.05217 0.08917 0.02433 0.03500 0.04800 0.08151
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
27 0.05267 0.09001 0.02450 0.03583 0.04850 0.08217
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
28 0.05317 0.09084 0.02467 0.03667 0.04900 0.08284
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
29 0.05367 0.09168 0.02483 0.03750 0.04950 0.08351
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
30 0.05417 0.09251 0.02500 0.03833 0.05000 0.08417
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
31 0.05467 0.09351 0.02600 0.04017 0.05050 0.08534
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
32 0.05517 0.09451 0.02700 0.04200 0.05100 0.08651
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
33 0.05567 0.09551 0.02800 0.04384 0.05150 0.08767
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
34 0.05617 0.09651 0.02900 0.04567 0.05200 0.08884
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
35 0.05667 0.09751 0.03000 0.04750 0.05250 0.09001
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
36 0.06017 0.10718 0.03250 0.05350 0.05584 0.09918
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
37 0.06367 0.11685 0.03500 0.05950 0.05917 0.10835
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
38 0.06717 0.12652 0.03750 0.06550 0.06250 0.11751
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
39 0.07067 0.13619 0.04000 0.07151 0.06584 0.12668
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
40 0.07417 0.14585 0.04250 0.07751 0.06917 0.13585
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
41 0.08051 0.16619 0.04700 0.08667 0.07534 0.15436
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
42 0.08684 0.18653 0.05150 0.09584 0.08151 0.17286
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
43 0.09318 0.20688 0.05600 0.10501 0.08767 0.19137
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
44 0.09951 0.22722 0.06050 0.11418 0.09384 0.20988
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
45 0.10584 0.24756 0.06500 0.12335 0.10001 0.22839
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
46 0.11568 0.27458 0.07101 0.13535 0.10918 0.25323
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
47 0.12552 0.30159 0.07701 0.14736 0.11835 0.27808
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
48 0.13535 0.32861 0.08301 0.15936 0.12752 0.30293
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
49 0.14519 0.35563 0.08901 0.17136 0.13669 0.32777
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
50 0.15502 0.38265 0.09501 0.18337 0.14585 0.35262
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
51 0.17036 0.41984 0.10418 0.20087 0.16036 0.38682
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
52 0.18570 0.45704 0.11335 0.21838 0.17486 0.42101
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Male Male Female Female Unisex Unisex
Attained No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
Age
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
53 0.20104 0.49424 0.12252 0.23589 0.18937 0.45521
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
54 0.21638 0.53145 0.13168 0.25340 0.20387 0.48941
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
55 0.23172 0.56866 0.14085 0.27091 0.21838 0.52361
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
56 0.25140 0.60837 0.15019 0.28675 0.23656 0.55981
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
57 0.27107 0.64809 0.15953 0.30259 0.25473 0.59602
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
58 0.29075 0.68781 0.16886 0.31843 0.27291 0.63223
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
59 0.31043 0.72753 0.17820 0.33428 0.29108 0.66845
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
60 0.33011 0.76725 0.18754 0.35012 0.30926 0.70466
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
61 0.35880 0.81049 0.20404 0.37898 0.33611 0.74589
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
62 0.38748 0.85373 0.22055 0.40783 0.36297 0.78712
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
63 0.41617 0.89697 0.23706 0.43669 0.38982 0.82835
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
64 0.44486 0.94022 0.25356 0.46555 0.41667 0.86959
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
65 0.47356 0.98347 0.27007 0.49441 0.44353 0.91083
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
66 0.52361 1.08534 0.28308 0.52861 0.48790 1.00234
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
67 0.57366 1.18724 0.29609 0.56282 0.53228 1.09386
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
68 0.62372 1.28916 0.30910 0.59702 0.57667 1.18540
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
69 0.67379 1.39110 0.32210 0.63123 0.62105 1.27696
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
70 0.72386 1.49306 0.33511 0.66544 0.66544 1.36854
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
71 0.86608 1.65457 0.43719 0.76976 0.80164 1.52148
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
72 1.00835 1.81613 0.53929 0.87410 0.93788 1.67447
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
73 1.15066 1.97774 0.64141 0.97846 1.07415 1.82750
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
74 1.29300 2.13940 0.74355 1.08284 1.21046 1.98058
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
75 1.43539 2.30112 0.84571 1.18724 1.34681 2.13371
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
76 1.71862 2.50844 1.10171 1.40698 1.62597 2.34281
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
77 2.00200 2.71586 1.35784 1.62681 1.90529 2.55200
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
78 2.28555 2.92335 1.61410 1.84674 2.18476 2.76127
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
79 2.56925 3.13094 1.87049 2.06676 2.46439 2.97063
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
80 2.85312 3.33861 2.12701 2.28688 2.74418 3.18008
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
81 3.32267 3.75471 2.39506 2.56456 3.18344 3.57557
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
82 3.79266 4.17116 2.66324 2.84239 3.62308 3.97138
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
83 4.26310 4.58795 2.93157 3.12037 4.06311 4.36749
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
84 4.73397 5.00509 3.20004 3.39851 4.50352 4.76392
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
85 5.20529 5.42258 3.46866 3.67680 4.94433 5.16066
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
86 5.73672 5.93114 3.84876 4.07857 5.45307 5.65311
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
87 6.26872 6.44021 4.22914 4.48065 5.96234 6.14604
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
88 6.80128 6.94980 4.60982 4.88306 6.47212 6.63946
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
89 7.33440 7.45990 4.99078 5.28579 6.98242 7.13336
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
90 7.86809 7.97053 5.37204 5.68885 7.49323 7.62774
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
91 8.30914 8.40607 5.81866 6.14284 7.93497 8.06604
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
92 8.75057 8.84200 6.26568 6.59724 8.37709 8.50472
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
93 9.19240 9.27830 6.71310 7.05205 8.81961 8.94378
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
94 9.63461 9.71497 7.16091 7.50727 9.26251 9.38323
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
95 10.07720 10.15203 7.60913 7.96291 9.70580 9.82305
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
96 13.71848 13.82108 10.48581 10.94483 13.23197 13.38855
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
97 17.38611 17.51689 13.37897 13.94444 16.78285 16.97932
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
98 21.08037 21.23974 16.28874 16.96191 20.35871 20.59562
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
99 24.80156 24.98994 19.21527 19.99739 23.95981 24.23773
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
- ------------------------------------------------------------------------------------------------------------------------------------
THE AMOUNTS SHOWN ABOVE ARE CURRENT RATES PER $1,000 OF NET AMOUNT AT RISK AS OF
THE DATE OF THIS PROSPECTUS. TO DETERMINE THE CURRENT MONTHLY COST OF INSURANCE
CHARGE WE MULTIPLY THESE RATES BY THE NET AMOUNT AT RISK. TO THAT PRODUCT, WE
ADD THE CURRENT COST OF INSURANCE FEE. THE AMOUNTS SHOWN ABOVE ARE CURRENT RATES
PER $1,000 OF NET AMOUNT AT RISK.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Current monthly cost of insurance rates for specific proposed joint Insureds are
available on request.
- --------------------------------------------------------------------------------
Appendix F
Description of the Calculation of Current Monthly Cost of Insurance Charges
We determine the current monthly cost of insurance rate, the currently monthly
cost of insurance fee and any underwriting factor as follows:
1. Current monthly cost of insurance rate: The rate depends on a number
of factors, as follows.
a. For Policies with One Insured: The rates depend on the risk class
of the Insured(s), the Age and, where permissible, gender of the Insured.
b. For Policies with Two Insureds: The rates depend on the age of the
younger insured, and on the number of smokers insured (0,1 or 2).
2. Current monthly cost of insurance fee: The cost of insurance fee is
calculated using a "constant" of $12.00.
3. Underwriting factor: We reserve the right to multiply the current
cost of insurance rate by an underwriting factor. The underwriting factor for
Policies that are fully underwritten would be one, which results in no change to
the rate.
The following is an example of how we calculate the monthly cost of insurance
deduction. Assume for this example that: (1) the Policy is issued using Option A
with a Specified Amount of $80,000; (2) on the applicable Monthly Processing
Day, the Death Benefit equals the Specified Amount; (3) the then current Account
Value is $10,000; (4) there is one male Insured, who is currently Age 55; and
(5) the Policy is issued in the no tobacco use risk class in a situation where
gender can be used in determining cost of insurance charges.
(a) We look up the current monthly cost of insurance rate for the
Insured. As of the date of this Prospectus, the current monthly cost of
insurance rate for a 55 year old male nonsmoker Insured is $.23172 per thousand
of Net Amount at Risk.
(b) If applicable, we multiply the rate shown in (a) times the
applicable current underwriting factor.
(c) We multiply (a), or, if applicable, the result of (b), times the
Net Amount at Risk*. The result is 16.16.
(d) We add the current "constant" of $12.00 to (c), resulting in
$28.16.
(e) We look up the contractually guaranteed maximum monthly cost of
insurance charge for the Insured. In this case, we look up the charge for a 55
year old male in the no tobacco use class. That charge is .68759 per $1,000 Net
Amount at Risk.
(f) We multiply the rate shown in (e) times the Net Amount at Risk*.
The result is 47.95.
(g) We compare the result in (d) and (f). The lower of the two amounts
is the current monthly cost of insurance for the Insured. In this example, the
current cost of insurance is, therefore, $28.16.
* We determine the Net Amount at Risk by subtracting the Account Value from the
Death Benefit discounted to the beginning of the Policy Month at the rate of 4%
per year. In this example, the Amount at Risk is $69,739.
Appendix G
Maximum Annual Assessable Premiums per $1,000 of Specified Amount
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Male Male Female Female Unisex Unisex
Issue No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
Age
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
0 N/A 15.29 N/A 12.23 N/A 14.69
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
1 N/A 15.50 N/A 12.43 N/A 14.90
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
2 N/A 15.97 N/A 12.80 N/A 15.35
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
3 N/A 16.46 N/A 13.19 N/A 15.82
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
4 N/A 16.98 N/A 13.61 N/A 16.32
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
5 N/A 17.53 N/A 14.04 N/A 16.84
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
6 N/A 18.10 N/A 14.49 N/A 17.39
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
7 N/A 18.71 N/A 14.96 N/A 17.97
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
8 N/A 19.35 N/A 15.46 N/A 18.58
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
9 N/A 20.02 N/A 15.98 N/A 19.23
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
10 N/A 20.72 N/A 16.52 N/A 19.90
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
11 N/A 21.45 N/A 17.08 N/A 20.60
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
12 N/A 22.21 N/A 17.67 N/A 21.32
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
13 N/A 22.99 N/A 18.27 N/A 22.06
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
14 N/A 23.78 N/A 18.90 N/A 22.82
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
15 N/A 24.58 N/A 19.55 N/A 23.59
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
16 20.48 25.33 17.75 20.19 19.94 24.32
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
17 21.09 26.09 18.33 20.86 20.55 25.06
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
18 21.72 26.85 18.94 21.55 21.17 25.81
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
19 22.36 27.63 19.56 22.26 21.81 26.58
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
20 23.03 28.44 20.21 23.00 22.47 27.36
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
21 23.72 29.26 20.87 23.76 23.15 28.18
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
22 24.44 30.13 21.57 24.55 23.87 29.03
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
23 25.19 31.03 22.29 25.37 24.61 29.91
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
24 25.98 31.98 23.03 26.22 25.40 30.84
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
25 26.81 32.98 23.81 27.10 26.21 31.82
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
26 27.68 34.03 24.62 28.02 27.07 32.84
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
27 28.60 35.13 25.45 28.96 27.97 33.91
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
28 29.55 36.28 26.32 29.94 28.91 35.03
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
29 30.55 37.49 27.21 30.96 29.88 36.20
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
30 31.59 38.74 28.14 32.01 30.90 37.41
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
31 32.67 40.05 29.11 33.10 31.96 38.67
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
32 33.79 41.40 30.11 34.22 33.06 39.98
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
33 34.96 42.81 31.15 35.39 34.20 41.33
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
34 36.17 44.26 32.23 36.60 35.39 42.74
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
35 37.43 45.77 33.34 37.84 36.61 44.19
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
36 38.73 47.32 34.50 39.14 37.88 45.69
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
37 40.07 48.93 35.69 40.47 39.20 47.24
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
38 41.46 50.58 36.92 41.83 40.55 48.84
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
39 42.89 52.28 38.18 43.23 41.95 50.48
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
40 44.38 54.03 39.49 44.67 43.40 52.16
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
41 45.90 55.83 40.83 46.13 44.89 53.89
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
42 47.48 57.66 42.20 47.62 46.42 55.66
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
43 49.10 59.55 43.62 49.15 48.00 57.47
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
44 50.78 61.48 45.07 50.70 49.63 59.32
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
45 52.50 63.45 46.57 52.29 51.32 61.21
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
46 54.28 65.47 48.12 53.93 53.05 63.14
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
47 56.11 67.54 49.71 55.60 54.83 65.13
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
48 58.00 69.66 51.35 57.31 56.67 67.17
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
49 59.96 71.85 53.04 59.08 58.57 69.26
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
50 61.97 74.09 54.79 60.88 60.53 71.41
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
51 64.05 76.41 56.58 62.74 62.55 73.61
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
52 66.19 78.78 58.43 64.64 64.63 75.88
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Male Male Female Female Unisex Unisex
Issue No Tobacco Use Tobacco User No Tobacco Use Tobacco User No Tobacco Use Tobacco User
Age
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
53 68.39 81.21 60.32 66.57 66.77 78.19
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
54 70.66 83.69 62.26 68.55 68.96 80.55
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
55 72.99 86.22 64.25 70.56 71.22 82.95
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
56 75.38 88.80 66.30 72.61 73.54 85.40
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
57 77.84 91.45 68.40 74.72 75.92 87.90
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
58 80.38 94.16 70.58 76.90 78.38 90.47
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
59 83.00 96.97 72.84 79.18 80.91 93.13
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
60 85.70 99.88 75.20 81.56 83.54 95.88
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
61 88.50 102.91 77.66 84.05 86.26 98.74
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
62 91.40 106.03 80.21 86.65 89.07 101.70
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
63 94.38 109.25 82.85 89.33 91.96 104.73
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
64 97.46 112.56 85.55 92.06 94.95 107.83
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
65 100.63 115.93 88.32 94.84 98.01 110.99
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
66 103.90 119.40 91.15 97.66 101.17 114.21
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
67 107.30 122.98 94.07 100.57 104.43 117.53
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
68 110.85 126.72 97.12 103.62 107.84 120.98
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
69 114.60 130.67 100.34 106.85 111.43 124.62
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
70 118.55 134.87 103.76 110.32 115.22 128.48
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
71 122.74 139.33 107.40 114.06 119.24 132.59
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
72 127.16 144.06 111.27 118.05 123.48 136.93
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
73 131.80 149.01 115.36 122.26 127.92 141.47
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
74 136.63 154.15 119.65 126.66 132.55 146.18
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
75 141.64 156.53 124.15 131.24 137.35 151.01
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
76 146.86 156.00 128.86 136.01 142.36 155.77
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
77 149.50 155.48 133.84 141.01 147.63 154.88
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
78 148.62 155.07 139.18 146.34 148.31 154.06
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
79 147.95 154.86 143.80 146.45 147.44 153.38
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
80 147.53 154.81 142.69 145.54 146.79 152.84
-------------- ---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Appendix H
Hypothetical Illustration of Accelerated Death Benefit
The following are hypothetical illustrations of the impact of payments made to
the Insured under the accelerated death benefit provision of the Policy. The
first hypothetical illustration assumes the Insured is a female, age 45 as of
the Policy Date. The second hypothetical illustration assumes the Insured is a
male, age 65 as of the Policy Date. The following other assumptions apply to
both hypothetical illustrations:
1. Premiums of $5,000 per year were paid as of the first day of each
Policy Year, and the premium tax charged on each Premium was 1.75%. DAC tax also
was charged in relation to each Premium.
2. Each Policy was issued on the No Tobacco Use class, cost of
insurance rates differ by gender and there is no change to the current cost of
insurance rates during the period covered by the example.
3. The Death Benefit option in effect throughout the life of the Policy
is Option A.
4. The Specified Amount is $100,000 and has remained constant since the
Policy Date.
5. The provision is exercised as of the day preceding the 10th Policy
Anniversary.
6. The investment options in which Account Value was allocated have
grown on a constant basis since the Policy Date at an annualized rate of 8% per
year.
7. There have been no loans or loan repayments and no amounts have been
withdrawn.
8. 50% of the maximum available amount is taken pursuant to the
accelerated death benefit provision.
9. The 12-month interest rate discount used in the calculation of the
benefit assumes interest at 6% per year, compounded yearly.
------------------------- -------------------------
Female Age 45 Male Age 65
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Account Value Before the Accelerated Death Benefit is $61,659 $54,665
Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Cash Value Before the Accelerated Death Benefit is Paid $61,193 $54,165
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Maximum Amount Available For a Loan Before the $55,074 $48,748
Accelerated Death Benefit is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Specified Amount Before the Accelerated Death Benefit $100,000 $100,000
is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Minimum Required Death Benefit Before the Accelerated $154,405 $75,622
Death Benefit is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Guaranteed Minimum Death Benefit Before the $58,916 $52,821
Accelerated Death Benefit is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Death Benefit Before the Accelerated Death Benefit is $154,405 $100,000
Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Maximum Amount Available as the Accelerated Death $77,203 $50,000
Benefit
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Amount of Accelerated Death Benefit $38,601 $25,000
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Amount Paid as the Accelerated Death Benefit $36,416 $23,585
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Account Value After the Accelerated Death Benefit is $46,244 $40,999
Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Cash Value After the Accelerated Death Benefit is Paid $45,778 $40,499
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Maximum Amount Available For a Loan After the $41,200 $36,449
Accelerated Death Benefit is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Specified Amount After the Accelerated Death Benefit $75,000 $75,000
is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Minimum Required Death Benefit After the Accelerated $115,804 $56,717
Death Benefit is Paid
-------------------------------------------------------- ------------------------- -------------------------
-------------------------------------------------------- ------------------------- -------------------------
Guaranteed Minimum Death Benefit After the Accelerated $44,187 $39,616
Death Benefit is Paid
-------------------------------------------------------- ------------------------- -------------------------
PART II - OTHER INFORMATION
CONTENTS OF REGISTRATION STATEMENT
This registration statement comprises the following papers and
documents:
The facing sheet.
The prospectus consisting of 53 pages.
Representations and Undertakings.
The signatures.
Written consents of the following persons:
Werner & Kennedy TO BE FILED BY AMENDMENT
Ernst & Young LLP TO BE FILED BY AMENDMENT
Deloitte & Touche, LLP TO BE FILED BY AMENDMENT
Corporate Actuary TO BE FILED BY AMENDMENT
The following exhibits which correspond to those required by paragraph
A of the instructions for exhibits to Form N-8B-2:
1. A. (1) Resolution of the Board of Directors of the
Company are incorporated by reference to
Registration Statement No. 333-38119 filed
via EDGAR October 17, 1997.
(2) Not applicable.
(3) Distributing contracts:
(a) Principal Underwriting Agreement incorporated by reference
to Registration Statement No. 333-38119 filed via EDGAR October 17,
1997.
(b) Form of Revised Dealer Agreement
being filed via EDGAR with
Post-Effective Amendment No. 7 to
Registration Statement No. 33-87010 on April 24, 1998.
(c) Not applicable.
(4) Not applicable.
(5) Form of Flexible Premium Variable Life Insurance Policy
(a) Single Life Version FILED HEREWITH
(b) Last Survivor Version FILED HEREWITH
(6) Articles of Incorporation and By-laws of American Skandia Life Assurance
Corporation, incorporated by reference to Post-Effective Amendment No. 6 to Registration
Statement No. 33-87010, filed VIA EDGAR on March 2, 1998.
(7) Not applicable.
(8) Not applicable.
(9) Other material contracts. Not applicable
(10) Form of Application for Flexible Premium Variable Life Insurance
Policy. TO BE FILED BY AMENDMENT
(11) Memorandum describing transfer and
redemption procedures is incorporated by
reference to Registration Statement No.
333-58703 filed VIA Edgar on July 8, 1998.
2. Opinion and Consent of Werner and Kennedy. TO BE FILED BY AMENDMENT
3. No financial statements are to be omitted from the prospectus
pursuant to instruction 1(b) or 1(c) of the instructions as to
the prospectus.
4. Not applicable.
5. Financial Data Schedules. TO BE FILED BY AMENDMENT
6. Not applicable.
7. Opinion and Consent of certifying actuary. TO BE FILED BY AMENDMENT
8. (a) Opinion and Consent of Ernst & Young LLP TO BE FILED BY AMENDMENT
(b) Opinion and Consent of Deloitte & Touche LLP TO BE FILED BY AMENDMENT
9. Powers of Attorney are incorporated by reference to
Registration Statement No. 333-38119 filed via EDGAR October
17, 1997.
UNDERTAKING 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 heretofore or hereafter duly adopted pursuant to authority conferred
in that section.
RULE 484 UNDERTAKING ON INDEMNIFICATION
Article XIII of the By-laws of American Skandia Life Assurance Corporation, a
Connecticut corporation, (the "Corporation") provides for indemnification of its
officers, directors, and employees as follows:
SECTION 1. Proceedings Other Than by or in the Right of the Corporation.
The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigate
(other than an action by or in the right of the Corporation) by reason of the
fact that he, or the person whose representative he is, is or was a shareholder,
director, officer, employee or agent of the Corporation, or is or was serving
solely at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines,
penalties, and amounts paid in settlement actually and reasonably incurred by
him in connection with such action, suit or proceeding if the person is
successful on the merits in the defense of the proceeding or as provided in
Section 3 hereof, if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation, and
with respect to any criminal action or proceeding, the person had no reasonable
cause to believe his conduct was unlawful or if upon application to the court as
provided in Section 5 hereof, the court shall have determined that in view of
all the circumstances such person is fairly and reasonably entitled to be
indemnified, and then for such amount as the court shall determine; except that,
in connection with an alleged claim based upon his purchase or sale of
securities of the Corporation or of another enterprise, which he serves or
served at the request of the Corporation, the Corporation shall only indemnify
such person after the court shall have determined, on application as provided in
Section 5 hereof, that in view of all the circumstances such person is fairly
and reasonably entitled to be indemnified, and then for such amount as the court
shall determine. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo contendre or its
equivalent, shall not, of itself, create a presumption that the person did not
act in good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Corporation or of the participants and
beneficiaries of such employee benefit plan or trust and consistent with the
provisions of such employee benefit plan or trust, or, with respect to any
criminal action or proceeding, that he had reasonable cause to believe that his
conduct was unlawful.
SECTION 2. Proceedings by or in the Right of the Corporation.
The Corporation shall indemnify any person who was or is a party or threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, by or in the right of the Corporation, to procure a judgment in its
favor by reason of the fact that he, or the person whose legal representative he
is, is or was a shareholder, director, officer, employee or agent of the
Corporation, or is or was serving solely at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or enterprise, against expenses (including attorney fees)
actually and reasonably incurred by him in connection with such proceeding in
relation to matters as to which such person, or the person whose legal
representative his is, is finally adjudged not to have breached his duty to the
Corporation, or where the court, on application as provided in Section 6 hereof,
shall have determined that in view or all the circumstances such person is
fairly and reasonably entitled to be indemnified, and then for such amount as
the court shall determine. The Corporation shall not so indemnify any such
person for amounts paid to the Corporation, to a plaintiff or to counsel for a
plaintiff in settling or otherwise disposing of a proceeding, with or without
court approval; or for expenses incurred in defending a proceeding which is
settled or otherwise disposed of without court approval.
SECTION 3. Determination of Right of Indemnification.
The conclusion provided for in Section 1 hereof may be reached by any of the
following: (1) The Board of Directors of the Corporation by a consent in writing
signed by a majority of those directors who were not parties to such proceeding;
(2) independent legal counsel selected by a consent in writing signed by a
majority of those directors who were not parties to such proceeding; (3) in the
case of any employee or agent who is not an officer or director of the
Corporation, the Corporation's general counsel; or (4) the shareholders of the
Corporation by the affirmative vote of at least a majority of the voting power
of shares not owned by parties to such proceeding, represented at an annual or
special meeting of shareholders, duly called with notice of such purpose stated.
Such person shall also be entitled to apply to a court for such conclusion, upon
application as provided in Section 5 hereof, even though the conclusion reached
by any of the foregoing shall have been adverse to him or to the person whose
legal representative he is.
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 AND UNDERTAKING
The Registrant and the Company hereby make the following representations and
undertakings:
(a) This filing is made pursuant to Rules 6c-3 and 6e-3(T) under the Investment
Company Act of 1940 (the "Act"). The Registrant and the Company elect to be
governed by Rule 6e-3(T)(b)(13)(i)(A) under the Act with respect to the Policies
described in the prospectus. The Policies are designed in such a way as to
qualify for the exemptive relief from various provisions of the Act afforded by
Rule 6e-3(T).
(b) The Company is relying on Paragraph (b)(13)(iii)(F) of Rule 6e-3(T) for the
deduction of the mortality and expense risk charges ("risk charges")assumed by
the Company under the Policies. The Company represents that the risk charges are
reasonable in relation to all of the risks assumed by the issuer under the
Policies. (Paragraph (b)(13)(iii)(F)(2)(ii)). Actuarial memoranda demonstrating
the reasonableness of these charges are maintained by the Company, and will be
made available to the Securities and Exchange Commission (the "Commission") on
request.
(Paragraph (b)(13)(iii)(F)(3).
(c) The Company has concluded that there is a reasonable likelihood that the
distribution financing arrangement of the separate account will benefit the
separate account and the contractholders and will keep and make available to the
Commission on request a memorandum setting forth the basis for this
representation.
(Paragraph (b)(13)(iii)(F)(4)(ii)(A).
(d) The Company represents that the separate account will invest only in
management investment companies which have undertaken to have a board of
directors, a majority of whom are not interested persons of the company,
formulate and approve any plan under Rule 12b-1 to finance distribution
expenses. (Paragraph (b)(13)(iii)(F)(4)(ii)(B)(2).
(e) Pursuant to Rule 26(e) under the Act, the Company hereby represents that the
fees and charges deducted under the Policy described in the Prospectus, in the
aggregate, are reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by the Company.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, and its seal to be hereunto affixed and
attested, all in the City of Shelton, State of Connecticut, on 17th day of
November, 1998.
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
SEPARATE ACCOUNT F
(Registrant)
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
(Depositor)
By:/s/Lincoln R. Collins Attest: /s/Kathleen A. Chapman
Lincoln R. Collins, Kathleen A. Chapman,
Executive Vice President Assistant Corporate Secretary
and Chief Operating Officer
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the date indicated.
Signature Title Date
(Principal Executive Officer)
Jan R. Carendi* Chief Executive Officer, 11/17/98
Jan R. Carendi Chairman of the Board and Director
(Principal Financial Officer)
/s/Thomas M. Mazzaferro Executive Vice President and 11/17/98
Thomas M. Mazzaferro Chief Financial Officer
(Principal Accounting Officer)
/s/David R. Monroe Treasurer, Vice President 11/17/98
David R. Monroe and Controller
(Board of Directors)
Jan. R. Carendi* Gordon C. Boronow* Malcolm M. Campbell*
Jan. R. Carendi Gordon C. Boronow Malcolm M. Campbell
Henrik Danckwardt* Amanda C. Sutyak* Wade A. Dokken*
Henrik Danckwardt Amanda C. Sutyak Wade A. Dokken
Thomas M. Mazzaferro* Gunnar Moberg* Bayard F. Tracy*
Thomas M. Mazzaferro Gunnar Moberg Bayard F. Tracy
Anders Soderstrom* C. Ake Svensson* Lincoln R. Collins*
Anders Soderstrom C. Ake Svensson Lincoln R. Collins
Nancy F. Brunetti*
Nancy F. Brunetti
*By: /s/Kathleen A. Chapman
Kathleen A. Chapman
*Pursuant to Powers of Attorney filed with Initial
Registration Statement No. 333-38119.