Registration No. 333-65170

As filed with the Securities and Exchange Commission on October 10, 2001

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

PRE-EFFECTIVE AMENDMENT NO. 1 TO
FORM S-6
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
OF SECURITIES OF UNIT INVESTMENT TRUSTS REGISTERED ON FORM N-8B-2

AMERICAN GENERAL LIFE INSURANCE COMPANY
SEPARATE ACCOUNT VL-R
(Exact Name of Trust)

AMERICAN GENERAL LIFE INSURANCE COMPANY
(Exact Name of Depositor)
2727-A Allen Parkway
Houston, Texas 77019-2191
(Complete Address of Depositor's Principal Executive Offices)

Pauletta P. Cohn, Esq.
Deputy General Counsel
American General Life Companies
2929 Allen Parkway
Houston, Texas 77019-2191
(Name and Complete Address of Agent for Service)

Title and Amount of Securities Being Registered:
An Indefinite Amount of Units of Interest in
American General Life Insurance Company
Separate Account VL-R
Under Variable Life Insurance Policies

Securities Being Offered: Flexible Premium Variable Life Insurance Policies

Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.

The Registrant hereby amends this Registration Statement on such date or dates
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 this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

AMERICAN GENERAL LIFE INSURANCE COMPANY
SEPARATE ACCOUNT VL-R
RECONCILIATION AND TIE BETWEEN ITEMS IN FORM
N-8B-2 AND THE PROSPECTUS
(PURSUANT TO INSTRUCTION 4 OF FORM S-6)

CROSS REFERENCE SHEET

ITEM NO. OF FORM N-8B-2* PROSPECTUS CAPTION
------------------------ ------------------

1 Additional Information: Separate Account VL-R.
2 Additional Information: AGL.
3 Inapplicable.
4 Additional Information: Distribution of Policies.
5, 6 Additional Information: Separate Account VL-R.
7 Inapplicable.**
8 Inapplicable.**
9 Additional Information: Legal Matters.
10(a) Additional Information: Your Beneficiary,
Assigning Your Policy.
10(b) Basic Questions You May Have: How will the
value of my investment in a Policy change over
time?
10(c)(d) Basic Questions You May Have: How can I change
my Policy's insurance coverage? How can I
access my investment in a Policy? Can I choose
the form in which AGL pays out any proceeds
from my Policy? Additional Information:
Payment of Policy Proceeds.
10(e) Basic Questions You May Have: Must I invest any
minimum amount in a policy?
10(f) Additional Information: Voting Privileges.
10(g)(1), 10(g)(4), 10(h)(3), 10(h)(2) Basic Questions You May Have: To what extent
will AGL vary the terms and conditions of the
Policies in particular cases? Additional
Information: Voting Privileges; Additional Rights
That We Have.
10(g)(3), 10(g)(4), 10(h)(3), 10(h)(4) Inapplicable.**
10(i) Additional Information: Separate Account VL-R;
Tax Effects.
11 Basic Questions You May Have: How will the
value of my investment in a Policy change over
time? Additional Information: Separate Account
VL-R.
12(a) Additional Information: Separate Account VL-R;
Front Cover.
12(b) Inapplicable.**
12(c), 12(d) Inapplicable.**
12(e) Inapplicable, because the Separate Account did not
commence operations until 1998.
13(a) Basic Questions You May Have: What charges will
AGL deduct from my investment in a Policy?
What charges and expenses will the Mutual Funds
deduct from the amounts I invest through my
Policy? Additional Information: More About
Policy Charges.
13(b) Illustrations of Hypothetical Policy Benefits.
13(c) Inapplicable.**

13(d) Basic Questions You May Have: To what extent
will AGL vary the terms and conditions of the
Policy in particular cases?
13(e), 13(f), 13(g) None.
14 Basic Questions You May Have: How can I invest
money in a Policy?
15 Basic Questions You May Have: How can I invest
money in a Policy? How do I communicate with
AGL?
16 Basic Questions You May Have: How will the
value of my investment in a Policy change over
time?

ITEM NO. ADDITIONAL INFORMATION
-------- ----------------------
17(a), 17(b) Captions referenced under Items 10(c), 10(d), and
10(e).
17(c) Inapplicable.**
18(a) Captions referred to under Item 16.
18(b), 18(d) Inapplicable.**
18(c) Additional Information: Separate Account VL-R.
19 Additional Information: Separate Account VL-R;
Our Reports to Policy Owners.
20(a), 20(b), 20(c), 20(d), 20(e), 20(f) Inapplicable.**
21(a), 21(b) Basic Questions You May Have: How can I access
my investment in a Policy? Additional
Information: Payment of Policy Proceeds.
21(c) Inapplicable.**
22 Additional Information: Payment of Policy
Proceeds-Delay to Challenge Coverage.
23 Inapplicable.**
24 Basic Questions You May Have; Additional
Information.
25 Additional Information: AGL.
26 Inapplicable, because the Separate Account did not
commence operations until 1998.
27 Additional Information: AGL.
28 Additional Information: AGL's Management.
29 Additional Information: AGL.
30, 31, 32, 33, 34 Inapplicable, because the Separate Account did not
commence operations until 1998.
35 Inapplicable.**
36 Inapplicable.**
37 None.
38, 39 Additional Information: Distribution of the
Policies.
40 Inapplicable, because the Separate Account did not
commence operations until 1998.
41(a) Additional Information: Distribution of the
Policies.
41(b), 41(c) Inapplicable**
41,43 Inapplicable, because the Separate Account did not
commence operations or issue any securities until
1998.
44(a)(1), 44(a)(2), 44(a)(3) Basic Questions You May Have: How will the
value of my investment in a Policy change over
time?
44(a)(4) Additional Information: Tax Effects--Our taxes.
44(a)(5), 44(a)(6) Basic Questions You May Have: What charges will
AGL deduct from my investment in a Policy?
44(b) Inapplicable.**
44(c) Caption referenced in 13(d) above.

ITEM NO. ADDITIONAL INFORMATION
-------- ----------------------

45 Inapplicable, because the Separate Account did not
commence operations until 1998.
46(a) Captions referenced in 44(a) above.
46(b) Inapplicable.**
47, 48, 49 None.
50 Inapplicable.**
51 Inapplicable.**
52(a), 52(c) Basic Questions You May Have: To what extent
can AGL vary the terms and conditions of the
Policy in particular cases? Additional
Information: Additional Rights That We Have.
52(b), 52(d) None.
53(a) Additional Information: Tax Effects--Our taxes.
53(b), 54 Inapplicable.**
55 Illustrations of Hypothetical Policy Benefits.
56-59 Inapplicable.**

* Registrant includes this Reconciliation and Tie in its Registration
Statement in compliance with Instruction 4 as to the Prospectus as set
out in Form S-6. Separate Account VL-R (Account) has previously
filed a notice of registration as an investment company on Form N-8A
under the Investment Company Act of 1940 (Act), and a Form N-8B-2
Registration Statement. Pursuant to Sections 8 and 30(b)(1) of the
Act, Rule 30a-1 under the Act, and Forms N-8B-2 and N-SAR under that
Act, the Account will keep its Form N-8B-2 Registration Statement
current through the filing of periodic reports required by the Securities
and Exchange Commission (Commission).

** Not required pursuant to either Instruction 1(a) as to the Prospectus as
set out in Form S-6 or the administrative practice of the Commission and
its staff of adapting the disclosure requirements of the Commission's
registration statement forms in recognition of the differences between
variable life insurance policies and other periodic payment plan
certificates issued by investment companies and between separate
accounts organized as management companies and unit investment trusts.

PLATINUM INVESTOR (SM) SURVIVOR II
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY (THE "POLICY")
ISSUED BY
AMERICAN GENERAL LIFE INSURANCE COMPANY ("AGL")

ADMINISTRATIVE CENTER: HOME OFFICE: PREMIUM PAYMENTS:
(EXPRESS DELIVERY) (U.S. MAIL)
VUL Administration VUL Administration 2727-A Allen Parkway (EXPRESS PAYMENTS AND
2727-A Allen Parkway P. O. Box 4880 Houston, Texas 77019-2191 U.S. MAIL)
Houston, Texas 77019-2191 Houston, Texas 77210-4880 1-713-831-3443 #1 Franklin Square
1-713-831-3443, 1-888-325-9315 1-888-325-9315 Springfield, IL 62713-0001
(Hearing Impaired) 1-888-436-5258
Fax: 1-877-445-3098
(EXCEPT PREMIUM PAYMENTS)

This booklet is called the "prospectus."

Investment options. The AGL declared fixed interest account is the fixed
investment option for these Policies. You can also use AGL's Separate Account
VL-R ("Separate Account") to invest in the following variable investment
options. You may change your selections from time to time:

FUND INVESTMENT ADVISER INVESTMENT OPTION
---- ------------------ -----------------

. AIM Variable Insurance Funds.............. A I M Advisors, Inc............. AIM V.I. International Equity Fund
AIM V.I. Value Fund
. American Century Variable Portfolios, Inc. American Century Investment..... VP Value Fund
Management, Inc.
. Ayco Series Trust......................... The Ayco Company, L.P........... Ayco Growth Fund
. Credit Suisse Warburg Pincus Trust........ Credit Suisse Asset Management,. Small Company Growth Portfolio
LLC
. Dreyfus Investment Portfolios............. The Dreyfus Corporation......... MidCap Stock Portfolio - Initial shares
. Dreyfus Variable Investment Fund.......... The Dreyfus Corporation......... Quality Bond Portfolio - Initial shares
Small Cap Portfolio - Initial shares
. Fidelity Variable Insurance Products Fund. Fidelity Management &........... VIP Asset Manager(SM) Portfolio
Research Company VIP Contrafund(R) Portfolio
VIP Equity-Income Portfolio
VIP Growth Portfolio
. Janus Aspen Series - Service Shares....... Janus Capital................... Aggressive Growth Portfolio
International Growth Portfolio
Worldwide Growth Portfolio
. J. P. Morgan Series Trust II.............. J. P. Morgan Investment ........ J. P. Morgan Small Company
Management Inc. Portfolio
. MFS Variable Insurance Trust.............. Massachusetts Financial Services MFS Capital Opportunities Series
Company MFS Emerging Growth Series
MFS New Discovery Series
MFS Research Series
. Neuberger Berman Advisers Management...... Neuberger Berman Management..... Mid-Cap Growth Portfolio
Trust Inc.
. North American Funds Variable Product..... VALIC........................... International Equities Fund
Series I MidCap Index Fund
Money Market Fund
Nasdaq-100 Index Fund
Science & Technology Fund
Small Cap Index Fund
Stock Index Fund
. PIMCO Variable Insurance Trust............ Pacific Investment Management... PIMCO Real Return Bond Portfolio
Administrative Class Company LLC PIMCO Short-Term Bond Portfolio
PIMCO Total Return Bond Portfolio
. Putnam Variable Trust..................... Putnam Investment Management,... Putnam VT Diversified Income Fund - Class IB
LLC Putnam VT Growth and Income Fund - Class IB
Putnam VT International Growth and
Income Fund - Class IB
. SAFECO Resource Series Trust.............. SAFECO Asset Management......... RST Equity Portfolio
Company RST Growth Opportunities Portfolio
. The Universal Institutional Funds, Inc.... Morgan Stanley Asset Management. Equity Growth Portfolio
Morgan Stanley Investments LP... High Yield Portfolio
. Vanguard Variable Insurance Fund.......... Wellington Management........... High Yield Bond Portfolio
Company, llp
The Vanguard Group.............. REIT Index Portfolio
. Van Kampen Life Investment Trust.......... Van Kampen Asset................ Strategic Stock Portfolio
- Class I Shares Management Inc.

SEPARATE PROSPECTUSES CONTAIN MORE INFORMATION ABOUT THE MUTUAL FUNDS ("FUNDS"
OR "MUTUAL FUNDS") IN WHICH WE INVEST THE AMOUNTS THAT YOU ALLOCATE TO ANY OF
THE ABOVE-LISTED INVESTMENT OPTIONS (OTHER THAN OUR DECLARED FIXED INTEREST
ACCOUNT OPTION). THE FORMAL NAME OF EACH SUCH FUND IS SET FORTH IN THE CHART
THAT APPEARS ON PAGE 1. YOUR INVESTMENT RESULTS IN ANY SUCH OPTION WILL DEPEND
ON THOSE OF THE RELATED FUND. YOU SHOULD BE SURE YOU ALSO READ THE PROSPECTUS
OF THE MUTUAL FUND FOR ANY SUCH INVESTMENT OPTION YOU MAY BE INTERESTED IN. YOU
CAN REQUEST FREE COPIES OF ANY OR ALL OF THE MUTUAL FUND PROSPECTUSES FROM YOUR
AGL REPRESENTATIVE OR FROM US AT EITHER OUR HOME OFFICE OR ADMINISTRATIVE CENTER
LISTED ABOVE.

Right to return. If for any reason you are not satisfied with your Policy,
you may return it to us and we will refund you the greater of (i) any premium
payments received by us or (ii) your accumulation value plus any charges that
have been deducted. To exercise your right to return your Policy, you must mail
it directly to the Administrative Center address shown on the first page of
this prospectus or return it to the AGL representative through whom you
purchased the Policy within 10 days after you receive it. In a few states, this
period may be longer. Because you have this right, we will invest your initial
net premium payment in the money market investment option from the date your
investment performance begins until the first business day that is at least 15
days later. Then we will automatically allocate your investment among the
available investment options in the ratios you have chosen. Any additional
premium we receive during the 15-day period will also be invested in the money
market investment option and allocated to the investment options at the same
time as your initial net premium.

Charges and expenses. We deduct charges and expenses, including charges
for any additional benefit riders you choose, from the amounts you invest in the
Policy. These are described beginning on page 7.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION ("SEC") NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED
UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE. THE POLICIES ARE NOT AVAILABLE IN ALL STATES.

THE POLICIES ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY
SIMILAR AGENCY. THEY ARE NOT A DEPOSIT OR OTHER OBLIGATION OF, NOR ARE THEY
GUARANTEED OR ENDORSED BY, ANY BANK OR DEPOSITORY INSTITUTION. AN INVESTMENT IN
A VARIABLE UNIVERSAL LIFE INSURANCE POLICY IS SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL INVESTED.

This prospectus is dated October 10, 2001

GUIDE TO THIS PROSPECTUS

This prospectus contains information that you should know before you
purchase a Platinum Investor(SM) Survivor II variable life policy ("Policy")
or exercise any of your rights or privileges under a Policy. Please read this
prospectus carefully and keep it for future reference.

Basic Information. Here are the page numbers in this prospectus where you may
find answers to most of your questions:

PAGE TO SEE
BASIC QUESTIONS YOU MAY HAVE IN THIS PROSPECTUS
---------------------------- ------------------

. What are the Policies?.............................................. 4

. How can I invest money in a Policy?................................. 5

. How will the value of my investment in a Policy change over time?... 6

. What charges will AGL deduct from my investment in a Policy?........ 7

. What charges and expenses will the Mutual Funds deduct from
amounts I invest through my Policy?............................... 10

. What is the amount of insurance ("death benefit")
that AGL pays when the last surviving contingent insured dies?.... 14

. Must I invest any minimum amount in a Policy?....................... 16

. How can I change my Policy's investment options?.................... 17

. How can I change my Policy's insurance coverage?.................... 18

. What additional rider benefits might I select?...................... 20

. What is my Policy's exchange option?................................ 22

. How can I access my investment in a Policy?......................... 23

. Can I choose the form in which AGL pays out the proceeds
from my Policy?................................................... 25

. To what extent can AGL vary the terms and conditions of the Policy
in particular cases?.............................................. 26

. How will my Policy be treated for income tax purposes?.............. 26

. How do I communicate with AGL?...................................... 27

AGL's financial statements. We have included certain financial statements
of AGL in this prospectus. These begin on page Q-1.

Special words and phrases. If you want more information about any words or
phrases that you read in this prospectus, you may wish to refer to the Index of
Words and Phrases that appears at the end of this prospectus (page 58, which
follows all of the financial pages). That index will refer you to pages that
contain more about many of the words and phrases that we use.

BASIC QUESTIONS YOU MAY HAVE

WHAT ARE THE POLICIES?

Summary. This prospectus describes the last survivor flexible premium
variable life insurance Policy issued by AGL. The Policy is based on the lives
of two persons. We call each person a "contingent insured." We pay the death
benefit proceeds upon the death of the last surviving contingent insured.

We apply your net premiums to your Policy. You may invest your premiums in
our declared fixed interest account or in one or more of the variable investment
options, or both. The value of your investment in a variable investment option
depends on the investment results of the related Mutual Fund. We do not
guarantee any minimum cash value for amounts allocated to the variable
investment options. If the Fund investments go down, the value of a Policy can
decline. The value of our declared fixed interest account will depend on the
interest rates that we declare.

Other choices you have. During the insured persons' lifetimes, you may,
within limits, (1) request an increase or decrease in the amount of insurance,
(2) borrow or withdraw amounts you have invested, (3) choose when and how much
you invest, (4) choose whether your accumulation value under your Policy, upon
the last surviving contingent insured person's death, will be added to the
insurance proceeds we otherwise will pay to the beneficiary, and (5) add or
delete certain other optional benefits that we make available by rider to your
Policy. At the time of purchase, you can decide whether your policy will be
subject to certain tax rules that maximize the cash value or rules that maximize
the insurance coverage.

Administrative Center. The Administrative Center provides service to all
Policy owners. For applicants, your AGL representative will tell you if you
should use an address other than the Administrative Center address. All premium
payments, requests, directions and other communications should be directed to
the appropriate location. See "How do I communicate with AGL?" on page 27.
Also see "Services Agreements" on page 56.

Illustrations of a hypothetical Policy. Starting on page 28, we have
included some examples of how the values of a sample Policy would change over
time, based on certain assumptions we have made. Because your circumstances may
vary considerably from our assumptions, your AGL representative will also
provide you with a similar sample illustration that is more tailored to your own
circumstances and wishes.

Additional information. You may find the answers to any other questions
you have under "Additional Information" beginning on page 33, or in the forms of
our Policy and riders. A table of contents for the "Additional Information"
portion of this prospectus also appears on page 33. You can obtain copies of
our Policy and rider forms from (and direct any other questions to) your AGL
representative or our Administrative Center (shown on the first page of this
prospectus).

HOW CAN I INVEST MONEY IN A POLICY?

Premium payments. We call the payments you make "premiums" or "premium
payments." The amount we require as your initial premium varies depending on the
specifics of your Policy and the contingent insureds. We can refuse to accept a
subsequent premium payment that is less than $25. Otherwise, with a few
exceptions mentioned below, you can make premium payments at any time and in any
amount. Premium payments we receive after your right to return expires, as
discussed on page 2, will be allocated upon receipt to the available investment
options you have chosen.

Limits on premium payments. Federal tax law may limit the amount of
premium payments you can make (relative to the amount of your Policy's insurance
coverage) and may impose penalties on amounts you take out of your Policy if you
do not observe certain additional requirements. These tax law requirements and
a discussion of modified endowment contracts are summarized further under "How
will my Policy be treated for income tax purposes?" beginning on page 26 and
"Tax Effects" beginning on page 34. We will monitor your premium payments,
however, to be sure that you do not exceed permitted amounts or inadvertently
incur any tax penalties. The tax law limits can vary as a result of changes you
make to your Policy. For example, a reduction in the specified amount of your
Policy can reduce the amount of premiums you can pay.

Also, in certain limited circumstances, additional premiums may cause the
death benefit to increase by more than they increase your accumulation value.
In such case, we may refuse to accept an additional premium if the contingent
insureds do not provide us with adequate evidence that they continue to meet our
requirements for issuing insurance.

Checks and money orders. You may pay premiums by check or money order
drawn on a U.S. bank in U.S. dollars and made payable to "American General Life
Insurance Company," or "AGL." Premiums after the initial premium should be sent
directly to the appropriate address shown on your billing statement. If you do
not receive a billing statement, send your premium directly to the address for
premium payments shown on the first page of this prospectus. We also accept
premium payments by bank draft, wire or by exchange from another insurance
company. Premium payments from salary deduction plans may be made only if we
agree. You may obtain further information about how to make premium payments by
any of these methods from your AGL representative or from our Administrative
Center shown on the first page of this prospectus.

Dollar cost averaging. Dollar cost averaging is an investment strategy
designed to reduce the risks that result from market fluctuations. The strategy
spreads the allocation of your accumulation value among your chosen variable
investment options over a period of time. This allows you to reduce the risk of
investing most of your funds at a time when prices are high. The success of
this strategy depends on market trends and is not guaranteed.

Under dollar cost averaging, we automatically make transfers of your
accumulation value from the money market investment option to one or more of the
other variable investment options that you choose. You tell us whether you want
these transfers to be made monthly, quarterly, semi-annually or annually. We
make the transfers as of the end of the valuation period that contains the day
of the month that you select other than the 29th, 30th or 31st day of the month.
(The term

"valuation period" is described on page 43.) You must have at least $5,000 of
accumulation value to start dollar cost averaging and each transfer under the
program must be at least $100. Dollar cost averaging ceases upon your request,
or if your accumulation value in the money market investment option becomes
exhausted. You cannot use dollar cost averaging at the same time you are using
automatic rebalancing. No transfer fees will ever be charged to you for using
this service.

Automatic rebalancing. This feature automatically rebalances the
proportion of your accumulation value in each investment option under your
Policy to correspond to your then current premium allocation designation. You
tell us whether you want us to do the rebalancing quarterly, semi-annually or
annually. Automatic rebalancing will occur as of the end of the valuation
period that contains the date of the month your Policy was issued. For example,
if your Policy is dated January 17, and you have requested automatic rebalancing
on a quarterly basis, automatic rebalancing will start on April 17, and will
occur quarterly thereafter. You must have a total accumulation value of at
least $5,000 to begin automatic rebalancing. Rebalancing ends upon your
request. You cannot use automatic rebalancing at the same time you are using
dollar cost averaging. No transfer fees will ever be charged to you for using
this service.

HOW WILL THE VALUE OF MY INVESTMENT IN A POLICY CHANGE OVER TIME?

Your accumulation value. From each premium payment you make, we deduct the
charges that we describe on page 7 under "Premium tax charge" (or "Tax charge
back" if you are a resident of Oregon when you purchase your Policy) and "Other
deductions from each premium payment." We invest the rest in one or more of the
investment options listed in the chart on the first page of this prospectus. We
call the amount that is at any time invested under your Policy (including any
loan collateral we are holding for your Policy loans) your "accumulation value."

Your investment options. We invest the accumulation value that you have
allocated to any variable investment option in shares of a corresponding Mutual
Fund. Over time, your accumulation value in any such investment option will
increase or decrease by the same amount as if you had invested in the related
Fund's shares directly (and reinvested all dividends and distributions from the
Fund in additional Fund shares); except that your accumulation value will also
be reduced by certain charges that we deduct. We describe these charges
beginning on page 7 under "What charges will AGL deduct from my investment in a
Policy?"

You can review other important information about the Mutual Funds that you
can choose in the separate prospectuses for those Funds. You can request
additional free copies of these prospectuses from your AGL representative, from
our Home Office or from the Administrative Center (both locations and the
telephone numbers are shown on the first page of this prospectus).

We invest any accumulation value you have allocated to our declared fixed
interest account option as part of our general assets. We credit interest on
that accumulation value at a rate which we declare from time to time. We
guarantee that the interest will be credited at an annual effective rate of at
least 4%. Although this interest increases the amount of any accumulation value
that you have in our declared fixed interest account option, such accumulation
value will also be reduced by any charges that are allocated to this option
under the procedures described under "Allocation of

charges" on page 9. The "daily charge" described on page 7 and the charges and
expenses of the Mutual Funds discussed on pages 10 - 14 do not apply to our
declared fixed interest account option.

Policies are "non-participating." You will not be entitled to any
dividends from AGL.

WHAT CHARGES WILL AGL DEDUCT FROM MY INVESTMENT IN A POLICY?

Premium tax charge. Unless your Policy was issued in Oregon, we deduct
from each premium a charge for the tax that is then applicable to us in your
state or other jurisdiction. These taxes, if any, currently range from 0.75% to
3.5%. Please let us know if you move to another jurisdiction, so we can adjust
this charge if required. You are not permitted to deduct the amount of these
taxes on your income tax return.

Tax charge back. If you are a resident of Oregon at the time you purchase
a Policy, there is no premium tax charge. Instead, we will deduct from each
premium a tax charge back that is permissible under Oregon law. If you later
move from Oregon to a state that has a premium tax, we will not charge you a
premium tax. We deduct the tax charge back from each premium you pay,
regardless of the state in which you reside at the time you pay the premium.
The current tax charge back is 2% of each premium. We may change the tax charge
back amount but any change will only apply to new Policies we issue. We use the
charge partly to offset our obligation to pay premium taxes on the same Policy
if you move to another state. We also use the charge to pay for the cost of
additional administrative services we provide under these Policies.

Other deductions from each premium payment. After we deduct the applicable
premium tax (or a tax charge back if we issued your Policy in Oregon) from your
premium payment, we will deduct 5.0% of the remainder on all premiums received
each year. We may lower this percentage deduction but it is guaranteed never to
exceed 5.0%. Your Policy refers to these deductions as a Premium Expense
Charge. We use these charges to cover sales expenses, including commissions.

Daily charge. We will deduct a daily charge at an annual effective rate of
0.75% of your accumulation value that is then being invested in any of the
variable investment options. After a Policy has been in effect for 15 years,
however, we will reduce this rate to an annual effective rate of 0.50%, and
after 30 years, to an annual effective rate of 0.15%. Although the years for
the reduction of rates may not be changed, we may lower these current rates but
they can never exceed the rates set forth in this paragraph. We apply this
charge to pay for our mortality and expense risks, except in Maryland. In
Maryland, all references in the Policy to the mortality and expense charge have
been changed to the "Separate Account Charge."

Flat monthly charge. We will deduct $10 from your accumulation value each
month. We may lower this charge but it is guaranteed to never exceed $10. The
flat monthly charge is the Monthly Administration Fee shown on page 4 of your
Policy. We use this charge to pay for the cost of administrative services we
provide under the Policies.

First Four Years Monthly Expense Charge. The Policies have a monthly
expense charge which will be deducted during the first four Policy years, and
during the first four years of any increase in base coverage. We will apply
this four year monthly expense charge only to the base

coverage portion of the specified amount. Any decrease in base coverage will not
change the monthly expense charge. This charge varies according to the amount of
base coverage and the ages, gender and the premium classes of both of the
contingent insureds. This charge is a maximum of $3.01 for each $1000 of base
coverage. We use this charge to pay for underwriting costs and other costs of
issuing the Policies, and also to help pay for the administrative services we
provide under the Policies.

Monthly insurance charge. Every month we will deduct from your
accumulation value a charge based on the cost of insurance rates applicable to
your Policy on the date of the deduction and our "amount at risk" on that date.
Our amount at risk is the difference between (a) the death benefit that would be
payable before reduction by policy loans if the last surviving contingent
insured died on that date and (b) the then total accumulation value under the
Policy. For otherwise identical Policies:

. greater amounts at risk result in a higher monthly insurance charge;
and

. higher cost of insurance rates also result in a higher monthly
insurance charge.

Our cost of insurance rates are guaranteed not to exceed those that will be
specified in your Policy. Our current rates are not greater than the guaranteed
maximum rates for insured persons in all age, gender and premium classes,
although we have the right at any time to raise these rates to not more than the
guaranteed maximum.

In general, the longer you own your Policy, the higher the cost of
insurance rate will be as the contingent insureds grow older. Also our cost of
insurance rates will generally be lower if one or both of the insured persons is
a female than if a male. Similarly, our current cost of insurance rates are
generally lower for non-tobacco users than tobacco users. On the other hand,
contingent insureds who present particular health, occupational or non-work
related risks may require higher cost of insurance rates and other additional
charges based on the specified amount of insurance coverage under their Policy.

We use this charge to fund the death benefits we pay under the Policies.

Monthly charges for additional benefit riders. We will deduct charges
monthly from your accumulation value, if you select additional benefit riders.
The charges for any rider you select will vary by Policy within a range based on
either the personal characteristics of the contingent insureds or the specific
coverage you choose under the rider. The riders we offer are maturity extension
rider (a charge of up to $30 for each $1,000 net amount at risk), return of
premium death benefit rider and single life annually renewable term insurance
rider. The riders are described beginning on page 20, under "What additional
rider benefits might I select?" The specific charges for any rider you choose
are shown on page 3 of your Policy. We use these charges to pay for the benefits
under the riders and to help offset the risks we assume.

Surrender charge. The Policies have a surrender charge that applies for a
maximum of the first 14 Policy years (and for a maximum of the first 14 Policy
years after any requested increase in the Policy's base coverage). We will
apply the surrender charge only to the base coverage portion of the specified
amount.

The surrender charge period depends on the age of the younger of the
contingent insureds. The amount of the surrender charge depends on the age,
gender and premium classes of both of the contingent insureds. Your Policy's
surrender charge will be found in the table on page 4C of the Policy. It may
initially be as high as $50 per $1,000 of base coverage or as low as $0 per
$1,000 of base coverage (or any increase in the base amount).

We are permitted to not charge some or all of the surrender charges under
certain limited circumstances, according to the terms of a Policy endorsement.

We will deduct the entire amount of any then applicable surrender charge
from the accumulation value at the time of a full surrender. Upon a requested
decrease in a Policy's base coverage portion of the specified amount, we will
deduct any remaining amount of the surrender charge that was associated with the
base coverage that is canceled. This includes any decrease that results from
any requested partial surrender. See "Partial surrender" beginning on page 23.
For those Policies that lapse in the first 14 Policy years, we use this charge
to help recover sales expenses.

Partial surrender fee. We will charge a maximum fee equal to the lesser of
2% of the amount withdrawn or $25 for each partial surrender you make. This
charge is currently $10. We use this charge to help pay for the expense of
making a partial surrender.

Transfer fee. We may charge a $25 transfer fee for each transfer between
investment options that exceeds 12 each Policy Year. We do not currently assess
this charge but reserve the right to do so in the future. This charge will be
deducted from the investment options in the same ratio as the requested
transfer. We use this charge to help pay for the expense of making the
requested transfer.

Illustrations. If you request illustrations more than once in any Policy
year, we may charge $25 for the illustration.

Policy loans. We will charge you interest on any loan at an annual
effective rate of 4.75%. The loan interest charged on a preferred loan
(available after the first 10 Policy years) will never exceed an annual
effective rate of 4.25%. See "Policy loans" beginning on page 24.

Charge for taxes. We can adjust charges in the future on account of taxes
we incur or reserves we set aside for taxes in connection with the Policies.
This would reduce the investment experience of your accumulation value.

For a further discussion regarding these charges, see "More About Policy
Charges" on page 42.

Allocation of charges. You may choose the investment options from which we
deduct all monthly charges and any applicable surrender charges. If you do not
have enough accumulation value in those investment options, we will deduct these
charges in the same ratio the charges bear to the unloaned accumulation value
you then have in each investment option.

WHAT CHARGES AND EXPENSES WILL THE MUTUAL FUNDS DEDUCT FROM AMOUNTS I INVEST
THROUGH MY POLICY?

Each Mutual Fund pays its investment management fees and other operating
expenses. Because they reduce the investment return of a Fund, these fees and
expenses also will reduce indirectly the return you will earn on any
accumulation value that you have invested in that Fund. The charges and expenses
that we show in the following table are for each Fund's most recent fiscal year
ended, unless we indicate otherwise:

THE MUTUAL FUNDS' ANNUAL EXPENSES/1/ (as a percentage of average net assets)

FUND OTHER FUND TOTAL FUND
MANAGEMENT OPERATING OPERATING
FEES (AFTER EXPENSES (AFTER EXPENSES (AFTER
EXPENSE 12B-1 EXPENSE EXPENSE
NAME OF FUND REIMBURSEMENT)/3/ FEES REIMBURSEMENT)/3/ REIMBURSEMENT)/3/
----------------- ------ ----------------- -----------------

AIM VARIABLE INSURANCE FUNDS:/1/
AIM V.I. International Equity Fund 0.73% 0.29% 1.02%
AIM V.I. Value Fund 0.61% 0.23% 0.84%
AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.:/1/
VP Value Fund 1.00% 0.00% 1.00%
AYCO SERIES TRUST:/2/
Ayco Growth Fund 0.00% 1.00% 1.00%
CREDIT SUISSE WARBURG PINCUS TRUST:/1/
Small Company Growth Portfolio/3/ 0.90% 0.21% 1.11%
DREYFUS INVESTMENT PORTFOLIOS:/1/
MidCap Stock Portfolio - Initial shares/3, 4/ 0.75% 0.25% 1.00%
DREYFUS VARIABLE INVESTMENT FUND:/1/
Quality Bond Portfolio - Initial shares 0.65% 0.07% 0.72%
Small Cap Portfolio - Initial shares 0.75% 0.03% 0.78%
FIDELITY VARIABLE INSURANCE PRODUCTS FUND:/1, 5/
VIP Asset Manager(SM) Portfolio 0.53% 0.25% 0.10% 0.88%
VIP Contrafund(R) Portfolio/6/ 0.57% 0.25% 0.10% 0.92%
VIP Equity-Income Portfolio/6/ 0.48% 0.25% 0.10% 0.83%

(Footnotes begin on page 12)

VIP Growth Portfolio/6/ 0.57% 0.25% 0.09% 0.91%
JANUS ASPEN SERIES - SERVICE SHARES:/7/
Aggressive Growth Portfolio 0.65% 0.25% 0.02% 0.92%
International Growth Portfolio 0.65% 0.25% 0.06% 0.96%
Worldwide Growth Portfolio 0.65% 0.25% 0.05% 0.95%
J. P. MORGAN SERIES TRUST II:/1/
J. P. Morgan Small Company 0.60% 0.55% 1.15%
Portfolio/3/
MFS VARIABLE INSURANCE TRUST:/1/
MFS Capital Opportunities Series/8/ 0.75% 0.16% 0.91%
MFS Emerging Growth Series /8/ 0.75% 0.10% 0.85%
MFS New Discovery Series/3, 8/ 0.90% 0.16% 1.06%
MFS Research Series /8/ 0.75% 0.10% 0.85%
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST:/1/
Mid-Cap Growth Portfolio 0.84% 0.14% 0.98%
NORTH AMERICAN FUNDS VARIABLE PRODUCT SERIES I:/1, 9/
International Equities Fund 0.35% 0.07% 0.42%
MidCap Index Fund 0.30% 0.08% 0.38%
Money Market Fund 0.50% 0.10% 0.60%
Nasdaq-100(R) Index Fund 0.40% 0.12% 0.52%
Science & Technology Fund 0.90% 0.10% 1.00%
Small Cap Index Fund 0.35% 0.09% 0.44%
Stock Index Fund 0.26% 0.08% 0.34%
PIMCO VARIABLE INSURANCE TRUST
ADMINISTRATIVE CLASS:/1, 10/
PIMCO Real Return Bond Portfolio 0.25% 0.40% 0.65%
PIMCO Short-Term Bond Portfolio 0.25% 0.35% 0.60%

(Footnotes begin on page 12)

PIMCO Total Return Bond Portfolio/3/ 0.25% 0.40% 0.65%
PUTNAM VARIABLE TRUST:/11/
Putnam VT Diversified Income Fund - 0.68% 0.25% 0.10% 1.03%
Class IB/12/
Putnam VT Growth and Income Fund - 0.46% 0.25% 0.04% 0.75%
Class IB/12/
Putnam VT International Growth and 0.80% 0.25% 0.17% 1.22%
Income Fund - Class IB/12/
SAFECO RESOURCE SERIES TRUST:/1/
RST Equity Portfolio 0.74% 0.04% 0.78%
RST Growth Opportunities Portfolio 0.74% 0.03% 0.77%
THE UNIVERSAL INSTITUTIONAL FUNDS, INC.:/1/
Equity Growth Portfolio/3/ 0.48% 0.37% 0.85%
High Yield Portfolio/3/ 0.26% 0.54% 0.80%
VANGUARD VARIABLE INSURANCE FUND:
High Yield Bond Portfolio 0.18% 0.08% 0.26%
REIT Index Portfolio 0.34% 0.13% 0.47%
VAN KAMPEN LIFE INVESTMENT TRUST - CLASS I SHARES:/1/
Strategic Stock Portfolio/3/ 0.13% 0.53% 0.66%

_______________

/1/ Most of the Mutual Funds' advisers or administrators have entered into
arrangements under which they pay certain amounts to AGL for services such as
proxy mailing and tabulation, mailing of fund related information and responding
to Policy owners' inquiries about the Funds. PIMCO Variable Insurance Trust has
entered into such an arrangement directly with us. The fees shown above for
Total Fund Operating Expenses are unaffected by these arrangements. To the
extent we receive these fees, we do not lower the Policy fees we charge you. We
do not generate a profit from these fees, but only offset the cost of the
services. (See "Certain Arrangements" on page 43 and "Services Agreements" on
page 56.)
/2/ The Ayco Growth Fund is a new Fund that became effective in December 2000.
The Fund has an expense limitation agreement in place to limit its 2001 fees and
charges to 1.00%.
/3/ For the Funds indicated, management fees and other expenses as shown for
fiscal year 2000 would have been the percentages shown below without certain
voluntary fee waivers and expense reimbursements from the investment adviser or
other parties. Current and future fees and expenses may vary from the fiscal
year 2000 fees and expenses.
(Footnotes continue on page 13)

MANAGEMENT OTHER TOTAL
FEES EXPENSES ANNUAL EXPENSES
----------- --------- ----------------

CREDIT SUISSE WARBURG PINCUS TRUST:
Small Company Growth Portfolio 0.90% 0.23% 1.13%
DREYFUS INVESTMENT PORTFOLIOS:
MidCap Stock Portfolio - Initial shares 0.75% 0.29% 1.04%
J.P. MORGAN SERIES TRUST II:
J.P. Morgan Small Company Portfolio 0.60% 0.72% 1.32%
MFS VARIABLE INSURANCE TRUST:
MFS New Discovery Series 0.90% 0.19% 1.09%
PIMCO VARIABLE INSURANCE TRUST
ADMINISTRATIVE CLASS:
PIMCO Total Return Bond Portfolio 0.25% 0.41% 0.66%
THE UNIVERSAL INSTITUTIONAL FUNDS, INC.:
Equity Growth Portfolio 0.55% 0.37% 0.92%
High Yield Portfolio 0.50% 0.54% 1.04%
VAN KAMPEN LIFE INVESTMENT
TRUST - CLASS I SHARES: 0.50% 0.53% 1.03%
Strategic Stock Portfolio

No other Funds received any fee waivers and expense reimbursements.

/4/ The expenses shown in THE MUTUAL FUNDS' ANNUAL EXPENSES table above reflect
the MidCap Stock Portfolio adviser's waiver of fees or reimbursement of expenses
for the fiscal year ended December 31, 2000. For such fiscal year, the
Portfolio's adviser further reimbursed the Portfolio for other expenses so that
the total annual Portfolio expenses were 0.98% instead of 1.00%. This
additional expense reimbursement was voluntary. The "Other Fund Operating
Expenses" information provided in THE MUTUAL FUNDS' ANNUAL EXPENSES table has
been restated to reflect the amount the fees would have been without the
additional voluntary reimbursement. The Portfolio's adviser has agreed, until
December 31, 2001, to waive receipt of its fees and/or assume the expenses of
the Portfolio so that the expenses of the Portfolio (excluding taxes, brokerage
commissions, extraordinary expenses, interest expenses and commitment fees on
borrowing) do not exceed 1.00%. See the accompanying MidCap Stock Portfolio
prospectus for more details.

/5/ The prospectuses for Fidelity Variable Insurance Products Fund under "Fund
Distribution" discuss this 12b-1 fee.

/6/ Actual annual class operating expenses were lower because a portion of the
brokerage commissions that the Fund paid was used to reduce the Fund's expenses,
and/or because through arrangements with the Fund's custodian, credits realized
as a result of uninvested cash balances were used to reduce a portion of the
Fund's custodian expenses. See the accompanying prospectuses for Fidelity
Variable Insurance Product Fund for details.

/7/ Expenses are based upon expenses for the fiscal year ended December 31,
2000, restated to reflect a reduction in the management fee for the Aggressive
Growth, International Growth and Worldwide Growth Portfolios. All expenses are
shown without the effect of any expense offset arrangements. The prospectus for
Janus Aspen Series under "Fees and Expenses" discusses the 12b-1 fee.

/8/ Each of the MFS Capital Opportunities, MFS Emerging Growth, MFS New
Discovery and MFS Research Series has an expense offset arrangement which
reduces the Series' custodian fee based upon the amount of cash maintained by
the Series with its custodian and dividend disbursing agent. Each Series may
enter into other such arrangements and directed brokerage arrangements, which
would also have the effect of reducing the Series' expenses. The "Other Fund
Operating Expenses" in THE MUTUAL FUNDS' ANNUAL EXPENSES table above do not take
into account these expense reductions, and are therefore higher than the actual
expenses of the Series. Had these fee reductions been taken into account,
"Total Fund Operating Expenses (After Expense Reimbursements)" in THE MUTUAL
FUNDS'
(Footnotes continue on page 14)

ANNUAL EXPENSES table above would be lower for the Series and would equal
0.90% for MFS Capital Opportunities Series, 0.84% for MFS Emerging Growth
Series, 1.05% for MFS New Discovery Series, and 0.84% for MFS Research Series.
See the accompanying MFS Variable Insurance Trust prospectus for more details.

/9/ The Expenses have been restated to reflect contractual changes effective
May 1, 2001.

/10/ AGL has entered into a service agreement with PIMCO Variable Insurance
Trust under which a portion of the Other Fund Operating Expenses is paid to AGL
to reimburse AGL for services provided to the PIMCO Variable Insurance Trust.

/11/ The prospectus for Putnam Variable Trust under "Distribution Plan"
discusses this 12b-1 fee.

/12/ The Fund's 12b-1 fees have been restated to reflect an increase in 12b-1
fees currently payable to Putnam Retail Management. The Trustees of Putnam
Variable Trust currently limit 12b-1 fee payments on Class IB shares to 0.25% of
average net assets.

WHAT IS THE AMOUNT OF INSURANCE ("DEATH BENEFIT") THAT AGL PAYS WHEN THE LAST
SURVIVING CONTINGENT INSURED DIES?

Your specified amount of insurance. In your application to buy a Platinum
Investor Survivor II Policy, you tell us how much life insurance coverage you
want. We call this the "specified amount" of insurance. Platinum Investor
Survivor II is available for specified amounts of $500,000 or more.

The specified amount consists of what we refer to as "base coverage" plus
any "supplemental coverage" you select. You decide how much base coverage and
how much supplemental coverage you want. Base coverage must be at least 10% of
the specified amount. We also provide a guarantee of a death benefit equal to
the initial specified amount (less any indebtedness) and any benefit riders
during the first 5 Policy years. We provide more information about this benefit
and the specified amount under "Monthly guarantee premiums," beginning on page
17 and under "More About the Death Benefit" beginning on page 45. You should
read these other discussions carefully because they contain important
information about how the choices you make can affect your benefits and the
amount of premiums and charges you may have to pay.

Your death benefit. The death benefit we will pay is reduced by any
outstanding Policy loans and increased by any unearned loan interest we may have
already charged. At any time before the death of the last surviving contingent
insured, you can choose whether the death benefit we will pay is

. Option 1--The specified amount on the date of the last surviving
contingent insured's death; or

. Option 2--The specified amount plus the Policy's accumulation value on
the date of the last surviving contingent insured's death.

Under Option 2, your death benefit will tend to be higher than under
Option 1. However, the monthly insurance charge we deduct will also be higher
to compensate us for our additional risk. Because of this, your accumulation
value for the same amount of premium will tend to be higher under Option 1 than
under Option 2.

Any premiums we receive after the last surviving contingent insured's death
will be returned and not included in your accumulation value.

We may pay a larger death benefit depending on the amount of the
accumulation value on the date of death, as explained below.

Federal tax law requires a minimum death benefit in relation to the
accumulation value in order for a Policy to qualify as life insurance. We will
automatically increase the death benefit of a Policy if necessary to ensure that
the Policy will continue to qualify as life insurance. One of two tests under
current federal tax law can be used: the "guideline premium test" or the "cash
value accumulation test." You must elect one of these tests at issue, and, once
elected, the choice may not be changed. Factors you should consider in making
this choice are discussed below.

The "guideline premium test" limits the amount of premiums paid under a
Policy at any time to a certain amount which depends on the size of the Policy
and the age and gender of the contingent insureds. Therefore, the maximum
premiums you can pay are generally more limited under this test than under the
cash value accumulation test.

The other major difference between the two tax tests involves the Policy's
"alternative death benefit." The alternative death benefit is calculated as
shown in the tables that follow. During any time when the alternative death
benefit works out to be more than the Option 1 or Option 2 death benefit you
have chosen, we would automatically deem the death benefit to be such higher
amount.

As illustrated in the tables below, choosing the cash value accumulation
test for tax law compliance generally makes it more likely that an alternative
death benefit will apply. Therefore, if you anticipate that your Policy may
have a substantial accumulation value in relation to its death benefit, you
should be aware that the alternative death benefit may cause your Policy's death
benefit to be higher if you choose that test than if you choose the guideline
premium test. To the extent that the alternative death benefit does result in a
higher death benefit, the cost of insurance charges deducted from your Policy
will also tend to be higher. (This compensates us for the additional risk that
we might have to pay the higher alternative death benefit.)

If you have selected the guideline premium test, we calculate the
alternative death benefit by multiplying your Policy's accumulation value by the
following percentages:

SPECIMEN ALTERNATIVE DEATH BENEFITS AS A PERCENTAGE MULTIPLE
OF POLICY ACCUMULATION VALUE (ASSUMING YOU
SELECT THE GUIDELINE PREMIUM TEST)

YOUNGER
CONTINGENT
INSURED'S
AGE* 40 45 50 55 60 65 70 75 100

% 250% 215% 185% 150% 130% 120% 115% 105% 100%

* Age nearest birthday at the beginning of the Policy year in which the last
surviving contingent insured dies. We use the younger contingent insured's age
for this purpose even if the younger contingent insured is the first to die.

If you have selected the cash value accumulation test, we calculate the
alternative death benefit by multiplying your Policy's accumulation value by a
percentage that will be set forth on page 4A of your Policy. The percentage
varies based on the insurance characteristics of the contingent insureds. Below
is an example of applicable alternative death benefit percentages for the cash
value accumulation test. The example is for a male non-tobacco user and a female
non-tobacco user both preferred premium class and issue age 55.

SPECIMEN ALTERNATIVE DEATH BENEFITS AS A PERCENTAGE MULTIPLE
OF POLICY ACCUMULATION VALUE (ASSUMING YOU
SELECT THE CASH VALUE ACCUMULATION TEST)

POLICY YEAR 1 2 3 5 10 20 30 40 45

% 313% 301% 290% 268% 222% 159% 126% 111% 104%

Your Policy calls the multipliers used for each test the "Death Benefit
Corridor Rate."

MUST I INVEST ANY MINIMUM AMOUNT IN A POLICY?

Planned periodic premiums. Page 3 of your Policy will specify a "Planned
Periodic Premium." This is the amount that you (within limits) choose to pay.
Our current practice is to bill quarterly, semi-annually or annually. However,
payment of these or any other specific amounts of premiums is not mandatory.
After payment of your initial premium, you need only invest enough to ensure
your Policy's cash surrender value stays above zero or that the first 5 Policy
year benefit (described under "Monthly guarantee premiums" on page 17) remains
in effect. ("Cash surrender value" is explained under "Full surrender" on page
23.) The less you invest, the more likely it is that your Policy's cash
surrender value could fall to zero or that the first 5 Policy year benefit is
not in effect, as a result of the market performance and/or deductions we
periodically make from your accumulation value.

Policy lapse and reinstatement. During the first 5 Policy year benefit
period discussed on page 17, your Policy will not enter a grace period or
terminate if the Monthly Guarantee Premium has been met. After expiration of
this benefit, if your Policy's cash surrender value falls to an amount
insufficient to cover the monthly charges, we will notify you in a letter and
give you a grace period of 61 days to pay at least the amount we estimate is
necessary to keep your Policy in force for a reasonable time. If we do not
receive your payment by the end of the grace period, your Policy and all riders
will end without value and all coverage under your Policy will cease. Although
you can apply to have your Policy "reinstated," you must do this within 5 years
(or, if earlier, before the Policy's maturity date), and you must present
evidence that each contingent insured who was living when the Policy lapsed is
still living and meets our requirements for issuing coverage. Also, you will
have to pay at least the amount of premium that we estimate will keep your
Policy in force for two months, as well as pay or reinstate any indebtedness.
You will find additional information in the Policy about the values and terms of
the Policy after it is reinstated.

Monthly guarantee premiums. Page 3 of your Policy will specify a "Monthly
Guarantee Premium." In Maryland, your Policy will instead specify a "No-Lapse
Premium" on Page 3. If you pay these guarantee premiums, we will provide at
least an Option 1 death benefit, even if your policy's cash surrender value has
declined to zero.

We provide this benefit for the first 5 Policy years for all Policies.
On the first day of each Policy month that the cash surrender value is not
sufficient to pay the monthly deduction, we check to see if the cumulative
amount of premiums paid under the Policy, less any Policy loans, is at least
equal to the sum of the monthly guarantee premiums plus any partial surrenders
for all Policy months to date, including the Policy month then starting.
(Policy months are measured from the "Date of Issue" that will also be shown on
page 3 of your Policy.) So long as at least this amount of premium payments has
been paid by the beginning of that Policy month during this guarantee benefit,
the Policy will not enter a grace period or terminate (i.e., lapse) because of
insufficient cash surrender value.

Also, during the first 5 Policy years, whenever you increase or decrease
your specified amount, we calculate a new monthly guarantee premium, so the
amount you must pay to keep this benefit in force will increase or decrease
depending on whether you increase or decrease your specified amount. If you add
or increase a benefit rider, your monthly guarantee premium will increase. If
you remove or decrease a benefit rider, your monthly guarantee premium will
decrease. The more supplemental coverage you choose the higher will be your
monthly guarantee premiums.

The period of coverage for this benefit is unaffected by the contingent
insureds' ages at the Policy's date of issue or your choice of base coverage and
supplemental coverage. The period for this benefit will not be extended or
otherwise changed by changes in the specified amount, the addition, deletion or
change in benefit riders, or by reinstatement of the Policy.

HOW CAN I CHANGE MY POLICY'S INVESTMENT OPTIONS?

Future premium payments. You may at any time change the investment options
in which future premiums you pay will be invested. Your allocation must,
however, be in whole percentages that total 100%.

Transfers of existing accumulation value. You may also transfer your
existing accumulation value from one investment option under the Policy to
another. The first 12 transfers in a year are free of charge. We may charge you
$25 for each additional transfer. We do not currently assess this charge but
reserve the right to do so in the future. You may make transfers from the
variable investment options at any time. You may make transfers from the
declared fixed interest account only during the 60-day period following each
Policy anniversary. The amount that you can transfer each year from the declared
fixed interest account is limited to the greater of

. 25% of the unloaned accumulation value you have in the declared fixed
interest account as of the Policy anniversary, or

. the sum of any amounts you transferred or surrendered from the declared
fixed interest account during the previous Policy year.

Unless you are transferring the entire amount you have in an investment
option, including the declared fixed interest account, each transfer must be at
least $500. See "Additional Rights That We Have" on page 50.

Market Timing. The Policy is not designed for professional market timing
organizations or other entities using programmed and frequent transfers
involving large amounts. We may not unilaterally terminate or discontinue
transfer privileges. However, we reserve the right to suspend such privileges
for a reasonable time with reasonable notice to prevent market timing efforts
that could disadvantage other Policy owners.

HOW CAN I CHANGE MY POLICY'S INSURANCE COVERAGE?

Increase in coverage. At any time while both contingent insureds are
living, you may request an increase in the specified amount of coverage under
your Policy. You must, however, provide us with satisfactory evidence that both
contingent insureds continue to meet our requirements for issuing insurance
coverage.

We treat an increase in specified amount in many respects as if it were the
issuance of a new Policy. For example, the monthly insurance charge for the
increase will be based on the ages, gender and premium classes of the contingent
insureds at the time of the increase. Also, a new amount of surrender charge:

. applies to any amount of the increase that you request as base (rather
than supplemental) coverage; and

. applies for up to 14 Policy years following the increase.

You are not required to increase your specified amount in any specific
percentage or ratio that your base and supplemental coverage bear to your
specified amount before the increase, with one exception. Base coverage must be
at least 10% of the total specified amount after the increase.

Decrease in coverage. After the first Policy year, you may request a
reduction in the specified amount of coverage, but not below certain minimums.
After any decrease, the specified amount cannot be less than the greater of:

. $500,000, and

. any minimum amount which, in view of the amount of premiums you have
paid, is necessary for the Policy to continue to meet the Federal tax
law definition of life insurance.

We will apply a reduction in specified amount in the following order, as
long as your base coverage is at least 10% of the specified amount:

. against the specified amount provided by the most recent increase, with
the decrease applying first to the entire supplemental coverage portion
of such increase, if any, followed by the base coverage portion;

. against the next most recent increases successively, with the decrease
of each prior increase applying first to the entire supplemental
coverage portion of such increase, if any, followed by the base coverage
portion;

. against the specified amount provided under the original application,
with the decease applying first to the entire supplemental coverage
portion of such amount, if any, followed by the base coverage portion.

We will deduct from your accumulation value any remaining surrender charge that
is associated only with any amount of base coverage that is canceled in this
way. If there is not sufficient accumulation value to pay the surrender charge
at the time you request a reduction, the decrease will not be allowed.

Change of death benefit option. You may at any time before the death
of the last surviving contingent insured request us to change your coverage from
death benefit Option 1 to Option 2 or vice-versa.

. If you change from Option 1 to Option 2, we also automatically reduce
your Policy's specified amount of insurance by the amount of your
Policy's accumulation value (but not below zero) at the time of the
change. The change will go into effect on the monthly deduction day
following the date we receive your request for change. We will apply a
reduction in specified amount in the same order as set out under
"Decrease in coverage" on page 18, as long as your base coverage is at
least 10% of the specified amount.

We will not charge a surrender charge for this reduction in specified amount.

. If you change from Option 2 to Option 1, we automatically increase your
Policy's specified amount by the amount of your Policy's accumulation
value. The entire increase in the specified amount will be applied to
the last coverage added (either base or supplemental) which has not been
removed. For the purpose of this calculation, if the base and
supplemental coverages were issued on the same date, we will consider
the supplemental coverage to have been issued later.

Tax consequences of changes in insurance coverage. Please read "Tax
Effects" starting on page 34 of this prospectus to learn about possible tax
consequences of changing your insurance coverage under your Policy.

Effect of changes in insurance coverage on guarantee benefit. A change in
coverage does not result in termination of the guarantee benefit, so that if you
pay certain prescribed amounts of premiums, we will pay a death benefit even if
your policy's cash surrender value declines to zero.

The details of this guarantee are discussed under "Monthly guarantee premiums,"
beginning on page 17.

WHAT ADDITIONAL RIDER BENEFITS MIGHT I SELECT?

You can request that your Policy include the additional rider benefits
described below. For most of the riders that you choose, a charge, which will
be shown on page 3 of your Policy, will be deducted from your accumulation value
on each monthly deduction date. Eligibility for and changes in these benefits
are subject to our rules and procedures as in effect from time to time. Not all
riders are available in all states. More details are included in the form of
each rider, which we suggest that you review if you choose any of these
benefits.

Maturity Extension Rider
------------------------

. This rider permits you to extend the Policy's maturity date beyond
what it otherwise would be. You have two versions of this rider
from which to choose. Either or both versions may not be available
in all states.

. The first version provides for a death benefit after the original
maturity date that is equal to the accumulation value on the date of the
last surviving contingent insured's death. The death benefit will be
reduced by any outstanding Policy loan amount. There is no charge for
this version until you reach the original maturity date. Thereafter we
will charge a monthly fee of no more than $10.

. The second version provides for a death benefit (after the death of the
last surviving contingent insured) after the original maturity date
equal to the death benefit in effect on the day prior to the original
maturity date. If the death benefit is based fully, or in part, on the
accumulation value, we will adjust the death benefit to reflect future
changes in your accumulation value. The death benefit will never be less
than the accumulation value. The death benefit will be reduced by any
outstanding Policy loan amount. There is a monthly charge of no more
than $30 for each $1000 of the net amount at risk. If you wish to
purchase this rider, you must inform us in writing at least 9 years
before the original maturity date. When the 9-year period begins, each
month we will charge you up to the maximum $30 for each $1,000 of the
net amount at risk. After the original maturity date, we will terminate
this charge, and start charging you a monthly fee of no more than $10.

. There are features common to both riders in addition to the $10 maximum
monthly fee. Only the insurance coverage associated with the Policy will
be extended beyond the original maturity date. We do not allow
additional premium payments, new loans, or changes in specified amount
after the original maturity date. Once you have exercised your right to
extend the original maturity date, you cannot revoke it. You can,
however, surrender your Policy

at any time. If you wish to extend the original maturity date, you must
give us written notice at least 30 days before the original maturity
date.

. Extension of the maturity date beyond the younger contingent
insured's age 100 may result in current taxation of increases in
your Policy's accumulation value as a result of interest or
investment experience after that time. You should consult a
qualified tax adviser before making such an extension.

Return of Premium Death Benefit Rider
-------------------------------------

. This rider provides additional term life insurance coverage on the life
of the last surviving contingent insured. The amount of additional
insurance varies so that it always equals the cumulative amount of
premiums paid under the Policy (subject to certain adjustments).

. You may purchase this rider only as of the date of issue and only if you
have selected death benefit Option 1.

. There is no separate fee for this rider. The use of this rider increases
the specified amount, which results in a change in the amount at risk
and an increase in the monthly insurance charge.

Single Life Annually Renewable Term Insurance Rider
---------------------------------------------------

. This rider allows you to provide term single life insurance on the
life of either or both of the contingent insureds. We will pay a
death benefit upon the death of the contingent insured on whose
life you purchased the rider. The death benefit is in addition to
any death benefit we pay under the Policy.

. You can purchase this rider on the life of a contingent insured who is
younger than age 75.

. You cannot purchase this rider on the life of a contingent insured if
the premium class for that contingent insured is uninsurable.

. This rider terminates at age 75 of the covered insured.

. The maximum cost of this rider is $6.66 per thousand of the rider's
specified amount.

Tax consequences of additional rider benefits. Adding or deleting
riders, or increasing or decreasing coverage under existing riders can have tax
consequences. See "Tax Effects" starting on page 34. You should consult a
qualified tax adviser.

WHAT IS MY POLICY'S EXCHANGE OPTION?

This option is not a rider. You as the owner of the Policy have the
right at any time while both contingent insureds are living to request that the
Policy be split into two separate policies, insuring each of the contingent
insureds under new, single life policies. In order for you to exercise this
option, neither contingent insured could have the "uninsurable" premium class
when the original Policy was issued. Here are the additional features about the
exchange option:

. You can choose the amount of coverage on each policy, as long as the
total equals the death benefit amount of the Policy. We will transfer
the cash surrender value of the Policy, after paying off any outstanding
loan, to the new policies in the same proportion as the new face amounts
are to each other (except for Policies issued in Texas, where
outstanding loans are also transferred to the new policies in the same
proportion as the new face amounts are to each other).

. The new policies can be any flexible or level premium whole life policy
or endowment plan we would ordinarily issue when the option is
exercised.

. The new policies are subject to underwriting based on our established
procedures. This option requires that both contingent insureds are found
to be insurable.

. You can choose to exchange without underwriting only if the contingent
insureds were married to one another and have divorced, the Federal
unlimited marital deduction is repealed, or there is a reduction of at
least 50% of the tax rate in the maximum Federal estate tax bracket.
However, in the case of divorce, the divorce decree must have been final
at least 24 months before the exchange. In these situations, the
original Policy's specified amount and cash surrender value will be
split equally between the two new policies (except in Pennsylvania,
where underwriting is required without exception if the contingent
insureds are divorced from one another).

. The Policy terminates when we issue the new policies.

. Under each of the new policies, if the insured commits suicide within
the first two policy years, we will limit the death benefit proceeds to
the total of all premiums that have been paid on the Policy insuring the
deceased person to the time of death minus any outstanding policy loans
(plus any unearned loan interest) and partial surrenders.

In Texas the first two policy years limit runs from the date of issue of
the Policy but only for insurance coverage that does not require new
underwriting information.

. There is no additional charge for this option or its exercise.

HOW CAN I ACCESS MY INVESTMENT IN A POLICY?

Full surrender. You may at any time surrender your Policy in full. If you
do, we will pay you the accumulation value, less any Policy loans, plus any
unearned loan interest, and less any surrender charge that then applies. We call
this amount your "cash surrender value." Because of the surrender charge, it is
unlikely that a Platinum Investor Survivor II Policy will have any cash
surrender value during at least the first year unless you pay significantly more
than the monthly guarantee premiums.

Partial surrender. You may, at any time after the first Policy year, make a
partial surrender of your Policy's cash surrender value. A partial surrender
must be at least $500. We will automatically reduce your Policy's accumulation
value by the amount of your withdrawal and any related charges. We do not allow
partial surrenders that would reduce the death benefit below $500,000.

We will apply a reduction in specified amount in the following order, as
long as your base coverage is at least 10% of the specified amount:

We will deduct any remaining surrender charge that is associated with any
portion of your Policy's base amount of coverage that is canceled. If the Option
2 death benefit is then in effect, we will automatically reduce your
accumulation value.

You may choose the investment option or options from which money that you
withdraw will be taken. Otherwise, we will allocate the partial surrender in the
same proportions as then apply for deducting monthly charges under your Policy
or, if that is not possible, in proportion to the amount of accumulation value
you then have in each investment option.

There is a maximum partial surrender fee equal to the lesser of 2% of the
amount withdrawn or $25 for each partial surrender you make. This charge
currently is $10.

Exchange of Policy in certain states. Certain states require that a
policy owner be given the right to exchange the Policy for a fixed benefit life
insurance policy, within either 18 or 24 months from the date of issue. This
right is subject to various conditions imposed by the states and

us. In such states, this right has been more fully described in your Policy or
related endorsements to comply with the applicable state requirements.

Policy loans. You may at any time borrow from us an amount up to your
Policy's cash surrender value less the interest that will be payable on your
loan through your next Policy anniversary.

We remove from your investment options an amount equal to your loan and
hold that part of your accumulation value in the declared fixed interest account
as collateral for the loan. We will credit your Policy with interest on this
collateral amount at a guaranteed annual effective rate of 4% (rather than any
amount you could otherwise earn in one of our investment options) and we will
charge you interest on your loan at an annual effective rate of 4.75%. Loan
interest is payable annually, on the Policy anniversary and in advance at a rate
of 4.54%. Any amount not paid by its due date will automatically be added to the
loan balance as an additional loan. Interest you pay on Policy loans will not,
in most cases, be deductible on your tax returns.

You may choose which of your investment options the loan will be taken
from. If you do not so specify, we will allocate the loan in the same way that
charges under your Policy are being allocated. If this is not possible, we will
make the loan pro-rata from each investment option that you then are using.

You may repay all or part (but not less than $10 unless it is the final
payment) of your loan at any time before the death of the last surviving
contingent insured while the Policy is in force. You must designate any loan
repayment as such. Otherwise, we will treat it as a premium payment instead. Any
loan repayments go first to repay all loans that were taken from our declared
fixed interest account option. We will invest any additional loan repayments you
make in the investment options you request. In the absence of such a request we
will invest the repayment in the same proportion as you then have selected for
premium payments that we receive from you. Any unpaid loan (increased by any
unearned loan interest we may have already charged) will be deducted from the
proceeds we pay following the last surviving contingent insured's death.

Preferred loan interest rate. We will charge a lower interest rate on
preferred loans (available after the first 10 Policy years). The maximum amount
eligible for preferred loans for any year is:

. 10% of your Policy's accumulation value (which includes any loan
collateral we are holding for your Policy loans) at the Policy
anniversary; or

. if less, your Policy's maximum remaining loan value at that Policy
anniversary.

We will always credit your preferred loan collateral amount at a guaranteed
annual effective rate of 4.0%. We intend to set the rate of interest you are
paying to the same 4.0% rate we credit to your preferred loan collateral amount,
resulting in a zero net cost (0.00%) of borrowing for that amount. We have full
discretion to vary the rate we charge you, provided that the rate:

. will always be greater than or equal to the guaranteed preferred loan
collateral rate of 4.0%, and

. will never exceed an annual effective rate of 4.25%.

Maturity of your Policy. If one or both contingent insureds are
living on the "Maturity Date" shown on page 3 of your Policy, we will pay you
the cash surrender value of the Policy, and the Policy will end. The maturity
date can be no later than the Policy anniversary nearest the younger contingent
insured's 100/th/ birthday.

Tax considerations. Please refer to "How will my Policy be treated for
income tax purposes?" on page 26 for information about the possible tax
consequences to you when you receive any loan, surrender or other funds from
your Policy. A Policy loan may cause the Policy to lapse which will result in
adverse tax consequences.

CAN I CHOOSE THE FORM IN WHICH AGL PAYS OUT THE PROCEEDS FROM MY POLICY?

Choosing a payment option. You will receive the full proceeds from the
Policy as a single sum, unless you elect another method of payment within 60
days of the last surviving contingent insured's death. This also includes
proceeds that become payable upon full surrender or the maturity date. You can
elect that all or part of such proceeds be applied to one or more of the
following payment options:

. Option 1--Equal monthly payments for a specified period of time.

. Option 2--Equal monthly payments of a selected amount of at least $60
per year for each $1,000 of proceeds until all amounts are paid out.

. Option 3--Equal monthly payments for the payee's life, but with payments
guaranteed for a specified number of years. These payments are based on
annuity rates that are set forth in the Policy or, at the payee's
request, the annuity rates that we then are using.

. Option 4--Proceeds left to accumulate at an interest rate of 3%
compounded annually for any period up to 30 years. At your request we
will make payments to you monthly, quarterly, semiannually, or annually.
You can also request a partial withdrawal of any amount of $500 or more.

Additional payment options may also be available with our consent. We have
the right to reject any payment option, if the payee is a corporation or other
entity. You can read more about each of these options in the Policy and in the
separate form of payment contract that we issue when any such option takes
effect.

Interest rates that we credit under each option will be at least 3%.

Change of payment option. You may give us written instructions to change
any payment option you have elected at any time while the Policy is in force and
before the start date of the payment option.

Tax impact. If a payment option is chosen, you or your beneficiary may have
tax consequences. You should consult with a qualified tax adviser before
deciding whether to elect one or more payment options.

TO WHAT EXTENT CAN AGL VARY THE TERMS AND CONDITIONS OF THE POLICY IN PARTICULAR
CASES?

Here are some variations we may make in the terms and conditions of a
Policy. Any variations will be made only in accordance with uniform rules that
we establish.

Underwriting and premium classes. We have seven premium classes we use to
decide how much the monthly insurance charges under any particular Policy will
be: preferred non-tobacco, standard non-tobacco, preferred tobacco, standard
tobacco, special non-tobacco, special tobacco and uninsurable. They are each
described in your Policy. Policies issued in Arizona, North Carolina and
Wisconsin do not have the uninsurable class.

The term "uninsurable" is used in a special way when we issue a Policy.
"Uninsurable" describes a person proposed to become insured under a Policy who
would not pass our requirements to be insured under one of our policies that
insures only one life. Under some conditions a person who is uninsurable can
become a contingent insured under a Policy. The other contingent insured cannot
be uninsurable.

Policies purchased through "internal rollovers." We maintain published
rules that describe the procedures necessary to replace another life insurance
policy we issued with a Policy. Not all types of other insurance we issue are
eligible to be replaced with a Policy. Our published rules may be changed from
time to time, but are evenly applied to all our customers.

State law requirements. AGL is subject to the insurance laws and
regulations in every jurisdiction in which the Policies are sold. As a result,
various time periods and other terms and conditions described in this prospectus
may vary depending on where you reside. These variations will be reflected in
your Policy and related endorsements.

Variations in expenses or risks. AGL may vary the cost of insurance charges
and other terms within the limits of the Policy where special circumstances
result in sales, administrative or other expenses, mortality risks or other
risks that are different from those normally associated with the Policy.

HOW WILL MY POLICY BE TREATED FOR INCOME TAX PURPOSES?

Generally, the death benefit paid under a Policy is not subject to income
tax, and earnings on your accumulation value are not subject to income tax as
long as we do not pay them out to you. If we do pay any amount of your Policy's
accumulation value upon surrender, partial surrender, or

maturity of your Policy, all or part of that distribution may be treated as a
return of the premiums you paid, which is not subject to income tax.

Amounts you receive as Policy loans are not taxable to you, unless you
have paid such a large amount of premiums that your Policy becomes what the tax
law calls a "modified endowment contract." In that case, the loan will be taxed
as if it were a partial surrender. Furthermore, loans, partial surrenders and
other distributions from a modified endowment contract may require you to pay
additional taxes and penalties that otherwise would not apply. If your Policy
lapses, you may have to pay income tax on a portion of any outstanding loan.

For further information about the tax consequences of owning a Policy,
please read "Tax Effects" starting on page 34.

HOW DO I COMMUNICATE WITH AGL?

When we refer to "you," we mean the person who is authorized to take any
action with respect to a Policy. Generally, this is the owner named in the
Policy. Where a Policy has more than one owner, each owner generally must join
in any requested action, except for transfers and changes in the allocation of
future premiums or changes among the investment options.

General. You should mail or express checks and money orders for premium
payments and loan repayments directly to the appropriate address shown on your
billing statement. If you do not receive a billing statement, send your premium
directly to the address for premium payments shown on the first page of the
prospectus.

You must make the following requests in writing:

. transfer of accumulation value;

. loan;

. full surrender;

. partial surrender;

. change of beneficiary or contingent beneficiary;

. change of allocation percentages for premium payments;

. loan repayments or loan interest payments;

. change of death benefit option or manner of death benefit payment;

. change in specified amount;

. addition or cancellation of, or other action with respect to, election
of a payment option for Policy proceeds;

. tax withholding elections; and

. telephone transaction privileges.

You should mail or express these requests to the Administrative Center address
shown on the first page of this prospectus. You should also communicate notice
of each contingent insured's death, and related documentation, to our
Administrative Center address shown on the first page of this prospectus.

We have special forms which should be used for loans, assignments, partial
and full surrenders, changes of owner or beneficiary, and all other contractual
changes. You will be asked to return your Policy when you request a full
surrender. You may obtain these forms from our Administrative Center or from
your AGL representative. Each communication must include your name, Policy
number and the names of both contingent insureds. We cannot process any
requested action that does not include all required information.

Telephone transactions. If you have a completed telephone authorization
form on file with us, you may make transfers, or change the allocation of future
premium payments or deduction of charges, by telephone, subject to the terms of
the form. We will honor telephone instructions from any person who provides the
correct information, so there is a risk of possible loss to you if unauthorized
persons use this service in your name. Our current procedure is that only the
owner or your AGL representative may make a transfer request by phone. We are
not liable for any acts or omissions based upon instructions that we reasonably
believe to be genuine. Our procedures include verification of the Policy number,
the identity of the caller, both the contingent insureds' and owner's names, and
a form of personal identification from the caller. We will mail you a prompt
written confirmation of the transaction. If (a) many people seek to make
telephone requests at or about the same time, or (b) our recording equipment
malfunctions, it may be impossible for you to make a telephone request at the
time you wish. You should submit a written request if you cannot make a
telephone transfer. Also, if, due to malfunction or other circumstances, your
telephone request is incomplete or not fully comprehensible, we will not process
the transaction. The phone number for telephone requests is 1-888-325-9315.

ILLUSTRATIONS OF HYPOTHETICAL POLICY BENEFITS

To help explain how our Policy works, we have prepared the following
tables:

PAGE TO SEE
IN THIS PROSPECTUS
------------------
Death Benefit Option 1--Current Charges.............. 31
Death Benefit Option 1--Guaranteed Maximum Charges... 32

The tables show how death benefits, accumulation values, and cash surrender
values ("Policy benefits") under a sample Policy would change over time if the
investment options had constant

hypothetical gross annual investment returns of 0%, 6% or 12% over the years
covered by each table. The tables are for a male non-tobacco user and female
non-tobacco user both preferred premium class and issue age 55. An annual
premium payment of $7,000 for an initial $500,000 of specified amount of
coverage is assumed to be paid. The illustrations assume no Policy loan has been
taken. The differences between the accumulation values and the cash surrender
values for the first 14 years in the tables are because of the Policy's
surrender charges. As illustrated, this Policy would not be classified as a
modified endowment contract (see "Tax Effects" beginning on page 34 for further
discussion).

The tables show a sample Policy with 100% base coverage only. A Policy
with supplemental coverage at current charges will over time have lower monthly
insurance charges and a higher accumulation value. Your AGL representative can
provide you with Policy illustrations specific to you, showing how your
selection of base and supplemental coverage, if any, can affect your Policy
values under different assumptions.

Although the tables that follow do not include an example of a Policy with
an Option 2 death benefit, such a Policy would have higher death benefits and
lower cash surrender values.

Separate tables are included to show both current and guaranteed maximum
charges. The charges assumed in the following tables include:

. a charge for state premium tax (or a tax charge back if we issued the
Policy in Oregon), assumed to be 2.0% (for both current and guaranteed
maximum charges);

. after we deduct applicable premium taxes (or a tax charge back if we
issued the Policy in Oregon), a deduction from the remainder of each
premium payment of 5% for each premium we receive during each Policy
year. These rates are for both current and guaranteed charges;

. a daily charge for the first 15 Policy years at an annual effective rate
of 0.75% (for both current and guaranteed maximum charges);

. a daily charge after 15 Policy years at an annual effective rate of
0.50% (for both current and guaranteed maximum charges);

. a daily charge after 30 Policy years at an annual effective rate of
0.15% (for both current and guaranteed maximum charges);

. a flat monthly charge of $10 (for both current and guaranteed maximum
charges);

. a monthly charge for each $1,000 of base coverage of $0.434 (for both
current and guaranteed maximum charges); and

. the monthly insurance charge (for both current and guaranteed maximum
charges).

The charges assumed by both the current and guaranteed maximum charge
tables also include Mutual Fund expenses of 0.79% of aggregate Mutual Fund
assets, which is the arithmetic average of the advisory fees payable with
respect to each Mutual Fund plus the arithmetic average of all other operating
expenses of each such Fund, after all reimbursements, as reflected on pages 10 -
14 of this prospectus. We expect the reimbursement arrangements to continue in
the future. If the reimbursement arrangements were not currently in effect, the
arithmetic average of Mutual Fund expenses would equal 0.82% of aggregate Mutual
Fund assets.

Individual illustrations. We may furnish you with additional illustrations
based on other characteristics. These characteristics could include different
annual investment returns, your choice of investment options which show your
premium payments invested in percentages of your choice, the weighted average of
Fund expenses, and other differences you request. If you request illustrations
more than once in any Policy year, we may charge $25 for the illustration.

PLATINUM INVESTOR SURVIVOR II

ANNUAL PREMIUM $7,000 INITIAL SPECIFIED AMOUNT $500,000
DEATH BENEFIT OPTION 1

MALE AND FEMALE, AGE 55
NON-TOBACCO USERS, PREFERRED PREMIUM CLASS
ASSUMING CURRENT CHARGES

END OF DEATH BENEFIT ACCUMULATION VALUE CASH SURRENDER VALUE
POLICY ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
YEAR ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
0.0% 6.0% 12.0% 0.0% 6.0% 12.0% 0.0% 6.0% 12.0%

1 500,000 500,000 500,000 3,715 4,016 4,318 0 0 0
2 500,000 500,000 500,000 7,371 8,207 9,082 0 57 932
3 500,000 500,000 500,000 10,969 12,581 14,337 2,969 4,581 6,337
4 500,000 500,000 500,000 14,506 17,143 20,132 6,661 9,298 12,287
5 500,000 500,000 500,000 20,564 24,565 29,269 12,879 16,880 21,584
6 500,000 500,000 500,000 26,519 32,305 39,344 18,999 24,785 31,824
7 500,000 500,000 500,000 32,369 40,374 50,451 25,549 33,554 43,631
8 500,000 500,000 500,000 38,111 48,781 62,693 31,965 42,636 56,548
9 500,000 500,000 500,000 43,742 57,538 76,184 38,257 52,053 70,699
10 500,000 500,000 500,000 49,258 66,653 91,047 44,408 61,803 86,197

15 500,000 500,000 500,000 74,791 117,848 191,239 74,791 117,848 191,239

20 500,000 500,000 500,000 96,824 181,078 358,260 96,824 181,078 358,260

THE VALUES WILL CHANGE IF PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.

THE INVESTMENT RESULTS ARE AN EXAMPLE ONLY AND ARE NOT A REPRESENTATION OF PAST
OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN.

PLATINUM INVESTOR SURVIVOR II

ANNUAL PREMIUM $7,000 INITIAL SPECIFIED AMOUNT $500,000
DEATH BENEFIT OPTION 1

MALE AND FEMALE, AGE 55
NON-TOBACCO USERS, PREFERRED PREMIUM CLASS
ASSUMING GUARANTEED CHARGES

1 500,000 500,000 500,000 3,692 3,992 4,294 0 0 0
2 500,000 500,000 500,000 7,274 8,105 8,975 0 0 825
3 500,000 500,000 500,000 10,734 12,332 14,073 2,734 4,332 6,073
4 500,000 500,000 500,000 14,063 16,665 19,617 6,218 8,820 11,772
5 500,000 500,000 500,000 19,831 23,761 28,389 12,146 16,076 20,704
6 500,000 500,000 500,000 25,400 31,060 37,960 17,880 23,540 30,440
7 500,000 500,000 500,000 30,752 38,550 48,393 23,932 31,730 41,573
8 500,000 500,000 500,000 35,861 46,210 59,751 29,716 40,065 53,606
9 500,000 500,000 500,000 40,691 54,012 72,099 35,206 48,527 66,614
10 500,000 500,000 500,000 45,200 61,919 85,504 40,350 57,069 80,654

15 500,000 500,000 500,000 61,205 101,509 171,539 61,205 101,509 171,539

20 500,000 500,000 500,000 59,159 135,929 306,019 59,159 135,929 306,019

THE VALUES WILL CHANGE IF PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.

THE INVESTMENT RESULTS ARE AN EXAMPLE ONLY AND ARE NOT A REPRESENTATION OF PAST
OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN.

ADDITIONAL INFORMATION

A general overview of the Policy appears on pages 1 - 32. The additional
information that follows gives more details, but generally does not repeat what
is set forth above.

PAGE TO
SEE IN THIS
CONTENTS OF ADDITIONAL INFORMATION PROSPECTUS
------------------------------------------------------------------------

AGL...................................................... 34
Separate Account VL-R.................................... 34
Tax Effects.............................................. 34
Voting Privileges........................................ 41
Your Beneficiary......................................... 42
Assigning Your Policy.................................... 42
More About Policy Charges................................ 42
Effective Date of Policy and Related Transactions........ 43
More About the Death Benefit............................. 45
More About Our Declared Fixed Interest Account Option.... 46
Distribution of the Policies............................. 47
Payment of Policy Proceeds............................... 48
Adjustments to Death Benefit............................. 49
Additional Rights That We Have........................... 50
Performance Information.................................. 51
Our Reports to Policy Owners............................. 51
AGL's Management......................................... 52
Principal Underwriter's Management....................... 54
Legal Matters............................................ 55
Accounting and Auditing Experts.......................... 56
Actuarial Expert......................................... 56
Services Agreements...................................... 56
Certain Potential Conflicts.............................. 56
Financial Statements..................................... 57

Special words and phrases. If you want more information about any words or
phrases that you read in this prospectus, you may wish to refer to the Index of
Words and Phrases that appears at the end of this prospectus (pages 58 and 59,
which follow all of the financial pages). That index will tell you on what page
you can read more about many of the words and phrases that we use.

AGL

We are American General Life Insurance Company ("AGL"). AGL is a stock
life insurance company organized under the laws of Texas. AGL is a successor in
interest to a company originally organized under the laws of Delaware on January
10, 1917. AGL is an indirect, wholly-owned subsidiary of American General
Corporation ("AGC"), a diversified financial services holding company engaged
primarily in the insurance business. American General Financial Group is the
marketing name of AGC and its subsidiaries. The commitments under the Policies
are AGL's, and AGC has no legal obligation to back those commitments.

On May 11, 2001, AGC, a Texas corporation, American International Group,
Inc. ("AIG"), a Delaware corporation and Washington Acquisition Corporation, a
Texas corporation and a wholly-owned subsidiary of AIG, entered into an
agreement pursuant to which AGC would become a wholly-owned subsidiary of AIG
(the "Transaction"). On August 15, 2001, the shareholders of AGC voted to
approve the Transaction. On August 29, 2001, the Transaction was completed. As
a result of the Transaction, AGL is now an indirect, wholly-owned subsidiary of
AIG.

AGL is a member of the Insurance Marketplace Standards Association
("IMSA"). IMSA is a voluntary membership organization created by the life
insurance industry to promote ethical market conduct for individual life
insurance and annuity products. AGL's membership in IMSA applies only to AGL
and not its products.

SEPARATE ACCOUNT VL-R

We hold the Mutual Fund shares in which any of your accumulation value is
invested in Separate Account VL-R. Separate Account VL-R is registered as a
unit investment trust with the SEC under the Investment Company Act of 1940. We
created the separate account on May 6, 1997 under Texas law.

For record keeping and financial reporting purposes, Separate Account VL-R
is divided into 65 separate "divisions," 41 of which correspond to the 41
variable "investment options" available since the inception of the Policy. The
remaining 24 divisions, and some of these 41 divisions, represent investment
options available under other variable life policies we offer. We hold the
Mutual Fund shares in which we invest your accumulation value for an investment
option in the division that corresponds to that investment option.

The assets in Separate Account VL-R are our property. The assets in
Separate Account VL-R would be available only to satisfy the claims of owners of
the Policies, to the extent they have allocated their accumulation value to
Separate Account VL-R. Our other creditors could reach only those Separate
Account VL-R assets (if any) that are in excess of the amount of our reserves
and other contract liabilities under the Policies with respect to Separate
Account VL-R.

TAX EFFECTS

This discussion is based on current federal income tax law and
interpretations. It assumes that the policy owner is a natural person who is a
U.S. citizen and resident. The tax consequences

for corporate taxpayers, non-U.S. residents or non-U.S. citizens, may be
different. This discussion is general in nature, and should not be considered
tax advice, for which you should consult a qualified tax adviser.

General. The Policy will be treated as "life insurance" for federal income
tax purposes (a) if it meets the definition of life insurance under Section 7702
of the Internal Revenue Code of 1986, as amended (the "Code") and (b) for as
long as the investments made by the underlying Mutual Funds satisfy certain
investment diversification requirements under Section 817(h) of the Code. We
believe that the Policy will meet these requirements and that:

. the death benefit received by the beneficiary under your Policy will not
be subject to federal income tax; and

. increases in your Policy's accumulation value as a result of interest or
investment experience will not be subject to federal income tax unless
and until there is a distribution from your Policy, such as a
surrender or a partial surrender.

Although AGL believes that the Policies are in compliance with Section 7702
of the Code, the manner in which Section 7702 should be applied to certain
features of a last survivor life insurance policy is not directly addressed by
Section 7702. In the absence of final regulations or other guidance issued
under Section 7702, there is necessarily some uncertainty whether survivor life
insurance policies, like the Platinum Investor Survivor II Policies, will meet
the Section 7702 definition of a life insurance contract.

The federal income tax consequences of a distribution from your Policy can
be affected by whether your Policy is determined to be a "modified endowment
contract,"as you can see from the following discussion. In all cases, however,
the character of all income that is described as taxable to the payee will be
ordinary income (as opposed to capital gain).

Testing for modified endowment contract status. The Code provides for a
"seven-pay test." This test determines if your Policy will be a "modified
endowment contract."

If, at any time during the first seven Policy years:

. you have paid a cumulative amount of premiums;

. the cumulative amount exceeds the premiums you would have paid by the
same time under a similar fixed-benefit life insurance policy; and

. the fixed benefit policy was designed (based on certain assumptions
mandated under the Code) to provide for paid-up future benefits
("paid-up" means no future premium payments are required) after the
payment of seven level annual premiums;

then your Policy will be a modified endowment contract.

Whenever there is a "material change" under a policy, the policy will
generally be (a) treated as a new contract for purposes of determining whether
the policy is a modified endowment contract and (b) subjected to a new seven-pay
period and a new seven-pay limit. The new seven-pay limit would be determined
taking into account, under a prescribed formula, the accumulation value of the
policy at the time of such change. A materially changed policy would be
considered a modified endowment contract if it failed to satisfy the new seven-
pay limit at any time during the new seven-pay period. A "material change" for
these purposes could occur as a result of a change in death benefit option. A
material change will occur as a result of an increase in your Policy's specified
amount of coverage, and certain other changes.

If your Policy's benefits are reduced during the first seven Policy years
(or within seven years after a material change), the calculated seven-pay
premium limit will be redetermined based on the reduced level of benefits and
applied retroactively for purposes of the seven-pay test. (Such a reduction in
benefits could include, for example, a decrease in the specified amount that you
request or that results from a partial surrender). If the premiums previously
paid are greater than the recalculated seven-payment premium level limit, the
Policy will become a modified endowment contract.

A life insurance policy that is received in a tax free 1035 exchange for a
modified endowment contract will also be considered a modified endowment
contract.

Other effects of Policy changes. Changes made to your Policy (for example,
a decrease in specified amount that you request or that results from a partial
surrender that you request) may also have other effects on your Policy. Such
effects may include impacting the maximum amount of premiums that can be paid
under your Policy, as well as the maximum amount of accumulation value that may
be maintained under your Policy.

Rider benefits. The premium payments and any death benefits to be paid
under any term insurance rider you may purchase under your Policy will not
disqualify your Policy as life insurance for tax purposes. However, a term
rider may be determined to constitute a "qualified additional benefit" as that
term is defined in Section 7702 of the Internal Revenue Code. The death benefit
to be paid under a rider that is a "qualified additional benefit" will not be
treated as a future benefit of the Policy for tax purposes. The premium
payments for the same rider, however, will be treated as future benefits for
purposes of compliance with Section 7702. You should consult a qualified tax
adviser regarding any term rider you may purchase.

Taxation of pre-death distributions if your Policy is not a modified
endowment contract. As long as your Policy remains in force during the
contingent insureds' lifetime and not as a modified endowment contract, a Policy
loan will be treated as indebtedness, and no part of the loan proceeds will be
subject to current federal income tax. Interest on the Policy loan generally
will not be tax deductible.

After the first 15 Policy years, the proceeds from a partial surrender will
not be subject to federal income tax except to the extent such proceeds exceed
your "basis" in your Policy. (Your basis generally will equal the premiums you
have paid, less the amount of any previous distributions from your Policy that
were not taxable.) During the first 15 Policy years, however, the proceeds

from a partial surrender could be subject to federal income tax, under a complex
formula, to the extent that your accumulation value exceeds your basis in your
Policy.

On the maturity date or upon full surrender, any excess in the amount of
proceeds we pay (including amounts we use to discharge any Policy loan) over
your basis in the Policy, will be subject to federal income tax. In addition,
if a Policy ends after a grace period while there is a policy loan, the
cancellation of such loan and any accrued loan interest will be treated as a
distribution and could be subject to federal income tax under the above rules.
Finally, if you make an assignment of rights or benefits under your Policy you
may be deemed to have received a distribution from your Policy, all or part of
which may be taxable.

Taxation of pre-death distributions if your Policy is a modified endowment
contract. If your Policy is a modified endowment contract, any distribution
from your Policy while either contingent insured is still living will be taxed
on an "income-first" basis. Distributions:

. include loans (including any increase in the loan amount to pay interest
on an existing loan, or an assignment or pledge to secure a loan) and
partial surrenders;

. will be considered taxable income to you to the extent your accumulation
value exceeds your basis in the Policy; and

. have their taxability determined by aggregating all modified endowment
contracts issued by the same insurer (or its affiliates) to the same
owner (excluding certain qualified plans) during any calendar year.

For modified endowment contracts, your basis:

. is similar to the basis described above for other policies; and

. will be increased by the amount of any prior loan under your Policy that
was considered taxable income to you.

A 10% penalty tax also will apply to the taxable portion of most
distributions from a policy that is a modified endowment contract. The penalty
tax will not, however, apply:

. to taxpayers 59-1/2 years of age or older;

. in the case of a disability (as defined in the Code); or

. to distributions received as part of a series of substantially equal
periodic annuity payments for the life (or life expectancy) of the
taxpayer or the joint lives (or joint life expectancies) of the
taxpayer and his or her beneficiary.

If your Policy ends after a grace period while there is a Policy loan, the
cancellation of the loan will be treated as a distribution to the extent not
previously treated as such and could be subject to tax, including the 10%
penalty tax, as described above. In addition, on the maturity date or upon

a full surrender, any excess of the proceeds we pay (including any amounts we
use to discharge any Policy loan) over your basis in the Policy, will be subject
to federal income tax and, unless one of the above exceptions applies, the 10%
penalty tax.

Distributions that occur during a Policy year in which your Policy becomes
a modified endowment contract, and during any subsequent Policy years, will be
taxed as described in the two preceding paragraphs. In addition, distributions
from a policy within two years before it becomes a modified endowment contract
also will be subject to tax in this manner. This means that a distribution made
from a policy that is not a modified endowment contract could later become
taxable as a distribution from a modified endowment contract.

Policy lapses and reinstatements. A Policy which has lapsed may have the
tax consequences described above, even though you may be able to reinstate that
Policy. For tax purposes, some reinstatements may be treated as the purchase of
a new insurance contract.

Taxation of Exchange Option. You can split the policy into two other
single life insurance policies under some circumstances. A policy split could
have adverse tax consequences if it is not treated as a nontaxable exchange
under Section 1035 of the Code. This could include, among other things,
recognition as taxable income an amount up to any gain in the Policy at the time
of the exchange.

Diversification. Under Section 817(h) of the Code, the Treasury Department
has issued regulations that implement investment diversification requirements.
Our failure to comply with these regulations would disqualify your Policy as a
life insurance policy under Section 7702 of the Code. If this were to occur,
you would be subject to federal income tax on the income under the Policy for
the period of the disqualification and for subsequent periods. Also, if the
last surviving contingent insured died during such period of disqualification or
subsequent periods, a portion of the death benefit proceeds would be taxable to
the beneficiary. Separate Account VL-R, through the Mutual Funds, intends to
comply with these requirements. Although we do not have direct control over the
investments or activities of the Mutual Funds, we will enter into agreements
with them requiring the Mutual Funds to comply with the diversification
requirements of the Section 817(h) Treasury Regulations.

The Treasury Department has stated that it anticipates the issuance of
guidelines prescribing the circumstances in which the ability of a policy owner
to direct his or her investment to particular Mutual Funds within Separate
Account VL-R may cause the policy owner, rather than the insurance company, to
be treated as the owner of the assets in the account. Due to the lack of
specific guidance on investor control, there is some uncertainty about when a
policy owner is considered the owner of the assets for tax purposes. If you
were considered the owner of the assets of Separate Account VL-R, income and
gains from the account would be included in your gross income for federal income
tax purposes. Under current law, however, we believe that AGL, and not the
owner of a Policy, would be considered the owner of the assets of Separate
Account VL-R.

Estate and generation skipping taxes. If the last surviving contingent
insured is the Policy's owner, the death benefit under the Policy will generally
be includable in the owner's estate for purposes of federal estate tax. If the
owner is not the last surviving contingent insured, under certain

conditions, only an amount approximately equal to the cash surrender value of
the Policy would be includable. The federal estate tax is integrated with the
federal gift tax under a unified rate schedule and unified credit. The Taxpayer
Relief Act of 1997 gradually raises the value of the credit to $1,000,000 in
2006. In 2001, the value of the unified credit is $675,000. In addition, an
unlimited marital deduction may be available for federal estate tax purposes.

On May 26, 2001, our Congress passed legislation which gradually phases out
the estate tax between the years 2002 and 2010. However, if Congress does not
take further action, the current estate tax rules will automatically be
reinstated in 2011. During this phase out period between 2002 and 2010, the
estate tax continues with the exemption amount increasing from $1 million in
2002 up to $3.5 million in 2009. During this same time period, the top estate
tax rate gradually decreases from 50% in 2002 down to 45% in 2007 and later
years.

As a general rule, if a "transfer" is made to a person two or more
generations younger than the Policy's owner, a generation skipping tax may be
payable at rates similar to the maximum estate tax rate in effect at the time.
The generation skipping tax provisions generally apply to "transfers" that would
be subject to the gift and estate tax rules. Individuals are generally allowed
an aggregate generation skipping tax exemption of $1 million. Because these
rules are complex, you should consult with a qualified tax adviser for specific
information, especially where benefits are passing to younger generations.

The particular situation of each Policy owner, contingent insured or
beneficiary will determine how ownership or receipt of Policy proceeds will be
treated for purposes of federal estate and generation skipping taxes, as well as
state and local estate, inheritance and other taxes.

Life insurance in split dollar arrangements. The IRS has released a
technical advice memorandum ("TAM") on the taxability of insurance policies used
in certain split dollar arrangements. A TAM provides advice as to the internal
revenue laws, regulations, and related statutes with respect to a specified set
of facts and a specified taxpayer. In the TAM, among other things, the IRS
concluded that an employee was subject to current taxation on the excess of the
cash surrender value of the policy over the premiums to be returned to the
employer. Purchasers of life insurance policies to be used in split dollar
arrangements are strongly advised to consult with a qualified tax adviser to
determine the tax treatment resulting from such an arrangement.

The Internal Revenue Service ("IRS") recently issued Notice 2001-10 in an
effort to clarify its position and provide guidance regarding split-dollar life
insurance arrangements. As part of this Notice, the IRS concluded that the P.S.
58 rates, which have been used to determine the fair market value of life
insurance protection, are no longer appropriate and may not be used after
December 31, 2001. The Notice indicates that in 2002, the rate table issued
under section 79 of the Code must be used to reflect the economic value of the
life insurance protection in split dollar arrangements. The parties to a split
dollar arrangement also may elect to use published alternate term rates,
provided by the issuing insurance company, if the parties comply with certain
new conditions.

In cases of reverse split dollar or equity split dollar arrangements, the
IRS has also stated that an employee will be taxed on the value of any economic
benefit above and beyond the employer's investment in the contract. We urge you
to contact your tax adviser regarding the federal income

tax consequences of split dollar arrangements or reverse split dollar
arrangements as a result of the recent IRS Notice 2001-10.

Pension and profit-sharing plans. If a life insurance policy is purchased
by a trust or other entity that forms part of a pension or profit-sharing plan
qualified under Section 401(a) of the Code for the benefit of participants
covered under the plan, the federal income tax treatment of such policies will
be somewhat different from that described above.

The reasonable net premium cost for such amount of insurance that is
purchased as part of a pension or profit-sharing plan is required to be included
annually in the plan participant's gross income. This cost (generally referred
to as the "P.S. 58" cost) is reported to the participant annually. If the plan
participant dies while covered by the plan and the policy proceeds are paid to
the participant's beneficiary, then the excess of the death benefit over the
policy's accumulation value will not be subject to federal income tax. However,
the policy's accumulation value will generally be taxable to the extent it
exceeds the participant's cost basis in the policy. The participant's cost
basis will generally include the costs of insurance previously reported as
income to the participant. Special rules may apply if the participant had
borrowed from the policy or was an owner-employee under the plan.

There are limits on the amounts of life insurance that may be purchased on
behalf of a participant in a pension or profit-sharing plan. Complex rules, in
addition to those discussed above, apply whenever life insurance is purchased by
a tax qualified plan. You should consult a qualified tax adviser.

Other employee benefit programs. Complex rules may also apply when a
policy is held by an employer or a trust, or acquired by an employee, in
connection with the provision of other employee benefits. These policy owners
must consider whether the policy was applied for by or issued to a person having
an insurable interest under applicable state law and with both contingent
insureds' consent. The lack of an insurable interest or consent may, among
other things, affect the qualification of the policy as life insurance for
federal income tax purposes and the right of the beneficiary to receive a death
benefit.

ERISA. Employers and employer-created trusts may be subject to reporting,
disclosure and fiduciary obligations under the Employee Retirement Income
Security Act of 1974, as amended. You should consult a qualified legal adviser.

Our taxes. We report the operations of Separate Account VL-R in our
federal income tax return, but we currently pay no income tax on Separate
Account VL-R's investment income and capital gains, because these items are, for
tax purposes, reflected in our variable universal life insurance policy
reserves. We currently make no charge to any Separate Account VL-R division for
taxes. We reserve the right to make a charge in the future for taxes incurred;
for example, a charge to Separate Account VL-R for income taxes we incur that
are allocable to the Policy.

We may have to pay state, local or other taxes in addition to applicable
taxes based on premiums. At present, these taxes are not substantial. If they
increase, we may make charges for such taxes when they are attributable to
Separate Account VL-R or allocable to the Policy.

Certain Mutual Funds in which your accumulation value is invested may elect
to pass through to AGL taxes withheld by foreign taxing jurisdictions on foreign
source income. Such an election will result in additional taxable income and
income tax to AGL. The amount of additional income tax, however, may be more
than offset by credits for the foreign taxes withheld which are also passed
through. These credits may provide a benefit to AGL.

When we withhold income taxes. Generally, unless you provide us with an
election to the contrary before we make the distribution, we are required to
withhold income tax from any proceeds we distribute as part of a taxable
transaction under your Policy. In some cases, where generation skipping taxes
may apply, we may also be required to withhold for such taxes unless we are
provided satisfactory written notification that no such taxes are due.

In the case of non-resident aliens who own a Policy, the withholding rules
may be different. With respect to distributions from modified endowment
contracts, non-resident aliens are generally subject to federal income tax
withholding at a statutory rate of 30% of the distributed amount. In some
cases, the non-resident alien may be subject to lower or even no withholding if
the United States has entered into a tax treaty with his or her country of
residence.

Tax changes. The U.S. Congress frequently considers legislation that, if
enacted, could change the tax treatment of life insurance policies. Congress
recently passed tax legislation on May 26, 2001 which modified the existing
estate tax law. In addition, the Treasury Department may amend existing
regulations, issue regulations on the qualification of life insurance and
modified endowment contracts, or adopt new interpretations of existing law.
State and local tax law or, if you are not a U.S. citizen and resident, foreign
tax law, may also affect the tax consequences to you, the contingent insureds or
your beneficiary, and are subject to change. Any changes in federal, state,
local or foreign tax law or interpretation could have a retroactive effect. We
suggest you consult a qualified tax adviser.

VOTING PRIVILEGES

We are the legal owner of the Funds' shares held in Separate Account VL-R.
However, you may be asked to instruct us how to vote the Fund shares held in the
various Mutual Funds that are attributable to your Policy at meetings of
shareholders of the Funds. The number of votes for which you may give
directions will be determined as of the record date for the meeting. The number
of votes that you may direct related to a particular Fund is equal to (a) your
accumulation value invested in that Fund divided by (b) the net asset value of
one share of that Fund. Fractional votes will be recognized.

We will vote all shares of each Fund that we hold of record, including any
shares we own on our own behalf, in the same proportions as those shares for
which we have received instructions from owners participating in that Fund
through Separate Account VL-R.

If you are asked to give us voting instructions, we will send you the proxy
material and a form for providing such instructions. Should we determine that
we are no longer required to send the owner such materials, we will vote the
shares as we determine in our sole discretion.

In certain cases, we may disregard instructions relating to changes in a
Fund's investment manager or its investment policies. We will advise you if we
do and explain the reasons in our next report to policy owners. AGL reserves
the right to modify these procedures in any manner that the laws in effect from
time to time allow.

YOUR BENEFICIARY

You name your beneficiary when you apply for a Policy. The beneficiary is
entitled to the insurance benefits of the Policy. You may change the
beneficiary during the lifetime of either contingent insured unless your
previous designation of beneficiary provides otherwise. In this case the
previous beneficiary must give us permission to change the beneficiary and then
we will accept your instructions. A new beneficiary designation is effective as
of the date you sign it, but will not affect any payments we may make before we
receive it. If no beneficiary is living when the last surviving contingent
insured dies, we will pay the insurance proceeds to the owner or the owner's
estate.

ASSIGNING YOUR POLICY

You may assign (transfer) your rights in a Policy to someone else as
collateral for a loan or for some other reason. We will not be bound by an
assignment unless it is received in writing. You must provide us with two
copies of the assignment. We are not responsible for any payment we make or any
action we take before we receive a complete notice of the assignment in good
order. We are also not responsible for the validity of the assignment. An
absolute assignment is a change of ownership. Because there may be unfavorable
tax consequences, including recognition of taxable income and the loss of income
tax-free treatment for any death benefit payable to the beneficiary, you should
consult a qualified tax adviser before making an assignment.

MORE ABOUT POLICY CHARGES

Purpose of our charges. The charges under the Policy are designed to
cover, in total, our direct and indirect costs of selling, administering and
providing benefits under the Policy. They are also designed, in total, to
compensate us for the risks we assume and services that we provide under the
Policy. These include:

. mortality risks (such as the risk that contingent insureds will, on
average, die before we expect, thereby increasing the amount of claims
we must pay);

. sales risks (such as the risk that the number of Policies we sell and
the premiums we receive net of withdrawals, are less than we expect,
thereby depriving us of expected economies of scale);

. regulatory risks (such as the risk that tax or other regulations may be
changed in ways adverse to issuers of variable life insurance
policies); and

. expense risks (such as the risk that the costs of administrative
services that the Policy requires us to provide will exceed what we
currently project).

The current monthly insurance charge has been designed primarily to provide
funds out of which we can make payments of death benefits under the Policy as
the last surviving contingent insured dies.

If the charges that we collect from the Policy exceed our total costs in
connection with the Policy, we will earn a profit. Otherwise we will incur a
loss.

Although the paragraphs above describe the primary purposes for which
charges under the Policies have been designed, these purposes are subject to
considerable change over the life of a Policy. We can retain or use the
revenues from any charge for any purpose.

Gender neutral policies. Congress and the legislatures of various states
have from time to time considered legislation that would require insurance rates
to be the same for males and females of the same age, premium class and tobacco
user status. In addition, employers and employee organizations should consider,
in consultation with counsel, the impact of Title VII of the Civil Rights Act of
1964 on the purchase of life insurance policies in connection with an
employment-related insurance or benefit plan. In a 1983 decision, the United
States Supreme Court held that, under Title VII, optional annuity benefits under
a deferred compensation plan could not vary on the basis of gender. In general,
we do not offer the Platinum Investor Survivor II Policy for sale in situations
which, under current law, require gender-neutral premiums or benefits.

Cost of insurance rates. Because of specified amount increases, different
cost of insurance rates may apply to different increments of specified amount
under your Policy. See "Monthly insurance charge" on page 8.

Certain arrangements. Most of the distributors or advisers of the Mutual
Funds listed on page 1 of this prospectus make certain payments to us, on a
quarterly basis, for certain administrative, Policy, and policy owner support
expenses. These amounts will be reasonable for the services performed and are
not designed to result in a profit. These amounts are paid by the distributors
or the advisers, and will not be paid by the Mutual Funds, the divisions or
Policy owners. No payments have yet been made under these arrangements, because
the number of Policies issued does not require a payment.

EFFECTIVE DATE OF POLICY AND RELATED TRANSACTIONS

Valuation dates, times, and periods. We compute values under a Policy on
each day that the New York Stock Exchange is open for business. We call each
such day a "valuation date" or a "business day."

We compute policy values as of 3:00 p.m., Central time, on each valuation
date. We call this our "close of business." We call the time from the close of
business on one valuation date to the close of business of the next valuation
date a "valuation period."

Date of receipt. Generally we consider that we have received a premium
payment or another communication from you on the day we actually receive it in
full and proper order at any of the

addresses shown on the first page of this prospectus. If we receive it after the
close of business on any valuation date, however, we consider that we have
received it on the day following that valuation date.

Commencement of insurance coverage. After you apply for a Policy, it can
sometimes take up to several weeks for us to gather and evaluate all the
information we need to decide whether to issue a Policy to you and, if so, what
the contingent insureds' premium classes should be. We will not pay a death
benefit under a Policy unless (a) it has been delivered to and accepted by the
owner and at least the initial premium has been paid, and (b) at the time of
such delivery and payment, there have been no adverse developments in the
contingent insureds' health or risk of death. However, if you pay at least the
minimum first premium payment with your application for a Policy, we will
provide temporary coverage of up to $300,000 provided the contingent insureds
meet certain medical and risk requirements. The terms and conditions of this
coverage are described in our "Limited Temporary Life Insurance Agreement." You
can obtain a copy from our Administrative Center by writing to the address shown
on the first page of this prospectus or from your AGL representative.

Date of issue; Policy months and years. We prepare the Policy only after
we approve an application for a Policy and assign an appropriate premium class.
The day we begin to deduct charges will appear on page 3 of your Policy and is
called the "Date of Issue." Policy months and years are measured from the date
of issue. To preserve a younger age at issue for the contingent insureds, we
may assign a date of issue to a Policy that is up to 6 months earlier than
otherwise would apply.

Monthly deduction days. Each charge that we deduct monthly is assessed
against your accumulation value at the close of business on the date of issue
and at the end of each subsequent valuation period that includes the first day
of a Policy month. We call these "monthly deduction days."

Commencement of investment performance. We begin to credit an investment
return to the accumulation value resulting from your initial premium payment on
the later of (a) the date of issue, or (b) the date all requirements needed to
place the Policy in force have been satisfied, including underwriting approval
and receipt of the necessary premium. In the case of a back-dated Policy, we do
not credit an investment return to the accumulation value resulting from your
initial premium payment until the date stated in (b) above.

Effective date of other premium payments and requests that you make.
Premium payments (after the first) and transactions made in response to your
requests and elections are generally effected at the end of the valuation period
in which we receive the payment, request or election and based on prices and
values computed as of that same time. Exceptions to this general rule are as
follows:

. Increases you request in the specified amount of insurance,
reinstatements of a Policy that has lapsed, and changes in death
benefit option take effect on the Policy's monthly deduction day on or
next following our approval of the transaction;

. In most states, we may return premium payments, make a partial surrender
or reduce the death benefit if we determine that such premiums would
cause your Policy to become a modified endowment contract or to cease
to qualify as life insurance under federal income tax law or exceed
the maximum net amount at risk;

. If you exercise the right to return your Policy described on the second
page of this prospectus, your coverage will end when you deliver it to
your AGL representative or if you mailed it to us, the day it is
postmarked; and

. If you pay a premium in connection with a request which requires our
approval, your payment will be applied when received rather than
following the effective date of the change requested so long as your
coverage is in force and the amount paid will not cause you to exceed
premium limitations under the Code. If we do not approve your
request, no premium will be refunded to you except to the extent
necessary to cure any violation of the maximum premium limitations
under the Code. We will not apply this procedure to premiums you pay
in connection with reinstatement requests.

MORE ABOUT THE DEATH BENEFIT

Base coverage and supplemental coverage. The amount of insurance coverage
you select at the time you apply to purchase a Policy is called the specified
amount. The specified amount is the total of two types of coverage: your "base
coverage" and "supplemental coverage," if any, that you select. You can choose
to have only base coverage. You decide how much base coverage and how much
supplemental coverage you want, as long as the total is not less than the
minimum of $500,000 and at least 10% of the total is base coverage when you
purchase the Policy. You can use the mix of base and supplemental coverage to
emphasize your own objectives.

Whenever you decrease the specified amount, we will reduce your base and
supplemental coverages in the order set forth beginning on page 18 under
"Decrease in Coverage", as long as at least 10% of the total is base coverage.
A partial surrender will reduce the specified amount. In this case, we will
deduct any surrender charge that applies to the decrease in base coverage, but
not to the decrease in supplemental coverage. You can change the percentage of
base coverage when you increase the specified amount but at least 10% of the
total specified amount after the increase must be base coverage.

Here are the features about supplemental coverage that differ from base
coverage:

. Supplemental coverage has no surrender charges;

. The four year monthly expense charge does not apply to supplemental
coverage; and

. The monthly insurance charge for supplemental coverage is always equal
to or less than the monthly insurance charge for an equivalent amount
of base coverage.

Generally, if you choose supplemental coverage instead of base coverage,
you will reduce your total charges and increase your accumulation value on a
current charge basis. The more

supplemental coverage you elect, the greater will be the amount of the reduction
in charges and increase in accumulation value, on a current charge basis. Keep
in mind, however, that our guarantee of a minimum death benefit will require a
higher monthly guarantee premium for the first 5 Policy years if supplemental
coverage is included. Therefore, before deciding how much, if any, supplemental
coverage you should have, you should discuss with your AGL representative what
you believe to be your own objectives. Your representative can provide you with
further information and Policy illustrations showing how your selection of base
and supplemental coverage can affect your Policy values under different
assumptions. You can then decide what is to be your initial mix of base and
supplemental coverage.

Increases after age 90. We allow you to increase your supplemental
coverage after the older contingent insured reaches age 90 and until the younger
contingent insured reaches age 99 (or would have reached age 99, if deceased),
but only under certain conditions:

. Increases are allowed only if you have financed the Policy's premiums.

. Increases cannot result in a specified amount greater than the amount
we approve through underwriting at the time the Policy is issued.

. You must purchase the return of premium death benefit rider when the
Policy is issued and keep the rider in force at all times.

. You may be required to purchase additional base coverage because you
must still maintain at least 10% of your specified amount as base
coverage.

MORE ABOUT OUR DECLARED FIXED INTEREST ACCOUNT OPTION

Our general account. Our general account assets are all of our assets that
we do not hold in legally segregated separate accounts. Our general account
supports our obligations to you under your Policy's declared fixed interest
account option. Because of applicable exemptions, no interest in this option
has been registered under the Securities Act of 1933, as amended. Neither our
general account or our declared fixed interest account is an investment company
under the Investment Company Act of 1940. We have been advised that the staff
of the SEC has not reviewed the disclosures that are included in this prospectus
for your information about our general account or our declared fixed interest
account option. Those disclosures, however, may be subject to certain generally
applicable provisions of the federal securities laws relating to the accuracy
and completeness of statements made in prospectuses.

How we declare interest. Except for amounts held as collateral for loans,
we can at any time change the rate of interest we are paying on any accumulation
value allocated to our declared fixed interest account option, but it will
always be at an annual effective rate of at least 4%.

Under these procedures, it is likely that at any time different interest
rates will apply to different portions of your accumulation value, depending on
when each portion was allocated to our declared fixed interest account option.
Any charges, partial surrenders, or loans that we take from any accumulation
value that you have in our declared fixed interest account option will be taken

from each portion in reverse chronological order based on the date that
accumulation value was allocated to this option.

DISTRIBUTION OF THE POLICIES

American General Distributors, Inc. ("AGDI") is the principal underwriter
and distributor of the Policies. AGDI is an affiliate of AGL. In the states of
Florida and Illinois, AGDI is known as American General Financial Distributors
of Florida, Inc. and American General Financial Distributors of Illinois, Inc.,
respectively. AGDI's principal office is at 2929 Allen Parkway, Houston, Texas
77019. AGDI was organized as a Delaware corporation on June 24, 1994 and is a
registered broker-dealer under the Securities Exchange Act of 1934, as amended
and a member of the National Association of Securities Dealers, Inc. ("NASD").
AGDI is also the principal underwriter for AGL's Separate Accounts A and D, as
well as the underwriter for various separate accounts of other AGL affiliates.
These separate accounts are registered investment companies. AGDI, as the
principal underwriter and distributor, is not paid any fees on the Policies.

We and AGDI have sales agreements with various broker-dealers and banks
under which the Policies will be sold by registered representatives of the
broker-dealers or employees of the banks. These registered representatives and
employees are also required to be authorized under applicable state regulations
as life insurance agents to sell variable life insurance. The broker-dealers
are ordinarily required to be registered with the SEC and must be members of the
NASD.

We pay compensation directly to broker-dealers and banks for promotion and
sales of the Policies. The compensation may vary with the sales agreement, but
is generally not expected to exceed:

. 85% of the premiums received in the first Policy year up to a "target"
amount;

. 3% of the premiums up to the target amount received in each of Policy
years two through 10;

. 3% of the premiums in excess of the target amount received in any of
Policy years one through 10;

. 0.20% of the Policy's accumulation value (reduced by any outstanding
loans) in the investment options in each of Policy years one through
30; and

. 0.10% of the Policy's accumulation value (reduced by any outstanding
loans) in the investment options after Policy year 30.

We may pay additional compensation in the event a representative, a broker-
dealer or bank reaches certain premium production levels.

The target amount is an amount of level annual premium that would be
necessary to support the benefits under your Policy, based on certain
assumptions that we believe are reasonable. For this

purpose, we exclude any supplemental coverage and, therefore, the target premium
is reduced proportionately by the amount of supplemental coverage.

Commissions payable to broker-dealers and registered representatives for
sales of the Policies are calculated based on the total premium payments for
both the base and supplemental coverage. The commissions vary depending on the
ratio of premium necessary for the base and supplemental coverage. The same
amount of premium will result in the highest commission when there is no
supplementary coverage. The commissions decline as the portion of the specified
amount allocated to supplementary coverage increases. The lowest commission
amount is payable when you choose the maximum amount of supplementary coverage.

The maximum value of any alternative amounts we may pay for sales of the
Policies is expected to be equivalent over time to the amounts described above.
For example, we may pay a broker-dealer compensation in a lump sum which will
not exceed the aggregate compensation described above.

We pay a comparable amount of compensation to the broker-dealers or banks
with respect to any increase in the specified amount of coverage that you
request. In addition, we may pay broker-dealers or banks expense allowances,
bonuses, wholesaler fees and training allowances.

We pay the compensation directly to any selling broker-dealer firm or bank.
We pay the compensation from our own resources which does not result in any
additional charge to you that is not described beginning on page 7. Each
broker-dealer firm or bank, in turn, may compensate its registered
representative or employee who acts as agent in selling you a Policy.

We sponsor a non-qualified deferred compensation plan ("Plan") for our
insurance agents. Some of our agents are registered representatives of our
subsidiary broker-dealer American General Securities Incorporated and sell the
Policies. These agents may, subject to regulatory approval, receive benefits
under the Plan when they sell the Policies. The benefits are deferred and the
Plan terms may result in the agent never receiving the benefits. The Plan
provides for a varying amount of benefits annually. We have the right to change
the Plan in ways that affect the amount of benefits earned each year.

PAYMENT OF POLICY PROCEEDS

General. We will pay any death benefit, maturity benefit, cash surrender
value or loan proceeds within seven days after we receive the last required form
or request (and any other documents that may be required for payment of a death
benefit). If we do not have information about the desired manner of payment
within 60 days after the date we receive notification of the insured person's
death, we will pay the proceeds as a single sum, normally within seven days
thereafter.

Delay of declared fixed interest account option proceeds. We have the
right, however, to defer payment or transfers of amounts out of our declared
fixed interest account option for up to six months. If we delay more than 30
days in paying you such amounts, we will pay interest of at least 3% a year from
the date we receive all items we require to make the payment.

Delay for check clearance. We reserve the right to defer payment of that
portion of your accumulation value that is attributable to a payment made by
check for a reasonable period of time (not to exceed 15 days) to allow the check
to clear the banking system.

Delay of Separate Account VL-R proceeds. We reserve the right to defer
payment of any death benefit, loan or other distribution that comes from that
portion of your accumulation value that is allocated to Separate Account VL-R,
if:

. the New York Stock Exchange is closed other than customary weekend and
holiday closings, or trading on the New York Stock Exchange is
restricted;

. an emergency exists, as a result of which disposal of securities is not
reasonably practicable or it is not reasonably practicable to fairly
determine the accumulation value; or

. the SEC by order permits the delay for the protection of owners.

Transfers and allocations of accumulation value among the investment
options may also be postponed under these circumstances. If we need to defer
calculation of Separate Account VL-R values for any of the foregoing reasons,
all delayed transactions will be processed at the next values that we do
compute.

Delay to challenge coverage. We may challenge the validity of your
insurance Policy based on any material misstatements in your application or any
application for a change in coverage. However,

. We cannot challenge the Policy after it has been in effect, during
either contingent insured's lifetime, for two years from the date the
Policy was issued or restored after termination. (Some states may
require that we measure this time in another way. Some states may also
require that we calculate the amount we are required to pay in another
way.)

. We cannot challenge any Policy change that requires evidence of
insurability (such as an increase in specified amount) after the
change has been in effect for two years during either contingent
insured's lifetime.

. We cannot challenge an additional benefit rider that provides benefits
if either contingent insured becomes totally disabled, after two years
from the later of the Policy's date of issue or the date the
additional benefit rider becomes effective.

ADJUSTMENTS TO DEATH BENEFIT

Suicide. If either contingent insured commits suicide during the first two
Policy years, we will limit the death benefit proceeds to the total of all
premiums that have been paid to the time of death minus any outstanding Policy
loans (plus credit for any unearned interest) and any partial surrenders.

A new two year period begins if you increase the specified amount. You can
increase the specified amount only if both contingent insureds are living at the
time of the increase. In this case, if either contingent insured commits
suicide during the first two years following the increase, we will refund the
monthly insurance deductions attributable to the increase. The death benefit
will then be based on the specified amount in effect before the increase.

Some states require that we compute these periods for noncontestability
differently following a suicide.

Wrong age or gender. If the age or gender of either contingent insured was
misstated on your application for a Policy (or for any increase in benefits), we
will adjust any death benefit to be what the monthly insurance charge deducted
for the current month would have purchased based on the correct information.

Death during grace period. We will deduct from the insurance proceeds any
monthly charges that remain unpaid because the last surviving contingent insured
died during a grace period.

ADDITIONAL RIGHTS THAT WE HAVE

We have the right at any time to:

. transfer the entire balance in an investment option in accordance with
any transfer request you make that would reduce your accumulation
value for that option to below $500;

. transfer the entire balance in proportion to any other investment
options you then are using, if the accumulation value in an investment
option is below $500 for any other reason;

. end the automatic rebalancing feature if your accumulation value falls
below $5,000;

. change the underlying Mutual Fund that any investment option uses;

. add, delete or limit investment options, combine two or more investment
options, or withdraw assets relating to the Policies from one
investment option and put them into another;

. operate Separate Account VL-R under the direction of a committee or
discharge such a committee at any time;

. change our underwriting and premium class guidelines;

. operate Separate Account VL-R, or one or more investment options, in any
other form the law allows, including a form that allows us to make
direct investments. Separate Account VL-R may be charged an advisory
fee if its investments are made

directly rather than through another investment company. In that case,
we may make any legal investments we wish; or

. make other changes in the Policy that in our judgment are necessary or
appropriate to ensure that the Policy continues to qualify for tax
treatment as life insurance, or that do not reduce any cash surrender
value, death benefit, accumulation value, or other accrued rights or
benefits.

You will be notified as required by law if there are any material changes
in the underlying investments of an investment option that you are using. We
intend to comply with all applicable laws in making any changes and, if
necessary, we will seek policy owner approval.

PERFORMANCE INFORMATION

From time to time, we may quote performance information for the divisions
of Separate Account VL-R in advertisements, sales literature, or reports to
owners or prospective investors.

We may quote performance information in any manner permitted under
applicable law. We may, for example, present such information as a change in a
hypothetical owner's cash value or death benefit. We also may present the yield
or total return of the division based on a hypothetical investment in a Policy.
The performance information shown may cover various periods of time, including
periods beginning with the commencement of the operations of the division or the
Mutual Funds in which it invests. The performance information shown may reflect
the deduction of one or more charges, such as the premium charge, and we
generally expect to exclude costs of insurance charges because of the individual
nature of these charges.

We may compare a division's performance to that of other variable life
separate accounts or investment products, as well as to generally accepted
indices or analyses, such as those provided by research firms and rating
services. In addition, we may use performance ratings that may be reported
periodically in financial publications, such as Money Magazine, Forbes, Business
Week, Fortune, Financial Planning and The Wall Street Journal. We also may
advertise ratings of AGL's financial strength or claims-paying ability as
determined by firms that analyze and rate insurance companies and by nationally
recognized statistical rating organizations.

Performance information for any division reflects the performance of a
hypothetical Policy and is not illustrative of how actual investment performance
would affect the benefits under your Policy. You should not consider such
performance information to be an estimate or guarantee of future performance.

OUR REPORTS TO POLICY OWNERS

Shortly after the end of each Policy year, we will mail you a report that
includes information about your Policy's current death benefit, accumulation
value, cash surrender value and policy loans. We will send you notices to
confirm premium payments, transfers and certain other Policy transactions. We
will mail to you at your last known address of record, these and any other
reports

and communications required by law. You should give us prompt written notice of
any address change.

AGL'S MANAGEMENT

The directors, executive officers, and (to the extent responsible for
variable life operations) the other principal officers of AGL are listed below.

NAME BUSINESS EXPERIENCE WITHIN PAST FIVE YEARS
--------------------------------------------------------------------------------------------

Rodney O. Martin, Jr. Director of American General Life Insurance Company since
August 1996. Chairman of the Board and CEO of American General
Life Insurance Company since April 2000. President and CEO
(August 1996 - July 1998). President of American General Life
Insurance Company of New York (November 1995 - August 1996).

Donald W. Britton Director of the Board of American General Life Insurance
Company since April 1999. President of American General Life
Insurance Company since April 2000. President of First Colony
Life, Lynchburg, Virginia (1996 - April 1999).

David A. Fravel Director of American General Life Insurance Company since
November 1996. Elected Executive Vice President in April 1998.
Previously held position of Senior Vice President of American
General Life Insurance Company since November 1996. Senior
Vice President of Massachusetts Mutual, Springfield, Missouri
(March 1996 - June 1996).

David L. Herzog Director, Executive Vice President and Chief Financial Officer of
American General Life Insurance Company since March 2000.
Vice President of General American, St. Louis, Missouri (June
1991 - February 2000).

John V. LaGrasse Director of American General Life Insurance Company since
August 1996. Chief Technology Officer of American General
Life Insurance Company since April 2000. Elected Executive
Vice President in July 1998. Previously held position of Senior
Vice President of American General Life Insurance Company
since August 1996. Director of Citicorp Insurance Services, Inc.,
Dover, Delaware (1986 - 1996).

Royce G. Imhoff, II Director of American General Life Insurance Company since
November 1997. Previously held various positions with American
General Life Insurance Company including Vice President since
August 1996.

NAME BUSINESS EXPERIENCE WITHIN PAST FIVE YEARS
--------------------------------------------------------------------------------------------

Gary D. Reddick Director of American General Life Insurance Company since
April 2001. Executive Vice President of American General Life
Insurance Company since April 1998. Vice Chairman since July
1997 and Executive Vice President - Administration of The
Franklin Life Insurance Company since February 1995.

Paul L. Mistretta Executive Vice President of American General Life Insurance
Company since July 1999. Senior Vice President of First Colony
Life Insurance, Lynchburg, Virginia (1992 - July 1999).

Don M. Ward Executive Vice President of American General Life Insurance
Company since April 2000. Senior Vice President of American
General Life Insurance Company since February 1998. Vice
President of Pacific Life Insurance Company, Newport Beach, CA
(1991 - February 1998).

Wayne A. Barnard Senior Vice President of American General Life Insurance
Company since November 1997. Previously held various
positions with American General Life Insurance Company
including Vice President since February 1991.

Robert M. Beuerlein Senior Vice President and Chief Actuary of American General
Life Insurance Company since September 1999. Previously held
position of Vice President of American General Life Insurance
Company since December 1998. Director, Senior Vice President
and Chief Actuary of The Franklin Life Insurance Company,
Springfield, Illinois (January 1991 - June 1999).

David J. Dietz Senior Vice President - Corporate Markets Group of American
General Life Insurance Company since January 1999. President
and Chief Executive Officer - Individual Insurance Operations of
The United States Life Insurance Company in the City of New
York since September 1997. President of Prudential Select Life,
Newark, New Jersey (August 1990 - September 1997).

William Guterding Senior Vice President of American General Life Insurance
Company since April 1999. Senior Vice President and Chief
Underwriting Officer of The United States Life Insurance
Company in the City of New York since October 1980.

Robert F. Herbert, Jr. Senior Vice President and Treasurer of American General Life
Insurance Company since May 1996, and Controller since
February 1991.

NAME BUSINESS EXPERIENCE WITHIN PAST FIVE YEARS
--------------------------------------------------------------------------------------------

Simon J. Leech Senior Vice President of American General Life Insurance
Company since July 1997. Previously held various positions with
American General Life Insurance Company since 1981, including
Director of Policy Owners' Service Department in 1993, and Vice
President - Policy Administration in 1995.

Mark R. McGuire Senior Vice President of American General Life Insurance
Company since April 2001. Vice President of American General
Life Companies (2000 - March 2001). Vice President of The
Franklin Life Insurance Company (1997 - 2000). Previously held
various positions with American General Life Insurance Company
since August 1988, including Director of Work Site Marketing
Administration (1996 - 1997), and Director of Annuity
Administration (1994 - 1996).

Roy V. Washington Senior Vice President and Chief Compliance Officer of American
General Life Insurance Company since April 2001. Senior Vice
President and Chief Compliance Officer of American General Life
Companies since May 2000. Vice President of Lincoln National
Life, Fort Wayne, Indiana (June 1996 - May 2000). Legal
Counsel of Lincoln National Life, Fort Wayne, Indiana (August
1994 - June 1996).

The principal business address of each person listed above is our Home Office;
except that the street number for Messrs. Fravel, LaGrasse, Leech, Martin,
Herzog, Imhoff, Britton, Mistretta, Barnard, and Reddick is 2929 Allen Parkway,
the street number for Messrs. Ward and Washington is 2727 Allen Parkway, and the
street number for Messrs. Dietz and Guterding is 390 Park Ave, 5/th/ Floor, New
York, New York.

PRINCIPAL UNDERWRITER'S MANAGEMENT

The directors and principal officers of the principal underwriter are:

POSITION AND OFFICES
WITH UNDERWRITER,
NAME AND PRINCIPAL AMERICAN GENERAL
BUSINESS ADDRESS DISTRIBUTORS, INC.
---------------- ------------------

Robert P. Condon Director and Chairman,
2929 Allen Parkway Chief Executive Officer and President
Houston, TX 77019

Mary L. Cavanaugh Director and Assistant Secretary
2929 Allen Parkway
Houston, TX 77019

POSITION AND OFFICES
WITH UNDERWRITER,
NAME AND PRINCIPAL AMERICAN GENERAL
BUSINESS ADDRESS DISTRIBUTORS, INC.
---------------- ------------------

David H. den Boer Director, Senior Vice President,
2929 Allen Parkway and Secretary
Houston, TX 77019

Jennifer D. Cobbs Executive Vice President
2929 Allen Parkway
Houston, TX 77019

Krien VerBerkmoes Chief Compliance Officer
2929 Allen Parkway
Houston, TX 77019

John Reiner Chief Financial Officer and Treasurer
2929 Allen Parkway
Houston, TX 77019

Robyn Galerston Assistant Vice President -
2919 Allen Parkway Sales Literature Review
Houston, TX 77019

D. Lynne Walters Tax Officer
2929 Allen Parkway
Houston, TX 77019

Pauletta P. Cohn Assistant Secretary
2929 Allen Parkway
Houston, TX 77019

Lauren W. Jones Assistant Secretary
2929 Allen Parkway
Houston, TX 77019

Daniel R. Cricks Assistant Tax Officer
2929 Allen Parkway
Houston, TX 77019

James D. Bonsall Assistant Treasurer
2929 Allen Parkway
Houston, TX 77019

LEGAL MATTERS

We are not involved in any legal proceedings that would be considered
material with respect to a policy owner's interest in Separate Account VL-R.
Pauletta P. Cohn, Esquire, Deputy General

Counsel of the American General Life Companies, an affiliate of AGL, has opined
as to the validity of the Policies.

ACCOUNTING AND AUDITING EXPERTS

Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements at December 31, 2000 and 1999 and for each of the three
years in the period ended December 31, 2000, as set forth in their report. We
have included our financial statements in the prospectus in reliance on Ernst &
Young LLP's report, given on their authority as experts in accounting and
auditing. The address of Ernst & Young LLP is One Houston Center, 1221
McKinney, Suite 2400, Houston, Texas 77010-2007.

ACTUARIAL EXPERT

Actuarial matters have been examined by Robert M. Beuerlein who is Senior
Vice President and Chief Actuary of AGL. His opinion on actuarial matters is
filed as an exhibit to the registration statement we have filed with the SEC in
connection with the Policies.

SERVICES AGREEMENTS

American General Life Companies ("AGLC") is party to an existing general
services agreement with AGL. AGLC, an affiliate of AGL, is a business trust
established in Delaware on December 30, 2000. Prior to that date, AGLC was a
Delaware corporation. Pursuant to this agreement, AGLC provides services to
AGL, including most of the administrative, data processing, systems, customer
services, product development, actuarial, auditing, accounting and legal
services for AGL and the Policies.

We have entered into various services agreements with most of the advisers
or administrators for the Mutual Funds. We receive fees for the administrative
services we perform. These fees do not result in any additional charges under
the Policies that are not described under "What charges will AGL deduct from my
investment in a Policy?"

We have entered into a services agreement with PIMCO Variable Insurance
Trust under which we receive fees paid directly by this Mutual Fund for services
we perform.

CERTAIN POTENTIAL CONFLICTS

The Mutual Funds sell shares to separate accounts of insurance companies
(and may sell shares to certain qualified plans), both affiliated and not
affiliated with AGL. We currently do not foresee any disadvantages to you
arising out of such sales. Differences in treatment under tax and other laws,
as well as other considerations, could cause the interests of various owners to
conflict. For example, violation of the federal tax laws by one separate account
investing in the Funds could cause the contracts funded through another separate
account to lose their tax-deferred status, unless remedial action were taken.
However, each Mutual Fund has advised us that its board of trustees (or
directors) intends to monitor events to identify any material irreconcilable
conflicts that possibly may arise and to determine what action, if any, should
be taken in response. If we believe that a

Fund's response to any such event insufficiently protects our policy owners, we
will see to it that appropriate action is taken to do so as well as report any
material irreconcilable conflicts that we know exist to each Mutual Fund as soon
as a conflict arises. If it becomes necessary for any separate account to
replace shares of any Mutual Fund in which it invests, that Fund may have to
liquidate securities in its portfolio on a disadvantageous basis.

FINANCIAL STATEMENTS

The financial statements of AGL contained in this prospectus should be
considered to bear only upon the ability of AGL to meet its obligations under
the Policies. They should not be considered as bearing upon the investment
experience of Separate Account VL-R. No financial statements of Separate
Account VL-R are included because, at the date of this prospectus, none of the
41 divisions of Separate Account VL-R were available under the Policies.

PAGE TO
CONSOLIDATED FINANCIAL STATEMENTS OF SEE IN THIS
AMERICAN GENERAL LIFE INSURANCE COMPANY PROSPECTUS
--------------------------------------- ----------

Unaudited Consolidated Balance Sheet as of June 30, 2001...... Q-1
Unaudited Consolidated Income Statement for the six months
ended June 30, 2001........................................ Q-3
Report of Ernst & Young LLP Independent Auditors.............. F-1
Consolidated Balance Sheets as of December 31, 2000 and 1999.. F-2
Consolidated Statements of Income for the years ended
December 31, 2000, 1999 and 1998........................... F-4
Consolidated Statements of Shareholder's Equity for the years
ended December 31, 2000, 1999 and 1998..................... F-5
Consolidated Statements of Comprehensive Income
for the years ended December 31, 2000, 1999, and 1998...... F-6
Consolidated Statements of Cash Flows for the years
ended December 31, 2000, 1999 and 1998..................... F-7
Notes to Consolidated Financial Statements.................... F-8

American General Life Insurance Company

Consolidated Balance Sheet

(Unaudited)

June 30
2001
-------------
(In Thousands)
ASSETS
Investments:
Fixed maturity securities, at fair value (amortized cost-
$27,569,206) $27,677,835
Equity securities, at fair value (cost - $374,350) 412,662
Mortgage loans on real estate 2,223,944
Policy loans 1,307,253
Investment real estate 66,520
Other long-term investments 59,058
Short-term investments 1,771,759
Derivatives 16,632
-------------
Total investments 33,535,663

Cash 90,043
Investment in Parent Company (cost - $7,958) 64,994
Indebtedness from affiliates 63,214
Accrued investment income 479,605
Accounts receivable 1,195,476
Deferred policy acquisition costs 2,078,068
Property and equipment 80,134
Other assets 459,830
Assets held in separate accounts 21,152,666
-------------
Total assets $59,199,693
=============

Q-1

American General Life Insurance Company

Consolidated Balance Sheet

(Unaudited)

June 30
2001
-------------
(In Thousands)

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Future policy benefits $30,188,492
Other policy claims and benefits payable 65,653
Other policyholders' funds 393,745
Federal income taxes 488,052
Indebtedness to affiliates 10,721
Other liabilities 3,166,337
Liabilities related to separate accounts 21,152,666
-------------
Total liabilities 55,465,666

Shareholders' equity:
Common stock, $10 par value, 600,000 shares authorized,
issued, and outstanding 6,000
Preferred stock, $100 par value, 8,500 shares authorized,
issued, and outstanding 850
Additional paid-in capital 1,417,250
Accumulated other comprehensive income/(loss) 83,847
Retained earnings 2,226,080
-------------
Total shareholders' equity 3,734,027
-------------
Total liabilities and shareholders' equity $59,199,693
=============

Q-2

American General Life Insurance Company

Consolidated Income Statement

(Unaudited)

Six months ended
June 30, 2001
----------------
(In Thousands)

Revenues:
Premium and other considerations $ 325,505
Net investment income 1,193,047
Net realized investment loss (143,901)
Other 64,364
-------------
1,437,015

Benefits and expenses:
Benefits 887,730
Operating costs and expenses 289,506
-------------
Total benefits and expenses 1,177,236
-------------

Income before income tax expense 259,779
Income tax expense 74,909
-------------
$ 184,870

Cumulative effect of accounting change (22,383)
-------------
$ 162,487
=============

Q-3

[Ernst & Young Letterhead]

Report of Independent Auditors

Board of Directors and Stockholder
American General Life Insurance Company

We have audited the accompanying consolidated balance sheets of American General
Life Insurance Company (an indirectly wholly-owned subsidiary of American
General Corporation) and subsidiaries as of December 31, 2000 and 1999, and the
related consolidated statements of income, shareholder's equity, comprehensive
income, and cash flows for each of the three years in the period ended December
31, 2000. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of American General
Life Insurance Company and subsidiaries at December 31, 2000 and 1999, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 2000, in conformity with accounting
principles generally accepted in the United States.

February 5, 2001

/s/ Ernst & Young

F-1

American General Life Insurance Company

Consolidated Balance Sheets

December 31
2000 1999
------------------------------------
(In Thousands)

Assets
Investments:
Fixed maturity securities, at fair value (amortized cost -
$27,098,978 in 2000 and $27,725,167 in 1999) $ 26,991,695 $ 27,029,409
Equity securities, at fair value (cost - $413,959 in 2000 and
$198,640 in 1999) 413,908 237,065
Mortgage loans on real estate 2,084,299 1,918,956
Policy loans 1,297,438 1,234,729
Investment real estate 124,117 125,563
Other long-term investments 46,833 129,155
Short-term investments 140,496 123,779
------------------------------------
Total investments 31,098,786 30,798,656

Cash 44,747 45,983
Investment in Parent Company (cost - $8,597 in 2000
and 1999) 57,019 53,083
Indebtedness from affiliates 78,225 75,195
Accrued investment income 472,187 482,652
Accounts receivable 664,395 186,592
Deferred policy acquisition costs 2,090,810 1,956,653
Property and equipment 80,665 78,908
Other assets 228,685 250,299
Assets held in separate accounts 22,225,525 23,232,419
------------------------------------
Total assets $ 57,041,044 $ 57,160,440
====================================

F-2

Consolidated Balance Sheets

December 31
2000 1999
------------------------------------
(In Thousands)

Liabilities and shareholder's equity
Liabilities:
Future policy benefits $ 29,524,610 $ 29,901,842
Other policy claims and benefits payable 47,369 53,326
Other policyholders' funds 388,433 371,632
Federal income taxes 466,314 375,332
Indebtedness to affiliates 6,909 7,086
Other liabilities 920,570 372,416
Liabilities related to separate accounts 22,225,525 23,232,419
------------------------------------
Total liabilities 53,579,730 54,314,053

Shareholder's equity:
Common stock, $10 par value, 600,000 shares
authorized, issued, and outstanding 6,000 6,000
Preferred stock, $100 par value, 8,500 shares
authorized, issued, and outstanding 850 850
Additional paid-in capital 1,370,821 1,371,687
Accumulated other comprehensive loss (31,466) (356,865)
Retained earnings 2,115,109 1,824,715
------------------------------------
Total shareholder's equity 3,461,314 2,846,387

------------------------------------
Total liabilities and shareholder's equity $ 57,041,044 $ 57,160,440
====================================

See accompanying notes.

F-3

American General Life Insurance Company

Consolidated Statements of Income

Year ended December 31
2000 1999 1998
------------------------------------------------------
(In Thousands)

Revenues:
Premiums and other considerations $ 659,901 $ 540,029 $ 470,238
Net investment income 2,362,694 2,348,196 2,316,933
Net realized investment gains (losses) (98,109) 5,351 (33,785)
Other 134,769 82,581 69,602
------------------------------------------------------
Total revenues 3,059,255 2,976,157 2,822,988

Benefits and expenses:
Benefits 1,775,120 1,719,375 1,788,417
Operating costs and expenses 481,107 495,606 467,067
Interest expense 734 74 15
Litigation settlement - - 97,096
------------------------------------------------------
Total benefits and expenses 2,256,961 2,215,055 2,352,595
------------------------------------------------------
Income before income tax expense 802,294 761,102 470,393

Income tax expense 260,860 263,196 153,719
------------------------------------------------------
Net income $ 541,434 $ 497,906 $ 316,674
======================================================

See accompanying notes.

F-4

American General Life Insurance Company

Consolidated Statements of Shareholder's Equity

Year ended December 31
2000 1999 1998
------------------------------------------------------
(In Thousands)

Common stock:
Balance at beginning of year $ 6,000 $ 6,000 $ 6,000
Change during year - - -
------------------------------------------------------
Balance at end of year 6,000 6,000 6,000

Preferred stock:
Balance at beginning of year 850 850 850
Change during year - - -
------------------------------------------------------
Balance at end of year 850 850 850

Additional paid-in capital:
Balance at beginning of year 1,371,687 1,368,089 1,184,743
Capital contribution from Parent Company - - 182,284
Other changes during year (866) 3,598 1,062
------------------------------------------------------
Balance at end of year 1,370,821 1,371,687 1,368,089

Accumulated other comprehensive (loss) income:
Balance at beginning of year (356,865) 679,107 427,526
Change in unrealized gains (losses) on
securities 325,399 (1,035,972) 251,581
------------------------------------------------------
Balance at end of year (31,466) (356,865) 679,107

Retained earnings:
Balance at beginning of year 1,824,715 1,514,489 1,442,495
Net income 541,434 497,906 316,674
Dividends paid (251,040) (187,680) (244,680)
------------------------------------------------------
Balance at end of year 2,115,109 1,824,715 1,514,489
------------------------------------------------------
Total shareholder's equity $ 3,461,314 $ 2,846,387 $ 3,568,535
======================================================

See accompanying notes.

F-5

American General Life Insurance Company

Consolidated Statements of Comprehensive Income

Year ended December 31
2000 1999 1998
------------------------------------------------------
(In Thousands)

Net income $ 541,434 $ 497,906 $ 316,674
Other comprehensive income:
Gross change in unrealized gains (losses) on
securities (pretax: $435,000; ($1,581,500);
$341,000) 282,743 (1,027,977) 222,245
Less: gains (losses) realized in net income (42,656) 7,995 (29,336)
------------------------------------------------------
Change in net unrealized gains (losses) on
securities (pretax: $500,000;
($1,593,800); $387,000) 325,399 (1,035,972) 251,581
------------------------------------------------------
Comprehensive (loss) income $ 866,833 $ (538,066) $ 568,255
======================================================

See accompanying notes.

F-6

American General Life Insurance Company

Consolidated Statements of Cash Flows

Year ended December 31
2000 1999 1998
----------------------------------------------------------------
(In Thousands)

Operating activities
Net income $ 541,434 $ 497,906 $ 316,674
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Change in accounts receivable (477,803) 10,004 11,613
Change in future policy benefits and other policy claims (2,566,783) (2,422,221) (866,428)
Amortization of policy acquisition costs 23,443 101,066 125,062
Policy acquisition costs deferred (299,306) (307,854) (244,196)
Change in other policyholders' funds 16,801 (26,955) 273
Provision for deferred income tax expense 57,228 85,257 15,872
Depreciation 28,677 24,066 19,418
Amortization 22,831 (30,894) (26,775)
Change in indebtedness to/from affiliates (3,207) 74,814 (51,116)
Change in amounts payable to brokers 478,132 (43,321) (894)
Net loss on sale of investments 52,670 45,379 37,016
Other, net 47,646 (170,413) 57,307
----------------------------------------------------------------
Net cash used in operating activities (2,078,237) (2,163,166) (606,174)

Investing activities
Purchases of investments and loans made (33,436,962) (44,508,908) (28,231,615)
Sales or maturities of investments and receipts from
repayment of loans 33,627,301 43,879,377 26,656,897
Sales and purchases of property, equipment, and
software, net (45,078) (87,656) (105,907)
----------------------------------------------------------------
Net cash provided by (used in) investing activities 145,261 (717,187) (1,680,625)

Financing activities
Policyholder account deposits 6,144,393 5,747,658 4,688,831
Policyholder account withdrawals (3,960,747) (2,754,915) (2,322,307)
Dividends paid (251,040) (187,680) (244,680)
Capital contribution from Parent - - 182,284
Other (866) 3,598 1,062
----------------------------------------------------------------
Net cash provided by financing activities 1,931,740 2,808,661 2,305,190
----------------------------------------------------------------
(Decrease) increase in cash (1,236) (71,692) 18,391
Cash at beginning of year 45,983 117,675 99,284
----------------------------------------------------------------
Cash at end of year $ 44,747 $ 45,983 $ 117,675
================================================================

Interest paid amounted to approximately $50,673,000, $2,026,000, and $420,000 in
2000, 1999, and 1998, respectively.

See accompanying notes.

F-7

American General Life Insurance Company

Notes to Consolidated Financial Statements

December 31, 2000

NATURE OF OPERATIONS

American General Life Insurance Company (the "Company") is a wholly-owned
subsidiary of AGC Life Insurance Company, which is a wholly-owned subsidiary of
American General Corporation (the "Parent Company"). The Company's wholly-owned
life insurance subsidiaries are American General Life Insurance Company of New
York ("AGNY") and The Variable Annuity Life Insurance Company ("VALIC"). During
1998, the Company formed a new wholly-owned subsidiary, American General Life
Companies ("AGLC"), to provide management services to certain life insurance
subsidiaries of the Parent Company.

The Company offers a complete portfolio of the standard forms of universal life,
variable universal life, interest-sensitive whole life, term life, structured
settlements, and fixed and variable annuities throughout the United States. In
addition, a variety of equity products are sold through its wholly-owned
broker/dealer, American General Securities, Inc. The Company serves the estate
planning needs of middle- and upper-income households and the life insurance
needs of small- to medium-sized businesses. AGNY offers a broad array of
traditional and interest-sensitive insurance, in addition to individual annuity
products. VALIC provides tax-deferred retirement annuities and
employer-sponsored retirement plans to employees of health care, educational,
public sector, and other not-for-profit organizations throughout the United
States.

1. Accounting Policies

1.1 Preparation of Financial Statements

The consolidated financial statements have been prepared in accordance with
accounting principles generally accepted in the United States ("GAAP") and
include the accounts of the Company and its wholly-owned subsidiaries.
Transactions with the Parent Company and other subsidiaries of the Parent
Company are not eliminated from the financial statements of the Company. All
other material intercompany transactions have been eliminated in consolidation.

The preparation of financial statements requires management to make estimates
and assumptions that affect amounts reported in the financial statements and
disclosures of contingent assets and liabilities. Ultimate results could differ
from those estimates.

F-8

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.2 Statutory Accounting

The Company and its wholly-owned life insurance subsidiaries are required to
file financial statements with state regulatory authorities. State insurance
laws and regulations prescribe accounting practices for calculating statutory
net income and equity. In addition, state regulators may permit statutory
accounting practices that differ from prescribed practices. The use of such
permitted practices by the Company and its wholly-owned life insurance
subsidiaries did not have a material effect on statutory equity at December 31,
2000.

Statutory financial statements differ from GAAP financial statements.
Significant differences were as follows (in thousands):

2000 1999 1998
------------------------------------------------------

Net income:
Statutory net income (2000 net income is
unaudited) $ 360,578 $ 350,294 $ 259,903
Deferred policy acquisition costs and cost
of insurance purchased 302,965 200,285 116,597
Deferred income taxes (85,401) (86,456) (53,358)
Adjustments to policy reserves 4,717 23,110 52,445
Goodwill amortization (1,910) (2,437) (2,033)
Net realized gain (loss) on investments, net
of tax (62,075) 2,246 41,488
Litigation settlement - - (63,112)
Other, net 22,560 10,864 (35,256)
------------------------------------------------------
GAAP net income $ 541,434 $ 497,906 $ 316,674
======================================================

Shareholders' equity:
Statutory capital and surplus (2000 balance
is unaudited) $ 1,908,887 $ 1,753,570 $ 1,670,412
Deferred policy acquisition costs 2,090,810 1,975,667 1,109,831
Deferred income taxes (457,054) (350,258) (698,350)
Adjustments to policy reserves (250,808) (202,150) (274,532)
Acquisition-related goodwill 27,069 52,317 54,754
Asset valuation reserve ("AVR") 353,818 351,904 310,564
Interest maintenance reserve ("IMR") 18,942 53,226 27,323
Investment valuation differences (121,982) (683,500) 1,487,658
Surplus from separate accounts (155,471) (180,362) (174,447)
Other, net 47,103 75,973 55,322
------------------------------------------------------
Total GAAP shareholders' equity $ 3,461,314 $ 2,846,387 $ 3,568,535
======================================================

F-9

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.2 Statutory Accounting (continued)

The more significant differences between GAAP and statutory accounting
principles are that under GAAP: (a) acquisition costs related to acquiring new
business are deferred and amortized (generally in proportion to the present
value of expected gross profits from surrender charges and investment,
mortality, and expense margins), rather than being charged to operations as
incurred; (b) future policy benefits are based on estimates of mortality,
interest, and withdrawals generally representing the Company's experience, which
may differ from those based on statutory mortality and interest requirements
without consideration of withdrawals; (c) deferred tax assets and liabilities
are established for temporary differences between the financial reporting basis
and the tax basis of assets and liabilities, at the enacted tax rates expected
to be in effect when the temporary differences reverse; (d) certain assets
(principally furniture and equipment, agents' debit balances, computer software,
and certain other receivables) are reported as assets rather than being charged
to retained earnings; (e) acquisitions are accounted for using the purchase
method of accounting rather than being accounted for as equity investments; and
(f) fixed maturity investments are carried at fair value rather than amortized
cost. In addition, statutory accounting principles require life insurance
companies to establish an AVR and an IMR. The AVR is designed to address the
credit-related risk for bonds, preferred stocks, derivative instruments, and
mortgages and market risk for common stocks, real estate, and other invested
assets. The IMR is composed of investment- and liability-related realized gains
and losses that result from interest rate fluctuations. These realized gains and
losses, net of tax, are amortized into income over the expected remaining life
of the asset sold or the liability released.

1.3 Insurance Contracts

The insurance contracts accounted for in these financial statements include
primarily long-duration contracts. Long-duration contracts include traditional
whole life, endowment, guaranteed renewable term life, universal life, limited
payment, and investment contracts. Long-duration contracts generally require the
performance of various functions and services over a period of more than one
year. The contract provisions generally cannot be changed or canceled by the
insurer during the contract period; however, most new contracts written by the
Company allow the insurer to revise certain elements used in determining premium
rates or policy benefits, subject to guarantees stated in the contracts. At
December 31, 2000 and 1999, insurance investment contracts of $25.0 million and
$25.9 million, respectively, were included in the Company's liabilities.

F-10

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.4 Investments

Fixed Maturity and Equity Securities

Substantially all fixed maturity and equity securities were classified as
available-for-sale and recorded at fair value at December 31, 2000 and 1999.
After adjusting related balance sheet accounts as if the unrealized gains
(losses) had been realized, the net adjustment is recorded in accumulated other
comprehensive income (loss), within shareholders' equity. If the fair value of a
security classified as available-for-sale declines below its cost and this
decline is considered to be other than temporary, the security's amortized cost
is reduced to its fair value, and the reduction is recorded as a realized loss.

At various times, the Company holds trading securities and reports them at fair
value. Our trading security portfolio was immaterial at year-end 2000 and 1999.
Realized and unrealized gains (losses) related to trading securities are
included in net investment income, however, trading securities did not have a
material effect on net investment income in 2000, 1999, and 1998.

Equity partnerships, which are reported in equity securities, are accounted for
under the equity method of accounting. For those partnerships that report
changes in the fair value of underlying equity investments in earnings, the
Company records its proportionate interest in investment gains (losses).

Mortgage Loans

Mortgage loans are reported at amortized cost, net of an allowance for losses.
The allowance for losses covers estimated losses based on our assessment of risk
factors such as potential non-payment or non-monetary default. The allowance is
primarily based on a loan-specific review.

Loans for which the Company determines that collection of all amounts due under
the contractual terms is not probable are considered to be impaired. The Company
generally looks to the underlying collateral for repayment of impaired loans.
Therefore, impaired loans are reported at the lower of amortized cost or fair
value of the underlying collateral, less estimated cost to sell.

F-11

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.4 Investments (continued)

Policy Loans

Policy loans are reported at unpaid principal balance.

Real Estate

Real estate is classified as held for investment or available for sale, based on
management's intent. Real estate held for investment is carried at cost, less
accumulated depreciation and impairment write-downs. Real estate available for
sale is carried at the lower of cost (less accumulated depreciation, if
applicable) or fair value less cost to sell.

Dollar Roll Agreements

Dollar rolls are agreements to sell mortgage-backed securities and to repurchase
substantially the same securities at a specified price and date in the future.
We account for dollar rolls as short-term collateralized financings and include
the repurchase obligation in other liabilities. There were no dollar rolls
outstanding at December 31, 2000 or 1999.

Investment Income

Interest on fixed maturity securities and performing mortgage loans is recorded
as income when earned and is adjusted for any amortization of premium or
discount. Interest on delinquent mortgage loans is recorded as income when
received. Dividends are recorded as income on ex-dividend dates.

Income on mortgage-backed securities is recognized using a constant effective
yield based on estimated prepayments of the underlying mortgages. If actual
prepayments differ from estimated prepayments, a new effective yield is
calculated and the net investment in the security is adjusted accordingly. The
adjustment is recognized in net investment income.

Realized Investment Gains

Realized investment gains (losses) are recognized using the
specific-identification method and reported in net realized investment gains
(losses).

F-12

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.5 Separate Accounts

Separate Accounts are assets and liabilities associated with certain contracts,
principally annuities, for which the investment risk lies solely with the
contract holder. Therefore, the Company's liability for these accounts equals
the value of the account assets. Investment income, realized investment gains
(losses), and policyholder account deposits and withdrawals related to separate
accounts are excluded from the consolidated statements of income, comprehensive
income, and cash flows. Assets held in Separate Accounts are primarily shares in
mutual funds, which are carried at fair value based on the quoted net asset
value per share.

1.6 Deferred Policy Acquisition Costs ("DPAC") and Cost of Insurance Purchased
("CIP")

Certain costs of writing an insurance policy, including commissions,
underwriting, and marketing expenses, are deferred and reported as DPAC.

CIP represents the cost assigned to insurance contracts in force that are
acquired through the purchase of a block of business. At December 31, 2000, CIP
of $15.6 million was reported within other assets.

DPAC and CIP associated with interest-sensitive life contracts, insurance
investment contracts, and participating life insurance contracts is charged to
expense in relation to the estimated gross profits of those contracts. If
estimated gross profits change significantly, DPAC and CIP balances are
recalculated using the new assumptions. Any resulting adjustment is included in
current earnings as an adjustment to DPAC or CIP amortization. DPAC and CIP
associated with all other insurance contracts is charged to expense over the
premium-paying period or as the premiums are earned over the life of the
contract. Interest is accreted on the unamortized balance of DPAC at rates used
to compute policyholder reserves and on the unamortized balance of CIP at rates
of 2.5% to 7.88%.

DPAC and CIP are adjusted for the impact on estimated future gross profits as if
net unrealized gains (losses) on securities had been realized at the balance
sheet date. The impact of this adjustment is included in accumulated other
comprehensive income within shareholder's equity.

F-13

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.6 Deferred Policy Acquisition Costs ("DPAC") and Cost of Insurance Purchased
("CIP") (continued)

The Company reviews the carrying amount of DPAC and CIP on at least an annual
basis. Management considers estimated future gross profits or future premiums,
expected mortality, interest earned and credited rates, persistency, and
expenses in determining whether the carrying amount is recoverable. Any amounts
deemed unrecoverable are charged to expense.

1.7 Other Assets

Goodwill is charged to expense in equal amounts, generally over 40 years. The
Company reviews goodwill for indicators of impairment in value which it believes
are other than temporary, including unexpected or adverse changes in the
following: (1) the economic or competitive environments in which the Company
operates, (2) profitability analyses, (3) cash flow analyses, and (4) the fair
value of the relevant subsidiary. If facts and circumstances suggest that a
subsidiary's goodwill is impaired, the Company assesses the fair value of the
underlying business based on an independent appraisal and reduce goodwill to an
amount that results in the book value of the subsidiary approximating fair
value.

1.8 Policy and Contract Claims Reserves

Substantially all of the Company's insurance and annuity liabilities relate to
long duration contracts. The contracts normally cannot be changed or canceled by
the Company during the contract period.

For interest-sensitive life insurance and investment contracts, reserves equal
the sum of the policy account balance and deferred revenue charges. Reserves for
other contracts are based on estimates of the cost of future policy benefits.
Reserves are determined using the net level premium method. Interest assumptions
used to compute reserves ranged from 2.00% to 13.50% at December 31, 2000.

F-14

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.9 Premium Recognition

Most receipts for annuities and interest-sensitive life insurance policies are
classified as deposits instead of revenue. Revenues for these contracts consist
of mortality, expense, and surrender charges. Policy charges that compensate the
Company for future services are deferred and recognized in income over the
period earned, using the same assumptions used to amortize DPAC.

For limited-payment contracts, net premiums are recorded as revenue, and the
difference between the gross premium received and the net premium is deferred
and recognized in a constant relationship to insurance in force. For all other
contracts, premiums are recognized when due.

1.10 Reinsurance

The Company limits its exposure to loss on any single insured to $2.5 million by
ceding additional risks through reinsurance contracts with other insurers. The
Company diversifies its risk of reinsurance loss by using a number of reinsurers
that have strong claims-paying ability ratings. If the reinsurer could not meet
its obligations, the Company would reassume the liability as the Company remains
primarily liable to the policyholder.

A receivable is recorded for the portion of benefits paid and insurance
liabilities that have been reinsured. Reinsurance recoveries on ceded
reinsurance contracts were $20 million, $28 million, and $63 million, during
2000, 1999, and 1998, respectively. The cost of reinsurance is recognized over
the life of the reinsured policies using assumptions consistent with those used
to account for the underlying policies. Benefits paid and future policy benefits
related to ceded insurance contracts are recorded as reinsurance receivables,
and are included in accounts receivable.

1.11 Participating Policy Contracts

Participating life insurance accounted for approximately 1% of life insurance in
force at December 31, 2000 and 1999.

F-15

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.11 Participating Policy Contracts (continued)

The portion of earnings allocated to participating policyholders is excluded
from net income and shareholder's equity. Dividends to be paid on participating
life insurance contracts are determined annually based on estimates of the
contracts' earnings. Policyholder dividends were $4.4 million, $4.6 million, and
$4.9 million in 2000, 1999, and 1998, respectively.

1.12 Income Taxes

The Company and its life insurance subsidiaries, together with certain other
life insurance subsidiaries of the Parent Company, are included in a
life/non-life consolidated tax return with the Parent Company and its
noninsurance subsidiaries. The Company participates in a tax sharing agreement
with other companies included in the consolidated tax return. Under this
agreement, tax payments are made to the Parent Company as if the companies filed
separate tax returns; and companies incurring operating and/or capital losses
are reimbursed for the use of these losses by the consolidated return group.

Deferred tax assets and liabilities are established for temporary differences
between the financial reporting basis and the tax basis of assets and
liabilities, at the enacted tax rates expected to be in effect when the
temporary differences reverse. The effect of a tax rate change is recognized in
income in the period of enactment. State income taxes are included in income tax
expense.

A valuation allowance for deferred tax assets is provided if it is more likely
than not that some portion of the deferred tax asset will not be realized. An
increase or decrease in a valuation allowance that results from a change in
circumstances that causes a change in judgment about the realizability of the
related deferred tax asset is included in income. Changes related to
fluctuations in fair value of available-for-sale securities are included in the
consolidated statements of comprehensive income and accumulated other
comprehensive income in shareholder's equity.

F-16

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. Accounting Policies (continued)

1.13 Accounting Changes

SFAS 133

On January 1, 2001, the Company will adopt Statement of Financial Accounting
Standards ("SFAS") 133, Accounting for Derivative Instruments and Hedging
Activities, which requires all derivative instruments to be recognized at fair
value in the balance sheet. Changes in the fair value of a derivative instrument
will be reported in net income or other comprehensive income, depending upon the
intended use of the derivative instrument.

The adoption of SFAS 133 is not expected to have a material impact on the
company's results of operations and financial position in future periods. The
impact of fair value adjustments on derivatives which do not qualify for hedge
accounting and any ineffectiveness resulting from hedging activities will be
recorded in investment gains (losses).

Codification

The Company has performed a review of the revised Accounting Practices and
Procedures Manual ("Codification") effective January 1, 2001 and determined that
the effect of these changes will not result in a significant reduction in the
Company's statutory basis-capital and surplus as of adoption.

F-17

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments

2.1 Investment Income

Investment income by type of investment was as follows for the year ended:

2000 1999 1998
------------------------------------------------------
(In Thousands)

Investment income:
Fixed maturities $ 2,050,503 $ 2,118,794 $ 2,101,730
Equity securities 22,996 17,227 1,813
Mortgage loans on real estate 159,414 134,878 148,447
Investment real estate 22,749 20,553 23,139
Policy loans 71,927 69,684 66,573
Other long-term investments 13,062 7,539 3,837
Short-term investments 66,296 24,874 15,492
Investment income from affiliates 10,733 8,695 10,536
------------------------------------------------------
Gross investment income 2,417,680 2,402,244 2,371,567
Investment expenses 54,986 54,048 54,634
------------------------------------------------------
Net investment income $ 2,362,694 $ 2,348,196 $ 2,316,933
======================================================

The carrying value of investments that produced no investment income during 2000
was less than 1.5% of total invested assets. The ultimate disposition of these
investments is not expected to have a material effect on the Company's results
of operations and financial position.

Derivative financial instruments did not have a material effect on net
investment income in 2000, 1999, or 1998.

F-18

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments (continued)

2.2 Net Realized Investment Gains (Losses)

Realized gains (losses) by type of investment were as follows for the year
ended:

2000 1999 1998
------------------------------------------------------
(In Thousands)

Fixed maturities:
Gross gains $ 62,856 $ 118,427 $ 20,109
Gross losses (174,057) (102,299) (62,657)
------------------------------------------------------
Total fixed maturities (111,201) 16,128 (42,548)
Equity securities - 793 645
Other investments 13,092 (11,570) 8,118
------------------------------------------------------
Net realized investment gains (losses)
before tax (98,109) 5,351 (33,785)
Income tax expense (benefit) (34,338) 1,874 (11,826)
------------------------------------------------------
Net realized investment gains (losses)
after tax $ (63,771) $ 3,477 $ (21,959)
======================================================

F-19

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments (continued)

2.3 Fixed Maturity and Equity Securities

All fixed maturity and equity securities are classified as available-for-sale
and reported at fair value. Amortized cost and fair value at December 31, 2000
and 1999 were as follows:

Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gain Loss Value
------------------------------------------------------------------------
(In Thousands)

December 31, 2000
Fixed maturity securities:
Corporate securities:
Investment-grade $ 18,495,450 $ 420,049 $ (420,341) $ 18,495,158
Below investment-grade 1,662,879 14,888 (287,880) 1,389,887
Mortgage-backed securities* 6,340,762 145,597 (5,907) 6,480,452
U.S. government obligations 215,220 22,526 (21) 237,725
Foreign governments 209,305 7,402 (1,655) 215,052
State and political subdivisions 168,302 2,940 (4,821) 166,421
Redeemable preferred stocks 7,060 - (60) 7,000
------------------------------------------------------------------------
Total fixed maturity securities $ 27,098,978 $ 613,402 $ (720,685) $ 26,991,695
========================================================================
Equity securities $ 413,959 $ 10,146 $ (10,197) $ 413,908
========================================================================
Investment in Parent Company $ 8,597 $ 48,422 $ - $ 57,019
========================================================================

* Primarily include pass-through securities guaranteed by and mortgage
obligations ("CMOs") collateralized by the U.S. government and government
agencies.

F-20

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments (continued)

2.3 Fixed Maturity and Equity Securities (continued)

Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gain Loss Value
------------------------------------------------------------------------
(In Thousands)

December 31, 1999 Fixed maturity securities:
Corporate securities:
Investment-grade $ 19,455,518 $ 134,003 $ (704,194) $ 18,885,326
Below investment-grade 1,368,494 11,863 (114,260) 1,266,098
Mortgage-backed securities* 6,195,003 45,022 (74,746) 6,165,279
U.S. government obligations 276,621 15,217 (2,376) 289,462
Foreign governments 245,782 5,774 (1,767) 249,789
State and political subdivisions 154,034 499 (10,836) 143,697
Redeemable preferred stocks 29,715 43 - 29,758
------------------------------------------------------------------------
Total fixed maturity securities $ 27,725,167 $ 212,421 $ (908,179) $ 27,029,409
========================================================================
Equity securities $ 198,640 $ 39,381 $ (956) $ 237,065
========================================================================
Investment in Parent Company $ 8,597 $ 44,486 $ - $ 53,083
========================================================================

* Primarily include pass-through securities guaranteed by and mortgage
obligations ("CMOs") collateralized by the U.S. government and government
agencies.

F-21

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments (continued)

2.3 Fixed Maturity and Equity Securities (continued)

Net unrealized gains (losses) on securities included in accumulated
comprehensive income in shareholders' equity at December 31 were as follows:

2000 1999
-------------------------------
(In Thousands)

Gross unrealized gains $ 671,970 $ 296,288
Gross unrealized losses (730,882) (909,135)
DPAC and other fair value adjustments 23,119 200,353
Deferred federal income taxes 4,330 55,631
Other (3) (2)
--------------------------------
Net unrealized losses on securities $ (31,466) $ (356,865)
================================

The contractual maturities of fixed maturity securities at December 31, 2000
were as follows:

2000 1999
-----------------------------------------------------------------------
Amortized Market Amortized Market
Cost Value Cost Value
-----------------------------------------------------------------------
(In thousands) (In thousands)

Fixed maturity securities, excluding
mortgage-backed securities:
Due in one year or less $ 832,001 $ 833,695 $ 810,124 $ 813,683
Due after one year through
five years 5,539,620 5,562,918 5,380,557 5,394,918
Due after five years through
ten years 7,492,395 7,433,403 8,350,207 8,080,065
Due after ten years 6,894,200 6,681,227 6,988,799 6,575,461
Mortgage-backed securities 6,340,762 6,480,452 6,195,480 6,165,282
-----------------------------------------------------------------------
Total fixed maturity securities $27,098,978 $ 26,991,695 $27,725,167 $27,029,409
=======================================================================

Actual maturities may differ from contractual maturities, since borrowers may
have the right to call or prepay obligations. In addition, corporate
requirements and investment strategies may result in the sale of investments
before maturity. Proceeds from sales of fixed maturities were $12.3 billion,
$12.3 billion, and $5.4 billion, during 2000, 1999, and 1998, respectively.

F-22

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments (continued)

2.4 Mortgage Loans on Real Estate

Diversification of the geographic location and type of property collateralizing
mortgage loans reduces the concentration of credit risk. For new loans, the
Company requires loan-to-value ratios of 75% or less, based on management's
credit assessment of the borrower. The mortgage loan portfolio was distributed
as follows at December 31, 2000 and 1999:

Outstanding Percent of Percents
Amount Total Nonperforming
---------------------------------------------
(In Millions)

December 31, 2000
Geographic distribution:
South Atlantic $ 461 22.0% 0.0%
Pacific 374 17.9 7.6
West South Central 200 9.6 0.0
East South Central 158 7.6 0.0
East North Central 290 13.9 0.0
Mid-Atlantic 374 18.0 0.0
Mountain 89 4.3 0.0
West North Central 68 3.3 0.0
New England 79 3.8 0.0
Allowance for losses (9) (0.4) 0.0
--------------------------
Total $ 2,084 100.0% 1.4%
==========================

Property type:
Retail $ 596 28.5% 0.0%
Office 900 43.2 3.2
Industrial 300 14.4 0.0
Apartments 181 8.7 0.0
Hotel/motel 77 3.7 0.0
Other 39 1.9 0.0
Allowance for losses (9) (0.4) 0.0
--------------------------
Total $ 2,084 100.0% 1.4%
==========================

F-23

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

2. Investments (continued)

2.4 Mortgage Loans on Real Estate (continued)

Outstanding Percent of Percent
Amount Total Nonperforming
-------------------------------------------------------
(In Millions)

December 31, 1999
Geographic distribution:
South Atlantic $ 470 24.6% 0.2%
Pacific 363 18.9 7.8
Mid-Atlantic 185 9.6 0.0
East North Central 144 7.5 0.0
Mountain 256 13.3 0.0
West South Central 323 16.8 0.9
East South Central 107 5.6 13.8
West North Central 43 2.2 0.0
New England 44 2.3 0.0
Allowance for losses (16) (0.8) 0.0
-----------------------------------
Total $ 1,919 100.0% 2.4%
===================================

Property type:
Office $ 628 32.6% 2.5%
Retail 746 38.9 4.2
Industrial 302 15.7 0.0
Apartments 189 9.9 0.0
Hotel/motel 46 2.4 0.0
Other 24 1.3 0.2
Allowance for losses (16) (0.8) 0.0
-----------------------------------
Total $ 1,919 100.0% 2.4%
===================================

Impaired mortgage loans on real estate and related interest income is not
material.

F-24

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

3. Deferred Policy Acquisitions Costs

The balance of DPAC at December 31 and the components of the change reported in
operating costs and expenses for the years then ended were as follows:

2000 1999 1998
------------------------------------------------------
(In Thousands)

Balance at January 1 $ 1,956,653 $ 1,087,718 $ 835,031
Capitalization 174,379 191,143 135,023
Accretion of interest 124,927 116,711 109,173
Amortization (23,443) (101,066) (125,062)
Effect of net realized and unrealized gains
(losses) on securities (141,706) 662,147 133,553
--------------------------------------------------------
Balance at December 31 $ 2,090,810 $ 1,956,653 $ 1,087,718
========================================================

4. Other Assets

Other assets consisted of the following:

December 31
2000 1999
------------------------------------
(In Thousands)

Goodwill $ 27,069 $ 52,317
Cost of insurance purchased ("CIP") 15,598 19,014
Computer software 73,215 117,571
Other 112,803 61,397
------------------------------------
Total other assets $ 228,685 $ 250,299
====================================

F-25

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

4. Other Assets (continued)

A rollforward of CIP for the year ended December 31, 2000, was as follows:

2000 1999
------------------------------------
(In Thousands)

Balance at January 1 $ 19,014 $ 22,113
Accretion of interest at 5.02% 788 926
Amortization (3,432) (4,025)
Other changes (772) -
------------------------------------
Balance at December 31 $ 15,598 $ 19,014
====================================

5. Federal Income Taxes

5.1 Tax Liabilities

Income tax liabilities were as follows:

December 31
2000 1999
------------------------------------
(In Thousands)

Current tax (receivable) payable $ 9,260 $ 25,074
Deferred tax liabilities, applicable to:
Net income 463,117 405,889
Net unrealized investment gains (6,063) (55,631)
------------------------------------
Total deferred tax liabilities 457,054 350,258
------------------------------------
Total current and deferred tax liabilities $ 466,314 $ 375,332
====================================

F-26

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

5. Federal Income Taxes (continued)

5.1 Tax Liabilities (continued)

Components of deferred tax liabilities and assets at December 31 were as
follows:

2000 1999
------------------------------------
(In Thousands)

Deferred tax liabilities applicable to:
Deferred policy acquisition costs $ 624,393 $ 601,678
Basis differential of investments 55,603 -
Other 143,307 171,763
------------------------------------
Total deferred tax liabilities 823,303 773,441

Deferred tax assets applicable to:
Policy reserves (285,488) (215,465)
Basis differential of investments - (158,421)
Other (89,761) (141,236)
------------------------------------
Total deferred tax assets before valuation allowance (375,249) (515,122)
Valuation allowance 9,000 91,939
------------------------------------
Total deferred tax assets, net of valuation allowance (366,249) (423,183)
------------------------------------
Net deferred tax liabilities $ 457,054 $ 350,258
====================================

Under prior Federal income tax law, one-half of the excess of a life insurance
company's income form operations over its taxable investment income was not
taxed, but was set aside in a special tax account designated as "policyholders'
surplus." At December 31, 2000, the Company had approximately $88.2 million of
policyholders' surplus on which no payment of Federal income taxes will be
required unless it is distributed as a dividend, or under other specified
conditions. Barring the passage of unfavorable tax legislation, the Company does
not believe that any significant portion of the account will be taxed in the
foreseeable future. Accordingly, no deferred tax liability has been recognized
in relation to the policyholders' surplus account. If the entire balance of the
policyholders' surplus became taxable at the current federal income tax rates,
the tax would be approximately $30.9 million.

F-27

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

5. Federal Income Taxes (continued)

5.2 Tax Expense

Components of income tax expense for the years were as follows:

2000 1999 1998
------------------------------------------------------
(In Thousands)

Current expense $ 174,263 $ 176,725 $ 134,344
Deferred expense (benefit):
Deferred policy acquisition cost 82,739 65,377 33,230
Policy reserves 12,738 (22,654) 2,189
Basis differential of investments 14,627 (4,729) 11,969
Litigation settlement 2,764 22,641 (33,983)
Year 2000 - - (9,653)
Internally developed software 3,702 18,654 -
Other, net (29,973) 7,182 15,623
------------------------------------------------------
Total deferred expense 86,597 86,471 19,375
------------------------------------------------------
Income tax expense $ 260,860 $ 263,196 $ 153,719
======================================================

A reconciliation between the income tax expense computed by applying the federal
income tax rate (35%) to income before taxes and the income tax expense reported
in the financial statement is presented below.

2000 1999 1998
------------------------------------------------------
(In Thousands)

Income tax at statutory percentage of
GAAP pretax income $ 279,241 $ 266,386 $ 164,638
Tax-exempt investment income (16,654) (16,423) (11,278)
Goodwill 669 853 712
Other (2,396) 12,380 (353)
------------------------------------------------------
Income tax expense $ 260,860 $ 263,196 $ 153,719
======================================================

F-28

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

5. Federal Income Taxes (continued)

5.3 Taxes Paid

Income taxes paid amounted to approximately $182 million, $126 million, and $159
million, in 2000, 1999, and 1998, respectively.

5.4 Tax Return Examinations

The Parent Company and the majority of its subsidiaries file a consolidated
federal income tax return. The Internal Revenue Service ("IRS") has completed
examinations of the Parent Company's tax returns through 1992. The IRS is
currently examining tax returns for 1993 through 1999. In addition, the tax
returns of companies recently acquired are also being examined. Although the
final outcome of any issues raised in examination is uncertain, the Parent
Company believes that the ultimate liability, including interest, will not
materially exceed amounts recorded in the consolidated financial statements.

6. Transactions With Affiliates

Affiliated notes and accounts receivable were as follows:

December 31, 2000 December 31, 1999
--------------------------------------------------------------------
Par Value Book Value Par Value Book Value
--------------------------------------------------------------------
(In Thousands)

American General Corporation,
9%, due 2008 $ 4,725 $ 3,486 $ 4,725 $ 3,410
American General Corporation,
Promissory notes, due 2004 9,786 9,786 12,232 12,232
American General Corporation,
Restricted Subordinated Note,
13 1/2%, due 2002 25,321 25,321 27,378 27,378
--------------------------------------------------------------------
Total notes receivable from affiliates 39,832 38,593 44,335 43,020
Accounts receivable from affiliates - 39,632 - 32,175
--------------------------------------------------------------------
Indebtedness from affiliates $ 39,832 $ 78,225 $ 44,335 $ 75,195
====================================================================

F-29

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

6. Transactions With Affiliates (continued)

Various American General companies provide services to the Company, principally
mortgage servicing and investment management services, provided by American
General Investment Management Corporation on a fee basis. The Company paid
approximately $85,002,378, $55,318,000, and $46,921,000, for such services in
2000, 1999, and 1998, respectively. Accounts payable for such services at
December 31, 2000 and 1999 were not material. The Company rents facilities and
provides services on an allocated cost basis to various American General
companies. Beginning in 1998, amounts received by the Company from affiliates
include amounts received by its wholly-owned, non-life insurance subsidiary,
American General Life Companies ("AGLC"). AGLC provides shared services,
including technology, to a number of American General Corporation's life
insurance subsidiaries. The Company received approximately $171,650,000,
$138,885,000, and $66,550,000, for such services and rent in 2000, 1999, and
1998, respectively. Accounts receivable for rent and services at December 31,
2000 and 1999 were not material.

The Company has 8,500 shares of $100 par value cumulative preferred stock
authorized and outstanding with an $80 dividend rate, redeemable at $1,000 per
share after December 31, 2000. The holder of this stock, The Franklin Life
Insurance Company ("Franklin"), an affiliated company, is entitled to one vote
per share, voting together with the holders of common stock.

7. Benefit Plans

7.1 Pension Plans

The Company has non-contributory defined benefit pension plans covering most
employees. Pension benefits are based on the participant's compensation and
length of credited service.

Equity and fixed maturity securities were 65% and 28%, respectively, of the
plans' assets at the plans' most recent balance sheet dates. Additionally, 1% of
plan assets were invested in general investment accounts of the Parent Company's
subsidiaries through deposit administration insurance contracts.

F-30

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

7. Benefit Plans (continued)

7.1 Pension Plans (continued)

The benefit plans have purchased annuity contracts from American General
Corporation's subsidiaries to provide benefits for certain retirees. These
contracts are expected to provide future annual benefits to certain retirees of
American General Corporation and its subsidiaries of approximately $58 million.

The components of pension (income) expense and underlying assumptions were as
follows:

2000 1999 1998
------------------------------------------------------
(In Thousands)

Service cost $ 4,605 $ 3,575 $ 3,693
Interest cost 9,818 7,440 6,289
Expected return on plan assets (17,815) (12,670) (9,322)
Amortization (918) (820) (557)
Recognized Net Actuarial Loss/(Gain) (868) - -
------------------------------------------------------
Pension (income) expense $ (5,178) $ (2,475) $ 103
======================================================

Discount rate on benefit obligation 8.00% 7.75% 7.00%
Rate of increase in compensation levels 4.50% 4.25% 4.25%
Expected long-term rate of return on plan assets
10.35% 10.35% 10.25%

The Company's funding policy is to contribute annually no more than the maximum
deductible for federal income tax purposes. The funded status of the plans and
the prepaid pension expense included in other assets at December 31 were as
follows:

2000 1999
------------------------------------
(In Thousands)

Projected benefit obligation (PBO) $ 130,175 $ 100,600
Plan assets at fair value 187,266 145,863
------------------------------------
Plan assets at fair value in excess of PBO 57,091 45,263
Other unrecognized items, net (32,730) (26,076)
------------------------------------
Prepaid pension expense $ 24,361 $ 19,187
====================================

F-31

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

7. Benefit Plans (continued)

7.1 Pension Plans (continued)

The change in PBO was as follows:

2000 1999
------------------------------------
(In Thousands)

PBO at January 1 $ 100,600 $ 96,554
Service and interest costs 14,423 11,015
Benefits paid (5,394) (4,919)
Actuarial loss 1,668 (12,036)
Amendments, transfers, and acquisitions 18,878 9,986
------------------------------------
PBO at December 31 $ 130,175 $ 100,600
====================================

The change in the fair value of plan assets was as follows:

2000 1999
------------------------------------
(In Thousands)

Fair value of plan assets at January 1 $ 145,863 $ 120,898
Actual return on plan assets 9,249 17,934
Benefits paid (5,344) (4,919)
Acquisitions and other 37,498 11,950
------------------------------------
Fair value of plan assets at December 31 $ 187,266 $ 145,863
====================================

Postretirement Benefits Other Than Pensions

The Company has life, medical, supplemental major medical, and dental plans for
certain retired employees and agents. Most plans are contributory, with retiree
contributions adjusted annually to limit employer contributions to predetermined
amounts. The Company has reserved the right to change or eliminate these
benefits at any time.

F-32

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

7. Benefit Plans (continued)

7.2 Postretirement Benefits Other Than Pensions (continued)

The life plans are insured through December 31, 1999. A portion of the retiree
medical and dental plans is funded through a voluntary employees' beneficiary
association ("VEBA"); the remainder is unfunded and self-insured. All of the
retiree medical and dental plans' assets held in the VEBA were invested in
readily marketable securities at its most recent balance sheet date.

Postretirement benefit expense in 2000, 1999, and 1998 was $35,000, $254,000,
and $60,000, respectively. The accrued liability for postretirement benefits was
$20.5 million and $18.8 million at December 31, 2000, 1999, and 1998,
respectively. These liabilities were discounted at the same rates used for the
pension plans.

8. Derivative Financial Instruments

8.1 Use of Derivative Financial Instruments

The Company's use of derivative financial instruments is generally limited to
reducing its exposure to interest rate and currency exchange risk. The Company
uses interest rate and currency swap agreements and options to enter into
interest rate swap agreements. The Company accounts for these derivative and
financial instruments as hedges. Hedge accounting requires a high correlation
between changes in fair values or cash flows of the derivative financial
instrument and the specific item being hedged, both at inception and throughout
the life of the hedge.

8.2 Interest Rate and Currency Swap Agreements

Interest rate swap agreements are used to convert specific investment securities
from a floating to a fixed rate basis, or vice versa, and to hedge against the
risk of declining interest rates on anticipated security purchases.

Currency swap agreements are used to convert cash flows from specific investment
securities denominated in foreign currencies into U.S. dollars at specific
exchange rates and to hedge against currency rate fluctuation on anticipated
security purchases.

F-33

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

8. Derivative Financial Instruments (continued)

8.2 Interest Rate and Currency Swap Agreements (continued)

The difference between amounts paid and received on swap agreements is recorded
on an accrual basis as an adjustment to net investment income or interest
expense, as appropriate, over the periods covered by the agreements. The related
amount payable to or receivable from counterparties is included in other
liabilities or assets.

The fair values of swap agreements are recognized in the consolidated balance
sheets if the hedge investments are carried at fair value or if they hedge
anticipated purchases of such investments. In this event, changes in the fair
value of a swap agreement are reported in net unrealized gains on securities
included in other accumulated comprehensive income in shareholders' equity,
consistent with the treatment of the related investment security.

For swap agreements hedging anticipated investment purchases, the net swap
settlement amount or unrealized gain or loss is deferred and included in the
measurement of the anticipated transaction when it occurs.

Swap agreements generally have terms of two to ten years. Any gain or loss from
early termination of a swap agreement is deferred and amortized into income over
the remaining term of the related investment. If the underlying investment is
extinguished or sold, any related gain or loss on swap agreements is recognized
in income.

F-34

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

8. Derivative Financial Instruments (continued)

8.2 Interest Rate and Currency Swap Agreements (continued)

Interest rate and currency swap agreements related to investment securities at
December 31 were as follows:

2000 1999
---------------------------
(Dollars in Millions)

Interest rate swap agreements to receive fixed rate:
Notional amount $ 160 $ 160
Average receive rate 6.74% 6.73%
Average pay rate 6.94% 6.55%
Currency swap agreements (receive U.S. dollars/pay Canadian dollars):
Notional amount (in U.S. dollars) $ 74 $ 124
Average exchange rate 1.43 1.50
Currency swap agreements (receive U.S. dollars/pay Australian dollars):
Notional amount (in U.S. dollars) $ 23 $ 23
Average exchange rate 1.85 0.65

8.3 Swaptions

Options to enter into interest rate swap agreements are used to limit the
Company's exposure to reduced spreads between investment yields and interest
crediting rates should interest rates decline significantly over prolonged
periods. During such periods, the spread between investment yields and interest
crediting rates may be reduced as a result of certain limitations on the
Company's ability to manage interest crediting rates. Call swaptions allow the
Company to enter into interest rate swap agreements to receive fixed rates and
pay lower floating rates, effectively increasing the spread between investment
yields and interest crediting rates.

During prolonged periods of increasing interest rates, the spread between
investment yields and interest crediting rates may be reduced if the Company
decides to increase interest crediting rates to limit surrenders. Put swaptions,
which allow the Company to enter into interest rate swap agreements to pay fixed
rates and receive higher floating rates, effectively maintain the spread between
investment yields and interest crediting rates during such periods.

F-35

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

8. Derivative Financial Instruments (continued)

8.3 Swaptions (continued)

Premiums paid to purchase swaptions are included in investments and are
amortized to net investment income over the exercise period of the swaptions. If
a swaption is terminated, any gain is deferred and amortized to insurance and
annuity benefits over the expected life of the insurance and annuity contracts
and any unamortized premium is charged to income. If a swaption ceases to be an
effective hedge, any related gain or loss is recognized in income.

Swaptions at December 31 were as follows:

2000 1999
------------------------------
(Dollars in Millions)

Call swaptions:
Notional amount $ 723 $ 3,780
Average strike rate 5.00% 4.52%

Put swaptions:
Notional amount $ 790 $ 2,140
Average strike rate 8.70% 8.60%

8.4 Credit and Market Risk

Derivative financial instruments expose the Company to credit risk in the event
of non-performance by counterparties. The Company limits this exposure by
entering into agreements with counterparties having high credit ratings and by
regularly monitoring the ratings. The Company does not expect any counterparty
to fail to meet its obligation; however, non-performance would not have a
material impact on the Company's consolidated results of operations or financial
position.

The Company's exposure to market risk is mitigated by the offsetting effects of
changes in the value of the agreements and the related items being hedged.

F-36

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

9. Fair Value of Financial Instruments

Carrying amounts and fair values for certain of the Company's financial
instruments at December 31 are presented below. Care should be exercised in
drawing conclusions based on fair value, since (1) the fair values presented do
not include the value associated with all the Company's assets and liabilities,
and (2) the reporting of investments at fair value without a corresponding
evaluation of related policyholders liabilities can be misinterpreted.

2000 1999
Fair Carrying Fair Carrying
Value Amount Value Amount
----------------------------------------------------------------
(In millions)

Assets
Fixed maturity and equity securities $ 27,406 $ 27,406 $ 27,266 $ 27,266
Mortgage loans on real estate 2,090 2,084 1,829 1,919
Policy loans 1,357 1,297 1,205 1,235
Short-term investments 140 140 124 124
Assets held in separate accounts 22,226 22,226 23,232 23,232

Liabilities
Insurance investment contracts 25,038 25,328 24,099 25,917
Liabilities related to separate
accounting 22,226 22,226 23,232 23,232

The following methods and assumptions were used to estimate the fair value of
financial instruments:

Fixed Maturity and Equity Securities

Fair values of fixed maturity and equity securities were based on
quoted market prices, where available. For investments not actively
traded, fair values were estimated using values obtained from
independent pricing services or, in the case of some private
placements, by discounting expected future cash flows using a current
market rate applicable to yield, credit quality, and average life of
investments.

F-37

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

9. Fair Value of Financial Instruments (continued)

Mortgage Loans on Real Estate

Fair value of mortgage loans was estimated primarily using discounted
cash flows, based on contractual maturities and risk-adjusted discount
rates.

Policy Loans

Fair value of policy loans was estimated using discounted cash flows
and actuarially determined assumptions, incorporating market rates.

Investment in Parent Company

The fair value of the investment in Parent Company is based on quoted
market prices of American General Corporation common stock.

Assets and Liabilities Related to Separate Accounts

The fair value of Separate Account assets and liabilities was based on
quoted net asset value per share of the underlying mutual funds.

Derivative Financial Instruments

If the Company elected to terminate the interest rate swaps, they would
have paid $-0- million and $4.7 million at December 31, 2000 and 1999,
respectively, and received $11.4 million and $2.3 million at December
31, 2000 and 1999. These fair values were estimated using cash flows
discounted at current market rates.

Insurance Investment Contracts

Fair value of insurance investment contracts was estimated using cash
flows discounted at market interest rates.

F-38

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

9. Fair Value of Financial Instruments (continued)

Indebtedness From Affiliates

Indebtedness from affiliates is composed of accounts receivable and
notes receivable from affiliates. Due to the short-term nature of
accounts receivable, fair value is assumed to equal carrying value.
Fair value of notes receivable was estimated using discounted cash
flows based on contractual maturities and discount rates that were
based on U.S. Treasury rates for similar maturity ranges.

10. Dividends Paid

American General Life Insurance Company paid $251 million, $187 million, and
$244 million, in dividends on common stock to AGC Life Insurance Company in
2000, 1999, and 1998, respectively. The Company also paid $680 thousand per year
in dividends on preferred stock to an affiliate, The Franklin Life Insurance
Company, in 2000, 1999, and 1998.

11. Restrictions, Commitments, and Contingencies

The Company and its insurance subsidiaries are restricted by state insurance
laws as to the amounts they may pay as dividends without prior approval from
their respective state insurance departments. At December 31, 2000,
approximately $3.1 billion of consolidated shareholder's equity represents net
assets of the Company, which cannot be transferred, in the form of dividends,
loans, or advances to the Parent Company. Approximately $2.3 billion of
consolidated shareholders' equity is similarly restricted as to transfer from
its subsidiaries to the Company.

Generally, the net assets of the Company's subsidiaries available for transfer
to the Parent are limited to the amounts that the subsidiaries' net assets, as
determined in accordance with statutory accounting practices, exceed minimum
statutory capital requirements. However, payments of such amounts as dividends
may be subject to approval by regulatory authorities and are generally limited
to the greater of 10% of policyholders' surplus or the previous year's statutory
net gain from operations.

The Company has various leases, substantially all of which are for office space
and facilities. Rentals under financing leases, contingent rentals, and future
minimum rental commitments and rental expense under operating leases are not
material.

F-39

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

11. Restrictions, Commitments, and Contingencies (continued)

In recent years, various life insurance companies have been named as defendants
in class action lawsuits relating to life insurance pricing and sales practices,
and a number of these lawsuits have resulted in substantial settlements. On
December 16, 1998, American General Corporation announced that certain of its
life insurance subsidiaries had entered into agreements to resolve all pending
market conduct class action lawsuits.

In conjunction with the proposed settlements, the Company recorded a charge of
$97.1 million ($63.1 million after-tax) in the fourth quarter of 1998. The
charge covered the cost of policyholder benefits and other anticipated expenses
resulting from the proposed settlements, as well as other administrative and
legal costs.

On December 31, 1998, the Company entered into an agreement with the Parent
Company whereby the Company assigned, and the Parent Company assumed, $80.1
million of the liabilities of the Company related to the proposed resolution.
The liabilities of American General Life Insurance Company of New York, which
totaled $17.0 million, were not assumed by the Parent Company. As consideration
for the assumption of the liabilities, the Company paid the Parent Company an
amount equal to the liabilities recorded with respect to the proposed resolution
of the litigation. As of December 31, 2000, the Company has a remaining market
conduct litigation liability of $6.3 million recorded.

The Company is party to various other lawsuits and proceedings arising in the
ordinary course of business. These lawsuits and proceedings include certain
class action claims and claims filed by individuals who have excluded themselves
from settlement of class action lawsuits relating to life insurance pricing and
sales practices. In addition, many of these proceedings are pending in
jurisdictions that permit damage awards disproportionate to the actual economic
damages alleged to have been incurred. Based upon information presently
available, the Company believes that the total amounts that will ultimately be
paid, if any, arising from these lawsuits and proceedings will not have a
material adverse effect on the Company's results of operations and financial
position. However, it should be noted that the frequency of large damage awards,
including large punitive damage awards, that bear little or no relation to
actual economic damages incurred by plaintiffs in some jurisdictions continues
to create the potential for an unpredictable judgment in any given suit.

F-40

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

11. Restrictions, Commitments, and Contingencies (continued)

Insurance companies that are under regulatory supervision result in assessments
by state guaranty funds to cover losses to policyholders of insolvent or
rehabilitated insurance companies. Those mandatory assessments may be partially
recovered through a reduction in future premium taxes in certain states. At
December 31, 2000 and 1999, the Company has accrued $3.8 million and $8.6
million, respectively, for guaranty fund assessments, net of $-0- million and
$3.4 million, respectively, of premium tax deductions. The Company has recorded
receivables of $5.9 million and $4.4 million at December 31, 2000 and 1999,
respectively, for expected recoveries against the payment of future premium
taxes. Expenses incurred for guaranty fund assessments were $6.2 million, $2.1
million, and $3.6 million, in 2000, 1999, and 1998, respectively.

F-41

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

12. Reinsurance

Reinsurance transactions for the years ended December 31, 2000, 1999, and 1998
were as follows:

Ceded to Assumed Percentage
Gross Other From Other of Amount
Amount Companies Companies Net Amount Assumed to Net
-----------------------------------------------------------------------------------
(In Thousands)

December 31, 2000
Life insurance in force $ 53,258,777 $ 21,254,765 $ 401,854 $ 32,405,866 1.24%
====================================================================
Premiums:
Life insurance and annuities 138,418 77,566 810 61,662 1.31%
Accident and health insurance 877 127 - 750 0.00%
--------------------------------------------------------------------
Total premiums $ 139,295 $ 77,693 $ 810 $ 62,412 1.30%
====================================================================
December 31, 1999
Life insurance in force $ 50,060,334 $ 17,056,734 $ 524,062 $ 33,527,662 1.56%
====================================================================
Premiums:
Life insurance and annuities $ 101,900 $ 49,530 $ 252 $ 52,622 0.48%
Accident and health insurance 977 84 - 893 0.00%
--------------------------------------------------------------------
Total premiums $ 102,877 $ 49,614 $ 252 $ 53,515 0.47%
====================================================================
December 31, 1998
Life insurance in force $ 46,057,031 $ 13,288,183 $ 629,791 $ 33,398,639 1.89%
====================================================================
Premiums:
Life insurance and annuities $ 90,298 $ 42,235 $ 117 $ 48,180 0.24%
Accident and health insurance 1,134 87 - 1,047 0.00%
--------------------------------------------------------------------
Total premiums $ 91,432 $ 42,322 $ 117 $ 49,227 0.24%
====================================================================

Reinsurance recoverable on paid losses was approximately $12.2 million, $8.0
million, and $7.7 million, at December 31, 2000, 1999, and 1998, respectively.
Reinsurance recoverable on unpaid losses was approximately $3.2 million, $10.5
million, and $2.5 million, at December 31, 2000, 1999, and 1998, respectively.

F-42

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

13. Division Operations

13.1 Nature of Operations

The Company manages its business operation through two divisions, which are
based on products and services offered.

Retirement Services

The Retirement Services Division provides tax-deferred retirement annuities and
employer-sponsored retirement plans to employees of educational, health care,
public sector, and other not-for-profit organizations marketed nationwide
through exclusive sales representatives.

Life Insurance

The Life Insurance division provides traditional, interest-sensitive, and
variable life insurance and annuities to a broad spectrum of customers through
multiple distribution channels focused on specific market segments.

F-43

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

13. Division Operations

13.2 Division Results

Results of each division exclude goodwill amortization, net realized investment
gains, and non-recurring items.

Division earnings information was as follows:

Revenues Income Before Taxes Earnings
------------------------------------------------------------------------------------------------
2000 1999 1998 2000 1999 1998 2000 1999 1998
------------------------------------------------------------------------------------------------
(In Millions)

Retirement Services $ 2,215 $ 2,088 $ 1,987 $ 702 $ 567 $ 469 $ 463 $ 374 $ 315
Life Insurance 942 883 870 199 191 162 143 123 107
------------------------------------------------------------------------------------------------
Total divisions 3,157 2,971 2,857 901 758 631 606 497 422
Goodwill amortization - - - (1) (2) (2) (1) (2) (2)
RG (L) (98) 5 (34) (98) 5 (34) (64) 3 (22)
Nonrecurring items - - - - - (125)(a) - - (81)(a)
------------------------------------------------------------------------------------------------
Total consolidated $ 3,059 $ 2,976 $ 2,823 $ 802 $ 761 $ 470 $ 541 $ 498 $ 317
================================================================================================

(a) Includes $97 million pretax ($63 million after-tax) in litigation
settlements and $28 million pretax ($18 million after-tax) in Year 2000
costs.

Division balance sheet information was as follows:

Assets Liabilities
-----------------------------------------------------------------
December 31
-----------------------------------------------------------------
In millions 2000 1999 2000 1999
-----------------------------------------------------------------

Retirement Services $ 46,356 $ 47,323 $ 43,970 $ 45,359
Life Insurance 10,685 9,837 9,610 8,955
-----------------------------------------------------------------
Total consolidated $ 57,041 $ 57,160 $ 53,580 $ 54,314
=================================================================

F-44

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

14. Subsequent Event

On March 11, 2001, American General Corporation entered into a definitive merger
agreement with Prudential plc. Under the agreement, American General
Corporation's shareholders will exchange shares of American General
Corporation's common stock for 3.6622 shares of Prudential plc common stock. The
transaction, which is subject to shareholder and regulatory approvals, is
expected to be completed in third quarter 2001.

F-45

INDEX OF WORDS AND PHRASES

This index should help you to locate more information about some of the terms
and phrases used in this prospectus.

PAGE TO
SEE IN THIS
DEFINED TERM PROSPECTUS
------------ ----------

accumulation value........................... 6
Administrative Center........................ 1,4
AGLC......................................... 56
AGL.......................................... 34
amount at risk............................... 8
automatic rebalancing........................ 6
base coverage................................ 14, 45
basis........................................ 36
beneficiary.................................. 42
cash surrender value......................... 23
cash value accumulation test................. 15
close of business............................ 43
Code......................................... 35
contingent insured........................... 4
cost of insurance rates...................... 43
daily charge................................. 7
date of issue................................ 44
death benefit................................ 14
declared fixed interest account option....... 46
dollar cost averaging........................ 5
full surrender............................... 23
Fund, Funds.................................. 2
guideline premium test....................... 15
investment option............................ 1
lapse........................................ 16
last surviving contingent insured............ 4
loan, loan interest.......................... 24
maturity, maturity date...................... 25
modified endowment contract.................. 35
monthly deduction day........................ 44
monthly guarantee premium.................... 17
monthly insurance charge..................... 8
Mutual Fund.................................. 2

PAGE TO
SEE IN THIS
DEFINED TERM PROSPECTUS
------------ ----------

Option 1, Option 2........................... 14
planned periodic premium..................... 16
Policy....................................... 1
Policy loan.................................. 24
Policy month, year........................... 44
premium payments............................. 5
reinstate, reinstatement..................... 16
SEC.......................................... 2
Separate Account............................. 1
Separate Account VL-R........................ 34
seven-pay test............................... 35
specified amount............................. 14
surrender.................................... 23
telephone transactions....................... 28
transfers.................................... 17
uninsurable.................................. 26
valuation date, period....................... 43
variable investment option................... 1

We have filed a registration statement relating to Separate Account VL-R
and the Policy with the SEC. The registration statement, which is required by
the Securities Act of 1933, includes additional information that is not required
in this prospectus. If you would like the additional information, you may
obtain it from the SEC's Website at http://www.sec.gov or main office in
Washington, D.C. You will have to pay a fee for the material.

You should rely only on the information contained in this prospectus or
sales materials we have approved. We have not authorized anyone to provide you
with information that is different. The policies are not available in all
states. This prospectus is not an offer in any state to any person if the offer
would be unlawful.

PART II

(OTHER INFORMATION)

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

American General Life Insurance Company's Bylaws provide in Article VII for
indemnification of directors, officers and employees of the Company.

Insofar as indemnification for liability arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.

REPRESENTATION PURSUANT TO SECTION 26(e)(2)(A) OF THE INVESTMENT COMPANY ACT OF
1940

American General Life Insurance Company hereby represents that the fees and
charges deducted under the Policy, in the aggregate, are reasonable in relation
to the services rendered, the expenses expected to be incurred, and risks
assumed by American General Life Insurance Company.

II-1

CONTENTS OF REGISTRATION STATEMENT

This Registration Statement contains the following papers and documents:

The facing sheet.
Cross-Reference Table.
Prospectus, consisting of 59 pages of text, plus 48 financial pages of American
General Life Insurance Company.
The undertaking to file reports.
The Rule 484 undertaking.
Representation pursuant to Section 26(e)(2)(A).
The signatures.
Written Consents of the following persons:

(a) Pauletta P. Cohn, Deputy General Counsel of American General Life
Companies

(b) American General Life Insurance Company's Actuary

The following exhibits:

1. Exhibits required by Article IX, paragraph A of Form N-8B-2:

(1)(a) Resolutions of Board of Directors of American General Life
Insurance Company authorizing the establishment of Separate
Account VL-R. (1)

(b) Resolutions of Board of Directors of American General Life
Insurance Company authorizing the establishment of variable
life insurance standards of suitability and conduct. (1)

(2) Not applicable.

(3)(a) Form of Distribution Agreement between American General
Life Insurance Company and American General Distributors,
Inc. (16)

(b)(i) Form of Selling Group Agreement. (16)

(ii) Form of Selling Group Agreement, Schedule A (identifying
the policy offered) and Schedule B (describing the
commissions paid). (14)

(c) Schedule of Commissions (incorporated by reference from the
text included under the heading "Distribution of the
Policies" in the prospectus that is filed as part of this
Registration Statement).

II-2

(4) Not applicable.

(5) Specimen form of the "Platinum Investor/SM/ Survivor II"
Last Survivor Flexible Premium Variable Universal Life
Insurance Policy (Policy Form No. 01206). (Filed herewith)

(6)(a) Amended and Restated Articles of Incorporation of American
General Life Insurance Company, effective December 31,
1991. (2)

(b) Bylaws of American General Life Insurance Company, adopted
January 22, 1992. (3)

(c) Amendment to the Amended and Restated Articles of
Incorporation of American General Life Insurance Company,
effective July 13, 1995. (5)

(7) Not applicable.

(8)(a)(i) Form of Participation Agreement by and Among AIM Variable
Insurance Funds, Inc., A I M Distributors, Inc., American
General Life Insurance Company, on Behalf of Itself and
its Separate Accounts, and American General Securities
Incorporated. (6)

(ii) Form of Amendment Four to Participation Agreement by and
Among AIM Variable Insurance Funds, Inc., A I M
Distributors, Inc., American General Life Insurance
Company, on Behalf of Itself and its Separate Accounts,
and American General Securities Incorporated. (Filed
herewith)

(b)(i) Form of Participation Agreement by and between The
Variable Annuity Life Insurance Company, American General
Series Portfolio Company, American General Securities
Incorporated and American General Life Insurance Company.
(10)

(ii) Amendment One to Participation Agreement by and between
The Variable Annuity Life Insurance Company, American
General Series Portfolio Company, American General
Securities Incorporated and American General Life
Insurance Company dated as of July 21, 1998. (8)

(iii) Form of Amendment Two to Participation Agreement by and
between The Variable Annuity Life Insurance Company,
American General Series Portfolio Company, American
General Securities Incorporated and American General Life
Insurance Company. (15)

(iv) Form of Amendment Three to Participation Agreement by and
between The Variable Annuity Life Insurance Company,
American General Series

II-3

Portfolio Company, American General Securities
Incorporated and American General Life Insurance
Company. (16)

(c)(i) Form of Participation Agreement Between American General
Life Insurance Company and Dreyfus Variable Investment
Fund, The Dreyfus Socially Responsible Growth Fund, Inc.
and Dreyfus Life and Annuity Index Fund, Inc. (6)

(ii) Amendment One to Participation Agreement by and among
American General Life Insurance Company, Dreyfus Variable
Investment Fund, The Dreyfus Socially Responsible Growth
Fund, Inc. and Dreyfus Life and Annuity Index Fund, Inc.
dated December 1, 1998. (8)

(d)(i) Form of Participation Agreement Among MFS Variable
Insurance Trust, American General Life Insurance Company
and Massachusetts Financial Services Company. (6)

(ii) Form of Amendment Five to Participation Agreement by and
among MFS Variable Insurance Trust, American General Life
Insurance Company and Massachusetts Financial Services
Company. (15)

(iii) Form of Amendment Six to Participation Agreement by and
among MFS Variable Insurance Trust, American General Life
Insurance Company and Massachusetts Financial Services
Company. (Filed herewith)

(e)(i) Participation Agreement among Morgan Stanley Universal
Funds, Inc., Morgan Stanley Asset Management Inc., Miller
Anderson & Sherrerd LLP, Van Kampen American Capital
Distributors, Inc., American General Life Insurance
Company and American General Securities Incorporated. (9)

(ii) Amendment Number 1 to Participation Agreement among
Morgan Stanley Universal Funds, Inc., Morgan Stanley
Asset Management Inc., Miller Anderson & Sherrerd LLP,
Van Kampen American Capital Distributors, Inc., American
General Life Insurance Company and American General
Securities Incorporated. (11)

(iii) Form of Amendment Seven to Participation Agreement among
Morgan Stanley Universal Funds, Inc., Van Kampen American
Capital Distributors, Inc., Morgan Stanley Asset
Management Inc., Miller Anderson & Sherrerd, LLP,
American General Life Insurance Company and American
General Securities Incorporated. (16)

(iv) Form of Amendment Eight to Participation Agreement among
Morgan Stanley Universal Funds, Inc., Van Kampen American
Capital

II-4

Distributors, Inc., Morgan Stanley Asset Management Inc.,
Miller Anderson & Sherrerd, LLP, American General Life
Insurance Company and American General Distributors, Inc.
(Filed herewith)

(f) Form of Participation Agreement Among Putnam Variable
Trust, Putnam Mutual Funds Corp., and American General
Life Insurance Company. (6)

(g)(i) Form of Participation Agreement Among American General
Life Insurance Company, American General Securities
Incorporated, SAFECO Resources Series Trust and SAFECO
Securities, Inc. (6)

(ii) Form of Amendment Four to Participation Agreement among
American General Life Insurance Company, American General
Securities Incorporated, SAFECO Resource Series Trust and
SAFECO Securities, Inc. (16)

(iii) Form of Amendment Five to Participation Agreement among
American General Life Insurance Company, American General
Securities Incorporated, SAFECO Resource Series Trust and
SAFECO Securities, Inc. (Filed herewith)

(h)(i) Amended and Restated Participation Agreement by and among
American General Life Insurance Company, American General
Securities Incorporated, Van Kampen American Capital Life
Investment Trust, Van Kampen American Capital Asset
Management, Inc., and Van Kampen American Capital
Distributors, Inc. (9)

(ii) Amendment One to Amended and Restated Participation
Agreement by and among American General Life Insurance
Company, American General Securities Incorporated, Van
Kampen American Capital Life Investment Trust, Van Kampen
American Capital Asset Management, Inc., and Van Kampen
American Capital Distributors, Inc. (8)

(iii) Form of Amendment Six to Amended and Restated
Participation Agreement among Van Kampen Life Investment
Trust, Van Kampen Funds Inc., Van Kampen Asset Management
Inc., American General Life Insurance Company and
American General Securities Incorporated. (16)

(iv) Form of Amendment Seven to Amended and Restated
Participation Agreement among Van Kampen Life Investment
Trust, Van Kampen Funds Inc., Van Kampen Asset Management
Inc., American General Life Insurance Company and
American General Securities Incorporated. (Filed
herewith)

II-5

(i) Form of Administrative Services Agreement between American
General Life Insurance Company and fund distributor. (5)

(j) Form of Administrative Services Agreement between American
General Life Insurance Company, Miller Anderson & Sherrard
LLP and Morgan Stanley Dean Witter Investment Management
Inc. (14)

(k) Form of Administrative Services Agreement between American
General Life Insurance Company and SAFECO Asset Management
Company. (14)

(l) Form of Administrative Services Agreement between Van
Kampen Asset Management Inc. and American General Life
Insurance Company dated January 1, 2000. (13)

(m) Form of Services Agreement dated July 31, 1975, (limited
to introduction and first two recitals, and sections 1-3)
among various affiliates of American General Corporation,
including American General Life Insurance Company and
American General Life Companies. (7)

(n) Administrative Services Agreement dated as of June 1,
1998, between American General Life Insurance Company and
AIM Advisors, Inc. (4)

(o)(i) Administrative Services Agreement dated as of August 11,
1998, between American General Life Insurance Company and
The Dreyfus Corporation. (4)

(ii) Amendment to Administrative Services Agreement dated as of
August 11, 1998, between American General Life Insurance
Company and the Dreyfus Corporation effective as of
December 1, 1998. (4)

(p)(i) Form of Participation Agreement by and between American
General Life Insurance Company, Ayco Asset Management and
Ayco Series Trust. (15)

(ii) Form of Amendment No. 1 to Participation Agreement by and
between American General Life Insurance Company, Ayco
Asset Management and Ayco Series Trust. (Filed herewith)

(q)(i) Form of Amended and Restated Participation Agreement by
and between Variable Insurance Products Fund, Fidelity
Distributors Corporation and American General Life
Insurance Company. (15)

(ii) Form of Amendment No. 1 to Amended and Restated
Participation Agreement by and between Variable Insurance
Products Fund, Fidelity

II-6

Distributors Corporation and American General Life
Insurance Company. (Filed herewith)

(r)(i) Form of Amended and Restated Participation Agreement by
and between Variable Insurance Products Fund II, Fidelity
Distributors Corporation and American General Life
Insurance Company. (15)

(ii) Form of Amendment No. 1 to Amended and Restated
Participation Agreement by and between Variable Insurance
Products Fund II, Fidelity Distributors Corporation and
American General Life Insurance Company. (Filed herewith)

(s) Form of Participation Agreement by and between American
General Life Insurance Company and J. P. Morgan Series
Trust II. (15)

(t)(i) Form of Fund Participation Agreement by and between
American General Life Insurance Company and Janus Aspen
Series. (15)

(ii) Form of Amendment No. 1 to Fund Participation Agreement by
and between American General Life Insurance Company and
Janus Aspen Series. (Filed herewith)

(u) Form of Participation Agreement by and between American
General Life Insurance Company, PIMCO Variable Insurance
Trust and PIMCO Funds Distributor LLC. (15)

(v) Form of Participation Agreement by and between Vanguard
Variable Insurance Funds, The Vanguard Group, Inc.,
Vanguard Marketing Corporation and American General Life
Insurance Company. (15)

(w) Form of Participation Agreement by and between American
General Life Insurance Company, Warburg Pincus Trust,
Credit Suisse Asset Management, LLC and Credit Suisse
Asset Management Securities, Inc. (15)

(x)(i) Form of Administrative Services Agreement by and between
Ayco Asset Management and American General Life Insurance
Company. (15)

(ii) Form of Amendment No. 1 to Administrative Services
Agreement by and between Ayco Asset Management and
American General Life Insurance Company. (Filed herewith)

(y) Form of Service Contract by and between Fidelity
Distributors Corporation and American General Life
Insurance Company. (15)

II-7

(z) Form of Service Agreement by and between Fidelity Investments
Institutional Operations Company, Inc. and American General
Life Insurance Company. (15)

(aa) Form of Administrative Services Agreement by and between
American General Life Insurance Company and Morgan Guaranty
Trust Company of New York. (15)

(bb) Form of Distribution and Shareholder Services Agreement by
and between Janus Distributors, Inc. and American General
Life Insurance Company. (15)

(cc) Form of Services Agreement by and between American General
Life Insurance Company and Pacific Investment Management,
LLC. (15)

(dd) Form of PIMCO Variable Insurance Trust Services Agreement by
and between American General Life Insurance Company and PIMCO
Variable Insurance Trust. (15)

(ee) Form of Administrative Services Agreement by and between
American General Life Insurance Company and Credit Suisse
Asset Management, LLC. (15)

(ff) Form of Shareholder Services Agreement by and between
American General Life Insurance Company and American Century
Investment Management, Inc. (19)

(gg) Sales Agreement by and between American General Life
Insurance Company, Neuberger & Berman Advisors Management
Trust and Neuberger & Berman Management Incorporated. (19)

(hh) Form of Assignment and Modification Agreement by and between
Neuberger & Berman Management Incorporated and American
General Life Insurance Company. (19)

(ii) Form of Administrative Services Agreement by and between
American General Life Insurance Company and Neuberger &
Berman Management Incorporated. (19)

(9) Not applicable.

(10)(a) Specimen form of Multiple Insured Life Insurance Application-
Part A. (14)

II-8

(b) Specimen form of Multiple Insured Life Insurance
Application - Part B. (14)

(d) Specimen form of product specific Service Request Form.
(Filed herewith)

(e) Description of American General Life Insurance Company's
Issuance, Transfer and Redemption Procedures for Variable
Universal Life Insurance Policies Pursuant to Rule
6e-3(T)(b)(12)(iii) under the Investment Company Act of 1940.
(18)

(f) Specimen form of Variable Universal Life Insurance
Supplemental Application. (Filed herewith)

(11) Not applicable. Rule 17j(1)(c)(i) of the Investment Company
Act of 1940 specifically exempts the Separate Account from
adopting a code of ethics.

2. Other Exhibits

2(a) Opinion and Consent of Pauletta P. Cohn, Deputy General
Counsel of American General Life Companies. (Filed herewith)

2(b) Opinion and Consent of American General Life Insurance
Company's actuary. (Filed herewith)

3 Not applicable.

4 Not applicable.

6 Consent of Independent Auditors. (Filed herewith)

7 Powers of Attorney. (20)
------------
(1) Incorporated by reference to initial filing of Form S-6 Registration
Statement (File No. 333-42567) of American General Life Insurance Company
Separate Account VL-R filed on December 18, 1997.

(2) Incorporated by reference to initial filing of Form N-4 Registration
Statement (File No. 33-43390) of American General Life Insurance Company
Separate Account D filed on October 16, 1991.

(3) Incorporated by reference to Post-Effective Amendment No. 1 to Form N-4
Registration Statement (File No. 33-43390) of American General Life
Insurance Company Separate Account D filed on April 30, 1992.

II-9

(4) Incorporated by reference to initial filing of Form N-4 Registration
Statement (File No. 333-70667) of American General Life Insurance Company
Separate Account D filed on January 15, 1999.

(5) Incorporated by reference to Pre-Effective Amendment No. 3 to Form S-6
Registration Statement (File No. 333-53909) of American General Life
Insurance Company Separate Account VL-R filed on August 19, 1998.

(6) Incorporated by reference to Pre-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-42567) of American General Life
Insurance Company Separate Account VL-R filed on March 23, 1998.

(7) Incorporated by reference to Pre-Effective Amendment No. 23 to Form N-4
Registration Statement (File No. 33-44745) of American General Life
Insurance Company Separate Account A filed on April 24, 1998.

(8) Incorporated by reference to Pre-Effective Amendment No. 1 to Form N-4
Registration Statement (File No. 333-70667) of American General Life
Insurance Company Separate Account D filed on March 18, 1999.

(9) Incorporated by reference to Post-Effective Amendment No. 12 to Form N-4
Registration Statement (File No. 33-43390) of American General Life
Insurance Company Separate Account D filed on April 30, 1997.

(10) Incorporated by reference to Pre-Effective Amendment No. 1 to Form N-4
Registration Statement (File No. 333-40637) of American General Life
Insurance Company Separate Account D filed on February 12, 1998.

(11) Incorporated by reference to Pre-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-80191) of American General Life
Insurance Company Separate Account VL-R filed on August 25, 1999.

(12) Incorporated by reference to initial filing of Form S-6 Registration
Statement (File No. 333-90787) of American General Life Insurance Company
Separate Account VL-R filed on November 12, 1999.

(13) Incorporated by reference to Pre-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-87307) of American General Life
Insurance Company Separate Account VL-R filed on January 20, 2000.

(14) Incorporated by reference to Pre-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-90787) of American General Life
Insurance Company Separate Account VL-R filed on February 4, 2000.

II-10

(15) Incorporated by reference to Post-Effective Amendment No. 2 to Form S-6
Registration Statement (File No. 333-80191) of American General Life
Insurance Company Separate Account VL-R filed on September 20, 2000.

(16) Incorporated by reference to Post-Effective Amendment No. 4 to Form S-6
Registration Statement (File No. 333-42567) of American General Life
Insurance Company Separate Account VL-R filed on October 11, 2000.

(17) Incorporated by reference to Post-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-90787) of American General Life
Insurance Company Separate Account VL-R filed on October 18, 2000.

(18) Incorporated by reference to Post-Effective Amendment No. 2 to Form S-6
Registration Statement (File No. 333-89897) of American General Life
Insurance Company Separate Account VL-R filed on April 10, 2001.

(19) Incorporated by reference to Pre-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-89897) of American General Life
Insurance Company Separate Account VL-R filed on January 21, 2000.

(20) Incorporated by reference to initial filing of Form S-6 Registration
Statement (File No. 333-65170) of American General Life Insurance Company
Separate Account VL-R filed on July 16, 2001.

II-11

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant,
American General Life Insurance Company Separate Account VL-R, has duly caused
this amended 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 Houston, and state of Texas, on the 9th day of
October, 2001.

AMERICAN GENERAL LIFE INSURANCE
COMPANY SEPARATE ACCOUNT VL-R
(Registrant)

BY: AMERICAN GENERAL LIFE
INSURANCE COMPANY
(On behalf of the Registrant and itself)

BY: /s/ ROBERT F. HERBERT, JR.
---------------------------
Robert F. Herbert, Jr.
Senior Vice President, Treasurer and
Controller
[SEAL]

ATTEST: /s/ LAUREN W. JONES
--------------------
Lauren W. Jones
Assistant Secretary

Pursuant to the requirements of the Securities Act of 1933, this amended
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

RODNEY O. MARTIN, JR.* Director, Chairman and October 9, 2001
---------------------- Chief Executive Officer
(Rodney O. Martin, Jr.)

DONALD W. BRITTON* Director October 9, 2001
------------------
(Donald W. Britton)

DAVID L. HERZOG* Director and Chief October 9, 2001
---------------- Financial Officer
(David L. Herzog)

Signature Title Date
--------- ----- ----

DAVID A. FRAVEL* Director October 9, 2001
----------------
(David A. Fravel)

ROYCE G. IMHOFF, II* Director October 9, 2001
--------------------
(Royce G. Imhoff, II)

JOHN V. LAGRASSE* Director October 9, 2001
-----------------
(John V. LaGrasse)

GARY D. REDDICK* Director October 9, 2001
----------------
(Gary D. Reddick)

THOMAS M. ZUREK* Director October 9, 2001
----------------
(Thomas M. Zurek)

*/s/ ROBERT F. HERBERT, JR.
----------------------------
By: Robert F. Herbert, Jr.
Attorney-in-Fact

EXHIBIT INDEX:

The following exhibits:

1. Exhibits required by Article IX, paragraph A of Form N-8B-2:

(5) Specimen form of the "Platinum Investor/SM/ Survivor II"
Last Survivor Flexible Premium Variable Universal Life
Insurance Policy (Policy Form No. 01206).

(8)(a)(ii) Form of Amendment Four to Participation Agreement by and
Among AIM Variable Insurance Funds, Inc., A I M
Distributors, Inc., American General Life Insurance
Company, on Behalf of Itself and its Separate Accounts,
and American General Securities Incorporated.

(8)(d)(iii) Form of Amendment Six to Participation Agreement by and
among MFS Variable Insurance Trust, American General Life
Insurance Company and Massachusetts Financial Services
Company.

(8)(e)(iv) Form of Amendment Eight to Participation Agreement among
Morgan Stanley Universal Funds, Inc., Van Kampen American
Capital Distributors, Inc., Morgan Stanley Asset
Management Inc., Miller Anderson & Sherrerd, LLP, American
General Life Insurance Company and American General
Securities Incorporated.

(8)(g)(iii) Form of Amendment Five to Participation Agreement among
American General Life Insurance Company, American General
Securities Incorporated, SAFECO Resource Series Trust and
SAFECO Securities, Inc.

(8)(h)(iv) Form of Amendment Seven to Amended and Restated
Participation Agreement among Van Kampen Life Investment
Trust, Van Kampen Funds Inc., Van Kampen Asset Management
Inc., American General Life Insurance Company and American
General Securities Incorporated.

(8)(p)(ii) Form of Amendment No. 1 to Participation Agreement by and
between American General Life Insurance Company, Ayco
Asset Management and Ayco Series Trust.

(8)(q)(ii) Form of Amendment No. 1 to Amended and Restated
Participation Agreement by and between Variable Insurance
Products Fund, Fidelity Distributors Corporation and
American General Life Insurance Company.

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(8)(r)(ii) Form of Amendment No. 1 to Amended and Restated
Participation Agreement by and between Variable Insurance
Products Fund II, Fidelity Distributors Corporation and
American General Life Insurance Company.

(8)(t)(ii) Form of Amendment No. 1 to Fund Participation Agreement by
and between American General Life Insurance Company and
Janus Aspen Series.

(8)(x)(ii) Form of Amendment No. 1 to Administrative Services
Agreement by and between Ayco Asset Management and
American General Life Insurance Company.

(10)(d) Specimen form of product specific Service Request Form.

(10)(f) Specimen form of Variable Universal Life Insurance
Supplemental Application.

2. Other Exhibits

2(a) Opinion and Consent of Pauletta P. Cohn, Deputy General
Counsel of American General Life Companies.

2(b) Opinion and Consent of American General Life Insurance
Company's actuary.

6 Consent of Independent Auditors.

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