Registration No. 333-82982

As filed with the Securities and Exchange Commission on May 13, 2002

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)

Lauren W. Jones, Esq.
Deputy General Counsel
American General Life Companies
2929 Allen Parkway
Houston, Texas 77019
(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.
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) PLUS
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICIES (THE "POLICIES") ISSUED BY
AMERICAN GENERAL LIFE INSURANCE COMPANY ("AGL")

ADMINISTRATIVE CENTER: HOME OFFICE: PREMIUM PAYMENTS:

(EXPRESS DELIVERY) (U.S. MAIL) 2727-A Allen Parkway (EXPRESS PAYMENTS AND
VUL Administration VUL Administration Houston, Texas 77019-2191 U.S. MAIL)
2727-A Allen Parkway P. O. Box 4880 1-713-831-3443 #1 Franklin Square
Houston, Texas 77019-2191 Houston, Texas 77210-4880 1-888-325-9315 Springfield, IL 62713-0001
1-713-831-3443, 1-888-436-5258
(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 Growth Fund
-Class I Shares AIM V.I. Premier Equity 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 Trust....................... Credit Suisse Asset Management, Small Cap 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 - Service Class 2
VIP Contrafund/(R)/ Portfolio
- Service Class 2
VIP Equity-Income Portfolio - Service Class 2
VIP Growth Portfolio - Service Class 2
... Franklin Templeton Variable Insurance..... Franklin Advisers, Inc......... Franklin U.S. Government Fund - Class 2
Products Trust Franklin Mutual Advisers, LLC... Mutual Shares Securities Fund - Class 2
Templeton Investment Counsel, LLC Templeton Foreign Securities Fund - Class 2
... 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.
... PIMCO Variable Insurance Trust............ Pacific Investment Management.. PIMCO Real Return Portfolio
Administrative Class Company LLC PIMCO Short-Term Portfolio
PIMCO Total Return 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
... SunAmerica Series Trust................... SunAmerica Asset............... Aggressive Growth Portfolio - Class A
Management Corp. SunAmerica Balanced Portfolio - Class A
... The Universal Institutional Funds, Inc.... Morgan Stanley Investment Equity Growth Portfolio
Management Inc.
... VALIC Company I........................... VALIC.......................... International Equities Fund
Mid Cap Index Fund
Money Market I Fund
Nasdaq-100/(R)/ Index Fund
Science & Technology Fund
Small Cap Index Fund
Stock Index Fund
... 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............... Growth and Income 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 ON PAGE 1.

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, NOR ARE THEY
GUARANTEED OR ENDORSED BY, ANY BANK OR DEPOSITORY INSTITUTION. AN INVESTMENT IN
A VARIABLE LIFE INSURANCE POLICY IS SUBJECT TO INVESTMENT RISKS, INCLUDING
POSSIBLE LOSS OF PRINCIPAL INVESTED.

This prospectus is dated May 14, 2002

GUIDE TO THIS PROSPECTUS

This prospectus contains information that you should know before you
purchase a Platinum Investor/SM/ PLUS variable life Policy ("Policy") or
exercise any of your rights or privileges under a Policy. This prospectus
describes only the variable portion of the Policy, except where the fixed
account is specifically mentioned. 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 IN
BASIC QUESTIONS YOU MAY HAVE 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 payments does AGL receive from the Mutual Funds? ......... 16

... What is the basic amount of insurance ("death benefit")
that AGL pays when the insured person dies? .................. 16

... Must I invest any minimum amount in a Policy? ................. 19

... How can I change my Policy's investment options? .............. 20

... How can I change my Policy's insurance coverage? .............. 21

... What additional rider benefits might I select? ................ 23

... How can I access my investment in a Policy? ................... 26

... Can I choose the form in which AGL pays out the proceeds
from my Policy? .............................................. 28

... To what extent can AGL vary the terms and conditions of the
Policy in particular cases? .................................. 29

... How will my Policy be treated for income tax purposes? ........ 30

... How do I communicate with AGL? ................................ 30

Financial statements. We have included certain financial statements of AGL
in this prospectus. These begin on page F-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 63, 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 Platinum Investor PLUS flexible premium
variable life insurance Policies issued by AGL. If there are any differences
between this prospectus and your Policy, the provisions of your Policy will
control. Platinum Investor PLUS Policies provide life insurance coverage with
flexibility in death benefits, premium payments and investment options. Platinum
Investor PLUS pays a death benefit to a beneficiary you designate when the
insured person dies. You choose one of three death benefit options.

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 person's lifetime, you may,
within limits, (1) change the amount of insurance, (2) borrow or withdraw
amounts you have invested, (3) choose when and how much you invest, and (4)
choose whether your accumulation value under your Policy, upon the insured
person's death, will be added to the insurance proceeds we otherwise will pay to
the beneficiary.

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 30. Also
see "Services Agreements" on page 60. This booklet is called the "prospectus."

Illustrations of a hypothetical Policy. Starting on page 32, 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 36 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 36. 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 insured person. We can refuse to accept a
subsequent premium payment that is less than $50. If mandated under applicable
law, we may be required to reject a premium payment. 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 30 and
"Tax Effects" beginning on page 38. 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 insured person
does 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.

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. You should carefully

consider your financial ability to continue the program over a long period of
time to allocate accumulation value to the variable investment options when
their value is low as well as when it is high.

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 what day of the
month you want these transfers to be made (other than the 29th, 30th or 31st of
a month) and whether the transfers on that day should occur monthly, quarterly,
semi-annually or annually. We make the transfers at the end of the valuation
period containing the day of the month you select. (The term "valuation period"
is described on page 47.) 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. We
do not charge you for using this service.

Automatic rebalancing. This feature automatically rebalances the
proportion of your accumulation value in each variable investment option under
your Policy to correspond to your then current premium allocation designation.
Automatic rebalancing does not guarantee gains, nor does it assure that you will
not have losses. 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. We do not charge 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 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 effective annual 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 10. The
"daily charge" described on page 8 and the charges and expenses of the Mutual
Funds discussed on pages 11 - 15 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 premium tax (or
a tax charge back if we issued your Policy in Oregon) from your premium payment,
we currently deduct 5.0% from the remainder of all premium payments received in
the first Policy year, up to the "target amount." The amount we deduct in the
second and subsequent Policy years is currently 5.0% of all premium payments. We
may increase this charge for all years, but it will never exceed 7.5% of all
premium payments. See "Distribution of the Policies" on page 47 for a
description of the target amount.

Your Policy refers to this deduction as a Premium Expense Charge. We use
this charge to cover sales expenses, including commissions.

Daily charge. We will deduct a daily charge at an annual effective rate of
0.70% of your accumulation value that is then being invested in any of the
variable investment options. After a Policy has been in effect for 10 years,
however, we will reduce this rate to an annual effective rate of 0.45%, and
after 20 years, to an annual effective rate of 0.10%. We guarantee these rate
reductions. Since the Policies were first offered only in the year 2002, the
reduction has not yet taken effect under any outstanding Policies. We apply this
charge to pay for our mortality and expense risks.

Flat monthly charge. We will deduct $6 from your accumulation value each
month. We may lower this charge but it is guaranteed to never exceed $6. The
flat monthly charge is the Monthly Administration Fee shown on page 3A of your
Policy. We use this charge to pay for the cost of administrative services we
provide under the Policies.

Monthly charge per $1,000 of specified amount. We deduct a charge monthly
from your accumulation value for the first 7 Policy years. This monthly charge
also applies to the amount of any increase in specified amount during the 7
Policy years following the increase. The dollar amount of this charge changes
with each change in your Policy's specified amount. (We describe your specified
amount under "Your specified amount of insurance" on page 16.) This charge
varies according to the specified amount and the age, gender and premium class
of the insured person. This charge is a maximum of $1.22 for each $1000 of
specified amount. The initial amount of this charge is shown on page 3A of your
Policy and is called "Monthly Expense Charge for First Seven Years." 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 insured person 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 generally guaranteed not to exceed those
that will be specified in your Policy. Our current rates are lower than the
guaranteed maximum rates for insured persons in most age 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 insured person grows older. Also our cost of insurance rates
will generally be lower if the insured person is a female than if a male.
Similarly, our current cost of insurance rates are generally lower for
non-tobacco users than tobacco users, and for persons considered to be in
excellent health. On the other hand, insured persons 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 Policies.

Finally, our current cost of insurance rates for the same insured person
differ depending on the specified amount in force on the day the charge is
deducted. We have different rates we apply for specified amounts that range from
$50,000 to $99,999, $100,000 to $999,999 and $1,000,000 or more. Rates are
highest for the first range of $50,000 to $99,999, lower for the second range of
$100,000 to $999,999 and lower still for the third range of $1,000,000 or more.
This means, for instance, that if your specified amount for any reason increases
from the first range to the second or third range, or from the second range to
the third range, your subsequent cost of insurance rates will be lower under
your Policy than they would be before the increase. The reverse is also true.
Our cost of insurance rates are generally higher under a Policy that has been in
force for some period of time than they would be under an otherwise identical
Policy purchased more recently on the same insured person.

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 insured person or the specific
coverage you choose under the rider. The riders we offer are accidental death
benefit rider, automatic increase rider, children's insurance benefit rider, two
versions of maturity extension rider, spouse term rider, terminal illness rider
and waiver of monthly deduction rider. The riders are described beginning on
page 23, under "What additional rider benefits might I select?" The specific
charges for any riders 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 10 Policy years (and for a maximum of the first 10 Policy
years after any increase in the Policy's specified amount).

The amount of the surrender charge depends on the age and other insurance
characteristics of the insured person. Your Policy's surrender charge will be
found in the table beginning on page 27 of the Policy. It may initially be as
high as $48 per $1,000 of specified amount or as low as $3 per $1,000 of
specified amount (or any increase in the specified 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 specified amount, we will deduct any remaining amount of
the surrender charge that was associated with the specified amount that is
canceled. This includes any decrease that results from any requested partial
surrender. See "Partial surrender" beginning on page 26 and "Change of death
benefit option" beginning on page ?. For those Policies that lapse in the first
10 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 effective
annual rate of 4.75%. The loan interest charged on a preferred loan (available
after the first 10 Policy years) will never exceed an effective annual rate of
4.25%. See "Policy loans" beginning on page ___.

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 the charges we will deduct from your
investment in a Policy, see "More About Policy Charges" on page 46.

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)/4/ FEES REIMBURSEMENT)/4/ REIMBURSEMENT)/4/
----------------- ----- ------------------- ------------------

AIM VARIABLE INSURANCE FUNDS -
CLASS I SHARES:/1/

AIM V.I. International Growth Fund 0.73% 0.32% 1.05%

AIM V.I. Premier Equity Fund 0.60% 0.25% 0.85%

AMERICAN CENTURY VARIABLE
PORTFOLIOS, INC.:/1/

VP Value Fund/2/ 0.97% 0.00% 0.97%

AYCO SERIES TRUST:/3/

Ayco Growth Fund 0.00% 1.00% 1.00%

CREDIT SUISSE TRUST:/1/

Small Cap Growth Portfolio 0.90% 0.22% 1.12%

DREYFUS INVESTMENT PORTFOLIOS:/1/

MidCap Stock Portfolio - Initial 0.75% 0.14% 0.89%
shares

DREYFUS VARIABLE INVESTMENT FUND:/1/

Quality Bond Portfolio - Initial shares 0.65% 0.10% 0.75%

Small Cap Portfolio - Initial shares 0.75% 0.04% 0.79%

FIDELITY VARIABLE INSURANCE PRODUCTS
FUND:/1, 5/

VIP Asset Manager/SM/ Portfolio - 0.53% 0.25% 0.12% 0.90%
Service Class 2/6/

VIP Contrafund(R) Portfolio - 0.58% 0.25% 0.11% 0.94%
Service Class 2/6/

VIP Equity-Income Portfolio - 0.48% 0.25% 0.11% 0.84%
Service Class 2/6/

(Footnotes begin on page 14)

VIP Growth Portfolio - 0.58% 0.25% 0.10% 0.93%
Service Class 2/6/

FRANKLIN TEMPLETON VARIABLE
INSURANCE PRODUCTS TRUST:/1, 7/

Franklin U.S. Government Fund - 0.51% 0.25% 0.02% 0.78%
Class 2/8/

Mutual Shares Securities Fund - 0.60% 0.25% 0.19% 1.04%
Class 2

Templeton Foreign Securities Fund - 0.68% 0.25% 0.22% 1.15%
Class 2/4,9/

JANUS ASPEN SERIES - SERVICE SHARES:/10/

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% 0.04% 0.94%

J. P. MORGAN SERIES TRUST II:/1/

JPMorgan Small Company 0.60% 0.55% 1.15%
Portfolio

MFS VARIABLE INSURANCE TRUST:/1/

MFS Capital Opportunities Series/4, 11/ 0.75% 0.16% 0.91%

MFS Emerging Growth Series/11/ 0.75% 0.12% 0.87%

MFS New Discovery Series/4, 11/ 0.90% 0.16% 1.06%

MFS Research Series/11/ 0.75% 0.15% 0.90%

NEUBERGER BERMAN ADVISERS
MANAGEMENT TRUST:/1/

Mid-Cap Growth Portfolio 0.84% 0.07% 0.91%

PIMCO VARIABLE INSURANCE TRUST
ADMINISTRATIVE CLASS:/1, 12/

PIMCO Real Return Portfolio/4, 13/ 0.25% 0.41% 0.66%

(Footnotes begin on page 14)

PIMCO Short-Term Portfolio/4,13/ 0.25% 0.36% 0.61%

PIMCO Total Return Portfolio/4/ 0.25% 0.40% 0.65%

PUTNAM VARIABLE TRUST:/14/

Putnam VT Diversified Income Fund - 0.68% 0.25% 0.11% 1.04%
Class IB

Putnam VT Growth and Income Fund - 0.46% 0.25% 0.05% 0.76%
Class IB

Putnam VT International Growth and 0.80% 0.25% 0.18% 1.23%
Income Fund - Class IB

SAFECO RESOURCE SERIES TRUST:/1/

RST Equity Portfolio 0.74% 0.04% 0.78%

RST Growth Opportunities Portfolio 0.74% 0.04% 0.78%

SUNAMERICA SERIES TRUST:/1/

Aggressive Growth Portfolio -
Class A 0.68% 0.07% 0.75%

SunAmerica Balanced Portfolio -
Class A 0.60% 0.06% 0.66%

THE UNIVERSAL INSTITUTIONAL FUNDS,
INC.:/1/

Equity Growth Portfolio/4/ 0.49% 0.36% 0.85%

High Yield Portfolio/4/ 0.47% 0.33% 0.80%

VALIC COMPANY I:/1/

International Equities Fund 0.35% 0.11% 0.46%

Mid Cap Index Fund 0.30% 0.12% 0.42%

Money Market I Fund/4/ 0.50% 0.10% 0.60%

Nasdaq-100(R)Index Fund 0.40% 0.12% 0.52%

Science & Technology Fund/4/ 0.90% 0.10% 1.00%

Small Cap Index Fund 0.35% 0.12% 0.47%

(Footnotes begin on page 14)

Stock Index Fund 0.26% 0.12% 0.38%

VANGUARD VARIABLE INSURANCE FUND:

High Yield Bond Portfolio 0.24% 0.04% 0.28%

REIT Index Portfolio 0.29% 0.10% 0.39%

VAN KAMPEN LIFE INVESTMENT TRUST - CLASS
I SHARES:/1/

Growth and Income Portfolio/15/ 0.60% 0.15% 0.75%

- ------------------
/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 "What payments does AGL receive from the Mutual Funds?" on page
16, "Certain Arrangements" on page 47 and "Services Agreements" on page 60.)
/2/ The Fund has a stepped fee schedule. As a result, the Fund's management fee
rate generally decreases as the Fund's assets increase.
/3/ The expenses shown reflect an expense limitation agreement in place for 2001
and 2002 as approved by the Fund's Trustees.
/4/ For the Funds indicated, management fees and other expenses as shown for
fiscal year 2001 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 2001 fees and expenses.

TOTAL
MANAGEMENT 12B-1 OTHER ANNUAL
FEES FEES EXPENSES EXPENSES
---------- ----- -------- --------

FRANKLIN TEMPLETON VARIABLE INSURANCE
PRODUCTS TRUST:
Templeton Foreign Securities Fund - 0.69% 0.25% 0.22% 1.16%
Class 2

MFS VARIABLE INSURANCE TRUST:
MFS Capital Opportunities Series 0.75% 0.21% 0.96%
MFS New Discovery Series 0.90% 0.19% 1.09%

PIMCO VARIABLE INSURANCE TRUST
ADMINISTRATIVE CLASS:
PIMCO Real Return Portfolio 0.25% 0.42% 0.67%
PIMCO Short-Term Portfolio 0.25% 0.37% 0.62%
PIMCO Total Return Portfolio 0.25% 0.41% 0.66%

(Footnotes continue on page 15)

TOTAL
MANAGEMENT 12B-1 OTHER ANNUAL
FEES FEES EXPENSES EXPENSES
---------- ----- -------- --------

THE UNIVERSAL INSTITUTIONAL FUNDS, INC.:
Equity Growth Portfolio 0.55% 0.36% 0.91%
High Yield Portfolio 0.50% 0.33% 0.83%

VALIC COMPANY I
Money Market I Fund 0.50% 0.12% 0.62%
Science & Technology Fund 0.90% 0.11% 1.01%

No other Funds received any fee waivers and expense reimbursements.

/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/ The Fund's Class 2 distribution plan or "rule 12b-1 plan" is described in
the Fund's prospectus.
/8/ The Fund pays for administrative expenses indirectly through the Fund
Management Fee.
/9/ Prior to May 1, 2002, the Templeton Foreign Securities Fund was known as the
Templeton International Securities Fund.
/10/ Expenses are based upon expenses for the fiscal year ended December 31,
2001. 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.
/11/ 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'
ANNUAL EXPENSES table above would be lower for the Series and would equal 0.90%
for MFS Capital Opportunities Series, 0.86% for MFS Emerging Growth Series,
1.05% for MFS New Discovery Series, and 0.89% for MFS Research Series. See the
accompanying MFS Variable Insurance Trust prospectus for more details.
/12/ 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.
/13/ The ratio of net expenses to average net assets excluding interest expense
is 0.65% (for the PIMCO Real Return Portfolio and 0.60% for the PIMCO Short-Term
Portfolio.
/14/ The prospectus for Putnam Variable Trust under "Distribution Plan"
discusses this 12b-1 fee.
/15/ Effective May 1, 2002 the Van Kampen Life Investment Trust ("LIT")
Strategic Stock Fund - Class I Shares merged with the Van Kampen LIT Growth and
Income Fund - Class I Shares. Accordingly the performance figures that we may
publish for the Van Kampen LIT Growth and Income Fund - Class I Shares
investment option through May 1, 2002, reflect the historical performance and
inception date of the Van Kampen LIT Strategic Stock - Class I Shares investment
option.

WHAT PAYMENTS DOES AGL RECEIVE FROM THE MUTUAL FUNDS?

We have entered into various services agreements with most of the advisers
or administrators for the Mutual Funds. We receive payments for the
administrative services we perform such as proxy mailing and tabulation, mailing
of fund related information and responding to Policy owners' inquiries about the
Funds. Currently, these payments range from 0.15% to 0.35% of the market value
of the assets invested in the underlying Fund as of a certain date, usually paid
at the end of each calendar quarter. From time to time some of these
arrangements may be renegotiated so that we receive a greater payment than
previously paid depending on our determination that the expenses that we are
incurring are greater than we anticipated. These payments 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?" on page 7.

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.

We also receive what is referred to as "12b-1 fees" from some of the Mutual
Funds themselves. These fees are designed to help pay for our direct and
indirect distribution costs for the Policies. These fees are generally equal to
0.25% of the daily market value of the assets invested in the underlying Fund.

WHAT IS THE BASIC AMOUNT OF INSURANCE ("DEATH BENEFIT") THAT AGL PAYS WHEN THE
INSURED PERSON DIES?

Your specified amount of insurance. In your application to buy a Platinum
Investor PLUS Policy, you tell us how much life insurance coverage you want. We
call this the "specified amount" of insurance. We also provide a guarantee of a
death benefit equal to the specified amount (less any indebtedness) and any
benefit riders. We refer to this guarantee in both your Policy and this
prospectus as the "guarantee period" benefit. We provide more information about
the specified amount and the guarantee period benefit under "Monthly guarantee
premiums," beginning on page 20. 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. You may choose one of three death benefit options under
the Policy. You can choose Option 1 or Option 2 at the time of your application
or at any later time before the death of the insured person. You can choose
death benefit Option 3 only at the time of your application. 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. Depending on the Option you
choose, the death benefit we will pay is

. Option 1--The specified amount on the date of the insured person's
death.

. Option 2--The sum of (a) the specified amount on the date of the
insured person's death and (b) the Policy's accumulation value as of
the date of death.

. Option 3--The sum of (a) the death benefit we would pay under Option 1
and (b) the cumulative amount of premiums you paid for the Policy and
any riders. The death benefit payable will be reduced by any amounts
waived under the Waiver of Monthly Deduction Rider and any partial
surrenders. Following a partial surrender, any premiums you pay for
the Policy are not considered part of the "cumulative amount of
premiums you paid" until the total amount of premiums you pay for the
Policy and any riders exceeds the amount of the partial surrender.

See "Partial surrender" on page 26 for more information about the effect of
partial surrenders on the amount of the death benefit.

Under either Option 2 or Option 3, 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 either Option 2 or Option 3.

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

Required minimum death benefit. We may be required under federal tax law to
pay a larger death benefit than what would be paid under your chosen death
benefit Option. We refer to this larger benefit as the "required minimum death
benefit"as explained below.

Federal tax law requires a minimum death benefit (the required 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.

If you choose the guideline premium test, total premium payments paid in a
Policy year may not exceed the guideline premium payment limitations for life
insurance set forth under federal tax law. If you choose the cash value
accumulation test, there are no limits on the amount of premium you can pay in a
Policy year, so long as the death benefit is large enough compared to the
accumulation value to meet the test requirements.

The other major difference between the two tax tests involves the Policy's
required minimum death benefit. The required minimum death benefit is calculated
as shown in the tables that follow.

If you selected death benefit Option 1, Option 2 or Option 3 at any time
when the required minimum death benefit is more than the death benefit payable
under the Option you selected, the death benefit payable would be the required
minimum death benefit.

If you selected either death benefit Option 1 or Option 3 and elected the
cash value accumulation test, the payment of additional premiums under the cash
value accumulation test, as compared to the guideline premium test, may cause
your accumulation value to increase to a level where the required minimum death
benefit becomes applicable. Therefore, choosing the cash value accumulation test
may make it more likely that the required minimum death benefit will apply if
you select those death benefit Options. If you anticipate that your Policy may
have a substantial accumulation value in relation to its death benefit, you
should be aware that the cash value accumulation test may cause your Policy's
death benefit to be higher than if you had chosen the guideline premium test. To
the extent that the cash value accumulation test 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 required minimum death benefit.)

If you selected the guideline premium test, we calculate the required
minimum death benefit by multiplying your Policy's accumulation value by an
applicable percentage. The applicable percentage is 250% when the insured
person's age is 40 or less, and decreases each year thereafter to 100% when the
insured person's age is 95 or older. The applicable percentages under the
guideline premium test for certain ages between 40 to 95 are set forth in the
following table.

APPLICABLE PERCENTAGES UNDER
GUIDELINE PREMIUM TEST

INSURED
PERSON'S
AGE* 40 45 50 55 60 65 70 75 95+

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

- ---------------
*Age nearest birthday at the beginning of the Policy year in which the insured
person dies.

If you have selected the cash value accumulation test, we calculate the
required minimum death benefit by multiplying your Policy's accumulation value
by a percentage that

will be set forth on page 25 of your Policy. The percentage varies based on the
insurance characteristics of the insured person. Below is an example of
applicable required minimum death benefit percentages for the cash value
accumulation test. The example is for a male non-tobacco user preferred premium
class and issue age 55.

APPLICABLE PERCENTAGES UNDER
CASH VALUE ACCUMULATION TEST

POLICY
YEAR 1 2 3 5 10 20 30 40 45

% 218% 212% 207% 196% 173% 142% 127% 112% 104%

Your Policy calls the multipliers used for each test the "Cash Value 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
that your Policy's cash surrender value stays above zero or that the guarantee
period benefit (described under "Monthly guarantee premiums" on page 20) remains
in effect ("Cash surrender value" is explained under "Full surrender" on page
26.) The less you invest, the more likely it is that your Policy's cash
surrender value could fall to zero, as a result of the deductions we
periodically make from your accumulation value.

Policy lapse and reinstatement. If your Policy's cash surrender value (the
Policy's accumulation value less Policy loans and loan interest during the first
5 Policy years) falls to an amount insufficient to cover the monthly charges, we
will notify you 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 the insured person still 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 a Policy after it is reinstated.

Monthly guarantee premiums. Page 3 of your Policy will specify a "Monthly
Guarantee Premium." 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 call this our "guarantee period" benefit and here are its terms and
conditions. 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, the Policy will
not enter a grace period or terminate (i.e., lapse) because of insufficient cash
surrender value.

The length of time you are covered by the guarantee period benefit varies
on account of the insured person's age at the Policy's date of issue. The
maximum duration for the guarantee period - 10 years - happens in the event the
insured person is no older than age 50 at the Policy's date of issue. We reduce
the maximum time for the guarantee period by one year for each year the insured
person is older than age 50 at the date of issue. The reductions stop after the
insured person is age 55 or older at the date of issue. This means, for
instance, that you will have a guarantee period of 5 years if the insured person
is age 55 at the Policy's date of issue.

The least amount of time for the guarantee period to be in effect - 5 years
- - happens in the event the insured person is older than age 55 at the date of
issue.

Your sales representative will help you determine the exact duration of the
guarantee period benefit when you apply for a Policy.

Also, whenever you increase or decrease your specified amount, we calculate
a new monthly guarantee premium, so the amount you must pay to keep the
guarantee period 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.

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 54.

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 the insured person is living, you
may request an increase in the specified amount of coverage under your Policy.
You must, however, provide us with satisfactory evidence that the insured person
continues 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 age and premium class of the insured person at the
time of the increase. Also, a new amount of surrender charge applies to the
increased specified amount. These charges are the same as they would be if we
were instead issuing the same amount of additional coverage as a new Platinum
Investor PLUS Policy.

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:

. $50,000; 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 against any specified amount
increases first (beginning with the most recent), and then against the specified
amount provided under the original application. We will deduct from your
accumulation value any remaining surrender charge. 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. A reduction in specified amount
will not reduce the monthly charge per $1,000 of specified amount or the amount
of time we assess this charge.

Change of death benefit option. You may at any time before the death of the
insured person request us to change your choice of death benefit option from:

Option 1 to Option 2;
Option 2 to Option 1; or
Option 3 to Option 1.

No other changes are permitted. A change from Option 3 to Option 1 is
subject to regulatory approval in your state.

. If you change from Option 1 to Option 2, we 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 not charge a
surrender charge for this reduction in specified amount.

. If you change from either Option 2 or Option 3 to Option 1, then as of
the date of the change we automatically increase your Policy's
specified amount by the amount of your Policy's accumulation value.

Tax consequences of changes in insurance coverage. Please read "Tax
Effects" starting on page 38 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 period. A change in
coverage does not result in termination of the guarantee period, 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
20.

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.

. Accidental Death Benefit Rider This rider pays an additional death
benefit if the insured person dies from certain accidental causes. You
may purchase this rider only at the time we issue your Policy.

. Automatic Increase Rider This rider provides for automatic increases
in your Policy's specified amount of insurance at certain specified
dates and based on a specified index. After you have met our
eligibility requirements for this rider, these increases will not
require that evidence be provided to us about whether the insured
person continues to meet our requirements for insurance coverage.
These automatic increases are on the same terms (including additional
charges) as any other specified amount increase you request (as
described under "Increase in coverage" on page 21). If you choose not
to accept an automatic increase, this rider, and any future increases
under it, will be cancelled.

There is no additional charge for the rider itself, although the
automatic increases in the specified amount will increase the monthly
insurance charge deducted from your accumulation value, to compensate
us for the additional coverage. You may purchase this rider only at
the time we issue your Policy.

. Children's Insurance Benefit Rider This rider provides term life
insurance coverage on the eligible children of the person insured
under the Policy. This rider is convertible into any other insurance
(except for term coverage) available for conversions, under our
published rules at the time of conversion. You may purchase this rider
only at the time we issue your Policy.

. Maturity Extension Rider This rider gives you the option to extend the
Policy's maturity date beyond what it otherwise would be, at any time
before the original maturity date. Once you select this rider, if you
have not already elected to extend the maturity date, we will notify
you of this right 60 days before maturity. If you do not then elect to
extend the maturity date before the original maturity date, the rider
will terminate and the maturity date will not be extended. You have
two

versions of this rider from which to choose, the Accumulation Value
version and the Death Benefit version. Either or both versions may not
be available in your state.

The Accumulation Value version provides for a death benefit after your
original maturity date that is equal to the accumulation value on the
date of death. The death benefit will be reduced by any outstanding
Policy loan amount. There is no charge for this version until you
reach your original maturity date. After your original maturity date,
we will charge a monthly fee of no more than $10.

The Death Benefit version provides for a death benefit after your
original maturity date equal to the death benefit in effect on the day
prior to your 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.

We will charge you the following amounts under the death benefit
version

. A monthly fee of no more than $30 for each $1000 of the net
amount at risk. This fee begins 9 years before your original
maturity date and terminates on your original maturity date.

. A monthly fee of no more than $10. This fee begins on your
original maturity date if you exercise your right under the
rider to extend your original maturity date.

Nine years and 60 days before your original maturity date, we
will notify you that you will incur these charges if you keep the
rider. You will then have until your original maturity date to
terminate the rider and with it, your right to extend your
original maturity date. If you terminate the rider at any time
within this nine year and 60 day period, there will be no further
charges and you will receive no benefit.

The Accumulation Value version of the rider may be selected at any
time before your original maturity date. The Death Benefit version of
the rider may be selected only at the time we issue your Policy. In
Illinois you may select either version of the rider only after we
issue your Policy, and prior to your original maturity date.

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 your original maturity date. We do not
allow additional premium

payments, new loans, or changes in specified amount after your
original maturity date. The only charge we continue to automatically
deduct after the original maturity date is the daily charge described
on page 8. Once you have exercised your right to extend your original
maturity date, you cannot revoke it. You can, however, surrender your
Policy at any time.

Extension of the maturity date beyond the insured person'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.

. Spouse Term Rider This rider provides term life insurance on the life
of the spouse of the Policy's insured person. This rider terminates no
later than the Policy anniversary nearest the spouse's 75th birthday.
You can convert this rider into any other insurance (except for term
coverage) available for conversions, under our published rules at the
time of conversion. You can purchase this rider only at the time we
issue your Policy.

. Terminal Illness Rider This rider provides for a benefit to be
requested if the Policy's insured person is diagnosed as having a
terminal illness (as defined in the rider) and less than 12 months to
live. This rider is not available in all states. The maximum amount
you may receive under this rider before the insured person's death is
50% of the death benefit payable under the Policy (excluding any rider
benefits), not to exceed $250,000. The amount of benefits paid under
the rider, plus an administrative fee (not to exceed $250), plus
interest on these amounts to the next Policy anniversary becomes a
"lien" against all future Policy benefits. We will continue to charge
interest in advance on the total amount of the lien and will add any
unpaid interest to the total amount of the lien each year. Any time
the total lien, plus any other Policy loans, exceeds the Policy's then
current death benefit, the Policy will terminate without further
value. The cash surrender value of the Policy also will be reduced by
the amount of the lien. You can purchase this rider at any time prior
to the maturity date.

. Waiver of Monthly Deduction Rider This rider provides for a waiver of
all monthly charges assessed for both your Policy and riders that we
otherwise would deduct from your accumulation value, so long as the
insured person is totally disabled (as defined in the rider). While we
are paying benefits under this rider we will not permit you to request
any increase in the specified amount of your Policy's coverage. When
we "pay benefits" under this rider, we pay all monthly charges (except
for loan interest) for your Policy when they become due, and then
deduct the same charges from your Policy. Therefore, your Policy's
accumulation value does not change. We perform these two transactions
at the same time.

However, loan interest will not be paid for you under this rider, and
the Policy could, under certain circumstances, lapse for nonpayment of
loan interest. You can purchase this rider on the life of an insured
person who is younger than age 56. You can purchase this rider only at
the time we issue your Policy.

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 38. You should consult a
qualified tax adviser.

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 interest, and less any applicable surrender charge. We call this amount
your "cash surrender value." Because of the surrender charge, it is unlikely
that a Platinum Investor PLUS 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 $50,000.

If the Option 1 or Option 3 death benefit is then in effect, we also will
reduce your Policy's specified amount by the amount of such withdrawal and
charges, but not below $0. 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. The minimum amount you can borrow is
$500 or, if less, the entire remaining loan value. These rules are not
applicable in all states.

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 effective annual rate of 4.0% (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 effective annual rate of 4.75%. Loan
interest is payable annually, on the Policy anniversary, 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 $100 unless it is the final
payment) of your loan at any time before the death of the insured person 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 insured person'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
effective annual 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 effective annual rate of 4.25%.

Because we first began offering the Policies in the year 2002, we have not
yet declared a preferred loan interest rate we charge.

Maturity of your Policy. If the insured person is 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 insured person's 100th birthday.

Tax considerations. Please refer to "How will my Policy be treated for
income tax purposes?" 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 insured person'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 nine premium classes we use to
decide how much the monthly insurance charges under any particular Policy will
be: preferred-plus non-tobacco, preferred non-tobacco, standard non-tobacco,
preferred tobacco, standard tobacco, special non-tobacco, special tobacco,
juvenile and special juvenile. Various factors such as the insured's age, health
history, occupation and history of tobacco use, are used in considering the
appropriate premium class for the insured. Each premium class is described in
your Policy.

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 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 38.

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 this
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;

. change of allocation percentages for policy deductions;

. 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 the insured person's death, and related documentation, to our
Administrative Center address.

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, if you are not the insured person, that person's name. 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 insured person's 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 ..................... 34

Death Benefit Option 1--Guaranteed Maximum Charges............ 35

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 preferred premium class and issue age 55. An annual premium
payment of $35,000 for an initial $1,000,000 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 10 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 38 for further discussion).

Although the tables that follow do not include an example of a Policy with
an Option 2 or Option 3 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 premium tax (or a tax charge back if we issued the
Policy in Oregon), a charge of 5.0% and 7.5% for current charges and
guaranteed maximum charges, respectively;

. a daily charge for the first 10 Policy years at an annual effective
rate of 0.70% (for both current and guaranteed maximum charges);

. a daily charge for Policy years 11 through 20 at an annual effective
rate of 0.45% (for both current and guaranteed maximum charges);

. a daily charge after 20 Policy years at an annual effective rate of
0.10% (for both current and guaranteed maximum charges);

. a flat monthly charge of $6 (for both current and guaranteed maximum
charges);

. a monthly charge for the first 7 Policy years for each $1,000 of
specified amount of $0.33 (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 0.82% 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 11 -
16 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 PLUS

ANNUAL PREMIUM $35,000 INITIAL SPECIFIED AMOUNT $ 1,000,000
DEATH BENEFIT OPTION 1

MALE, AGE 55
NON-TOBACCO USER, 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 1,000,000 1,000,000 1,000,000 26,635 27,962 29,735 0 0 0
2 1,000,000 1,000,000 1,000,000 52,749 56,632 62,002 13,749 17,632 23,002
3 1,000,000 1,000,000 1,000,000 78,924 86,655 97,719 39,924 47,655 58,719
4 1,000,000 1,000,000 1,000,000 105,110 118,042 137,202 71,110 84,042 103,202
5 1,000,000 1,000,000 1,000,000 131,359 150,911 180,909 102,359 121,911 151,909
6 1,000,000 1,000,000 1,000,000 157,285 184,947 228,911 133,285 160,947 204,911
7 1,000,000 1,000,000 1,000,000 183,099 220,422 281,894 163,099 200,422 261,894
8 1,000,000 1,000,000 1,000,000 212,486 261,202 344,342 197,486 246,202 329,342
9 1,000,000 1,000,000 1,000,000 241,545 303,546 413,189 231,545 293,546 403,189
10 1,000,000 1,000,000 1,000,000 270,140 347,428 489,084 265,140 342,428 484,084

15 1,000,000 1,000,000 1,183,415 409,969 600,511 1,020,185 409,969 600,511 1,020,185

20 1,000,000 1,000,000 2,035,819 540,049 924,232 1,902,634 540,049 924,232 1,902,634

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.

THE ACTUAL INVESTMENT RATES OF RETURN WILL FLUCTUATE OVER TIME AND LIKELY WILL
BE BOTH POSITIVE AND NEGATIVE. THE ACTUAL VALUES UNDER THE POLICY COULD BE
SIGNIFICANTLY DIFFERENT FROM THOSE SHOWN EVEN IF ACTUAL RETURNS AVERAGED 0%, 6%
AND 12% BUT FLUCTUATED OVER AND UNDER THAT AVERAGE THROUGHOUT THE YEARS SHOWN.

PLATINUM INVESTOR PLUS

ANNUAL PREMIUM $ 35,000 INITIAL SPECIFIED AMOUNT $1,000,000
DEATH BENEFIT OPTION 1

MALE, AGE 55
NON-TOBACCO USER, PREFERRED PREMIUM CLASS
ASSUMING GUARANTEED CHARGES

1 1,000,000 1,000,000 1,000,000 18,297 19,416 20,916 0 0 0
2 1,000,000 1,000,000 1,000,000 34,976 38,044 42,308 0 0 3,308
3 1,000,000 1,000,000 1,000,000 50,823 56,684 65,132 11,823 17,684 26,132
4 1,000,000 1,000,000 1,000,000 65,863 75,379 89,610 31,863 41,379 55,610
5 1,000,000 1,000,000 1,000,000 80,006 94,062 115,884 51,006 65,062 86,884
6 1,000,000 1,000,000 1,000,000 93,166 112,670 144,128 69,166 88,670 120,128
7 1,000,000 1,000,000 1,000,000 105,148 131,035 174,450 85,148 111,035 154,450
8 1,000,000 1,000,000 1,000,000 119,844 153,174 211,311 104,844 138,174 196,311
9 1,000,000 1,000,000 1,000,000 133,165 175,126 251,264 123,165 165,126 241,264
10 1,000,000 1,000,000 1,000,000 145,032 196,865 294,777 140,032 191,865 289,777

15 1,000,000 1,000,000 1,000,000 178,245 302,604 595,372 178,245 302,604 595,372

20 1,000,000 1,000,000 1,226,505 135,671 387,586 1,146,266 135,671 387,586 1,146,266

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 at pages 1 - 35. 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........................................................... 37
Separate Account VL-R......................................... 37
Tax Effects................................................... 38
Voting Privileges............................................. 45
Your Beneficiary.............................................. 46
Assigning Your Policy......................................... 46
More About Policy Charges..................................... 46
Effective Date of Policy and Related Transactions............. 47
More About Our Declared Fixed Interest Account Option......... 49
Distribution of the Policies.................................. 50
Payment of Policy Proceeds.................................... 52
Adjustments to Death Benefit.................................. 53
Additional Rights That We Have................................ 54
Performance Information....................................... 55
Our Reports to Policy Owners.................................. 55
AGL's Management.............................................. 55
Principal Underwriter's Management............................ 58
Legal Matters................................................. 59
Legal Proceedings............................................. 60
Accounting and Auditing Experts............................... 60
Actuarial Expert.............................................. 60
Services Agreement............................................ 60
Certain Potential Conflicts................................... 61
Financial Statements.......................................... 61

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 63 and 64,
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 International
Group, Inc. ("AIG"). AIG, a Delaware corporation, is a holding company which
through its subsidiaries is primarily engaged in a broad range of insurance and
insurance-related activities and financial services in the United States and
abroad. AIG American General is a marketing name of AGL and its affiliates. The
commitments under the Policies are AGL's, and AIG has no legal obligation to
back those commitments.

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 70 separate "divisions," 46 of which correspond to the 46
variable "investment options" available since the inception of the Policy. The
remaining 24 divisions, and some of these 46 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 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.

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.

The Company has procedures in place, including Policy owner notification,
to prevent additional premium payments from causing your Policy to 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 insured person's 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 the insured person 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.

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 insured
person 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 insured person 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
insured person, 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 enactment of the Economic Growth and Tax Relief
Reconciliation Act of 2001 (P.L. 107-16) (the "2001 Act") brought significant
change to the transfer tax system, the most notable being the repeal of the
estate and generation-skipping transfer (GST) taxes in 2010. Prior to repeal, a
number of modifications are made to the maximum estate tax rate and the estate
and gift tax applicable exclusion amounts. The 2001 Act increases the estate tax
applicable exclusion amount to $1 million for decedents dying in 2002. In order
to comply with the Congressional Budget Act of 1974, the 2001 Act provides that
all provisions of, and amendments made by, the 2001 Act will not apply to
estates of decedents dying, gifts made, or generation-skipping transfers, after
December 31, 2010. Unless Congress acts affirmatively in the interim, the
Internal Revenue Code will thereafter be applied and administered as if these
provisions had not been enacted.

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 ($1,100,000 in 2002
indexed for inflation). 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, insured person 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 issued Notice 2001-10 in 2001, then revoked it
in Notice 2002-8, which was released on January 3, 2002. Both Notices were
intended to provide guidance regarding the tax treatment of parties entering
into split-dollar life insurance arrangements and to revise the applicable
standards for valuing the economic benefit provided by current life insurance
protection. Notice 2002-8, in addition to revoking the prior Notice, announced
that the Service intends to publish proposed regulations which will provide
comprehensive guidance on the treatment of split-dollar arrangements. It also
sets out a series of transition rules for determining how P.S. 58 rates would or
could be applied in determining the value of life insurance protection under
split-dollar arrangements until the promised new regulations are proposed and
become final. In general, it appears that for arrangements entered into prior to
January 28, 2002, the P.S. 58 rules used before Notice 2001-10 can continue to
be applied. The timeframe for the release of new regulations is unknown but may
be several years.

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 2002-8 and any subsequent guideline that is released.

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. The rules for determining P.S. 58 costs are being revised by the IRS and
may change.

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 the insured person's 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
passed tax legislation on May 26, 2001 which modified 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 insured person 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 the insured person 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 insured person 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 insured persons 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 insured person 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 Plus 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. If so, we attribute your accumulation value proportionately
to each increment of specified amount to compute our net amount at risk. See
"Monthly insurance charge" on page 8.

Certain arrangements. Most of the advisers or administrators 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 advisers or
the administrators, and will not be paid by the Mutual Funds, the divisions or
Policy owners. See "What payments does AGL receive from the Mutual Funds?" on
page 16.

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.

If we receive your premiums through payroll allotment, such as salary
deduction or salary reduction programs, we consider that we receive your premium
on the day we actually receive it, rather than the day the deduction from your
payroll occurs. This is important for you to know because your premium receives
no interest or earnings for the time between the deduction from your payroll and
our receipt of the payment. We currently do not accept military allotment
programs.

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 insured person's premium class 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 insured person's
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 insured person meets 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 insured person, 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 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 effective annual 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:

. 90% 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 each of
Policy years one through 10;

. 0.25% of the Policy's accumulation value (reduced by any outstanding
loans) in the investment options in each of Policy years two through
20;

. 0.15% of the Policy's accumulation value (reduced by any outstanding
loans) in the investment options in each Policy year after Policy year
20;

. a comparable amount of compensation to broker-dealers or banks with
respect to any increase in the specified amount of coverage that you
request; and

. any amounts that we may pay for broker-dealers or banks expense
allowances, bonuses, wholesaler fees, training allowances or
additional compensation for the Policies.

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.

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 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
computation of values and 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 the
insured person'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 the insured person's
lifetime.

. We cannot challenge an additional benefit rider that provides benefits
if the insured person 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.

Delay required under applicable law. We may be required under applicable
law to block a request for transfer or payment, including Policy loan requests,
under a Policy until we receive instructions from the appropriate regulator.

ADJUSTMENTS TO DEATH BENEFIT

Suicide. If the insured person commits suicide during the first two Policy
years, we will limit the proceeds payable 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 the insured person is living at the time
of the increase. In this case, if the insured person 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 the insured person 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 insured person 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 also may present the yield or total return of the
investment option in which a division invests.

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 AND PRINCIPAL
BUSINESS ADDRESS BUSINESS EXPERIENCE WITHIN PAST FIVE YEARS
- ------------------ ------------------------------------------

Rodney O. Martin, Jr. Director and Chairman of the Board of American General Life
2929 Allen Parkway Insurance Company (1996 - present). Previously Chief
Houston, TX 77019 Executive Officer (April 2000 - November 2001), Senior
Chairman of the Board (April 1998 -
January 2000), and President (August 1996 - July 1998) of
American General Life Insurance Company.

David J. Dietz Director of AGL since March 2002. Senior Vice President -
390 Park Avenue, 5th Floor Corporate Markets Group of AGL since January 1999.
New York, NY 10022 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).

Robert F. Herbert, Jr. Director of AGL since March 2002. Senior Vice President and
2727-A Allen Parkway Treasurer of AGL since May 1996. Controller of AGL since
Houston, TX 77019 February 1991.

David L. Herzog Director, Executive Vice President and Chief Financial Officer
2929 Allen Parkway of AGL since March 2000. Vice President of General
Houston, TX 77019 American, St. Louis, Missouri (June 1991 - February 2000).

Royce G. Imhoff, II Director of AGL since November 1997. President of AGL since
2929 Allen Parkway March 2002. Senior Vice President and Chief Marketing Officer
Houston, TX 77019 of AGL (1997 - March 2002). Previously held various positions
with AGL including Vice President since August 1996.

Gary D. Reddick Executive Vice President of American General Life Insurance
2929 Allen Parkway Company since April 1998 and Director since April 2001. Vice
Houston, TX 77019 Chairman and Executive Vice President of The Franklin Life
Insurance Company (1995 - April 1998).

NAME AND PRINCIPAL
BUSINESS ADDRESS BUSINESS EXPERIENCE WITHIN PAST FIVE YEARS
- ------------------ ------------------------------------------

R. Kendall Nottingham Director of AGL since March 2002. Currently, Executive Vice
70 Pine Street President for American International Group. Previously held
New York, NY 10270 various positions with subsidiaries of American International
Group, including Chairman of the Board
and Chief Executive Officer of American
International Life Insurance Company and
Director of American International Life
Assurance Company of New York since 1998.

Nicholas A. O'Kulich Director of AGL since March 2002. Currently, Vice President
70 Pine Street for American International Group. Previously held various
New York, NY 10270 positions with subsidiaries of American International Group
since 1990, including Chief Financial
Officer of Worldwide Life Organization
and Director of American International
Life Assurance Company of New York since
1990.

Paul L. Mistretta Executive Vice President of AGL since July 1999. Senior Vice
2929 Allen Parkway President of First Colony Life Insurance, Lynchburg, Virginia
Houston, TX 77019 (1992 - July 1999).

Wayne A. Barnard Senior Vice President of AGL since November 1997.
2929 Allen Parkway Previously held various positions with AGL, including Vice
Houston, TX 77019 President since February 1991.

Robert M. Beuerlein Senior Vice President and Chief Actuary of AGL since
2727-A Allen Parkway September 1999. Previously held position as Vice President of
Houston, TX 77019 AGL since December 1998. Director, Senior Vice President and
Chief Actuary of The Franklin Life
Insurance Company, Springfield, Illinois
(January 1991 - June 1999).

Pauletta P. Cohn Senior Vice President and Co-General Counsel of AGL since
2929 Allen Parkway March 2002. Senior Vice President, General Counsel and
Houston, TX 77019 Secretary of AGL (November 2001 - March 2002). Previously
held various positions with American General Life Companies
since 1993 including, Deputy General Counsel (2000 -
November 2001), Associate General Counsel (1998 - 2000)
and Senior Attorney (1993 - 1998).

William Guterding Senior Vice President of AGL since April 1999. Senior Vice
390 Park Avenue, 5th Floor President and Chief Underwriting Officer of The United States
New York, NY 10022 Life Insurance Company in the City of New York since October,
1980.

NAME AND PRINCIPAL
BUSINESS ADDRESS BUSINESS EXPERIENCE WITHIN PAST FIVE YEARS
- ------------------ ------------------------------------------

Kyle L. Jennings Senior Vice President and Co-General Counsel of AGL since
2929 Allen Parkway March 2002. Senior Vice President and General Counsel of
Houston, TX 77019 AGL (November 2001 - March 2002). Previously held position
of Deputy General Counsel-Litigation of American General Life
Companies (1998 - November 2001). Partner with Beirne,
Maynard & Parsons, L.L.P. (January 1995 - June 1998).

Simon J. Leech Senior Vice President of AGL since July 1997. Previously held
2929 Allen Parkway various positions with AGL since 1981, including Vice
Houston, TX 77019 President - Policy Administration in 1995.

Mark R. McGuire Senior Vice President of AGL since April 2001. Vice President
2727 Allen Parkway of American General Life Companies (2000 - March 2001).
Houston, TX 77019 Vice President of The Franklin Life Insurance Company (1997 - 2000).
Previously held various positions with AGL since August 1988,
including Director of Work Site Marketing Administration (1996 - 1997).

Lawrence J. O'Brien Senior Vice President of AGL since November 2001. Senior
2929 Allen Parkway Vice President of American General Life Companies since
Houston, TX 77019 February 1998. Vice President - Insurance Marketing of
Business Men's Assurance Company of America, Kansas City,
Missouri (1995 - February 1998).

PRINCIPAL UNDERWRITER'S MANAGEMENT

The directors and principal officers of the principal underwriter are:

NAME AND PRINCIPAL POSITION AND OFFICES WITH UNDERWRITER,
BUSINESS ADDRESS AMERICAN GENERAL DISTRIBUTORS, INC.
- ------------------ --------------------------------------
Robert P. Condon Director, Chairman,
2929 Allen Parkway President and Chief Executive Officer
Houston, TX 77019

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

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

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

Kurt W. Bernlohr Assistant Secretary
2919 Allen Parkway
Houston, TX 77019

Tracey E. Harris Assistant Secretary
2919 Allen Parkway
Houston, TX 77019

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

James D. Bonsall Assistant Treasurer
2919 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.
Lauren W. Jones, Esquire, Deputy General Counsel of American General Life
Companies, an affiliate of AGL, has opined as to the validity of the Policies.

LEGAL PROCEEDINGS

AGL is a party to various lawsuits and proceedings arising in the ordinary
course of business. Many of these lawsuits and proceedings arise in
jurisdictions that permit damage awards disproportionate to the actual damages
incurred. Based upon information presently available, AGL 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 AGL's results of
operations and financial position.

ACCOUNTING AND AUDITING EXPERTS

The consolidated balance sheets of AGL as of December 31, 2001 and 2000 and
the related consolidated statements of income, statements of comprehensive
income, statements of shareholders' equity and statements of cash flows for the
years ended December 31, 2001, 2000 and 1999 included in this prospectus have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon appearing elsewhere in this prospectus, and is included in this
prospectus in reliance upon such report of Ernst & Young LLP given on the
authority of such firm 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 Wayne A. Barnard who is Senior Vice
President 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 AGREEMENT

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.

For information about agreements with the Mutual Funds, see "What payments
does AGL receive from the Mutual Funds?" on page 16.

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 46
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
- --------------------------------------- -----------

Report of Ernst & Young LLP Independent Auditors................. F-1

Consolidated Balance Sheets as of December 31, 2001 and 2000..... F-2

Consolidated Statements of Income for the years
ended December 31, 2001, 2000, and 1999.................. F-4

Consolidated Statements of Shareholder's Equity for the years
ended December 31, 2001, 2000, and 1999.................. F-5

Consolidated Statements of Comprehensive Income for the years
ended December 31, 2001, 2000, and 1999.................. F-6

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

Consolidated Statements of Cash Flows for the years
ended December 31, 2001, 2000, and 1999.................. F-7

Notes to Consolidated Financial Statements....................... F-8

[Ernst & Young Letterhead appears here]

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) as of December 31, 2001 and 2000, 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,
2001. 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, 2001 and 2000, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 2001, in conformity with accounting
principles generally accepted in the United States.

As discussed in Note 1 to the consolidated financial statements, in 2001, the
Company changed its method of accounting for derivatives and its investments in
certain purchased and retained interests in securitized financial assets.

February 1, 2002 /s/ ERNST & YOUNG LLP

F - 1

American General Life Insurance Company

Consolidated Balance Sheets

DECEMBER 31
2001 2000
------------------------------
(In Thousands)

ASSETS
Investments:
Fixed maturity securities, at fair value
(amortized cost - $28,319,738 in 2001 and
$27,098,978 in 2000) $28,589,219 $26,991,695
Equity securities, at fair value (cost -
$202,556 in 2001 and $233,278 in 2000) 176,171 233,227
Mortgage loans on real estate 2,201,562 2,084,299
Policy loans 1,291,019 1,297,438
Investment real estate 65,974 124,117
Other long-term investments 277,087 227,514
Short-term investments 487,747 140,496
Derivatives 26,458 -
---------------------------
Total investments 33,115,237 31,098,786

Cash 86,005 44,747
Investment in Parent Company
(cost - $8,597 in 2001 and 2000) 64,326 57,019
Indebtedness from affiliates 213,015 78,225
Accrued investment income 487,349 472,187
Accounts receivable 506,683 664,395
Deferred policy acquisition costs 2,042,688 2,090,810
Property and equipment 76,285 80,665
Other assets 226,966 228,685
Assets held in separate accounts 20,279,272 22,225,525
---------------------------
Total assets $57,097,826 $57,041,044
===========================

F - 2

DECEMBER 31
2001 2001
---------------------------
(In Thousands)

LIABILITIES AND SHAREHOLDER'S EQUITY
Liabilities:
Future policy benefits $31,012,386 $29,524,610
Other policy claims and benefits payable 53,149 47,369
Other policyholders' funds 523,332 388,433
Federal income taxes 558,723 466,314
Indebtedness to affiliates 4,691 6,909
Other liabilities 838,612 920,570
Liabilities related to separate accounts 20,279,272 22,225,525
---------------------------
Total liabilities 53,270,165 53,579,730

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 1,397,860 1,370,821
Accumulated other comprehensive loss 129,460 (31,466)
Hedging activities 16,207 -
Retained earnings 2,277,284 2,115,109
---------------------------
Total shareholder's equity 3,827,661 3,461,314
---------------------------
Total liabilities and shareholder's equity $57,097,826 $57,041,044
===========================

See accompanying notes.

F - 3

American General Life Insurance Company

Consolidated Statements of Income

YEAR ENDED DECEMBER 31
2001 2000 1999
--------------------------------------------
(In Thousands)

Revenues:
Premiums and other considerations $ 794,347 $ 659,901 $ 540,029
Net investment income 2,393,778 2,362,694 2,348,196
Net realized investment gains
(losses) (65,668) (98,109) 5,351
Other 22,171 134,769 82,581
--------------------------------------------
Total revenues 3,144,628 3,059,255 2,976,157

Benefits and expenses:
Benefits 1,899,772 1,775,120 1,719,375
Operating costs and expenses 607,637 481,841 495,680
--------------------------------------------
Total benefits and expenses 2,507,409 2,256,961 2,215,055
--------------------------------------------
Income before income tax expense 637,219 802,294 761,102

Income tax expense 190,981 260,860 263,196
Cumulative effect of accounting
change (net of tax) (22,383) - -
--------------------------------------------
Net income $ 423,855 $ 541,434 $ 497,906
============================================

See accompanying notes.

F - 4

American General Life Insurance Company

Consolidated Statements of Shareholder's Equity

YEAR ENDED DECEMBER 31
2001 2000 1999
------------------------------------------
(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 1,370,821 1,371,687 1,368,089
Capital contribution from Parent
Company - - -
Other changes during year 27,039 (866) 3,598
------------------------------------------
Balance at end of year 1,397,860 1,370,821 1,371,687

Accumulated other comprehensive
(loss) income:
Balance at beginning of year (31,466) (356,865) 679,107
Change in unrealized gains
(losses) on securities, net of tax 160,926 325,399 (1,035,972)
------------------------------------------
Balance at end of year 129,460 (31,466) (356,865)

Hedging Activities:
Balance at beginning of year - - -
Change, net of tax 16,207 - -
------------------------------------------
Balance at end of year 16,207 - -

Retained earnings:
Balance at beginning of year 2,115,109 1,824,715 1,514,489
Net income 423,855 541,434 497,906
Dividends paid (261,680) (251,040) (187,680)
------------------------------------------
Balance at end of year 2,277,284 2,115,109 1,824,715
------------------------------------------
Total shareholder's equity $3,827,661 $3,461,314 $ 2,846,387
==========================================

See accompanying notes.

F - 5

American General Life Insurance Company

Consolidated Statements of Comprehensive Income

YEAR ENDED DECEMBER 31
2001 2000 1999
-----------------------------------------
(In Thousands)

Net income $423,855 $541,434 $ 497,906
Other comprehensive income:
Gross change in unrealized gains
(losses) on securities (pretax:
$221,614; $435,000; ($1,581,500) 139,067 282,743 (1,027,977)
Hedging activity 16,207 - -
Less: gains (losses) realized in
net income (21,859) (42,656) 7,995
-----------------------------------------
Change in net unrealized gains
(losses) on securities (pretax:
$269,562, $500,000; ($1,593,800)) 177,133 325,399 (1,035,972)
-----------------------------------------
Comprehensive income (loss) $600,988 $866,833 $ (538,066)
=========================================

See accompanying notes.

F - 6

American General Life Insurance Company

Consolidated Statements of Cash Flows

YEAR ENDED DECEMBER 31
2001 2000 1999
--------------------------------------------------------
(In Thousands)

OPERATING ACTIVITIES
Net income $ 423,855 $ 541,434 $ 497,906
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Change in accounts receivable 157,712 (477,803) 10,004
Change in future policy benefits and other
policy claims 225,127 (2,566,783) (2,422,221)
Amortization of policy acquisition costs 189,631 23,443 101,066
Policy acquisition costs deferred (296,014) (299,306) (307,854)
Change in other policyholders' funds 134,899 16,801 (26,955)
Provision for deferred income tax expense (17,539) 57,228 85,257
Depreciation 35,055 28,677 24,066
Amortization 26,266 22,831 (30,894)
Change in indebtedness to (from) affiliates (137,008) (3,207) 74,814
Change in amounts payable to brokers (206,153) 478,132 (43,321)
Net loss on sale of investments 101,455 52,670 45,379
Other, net 29,422 47,646 (170,413)
--------------------------------------------------------
Net cash provided by (used in) operating activities 666,708 (2,078,237) (2,163,166)

INVESTING ACTIVITIES
Purchases of investments and loans made (50,001,560) (33,436,962) (44,508,908)
Sales or maturities of investments and receipts
from repayment of loans 48,289,342 33,627,301 43,879,377
Sales and purchases of property, equipment, and
software, net 55,851 (45,078) (87,656)
--------------------------------------------------------
Net cash provided by (used in) investing activities (1,656,367) 145,261 (717,187)

FINANCING ACTIVITIES
Net policyholder account deposits/withdrawals 1,265,558 2,183,646 2,992,743
Dividends paid (261,680) (251,040) (187,680)
Other 27,039 (866) 3,598
--------------------------------------------------------
Net cash provided by financing activities 1,030,917 1,931,740 2,808,661
--------------------------------------------------------
Increase (decrease) in cash 41,258 (1,236) (71,692)
Cash at beginning of year 44,747 45,983 117,675
--------------------------------------------------------
Cash at end of year $ 86,005 $ 44,747 $ 45,983
========================================================

Interest paid amounted to approximately $76,500,000, $50,673,000, and $2,026,000
in 2001, 2000, and 1999, respectively.

See accompanying notes.

F - 7

American General Life Insurance Company

Notes to Consolidated Financial Statements

December 31, 2001

NATURE OF OPERATIONS

American General Life Insurance Company (the "Company") is a wholly owned
subsidiary of AGC Life Insurance Company ("Parent Company"), and its ultimate
parent is American International Group ("AIG"). 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"). The Company
also owns American General Life Companies ("AGLC"), which provides management
services to certain life insurance subsidiaries of the Parent Company. The
Company sells a variety of equity products through its wholly owned broker
dealer, American General Securities, Inc.

On August 29, 2001, pursuant to an Agreement and Plan of Merger dated as of May
11, 2001 (the "Agreement and Plan Merger") by and among American General
Corporation ("AGC"), which was the Company's then-ultimate controlling entity,
AIG and Washington Acquisition Corporation ("WAC"), which is a Texas corporation
and a wholly owned subsidiary of AIG, WAC was merged with and into AGC, with AGC
being the surviving corporation (the "Merger"). As a result of the Merger, AIG
became the ultimate parent of the Company. The Texas Department of Insurance
approved the Merger on August 28, 2001.

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. 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.

F - 8

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. ACCOUNTING POLICIES (CONTINUED)

1.1 PREPARATION OF FINANCIAL STATEMENTS (CONTINUED)

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.

Certain prior year amounts have been reclassified to conform with the current
year presentation.

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,
2001. Statutory net income and capital and surplus of the Company is as follows:

YEAR ENDED DECEMBER 31
2001 2000 1999
-----------------------------------------
(In Thousands)

Statutory net income (unaudited) $ 218,312 $ 360,578 $ 350,294
Statutory capital and surplus
(unaudited) $1,909,729 $1,908,887 $1,753,570

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) 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; (d) acquisitions are accounted for using the purchase method of
accounting rather than being accounted for as equity investments; and (e) fixed
maturity investments are carried at fair value rather than amortized cost. In
addition, statutory accounting principles require life insurance

F - 9

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. ACCOUNTING POLICIES (CONTINUED)

1.2 STATUTORY ACCOUNTING (CONTINUED)

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.

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 did not result in a significant reduction in the
Company's statutory-basis capital and surplus as of adoption.

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, 2001 and 2000, insurance investment contracts of $29.6 billion and
$25.3 billion, 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, 2001 and 2000.
After adjusting related balance sheet accounts as if the unrealized gains
(losses) had been realized, the adjustment, net of deferred taxes, 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. The Company's trading security portfolio was immaterial at year-end 2001
and 2000. 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 2001, 2000, and 1999.

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.
The Company accounts for dollar rolls as short-term collateralized financings
and includes the repurchase obligation in other liabilities. There were no
dollar rolls outstanding at December 31, 2001 and 2000.

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, 2001 and
2000, CIP of $11 million and $16 million, respectively, was reported within
other assets.

DPAC and CIP associated with interest-sensitive life contracts, insurance
investment contracts, and participating life insurance contracts are 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 are 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 5.08% to 5.15%.

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 amounts 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 reduces goodwill to an
amount that results in the book value of the subsidiary approximating fair
value. (See Footnote 1.13 Accounting Changes for treatment beginning next year.)

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, 2001.

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 $101 million, $65 million, and $71 million, during
2001, 2000, and 1999, 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, 2001 and 2000.

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 $3.6 million, $4.4 million, and
$4.6 million in 2001, 2000, and 1999, respectively.

1.12 INCOME TAXES

The Company's parent, AGC, was acquired by AIG on August 29, 2001. The Company
will join in the filing of a consolidated federal income tax return with AGC for
the period January 1, 2001 to August 29, 2001. For the period August 30, 2001 to
December 31, 2001, the Company will join in the filing of a consolidated federal
income tax return with AGC Life Insurance Company and its life insurance company
subsidiaries. The Company has a written agreement with AGC and AGC Life
Insurance Company setting forth the manner in which the total consolidated
federal income tax is allocated to each entity that joins in the consolidation.
AGC agrees to pay each subsidiary for the tax benefits, if any, of net operating
losses and investment, research and foreign tax credits which are not useable by
the subsidiary but which are used by other members of the consolidated group. In
addition, AGC Life Insurance Company agrees to reimburse the Company for the tax
benefits from net losses, if any, within ninety days after the filing of the
consolidated federal income tax return for the year in which the losses are
used.

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 the 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 adopted 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.

Adoption of SFAS 133 did not materially impact the Company's results of
operations and financial position in current periods and it is not expected to
materially impact future periods. The impact of fair value adjustments on
derivatives which do not qualify for hedge accounting and any ineffectiveness
resulting from hedging activities have been recorded in investment gains
(losses).

In January 2001, the Emerging Issues Task Force ("EITF") of the FASB issued EITF
99-20, Recognition of Interest Income and Impairment on Purchased and Retained
Interests in Securitized Financial Assets ("EITF 99-20"). This pronouncement
changed the accounting requirements for interests in many asset-backed
securities and residential mortgage backed securities. EITF 99-20 requires that
interest income on securities within its scope be recognized prospectively, with
changes in expected future cash flows reflected in reported yields going
forward. In addition, if cash flows are expected to decrease, EITF 99-20 may
require investors to recognize impairment losses. In accordance with the
transition provisions of EITF 99-20, the Company recorded a loss of $22.4
million, net of tax, at June 30, 2001 which is being recognized and reported in
the consolidated statements of income and comprehensive income as a cumulative
effect of accounting change.

In June 2001, the FASB issued Statement of Financial Accounting Standards 142,
Goodwill and Other Intangible Assets ("SFAS 142"). SFAS 142 requires the Company
to discontinue the amortization of goodwill on its consolidated income
statement. SFAS 142 is effective for the year commencing January 1, 2002. In
addition, SFAS 142 requires goodwill to be subject to an assessment of
impairment on an annual basis, or

F - 17

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

1. ACCOUNTING POLICIES (CONTINUED)

1.13 ACCOUNTING CHANGES (CONTINUED)

more frequently if circumstances indicate that a possible impairment has
occurred. As of December 31, 2001, the Company recorded $27 million of goodwill
in Other Assets on its consolidated balance sheet. The Company has evaluated the
impact of the impairment provisions of SFAS 142, and has determined that the
impact on its consolidated results of operations and financial position will not
be significant.

2. INVESTMENTS

2.1 INVESTMENT INCOME

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

2001 2000 1999
------------------------------------------
(In Thousands)
Investment income:
Fixed maturities $2,101,393 $2,050,503 $2,118,794
Equity securities 4,000 22,996 17,227
Mortgage loans on real estate 175,016 159,414 134,878
Investment real estate 16,491 22,749 20,553
Policy loans 74,619 71,927 69,684
Other long-term investments (2,875) 13,062 7,539
Short-term investments 64,420 66,296 24,874
Investment income from affiliates 7,490 10,733 8,695
------------------------------------------
Gross investment income 2,440,554 2,417,680 2,402,244
Investment expenses 46,776 54,986 54,048
------------------------------------------
Net investment income $2,393,778 $2,362,694 $2,348,196
==========================================

The carrying value of investments that produced no investment income during 2001
was less than 0.9% 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 2001, 2000, or 1999.

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:

2001 2000 1999
------------------------------------------
(In Thousands)
Fixed maturities:
Gross gains $ 303,468 $ 62,856 $ 118,427
Gross losses (295,380) (174,057) (102,299)
------------------------------------------
Total fixed maturities 8,088 (111,201) 16,128
Equity securities (4,538) - 793
Unhedged derivatives (2,250) - -
Other investments (66,968) 13,092 (11,570)
------------------------------------------
Net realized investment (losses)
gains before tax (65,668) (98,109) 5,351
Income tax (benefit) expense (22,030) (34,338) 1,874
------------------------------------------
Net realized investment (losses)
gains after tax $ (43,638) $ (63,771) $ 3,477
==========================================

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, 2001
and 2000 were as follows:

GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAIN LOSS VALUE
-------------------------------------------------------
(In Thousands)

December 31, 2001
Fixed maturity securities:
Corporate securities:
Investment-grade $13,900,833 $573,231 $(247,059) $14,227,005
Below investment-grade 1,814,978 32,155 (219,750) 1,627,383
Mortgage-backed securities* 7,041,992 142,028 (71,273) 7,112,747
U.S. government obligations 522,593 14,546 (10,389) 526,750
Foreign governments 194,027 9,468 (1,476) 202,019
State and political
subdivisions 4,838,258 95,224 (47,167) 4,886,315
Redeemable preferred stocks 7,057 - (57) 7,000
---------------------------------------------------------
Total fixed maturity
securities $28,319,738 $866,652 $(597,171) $28,589,219
=========================================================
Equity securities $ 202,556 $ 220 $ (26,605) $ 176,171
=========================================================
Investment in Parent Company $ 8,597 $ 55,729 $ - $ 64,326
=========================================================

* 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, 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 $ 233,278 $ 10,146 $ (10,197) $ 233,227
==========================================================
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 - 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:

2001 2000 1999
-----------------------------------------
(In Thousands)

Gross unrealized gains $ 922,601 $ 671,970 $ 296,288
Gross unrealized losses (623,776) (730,882) (909,135)
DPAC and other fair value adjustments (96,749) 23,119 200,353
Deferred federal income (taxes)
benefit (72,615) 4,330 55,631
Other (1) (3) (2)
-----------------------------------------
Net unrealized gains (losses) on
securities $ 129,460 $ (31,466) $(356,865)
=========================================

The contractual maturities of fixed maturity securities at December 31, 2001
were as follows:

2001 2000
-------------------------------------------------------------
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 $ 1,224,135 $ 1,248,865 $ 832,001 $ 833,695
Due after one year
through five years 4,314,919 4,466,280 5,539,620 5,562,918
Due after five years
through ten years 8,003,153 8,086,515 7,492,395 7,433,403
Due after ten years 7,735,539 7,674,812 6,894,200 6,681,227
Mortgage-backed
securities 7,041,992 7,112,747 6,340,762 6,480,452
---------------------------------------------------------
Total fixed maturity
securities $28,319,738 $28,589,219 $27,098,978 $26,991,695
=========================================================

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 $31.2 billion,
$12.3 billion, and $12.3 billion, and $12.3 billion during 2001, 2000, and 1999,
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, 2001 and 2000:

OUTSTANDING PERCENT OF PERCENT
AMOUNT TOTAL NONPERFORMING
------------------------------------------------
(In Millions)
December 31, 2001
Geographic distribution:
South Atlantic $ 493 22.5% 0.0%
Pacific 360 16.3 9.1
Mid-Atlantic 407 18.5 0.0
East North Central 320 14.5 0.0
Mountain 86 3.9 0.0
West South Central 170 7.7 0.0
East South Central 210 9.5 0.0
West North Central 87 4.0 0.0
New England 77 3.5 0.0
Allowance for losses (8) (0.4) 0.0
----------------------
Total $2,202 100.0% 1.3%
======================
Property type:
Office $1,034 47.0% 3.5%
Retail 585 26.5 0.0
Industrial 268 12.2 0.0
Apartments 205 9.3 0.0
Hotel/motel 81 3.7 0.0
Other 37 1.7 0.0
Allowance for losses (8) (0.4) 0.0
----------------------
Total $2,202 100.0% 1.3%
======================

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, 2000
Geographic distribution:
South Atlantic $ 461 22.0% 0.0%
Pacific 374 17.9 7.6
Mid-Atlantic 200 9.6 0.0
East North Central 158 7.6 0.0
Mountain 290 13.9 0.0
West South Central 374 18.0 0.0
East South Central 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:
Office $ 596 28.5% 0.0%
Retail 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%
=========================

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:

2001 2000 1999
------------------------------------------
(In Thousands)

Balance at January 1 $2,090,810 $1,956,653 $1,087,718
Capitalization 296,014 299,306 307,854
Accretion of interest 148,969 124,927 116,711
Amortization (338,600) (148,370) (217,777)
Effect of net realized and
unrealized (losses) gains on
securities (154,505) (141,706) 662,147
------------------------------------------
Balance at December 31 $2,042,688 $2,090,810 $1,956,653
==========================================

4. OTHER ASSETS

Other assets consisted of the following:

DECEMBER 31
2001 2000
-----------------------
(In Thousands)

Goodwill $ 26,828 $ 27,069
Cost of insurance purchased ("CIP") 10,598 15,598
Computer software 70,992 73,215
Other 118,548 112,803
-----------------------
Total other assets $226,966 $228,685
=======================

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, 2001, was as follows:

2001 2000
------------------------
(In Thousands)

Balance at January 1 $15,598 $19,014
Accretion of interest at 5.02% 1,000 788
Amortization (6,000) (3,432)
Other changes - (772)
------------------------
Balance at December 31 $10,598 $15,598
========================

5. FEDERAL INCOME TAXES

5.1 TAX LIABILITIES

Income tax liabilities were as follows:

DECEMBER 31
2001 2000
-----------------------
(In Thousands)

Current tax (receivable) payable $ 47,772 $ 9,260
Deferred tax liabilities, applicable to:
Net income 450,050 463,117
Net unrealized investment gains 60,901 (6,063)
-----------------------
Total deferred tax liabilities 510,951 457,054
-----------------------
Total current and deferred tax liabilities $558,723 $466,314
=======================

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:

2001 2000
-------------------------
(In Thousands)
Deferred tax liabilities applicable to:
Deferred policy acquisition costs $ 621,014 $ 624,393
Basis differential of investments 49,434 55,603
Net unrealized gains on debt and equity
securities available for sale 60,901 -
Other 133,743 143,307
-------------------------
Total deferred tax liabilities 865,092 823,303

Deferred tax assets applicable to:
Policy reserves (261,146) (246,128)
Net unrealized gains on debt and equity
securities available for sale - (39,360)
Other (93,995) (89,761)
-------------------------
Total deferred tax assets before valuation
allowance (355,141) (375,249)
Valuation allowance 1,000 9,000
-------------------------
Total deferred tax assets, net of valuation
allowance (354,141) (366,249)
-------------------------
Net deferred tax liabilities $ 510,951 $ 457,054
=========================

Under prior Federal income tax law, one-half of the excess of a life insurance
company's income from 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, 2001, 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 (benefit) for the years were as follows:

2001 2000 1999
----------------------------------------
(In Thousands)

Current expense $203,313 $174,263 $176,725
Deferred expense (benefit):
Deferred policy acquisition cost 35,727 82,739 65,377
Policy reserves 18,259 12,738 (22,654)
Basis differential of investments 7,964 14,627 (4,729)
Litigation settlement 3,524 2,764 22,641
Internally developed software 16,198 3,702 18,654
Basis differential of securities (70,624) (11,373) (14,358)
Restructure charges (17,799) - -
Other, net (5,581) (18,600) 21,540
----------------------------------------
Total deferred expense (benefit) (12,332) 86,597 86,471
----------------------------------------
Income tax expense $190,981 $260,860 $263,196
========================================

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.

2001 2000 1999
------------------------------------
(In Thousands)

Income tax at statutory percentage of
GAAP pretax income $222,797 $279,241 $266,386
Tax-exempt investment income (31,812) (16,654) (16,423)
Goodwill 397 669 853
Other (401) (2,396) 12,380
------------------------------------
Income tax expense $190,981 $260,860 $263,196
====================================

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 $131 million, $182 million, and $126
million in 2001, 2000, and 1999, respectively.

5.4 TAX RETURN EXAMINATIONS

The Internal Revenue Service (IRS) is currently examining the Parent Company's
tax return for the tax years 1993 to 1999.

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.

The Company's ultimate parent, American General Corporation, was acquired by
American International Group, Inc. (AIG) on August 29, 2001. The Company will
join in the filing of a consolidated federal income tax return with American
General Corporation for the period January 1, 2001 to August 29, 2001. The
Company has a written agreement with American General Corporation under which
each subsidiary agrees to pay American General Corporation an amount equal to
consolidated federal income tax expense multiplied by the ratio that the
subsidiary's separate return tax liability bears to the consolidated tax
liability, plus one hundred percent of the excess of the subsidiary's separate
return tax liability over the allocated consolidated tax liability. American
General Corporation agrees to pay each subsidiary for the tax benefits, if any,
of net operating losses and investment, research and foreign tax credits which
are not useable by the subsidiary but which are used by other members of the
consolidated group.

For the period August 30, 2001 to December 31, 2001, the Company will join in
the filing of a consolidated federal income tax return with AGC Life Insurance
Company and its life insurance company subsidiaries. The Company has a written
agreement with AGC Life Insurance Company setting forth the manner in which the
total consolidated federal income tax is allocated to each entity that joins in
the consolidation. Under this agreement, AGC Life Insurance Company agrees not
to charge the Company a greater portion of the consolidated tax liability than
would have been paid by the Company had it filed a separate federal income tax
return. In addition, AGC Life Insurance Company agrees to reimburse the Company
for the tax benefits from net losses, if any, within ninety days after the
filing of the consolidated federal income tax return for the year in which the
losses are used.

F - 29

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

6. TRANSACTIONS WITH AFFILIATES

Indebtedness from affiliates were as follows:

DECEMBER 31, 2001 DECEMBER 31, 2000
------------------------------------------------------------
PAR VALUE BOOK VALUE PAR VALUE BOOK VALUE
------------------------------------------------------------

(In Thousands)
American General
Corporation, 9 3/8%, due
2008 $ 4,725 $ 3,575 $ 4,725 $ 3,486
American General
Corporation, Promissory
notes, 5 1/2% due 2004 7,339 7,339 9,786 9,786
American General
Corporation, Senior
Promissory notes, 2 16/25%
due 2006 165,000 165,000 - -
American General
Corporation, Restricted
Subordinated Note, 13 1/2%,
due 2002 25,321 25,321 25,321 25,321
-----------------------------------------------------
Total notes receivable
from affiliates 202,385 201,235 39,832 38,593
Accounts receivable from
affiliates - 11,780 - 39,632
-----------------------------------------------------
Indebtedness from
affiliates $202,385 $213,015 $39,832 $78,225
=====================================================

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 $111,463,000, $85,002,378, and $55,318,000, for such services in
2001, 2000, and 1999, respectively. Accounts payable for such services at
December 31, 2001 and 2000 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 $225,712,000,
$171,650,000, and $138,885,000, for such services and rent in 2001, 2000, and
1999, respectively. Accounts receivable for rent and services at December 31,
2001 and 2000 were not material.

F - 30

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

6. TRANSACTIONS WITH AFFILIATES (CONTINUED)

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 70% and 30%, respectively, of the
plans' assets at the plans' most recent balance sheet dates. Additionally, 0.2%
of plan assets were invested in general investment accounts of the Parent
Company's subsidiaries through deposit administration insurance contracts.

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 $56 million.

F - 31

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

7. BENEFIT PLANS (CONTINUED)

7.1 PENSION PLANS (CONTINUED)

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

2001 2000 1999
--------------------------------------
(In Thousands)

Service cost $ 4,909 $ 4,605 $ 3,575
Interest cost 11,150 9,818 7,440
Expected return on plan assets (18,858) (17,815) (12,670)
Amortization (405) (918) (820)
Recognized net actuarial gain (70) (868) -
Gain due to settlement or curtailment 1,330 - -
Additional change due to contractual
termination 292 - -
--------------------------------------
Pension (income) $ (1,652) $ (5,178) $ (2,475)
======================================
Discount rate on benefit obligation 7.25% 8.00% 7.75%
Rate of increase in compensation
levels 4.25% 4.50% 4.25%
Expected long-term rate of return on
plan assets 10.35% 10.35% 10.35%

F - 32

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

7. BENEFIT PLANS (CONTINUED)

7.1 PENSION PLANS (CONTINUED)

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:

2001 2000
-----------------------
(In Thousands)

Projected benefit obligation ("PBO") $162,880 $130,175
Plan assets at fair value 168,641 187,266
-----------------------
Plan assets at fair value in excess of PBO 5,761 57,091
Other unrecognized items, net 23,427 (32,730)
-----------------------
Prepaid pension expense $ 29,188 $ 24,361
=======================

The change in PBO was as follows:

2001 2000
------------------------
(In Thousands)

PBO at January 1 $130,175 $100,600
Service and interest costs 16,058 14,423
Benefits paid (6,927) (5,394)
Actuarial loss 22,267 1,668
Amendments, transfers, and acquisitions 1,470 18,878
(Loss) due to settlement or curtailment (163) -
------------------------
PBO at December 31 $162,880 $130,175
========================

F - 33

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

7. BENEFIT PLANS (CONTINUED)

7.1 PENSION PLANS (CONTINUED)

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

2001 2000
-------------------------
(In Thousands)

Fair value of plan assets at January 1 $187,266 $145,863
Actual return on plan assets (19,825) 9,249
Benefits paid (5,589) (5,344)
Acquisitions and other 6,789 37,498
-------------------------
Fair value of plan assets at December 31 $168,641 $187,266
=========================

7.2 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.

The life plans are insured through December 31, 2001. 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 income (expense) in 2001, 2000, and 1999 was $(107,000),
$35,000, and $254,000, respectively. The accrued liability for postretirement
benefits was $20.0 million and $20.5 million at December 31, 2001 and 2000,
respectively. These liabilities were discounted at the same rates used for the
pension plans.

F - 34

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

8. DERIVATIVE FINANCIAL INSTRUMENTS

8.1 USE OF DERIVATIVE FINANCIAL INSTRUMENTS

The Company's use of derivative financial instruments is generally limited to
interest rate and currency swap agreements, and options to enter into interest
rate swap agreements (call and put swaptions). The Company is neither a dealer
nor a trader in derivative financial instruments.

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. For fair value
hedges, gains and losses on both the derivative and the hedged item attributable
to the risk being hedged are recognized in earnings. For both cash flow hedges
and foreign currency hedges, to the extent the hedge is effective, gains and
losses on both the derivative and the hedged item attributable to the risk being
hedged are recognized as a component of other comprehensive income or
shareholder's equity. Any ineffective portion of both cash flow hedges and
foreign currency hedges are reported in net realized investment gains (losses).

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.

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.

F - 35

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)

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.

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

2001 2000
----------------------------
(Dollars in Millions)
Interest rate swap agreements to receive fixed
rate:
Notional amount $ 160 $ 160
Average receive rate 6.74% 6.74%
Average pay rate 2.07% 6.94%
Currency swap agreements (receive U.S.
dollars/pay Canadian dollars):
Notional amount (in U.S. dollars) $ 74 $ 74
Average exchange rate 1.43 1.43
Currency swap agreements (receive U.S.
dollars/pay Australian dollars):
Notional amount (in U.S. dollars) $ 23 $ 23
Average exchange rate 1.85 1.85
Currency swap agreements (receive U.S.
dollars/pay Japanese Yen):
Notional amount (in U.S. dollars) $ 12 $ -
Average exchange rate 44.60 -

F - 36

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

8. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

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.

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:

2001 2000
----------------------------
(Dollars in Millions)
Call swaptions:
Notional amount $ 376 $ 723
Average strike rate 5.25% 5.00%

Put swaptions:
Notional amount $ 684 $ 790
Average strike rate 8.25% 8.70%

F - 37

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

8. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

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 - 38

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 of 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.

2001 2000
FAIR CARRYING FAIR CARRYING
VALUE AMOUNT VALUE AMOUNT
------------------------------------------------------
(In Millions)
ASSETS
Fixed maturity and
equity securities $28,765 $28,765 $27,406 $27,406
Mortgage loans on real
estate 2,288 2,202 2,090 2,084
Policy loans 1,521 1,291 1,357 1,297
Short-term investments 488 488 140 140
Investment in Parent Co. 64 64 57 57
Indebtedness from
affiliates 213 213 78 78
Assets held in separate
accounts 20,279 20,279 22,226 22,226

LIABILITIES
Insurance investment
contracts 29,582 29,593 25,038 25,328
Liabilities related to
separate accounting 20,279 20,279 22,226 22,226

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 - 39

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 AIG 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 $-0- million at December 31, 2001 and 2000,
respectively, and received $26.5 million and $11.4 million at December 31,
2001 and 2000. 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 - 40

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. The 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 $261 million, $251 million, and
$187 million in dividends on common stock to AGC Life Insurance Company in 2001,
2000, and 1999, respectively. The Company also paid $680 thousand in dividends
on preferred stock to an affiliate, The Franklin Life Insurance Company, in
2001, 2000, and 1999.

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, 2001,
approximately $3.5 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 $2.5 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 - 41

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, 1999, 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, 2001, the Company has a remaining market
conduct litigation liability of $3.3 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 - 42

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, 2001 and 2000, the Company has accrued $4.2 million and $3.8
million, respectively, for guaranty fund assessments, net of $-0- million and
$-0- million, respectively, of premium tax deductions. The Company has recorded
receivables of $1.9 million and $5.9 million at December 31, 2001 and 2000,
respectively, for expected recoveries against the payment of future premium
taxes. Expenses incurred for guaranty fund assessments were $0.6 million, $6.2
million, and $2.1 million, in 2001, 2000, and 1999, respectively.

The Company had $148,432,178 of unfunded commitments for its investments in
limited partnerships at December 31, 2001.

F - 43

American General Life Insurance Company

Notes to Consolidated Financial Statements (continued)

12. REINSURANCE

Reinsurance transactions for the years ended December 31, 2001, 2000, and 1999
were as follows:

PERCENTAGE
CEDED TO ASSUMED OF AMOUNT
OTHER FROM OTHER ASSUMED TO
GROSS AMOUNT COMPANIES COMPANIES NET AMOUNT NET
------------------------------------------------------------------------------
(In Thousands)

December 31, 2001
Life insurance in
force $57,955,308 $27,383,136 $1,476,006 $32,048,178 4.61%
==========================================================
Premiums:
Life insurance and
annuities 347,394 136,077 5,899 217,216 2.72%
Accident and health
insurance 784 71 - 713 0.00%
----------------------------------------------------------
Total premiums $ 348,178 $ 136,148 $ 5,899 $ 217,929 2.71%
==========================================================
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%
==========================================================

Reinsurance recoverable on paid losses was approximately $14.6 million, $12.2
million, and $8.0 million, at December 31, 2001, 2000, and 1999, respectively.
Reinsurance recoverable on unpaid losses was approximately $11.4 million, $3.2
million, and $10.5 million, at December 31, 2001, 2000, and 1999, respectively.

F - 44

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 - 45

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
-------------------------------------------------------------------------------------
2001 2000 1999 2001 2000 1999 2001 2000 1999
-------------------------------------------------------------------------------------
(In Millions)

Retirement
Services $2,107 $2,215 $2,088 $ 562 $ 702 $ 567 $ 385 $ 463 $ 374
Life Insurance 1,104 942 883 176 199 191 106 143 123
---------------------------------------------------------------------------------
Total
divisions 3,211 3,157 2,971 738 901 758 491 606 497
Goodwill
amortization - - - (1) (1) (2) (1) (1) (2)
RG (L) (66) (98) 5 (66) (98) 5 (44) (64) 3
Nonrecurring
items - - - (34) - - (22) - -
---------------------------------------------------------------------------------
Total
consolidated $3,145 $3,059 $2,976 $ 637 $ 802 $ 761 $ 424 $ 541 $ 498
=================================================================================

Division balance sheet information was as follows:

ASSETS LIABILITIES
------------------------------------------------
December 31
------------------------------------------------
2001 2000 2001 2000
------------------------------------------------
(In Millions)

Retirement Services $45,688 $46,356 $43,028 $43,970
Life Insurance 11,410 10,685 10,242 9,610
------------------------------------------------
Total consolidated $57,098 $57,041 $53,270 $53,580
================================================

F - 46

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 ............................................ 4
AGLC ............................................................. 60
AGL .............................................................. 37
amount at risk ................................................... 8
automatic rebalancing ............................................ 6
basis ............................................................ 40
beneficiary ...................................................... 46
cash surrender value ............................................. 26
cash value accumulation test ..................................... 17
close of business ................................................ 47
Code ............................................................. 38
cost of insurance rates .......................................... 47
daily charge ..................................................... 8
date of issue .................................................... 48
death benefit .................................................... 16
declared fixed interest account option ........................... 2
dollar cost averaging ............................................ 5
full surrender ................................................... 26
Fund, Funds ...................................................... 1
grace period ..................................................... 19
guarantee period, guarantee period benefit ....................... 20
guideline premium test ........................................... 17
insured person ................................................... 4
investment options ............................................... 1
lapse ............................................................ 19
loan, loan interest .............................................. 27
maturity, maturity date .......................................... 28
modified endowment contract ...................................... 38
monthly deduction days ........................................... 48
monthly guarantee premium ........................................ 20
monthly insurance charge ......................................... 8

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

Mutual Fund ...................................................... 2
Option 1, Option 2 and Option 3 .................................. 22
partial surrender ................................................ 26
payment option ................................................... 28
planned periodic premium ......................................... 19
Policy, Policies ................................................. 1
Policy loans ..................................................... 27
Policy month, year ............................................... 48
premium classes .................................................. 29
premium payments ................................................. 5
reinstate, reinstatement ......................................... 19
SEC .............................................................. 2
separate account ................................................. 1
Separate Account VL-R ............................................ 37
seven-pay test ................................................... 38
specified amount ................................................. 16
surrender ........................................................ 26
telephone transactions ........................................... 31
transfers ........................................................ 21
valuation date, period ........................................... 47
variable investment options ...................................... 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.

AIG AMERICAN
|GENERAL

PRIVACY NOTICE

AIG/American General understands that your privacy is important. You have
received this notice in accordance with applicable state and federal laws and
because you are a current or potential customer of one of our companies. This
notice will help you understand what types of nonpublic personal information we
may collect, how we use it and what we do to protect your privacy.

... Our employees, representatives, agents and selected third parties may
collect nonpublic information about you, including:

- Information provided to us, such as on applications or other forms

- Information about transactions with us, our affiliates or third parties

- Information from others, such as credit reporting agencies, employers,
and federal and state agencies

... The types of nonpublic personal information that we collect vary according
to the products provided and may include your name, address, Social
Security number, account balances, income, assets, insurance premiums,
coverage and beneficiaries, credit reports, marital status and payment
history. We also may collect nonpublic personal health information, such as
medical reports, to underwrite insurance policies, administer claims or
perform other insurance or related functions.

... We restrict access to nonpublic personal information to those employees,
agents, representatives or third parties who provide products or services
to you and who have been trained to handle nonpublic personal information
in conformity with this notice.

... We have policies and procedures that give directions to our employees, and
to the agents and representatives acting on our behalf, regarding how to
protect and use nonpublic personal information.

... We maintain physical, electronic and procedural safeguards designed to
protect nonpublic personal information.

... We do not share nonpublic personal information about you except as
permitted by law.

... We may disclose all types of nonpublic personal information that we
collect, including information regarding your transactions or experiences
with us, when needed, to:

(i) affiliated AIG/American General companies, including the American
International Group family of companies, agents, employees,
representatives and other third parties as permitted by law; or

(ii) other financial institutions with whom we have joint marketing
agreements.

... Examples of the types of companies and individuals to whom we may disclose
nonpublic personal information include banks, attorneys, trustees,
third-party administrators, insurance agents, insurance companies,
insurance support organizations, credit reporting agencies, registered
broker-dealers, auditors, regulators and reinsurers.

... Unless authorized by you or by applicable law, we do not share your
personally identifiable health information.

... Our privacy policy applies, to the extent required by law, to our agents
and representatives when they are acting on behalf of AIG/American General.

... You will receive appropriate notice if our privacy policy changes.

... Our privacy policy applies to current and former customers.

THIS PRIVACY NOTICE IS PROVIDED TO YOU FOR INFORMATIONAL PURPOSES ONLY. YOU DO
NOT NEED TO CALL OR TAKE ANY ACTION IN RESPONSE TO THIS NOTICE.

NEW MEXICO AND VERMONT RESIDENTS ONLY:
Following the law of your state, we will not disclose nonpublic personal
financial information about you to nonaffiliated third parties (other than as
permitted by law) unless you authorize us to make that disclosure.

Your authorization must be in writing. If you wish to authorize us to disclose
your nonpublic personal financial information to nonaffiliated third parties,
you may write to us at: American General Service Center, P.O. Box 4373, Houston,
Texas 77210-4373.

THIS DOCUMENT IS NOT PART OF ANY PROSPECTUS

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 sheets.
Cross-Reference Table.
Prospectus, consisting of 64 pages of text, plus 46 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) Lauren W. Jones, 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-8B2:

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

(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) Distribution Agreement between American General Life
Insurance Company and American General Distributors, Inc.,
dated May 2, 2002. (17)

(3)(b)(i) Form of Selling Group Agreement. (17)

(3)(b)(ii) Form of Selling Group Agreement, Schedule A (identifying
the policy offered) and Schedule B (describing the
commissions paid). (20)

II-2

(3)(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).

(4) Not applicable.

(5) Specimen form of "Platinum Investor PLUS" Variable
Universal Life Insurance Policy (Policy Form No. 02600).
(Filed herewith)

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

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

(6)(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)

(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. (17)

(8)(a)(iii) Form of Amendment Five 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)

(8)(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-3

(8)(b)(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)

(8)(b)(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. (19)

(8)(b)(iv) Form of Amendment Three 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. (17)

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

(8)(c)(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)

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

(8)(d)(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. (19)

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

(8)(e)(i) Participation Agreement by and among Morgan Stanley
Universal Funds, Inc., Morgan Stanley Asset Management
Inc., Miller Anderson & Sherrerd LLP., Van Kampen American
Capital

II-4

Distributors, Inc., American General Life Insurance
Company and American General Securities Incorporated. (9)

(8)(e)(ii) Amendment Number 1 to Participation Agreement by and 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)

(8)(e)(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. (17)

(8)(e)(iv) Form of Amendment Nine 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. (Filed herewith)

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

(8)(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)

(8)(g)(ii) Form of Amendment Four to Participation Agreement Among
American General Life Insurance Company, American General
Securities Incorporated, SAFECO Resources Series Trust,
and SAFECO Securities, Inc. (17)

(8)(g)(iii) Form of Amendment Six to Participation Agreement Among
American General Life Insurance Company, American General
Securities Incorporated, SAFECO Resources Series Trust,
and SAFECO Securities, Inc. (Filed herewith)

(8)(h)(i) Amended and Restated Participation Agreement by and among
American General Life Insurance Company, American General
Securities Incorporated, Van Kampen American Capital Life

II-5

Investment Trust, Van Kampen American Capital Asset
Management, Inc., and Van Kampen American Capital
Distributors, Inc. (9)

(8)(h)(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)

(8)(h)(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. (17)

(8)(h)(iv) Form of Amendment Eight 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)

(8)(i) Form of Shareholder Services Agreement by and between
American General Life Insurance Company and American
Century Investment Management, Inc. (15)

(8)(j)(i) Sales Agreement by and between American General Life
Insurance Company, Neuberger & Berman Advisors Management
Trust and Neuberger & Berman Management Incorporated. (15)

(8)(j)(ii) Form of Assignment and Modification Agreement by and
between Neuberger & Berman Management Incorporated and
American General Life Insurance Company. (15)

(8)(k)(i) Form of Participation Agreement by and between American
General Life Insurance Company, Ayco Asset Management and
Ayco Series Trust. (19)

(8)(k)(ii) Form of Amendment No. 1 to Participation Agreement by and
between American General Life Insurance Company, Ayco
Asset Management and Ayco Series Trust. (25)

II-6

(8)(k)(iii) Form of Amendment No. 2 to Participation Agreement by and
between American General Life Insurance Company, Ayco
Asset Management and Ayco Series Trust. (Filed herewith)

(8)(l)(i) Form of Fund Participation Agreement by and between
American General Life Insurance Company and Janus Aspen
Series. (19)

(8)(l)(ii) Form of Amendment No. 2 to Fund Participation Agreement by
and between American General Life Insurance Company and
Janus Aspen Series. (Filed herewith)

(8)(m) Form of Participation Agreement by and between American
General Life Insurance Company and J.P. Morgan Series
Trust II. (19)

(8)(n) Form of Participation Agreement by and between American
General Life Insurance Company, PIMCO Variable Insurance
Trust and PIMCO Funds Distributor LLC. (19)

(8)(o) Form of Participation Agreement by and between Vanguard
Variable Insurance Funds, The Vanguard Group, Inc.,
Vanguard Marketing Corporation and American General Life
Insurance Company. (19)

(8)(p) 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. (19)

(8)(q)(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. (19)

(8)(q)(ii) Form of Amendment No. 2 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)

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

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

II-7

(8)(t) Form of Administrative Services Agreement between American
General Life Insurance Company and SAFECO Asset
Management. (Filed herewith)

(8)(u) Form of Administrative Services Agreement between Van
Kampen Asset Management Inc. and American General Life
Insurance Company dated January 1, 2000 (22)

(8)(v) 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)

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

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

(8)(y) 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)

(8)(z)(i) Form of Administrative Services Agreement by and between
Ayco Asset Management and American General Life Insurance
Company. (19)

(8)(z)(ii) Form of Amendment No. 1 to Administrative Services
Agreement by and between Ayco Asset Management and
American General Life Insurance Company. (25)

(8)(z)(iii) Form of Amendment No. 2 to Administrative Services
Agreement by and between Ayco Asset Management and
American General Life Insurance Company. (Filed herewith)

(8)(aa) Form of Administrative Services Agreement by and between
American General Life Insurance Company and Morgan
Guaranty Trust Company of New York. (19)

II-8

(8)(bb) Form of Administrative Services Agreement by and between
American General Life Insurance Company and Neuberger &
Berman Management Incorporated. (15)

(8)(cc) Form of Services Agreement by and between American
General Life Insurance Company and Pacific Investment
Management, LLC. (19)

(8)(dd) Form of Administrative Services Agreement by and between
American General Life Insurance Company and Credit Suisse
Asset Management, LLC. (19)

(8)(ee)(i) Form of Participation Agreement by and among American
General Life Insurance Company, Franklin Templeton
Variable Insurance Products Trust and Franklin Templeton
Distributors, Inc. (24)

(8)(ee)(ii) Form of Amendment to Participation Agreement by and among
American General Life Insurance Company, Franklin
Templeton Variable Insurance Products Trust and Franklin
Templeton Distributors, Inc., effective May 1, 2000. (16)

(8)(ee)(iii) Form of Amendment to Participation Agreement by and among
American General Life Insurance Company, Franklin
Templeton Variable Insurance Products Trust and Franklin
Templeton Distributors, Inc., effective November 1, 2001.
(23)

(8)(ee)(iv) Form of Amendment to Participation Agreement by and among
American General Life Insurance Company, Franklin
Templeton Variable Insurance Products Trust and Franklin
Templeton Distributors, Inc. (Filed herewith)

(8)(ff)(i) Form of Administrative Services Agreement by and among
American General Life Insurance Company and Franklin
Templeton Services, Inc., dated as of July 1, 1999. (12)

(8)(ff)(ii) Form of Amendment to Administrative Services Agreement by
and among American General Life Insurance Company and
Franklin Templeton Services, LLC, effective November 1,
2001. (23)

(8)(ff)(iii) Form of Amendment to Administrative Services Agreement by
and among American General Life Insurance Company and
Franklin Templeton Services, LLC. (Filed herewith)

II-9

(8)(gg)(i) Form of Amended and Restated Participation Agreement by
and between Variable Insurance Products Fund, Fidelity
Distributors Corporation and American General Life
Insurance Company. (19)

(8)(gg)(ii) Form of Amendment No. 2 to Amended and Restated
Participation Agreement by and between Variable Insurance
Products Fund, Fidelity Distributors Corporation and
American General Life Insurance Company. (Filed herewith)

(8)(hh) Form of Service Contract by and between Fidelity
Distributors Corporation and American General Life
Insurance Company. (19)

(8)(ii) Form of Service Agreement by and between Fidelity
Investments Institutional Operations Company, Inc. and
American General Life Insurance Company. (19)

(8)(jj) Form of Distribution and Shareholder Services Agreement by
and between Janus Distributors, Inc. and American General
Life Insurance Company. (19)

(8)(kk) Form of PIMCO Variable Insurance Trust Services Agreement
by and between American General Life Insurance Company and
PIMCO Variable Insurance Trust. (19)

(8)(ll)(i) Form of Participation Agreement by and among American
General Life Insurance Company and SunAmerica Series
Trust. (21)

(8)(ll)(ii) Form of Administrative Services Agreement by and among
American General Life Insurance Company and SunAmerica
Asset Management Corp. (21)

(9) Not applicable.

(10)(a) Specimen form of Single Insured Life Insurance Application
- Part A. (18)

(10)(b) Specimen form of Single Insured Life Insurance Application
- Part B. (18)

(10)(c) Specimen form of Medical Exam Form Life Insurance
Application. (13)

(10)(d) Specimen form of Supplemental Application. (Filed
herewith)

II-10

(10)(e) Specimen form of Service Request Form. (Filed herewith)

(10)(f) 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. (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.

Other Exhibits

2(a) Opinion and Consent of Lauren W. Jones, 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. (26)

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

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

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

II-11

(4) Incorporated herein by reference to the initial filing of the 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 the filing of Pre-Effective Amendment No. 3 of
the 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 the filing of Pre-Effective Amendment No. 1 of
the 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 the filing of Pre-Effective Amendment No. 23
to the Form N-4 Registration Statement of American General Life Insurance
Company's Separate Account A (File No. 33-44745) filed on April 24, 1998.

(8) Incorporated by reference to the filing of the 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
Registrant's Form N-4 Registration Statement (File No. 33-43390) filed on
April 30, 1997.

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

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

(12) Incorporated by reference to Post-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 October 10, 2000.

(13) Incorporated herein by reference to the initial filing of the Form S-6
Registration Statement (File No. 333-89897) of American General Life
Insurance Company Separate Account VL-R filed on October 29, 1999.

(14) Incorporated by reference to Post-Effective Amendment No. 18 of the Form
N-4 Registration Statement (File No. 334-3390) of Separate Account D of
American General Life Insurance Company filed on April 12, 2000.

II-12

(15) Incorporated by reference to Pre-Effective Amendment No. 1 of the Form S-6
Registration Statement (File No. 333-89897) of American General Life
Insurance Company Separate Account VL-R filed on January 21, 2000.

(16) 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.

(17) 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.

(18) Incorporated by reference to Post-Effective Amendment No. 3 to Form S-6
Registration Statement (File No. 333-89897) of American General Life
Insurance Company Separate Account VL-R filed on April 23, 2002.

(19) 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.

(20) 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.

(21) Incorporated by reference to Post-Effective Amendment No. 2 to Form S-6
Registration Statement (File No. 333-65170) of American General Life
Insurance Company Separate Account VL-R filed on April 24, 2002.

(22) 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.

(23) Incorporated by reference to Post-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-65170) of American General Life
Insurance Company Separate Account VL-R filed on December 3, 2001.

(24) Incorporated by reference to Post-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 April 26, 2000.

(25) Incorporated by reference to Pre-Effective Amendment No. 1 to Form S-6
Registration Statement (File No. 333-65170) of American General Life
Insurance Company Separate Account VL-R filed on October 10, 2001.

II-13

(26) Incorporated by reference to the initial filing of Form S-6 Registration
Statement (File No. 333-82982) of American General Life Insurance Company
Separate Account VL-R filed on February 19, 2002.

II-14

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 10th day of
May, 2002.

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 11033, this amended
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

RODNEY O. MARTIN, JR.* Director and Chairman May 10, 2002
- ----------------------------
(Rodney O. Martin, Jr.)

/s/ DAVID J. DIETZ Director May 10, 2002
- ----------------------------
David J. Dietz

/s/ ROBERT F. HERBERT, JR. Director May 10, 2002
- ----------------------------
Robert F. Herbert, Jr.

DAVID L. HERZOG* Director and Chief May 10, 2002
- ---------------------------- Financial Officer
(David L. Herzog)

ROYCE G. IMHOFF, II* Director and President May 10, 2002
- ----------------------------
(Royce G. Imhoff, II)

GARY D. REDDICK* Director May 10, 2002
- ----------------------------
(Gary D. Reddick)

/s/ R. KENDALL NOTTINGHAM Director May 10, 2002
- ----------------------------
R. Kendall Nottingham

/s/ NICHOLAS A. O'KULICH Director May 10, 2002
- ----------------------------
Nicholas A. O'Kulich

*/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:

(3)(a) Distribution Agreement between American General Life
Insurance Company and American General Distributors, Inc.,
dated May 2, 2002.

(5) Specimen form of Platinum Investor PLUS Variable Universal
Life Insurance Policy (Policy Form No. 02600).

(8)(a)(iii) Form of Amendment Five 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 Seven 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 Nine 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)(h)(iv) Form of Amendment Eight to Amended and Restated
Participation Agreement among Van Kampen Investment Trust,
Van Kampen Funds Inc., Van Kampen Asset Management, Inc.,
American General Life Insurance Company and American General
Securities Incorporated.

(8)(k)(iii) Form of Amendment No. 2 to Participation Agreement by and
between American General Life Insurance Company, Ayco Asset
Management and Ayco Series Trust.

(8)(l)(ii) Form of Amendment No. 2 to Participation Agreement by and
between American General Life Insurance Company and Janus
Aspen Series.

E-1

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

(8)(z)(iii) Form of Amendment No. 2 to Administrative Agreement by and
between Ayco Asset Management and American General Life
Insurance Company.

(8)(ee)(iv) Form of Amendment to Participation Agreement by and among
American General Life Insurance Company, Franklin Templeton
Variable Insurance Products Trust and Franklin Templeton
Distributors, Inc.

(8)(ff)(iii) Form of Amendment to Administrative Services Agreement by
and among American General Life Insurance Company and
Franklin Templeton Services, LLC.

(10)(d) Specimen Form of Supplemental Application.

(10)(e) Specimen Form of Service Request Form.

Other Exhibits

2(a) Opinion and Consent of Lauren W. Jones, 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

E-2