AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON April 20, 2001

485BPOS 1 impindplusfiling.htm IMPACT-INDEPENDENCE PLUS 485(B) AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON April 20, 2001

REGISTRATION NOS. 2-96223/811-3240

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-4

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

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

Pre-Effective Amendment No. [ ]

Post Effective Amendment No. 31 [X]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

Amendment No. 75 [X]

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

THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

SEPARATE ACCOUNT A

(EXACT NAME OF REGISTRANT)

THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

(NAME OF DEPOSITOR)

2929 ALLEN PARKWAY, HOUSTON, TEXAS 77019

(ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

(713) 831-3150

(DEPOSITOR'S TELEPHONE NUMBER, INCLUDING AREA CODE)

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

MARY L. CAVANAUGH, ESQ.

THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

2929 ALLEN PARKWAY, HOUSTON, TEXAS 77019

(NAME AND ADDRESS OF AGENT FOR SERVICE)

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

It is proposed that this filing will become effective:

[ ] immediately upon filing pursuant to paragraph (b) of Rule 485

[X] On May 1, 2002 pursuant to paragraph (b) of Rule 485

[ ] 60 days after filing pursuant to paragraph (a) (1) of Rule 485

[ ] on [date] pursuant to paragraph (a) (1) of Rule 485

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

TITLE OF SECURITIES BEING REGISTERED:

Contract Form UIT-981 Fixed and Variable Annuity Contracts

Independence Plus Fixed and Variable Annuity Contracts

Contract Form UIT-981

Separate Account A

Fixed and Variable Annuity

Prospectus

May 1, 2002

The Variable Annuity Life Insurance Company

Units of Interest under Group and Individual

Fixed and Variable Annuity Contracts

Contract Form UIT-981

Separate Account A

Prospectus May 1, 2002

This prospectus describes flexible Purchase Payment individual fixed and variable annuity contracts (the "Contracts") offered by The Variable Annuity Life Insurance Company ("VALIC") to Participants in certain employer sponsored retirement plans. The Contracts may be available to you when you participate in a retirement program that qualifies for deferral of federal income taxes. Non-qualified contracts are also available for certain other employer sponsored plans as well as for certain after-tax arrangements that are not part of an employer's plan.

The Contracts permit you to invest in and receive retirement benefits in up to 3 out of a total of 6 Fixed and Variable Account Options (1 fixed and 5 variable) described in this prospectus. Each Variable Account Option invests in a separate portfolio of VALIC Company I, formerly, North American Funds Variable Product Series I.

This prospectus provides you with information you should know before investing in the Contracts. Please read and retain this prospectus for future reference.

A Statement of Additional Information, dated May 1, 2002, contains additional information about the Contracts and is part of this prospectus. For a free copy, call 1-800-428-2542 (option 3). The Statement of Additional Information has been filed with the Securities and Exchange Commission ("SEC") and is available along with other related materials at the SEC's internet web site (http://www.sec.gov).

INVESTMENT IN THE CONTRACTS IS SUBJECT TO RISK THAT MAY CAUSE THE VALUE OF THE OWNER'S INVESTMENT TO FLUCTUATE, AND WHEN THE CONTRACTS ARE SURRENDERED, THE VALUE MAY BE HIGHER OR LOWER THAN THE PURCHASE PAYMENTS.

THE SEC HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Table of Contents

Page

Glossary of Terms 1

Fee Table 2

Summary 3

Selected Purchase Unit Data 5

General Information 6

About the Contracts 6

About VALIC 6

About VALIC Separate Account A 6

Units of Interests 7

Distribution of the Contracts 7

Fixed Account Option 7

Variable Account Options 7

Purchase Period 8

Account Establishment 8

When Your Account Will be Credited 9

Purchase Units 10

Calculation of Purchase Unit Value 10

Stopping Purchase Payments 11

Transfers Between Investment Options 11

During the Purchase Period 11

During the Payout Period 12

Communicating Transfer or Reallocation Instructions 12

Effective Date of Transfer 13

Market Timing 13

Fees and Charges 13

Account Maintenance Fee 13

Surrender Charge 13

Amount of Surrender Charge 14

10% Free Withdrawal 14

Exceptions to Surrender Charge 14

Premium Tax Charge 14

Separate Account Charges 14

Fund Annual Expense Charges 15

Other Tax Charges 15

Reduction or Waiver of Account Maintenance Fee and Surrender Charge 15

Payout Period 16

Fixed Payout 16

Variable Payout 16

Combination Fixed and Variable Payout 16

Payout Date 16

Payout Options 17

Enhancements to Payout Options 17

Payout Information 17

Surrender of Account Value 18

When Surrenders Are Allowed 18

Surrender Process 18

Amount That May Be Surrendered 18

Surrender Restrictions 19

Partial Surrenders 19

Death Benefits 19

The Process 19

Beneficiary Information 19

During the Purchase Period 20

During the Payout Period 20

Investment Performance of Separate Account Divisions 20

Types of Investment Performance Information Advertised 21

Total Return Performance Information 21

Yield Performance Information 22

Other Contract Features 22

Changes That May Not Be Made 22

Change of Beneficiary 22

Cancellation -- The 10 Day Free Look 23

We Reserve Certain Rights 23

Fund Changes 23

Relationship to Employer's Plan 23

Voting Rights 23

Who May Give Voting Instructions 23

Determination of Fund Shares Attributable to Your Account 24

How Fund Shares Are Voted 24

Federal Tax Matters 24

Type of Plans 24

Tax Consequences in General 25

Effect of Tax-Deferred Accumulations 25

Glossary of Terms

Unless otherwise specified in this prospectus, the words "we," "our," "Company," and "VALIC" mean The Variable Annuity Life Insurance Company and the words "you" and "your" mean the participant, contract owner, annuitant or beneficiary.

Other specific terms we use in this prospectus are:

Account Value - the total sum of your Fixed Account Option and/or Variable Account Option that has not yet been applied to your Payout Payments.

Annuitant - the individual (in most cases, you) to whom Payout Payments will be paid.

Assumed Investment Rate - The rate used to determine your first monthly payout payment per thousand dollars of account value in your variable account option.

Beneficiary - the individual designated to receive Payout Payments upon the death of the Annuitant.

Contract Owner - the individual (in most cases, your employer) to whom the annuity contract ("Contract") is issued.

Fixed Account Option - an account that is guaranteed to earn at least a minimum rate of interest while invested in VALIC's general account.

Home Office - located at 2929 Allen Parkway, Houston, Texas 77019.

Mutual Fund or Fund - the investment portfolio(s) of a registered open-end management investment company, which serves as the underlying investment vehicle for each Division represented in VALIC Separate Account A.

Participant - the individual (in most cases, you) who makes purchase payments or for whom purchase payments are made.

Payout Period - the time when you begin to withdraw your money in a steady stream of payments.

Payout Unit - A measuring unit used to calculate payout payments from your variable account option. Payout unit values will vary with the investment experience of the VALIC Separate Account A Division.

Proof of Death - a certified copy of the death certificate, a certified copy of a decree of a court of competent jurisdiction as to death, a written statement by an attending physician, or any other proof satisfactory to VALIC.

Purchase Payments - an amount of money you or your employer pay to VALIC to receive the benefits of an annuity Contract offered by the Contracts.

Purchase Period - the time between your first Purchase Payment and your Payout Period (or surrender).

VALIC Separate Account A - a segregated asset account established by VALIC under the Texas Insurance Code. The purpose of the VALIC Separate Account A is to receive and invest your Purchase Payments and Account Value in the Variable Account Option, if selected.

Variable Account Option - investment options that correspond to Separate Account Divisions offered by the Contracts.

Fee Table

This Fee Table shows all charges and expenses which may be deducted from the assets of VALIC Separate Account A and from the Funds in which VALIC Separate Account A invests. Any and all limitations on total charges and expenses are reflected in this Fee Table. The purpose of this Fee Table is to help Contract Owners and Participants understand the various expenses of VALIC Separate Account A and the Funds which are, in effect, passed on to the Contract Owners and Participants.

Contract Owner/Participant Expenses ⁽¹⁾

Maximum Sales and Administrative Charge (as a percentage of the lesser of all Purchase Payments received during the last 36 months or the amount withdrawn) ⁽²⁾ 5.00%

Account Maintenance Fee ⁽²⁾ $ 30

Separate Account Expenses (as a percentage of Separate Account net assets)

Mortality and Expense Risk 1.00%

Fund Annual Expenses Management Other Total

(as a percentage of average net assets) Fees Expenses ⁽³⁾ Fund Expenses

Asset Allocation Fund 0.50% 0.12% 0.62%

Capital Conservation Fund 0.50% 0.12% 0.62%

Mid Cap Index Fund 0.30% 0.12% 0.42%

Money Market I Fund 0.50% 0.10% 0.60%

Stock Index Fund 0.26% 0.12% 0.38%

Fund	1 Year	3 Years	5 Years	10 Years
Asset Allocation Fund	$17	$52	$90	$197
Capital Conservation Fund	$17	$52	$90	$197
Mid Cap Index Fund	$15	$46	$80	$175
Money Market I Fund	$17	$52	$89	$195
Stock Index Fund	$14	$45	$78	$171

EXAMPLE #2- If you surrender the Contracts at the end of the period shown, you would pay the following expenses on a $1,000 investment under a typical Contract without a surrender charge imposed, invested in a single Separate Account Division as listed below, assuming a 5% annual return on assets:

Fund	1 Year	3 Years	5 Years	10 Years
Asset Allocation Fund	$63	$102	$90	$197
Capital Conservation Fund	$63	$102	$90	$197
Mid Cap Index Fund	$61	$96	$80	$175
Money Market I Fund	$63	$102	$89	$195
Stock Index Fund	$61	$95	$78	$171

Note: These examples should not be considered representations of past or future expenses for VALIC Separate Account A or for any Fund. Actual expenses may be greater or less than those shown above. Similarly, the 5% annual rate of return assumed in the examples is not an estimate or guarantee of future investment performance.

Summary

The following is a summary of the major features of the Contracts. For a more detailed discussion of the Contracts, please read the entire prospectus carefully.

FIXED AND VARIABLE OPTIONS

The Contracts offer a choice from among one Fixed Account Option and five Variable Account Options. Each of the Variable Account Options shown below is a series of VALIC Company I. You will not be able to invest in all of the Variable Account Options described below within a single group or individual annuity contract. If your Contract is part of your employer's retirement program, that program will describe which Variable Account Options are available to you.

Fixed Account Option

Fixed Account Plus - invests in the general account assets of the Company. This account provides fixed-return investment growth for the long-term. It is credited with interest at rates set by VALIC. The account is guaranteed to earn at least a minimum rate of interest. There are limitations on transfers out of this option.

Variable Account Options

Asset Allocation Fund - seeks maximum aggregate rate of return over the long-term through controlled investment risk by adjusting its investment mix among stocks, long-term debt securities and short-term money market securities. Adviser: VALIC. Sub-adviser: AIG Global Investment Corp.

Capital Conservation Fund - seeks the highest possible total return consistent with preservation of capital through current income and capital gains on investments in intermediate and long-term debt instruments and other income producing securities. Adviser: VALIC. Sub-adviser: AIG Global Investment Corp.

Mid Cap Index Fund - seeks growth of capital through investments primarily in a diversified portfolio of common stocks that, as a group, are expected to provide investment results closely corresponding to the performance of the S&P MidCap 400^® Index. Adviser: VALIC. Sub-adviser: AIG Global Investment Corp.

Money Market I Fund - seeks liquidity, protection of capital and current income thorough investments in short-term money market instruments. Adviser: VALIC. Sub-adviser: SunAmerica Asset Management Corp.

Stock Index Fund - seeks long-term capital growth through investments in common stocks that, as a group, are expected to provide investment results closely corresponding to the performance of the S&P 500^® Index. Adviser: VALIC. Sub-adviser: AIG Global Investment Corp.

More details about the investment objective and strategy of the Mutual Funds shown above can be found in the section of the prospectus entitled "Variable Account Options," and also in the current VALIC Company I prospectus, available at www.aigvalic.com (or call 1-800-428-2542, option 3).

GUARANTEED DEATH BENEFIT

The Contracts offer a death benefit equal to the greater of Account Value or Purchase Payments reduced by withdrawals upon death of the Annuitant during the Purchase Period.

TRANSFERS

There is no charge to transfer the money in your account among the investment options. You may transfer your Account Values between Variable Account Options or to the Fixed Account Option once every 30 days during the Purchase Period.

Your Account Value in the Fixed Account must remain there for at least 90 days before it can be transferred to other investment options.

Once you begin receiving payments from your account (called the Payout Period), you may still transfer funds among Variable Account Options or to the Fixed Account Option once every 365 days.

Transfers can be made by calling VALIC's toll-free transfer service at 1-800-621-7792. For more information on account transfers, see the "Transfers Between Investment Options" section in the prospectus.

FEES AND CHARGES
More information about fees may be found in the prospectus under the headings "Fees and Charges" and
"Fee Table."
Account Maintenance Fee

An annual account maintenance fee, which is currently $30 but which may be increased or decreased, is charged to your account.

Surrender Charge

Under some circumstances a surrender charge is deducted from your account. These situations are discussed in detail in the section of this prospectus entitled "Fees and Charges -- Surrender Charge." When this happens the surrender charge is 5% of the contributions you made to your account during the last 36 months.

Withdrawals are always subject to your plan provisions and federal tax restrictions, which generally include a tax penalty on withdrawals made prior to age 59 1/2.

Premium Tax Charge

Premium taxes ranging from zero to 3 1/2% are currently imposed by certain states and municipalities on Purchase Payments made under the Contract. For a detailed discussion on timing and deduction of premium taxes see the section of this prospectus entitled "Fees and Charges -- Premium Tax Charge."

Separate Account Charges

If you choose a Variable Account Option you will incur a mortality and expense risk fee computed at an aggregate annualized rate of 1.00% on the average daily net asset value of VALIC Separate Account A.

Fund Annual Expense Charge

A daily charge based on a percentage of each Fund's average daily net asset value is payable by each Fund to its investment adviser. In addition to the management fees, each Fund incurs other operating expenses which may vary.

Since some of these fees may not apply to your Contract, consult your VALIC financial advisor to see how these provisions apply to you.
PAYOUT OPTIONS

When you withdraw your money, you can select from several payout options: an annuity (which guarantees payment for as long as you live), periodic withdrawals and systematic withdrawals. More information on payout options can be found in the "Payout Period" section of this prospectus.

FEDERAL TAX INFORMATION

Although deferred annuity contracts such as the Contracts can be purchased with after-tax dollars, they are primarily used in connection with retirement programs which receive favorable tax treatment under federal law.

PURCHASE REQUIREMENTS

If the Contract is a flexible Purchase Payment Contract, Purchase Payments may be made at any time but each Purchase Payment must be at least $30 per Participant Account. The amount of each Purchase Payment allocated to each Variable Account Option and Fixed Account Option must also be at least $30. If the Contract is a single Purchase Payment Contract, the minimum Purchase Payment is $1,000 per Contract. These minimums may be waived where one purchaser, such as an employer, purchases a number of contracts.

Selected Purchase Unit Data

	Asset Allocation Division 5	Capital Conservation Division 1	Mid Cap Index Division 4	Money Market Division 2	Stock Index Division 10 ⁽¹⁾
December 31, 2001
Purchase Units In Force	48,720,402	1,004,582	149,549,757	1,386,970	4,447,667
Purchase Unit Value	$ 3.82	$ 4.24	$ 6.48	$ 2.76	$ 7.88
December 31, 2000
Purchase Units In Force	52,959,577	1,162,015	146,197,467	1,601,984	5,062,272
Purchase Unit Value	$ 4.03	$ 3.97	$ 6.61	$ 2.69	$ 9.06
December 31, 1999
Purchase Units In Force	61,240,667	1,415,413	151,288,816	1,632,469	5,858,523
Purchase Unit Value	$ 4.17	$ 3.67	$ 5.72	$ 2.56	$ 10.10
December 31, 1998
Purchase Units In Force	60,237,818	1,689,443	169,039,887	1,700,333	6,655,796
Purchase Unit Value	$ 3.77	$ 3.73	$ 5.03	$ 2.47	$ 8.46
December 31, 1997
Purchase Units In Force	57,307,351	1,831,961	171,065,657	1,931,439	7,438,537
Purchase Unit Value	$ 3.22	$ 3.51	$ 4.27	$ 2.37	$ 6.65
December 31, 1996
Purchase Units In Force	65,292,617	1,991,536	172,816,978	2,142,534	8,381,704
Purchase Unit Value	$ 2.65	$ 3.26	$ 3.27	$ 2.28	$ 5.05
December 31, 1995
Purchase Units In Force	75,851,431	2,402,085	172,613,690	2,917,361	9,885,873
Purchase Unit Value	$ 2.41	$ 3.24	$ 2.78	$ 2.19	$ 4.16
December 31, 1994
Purchase Units In Force	89,377,860	2,953,861	171,442,018	3,442,237	12,207,684
Purchase Unit Value	$ 1.95	$ 2.71	$ 2.15	$ 2.10	$ 3.06
December 31, 1993
Purchase Units In Force	93,899,802	3,590,916	134,621,879	4,129,981	14,043,516
Purchase Unit Value	$ 2.00	$ 2.91	$ 2.26	$ 2.04	$ 3.07
December 31, 1992
Purchase Units In Force	80,637,090	4,086,583	81,007,871	5,536,887	16,275,183
Purchase Unit Value	$ 1.85	$ 2.63	$ 2.02	$ 2.01	$ 2.82

^{(1) On May 1, 1992, the AGSPC Quality Growth Fund merged into the Stock Index Fund. Effective with this merger, units of Quality Growth Division 9 were exchanged for units of Stock Index Division 10D. The earnings (or losses) of Division 10D are credited to (or charged against) the assets of Division 10D.

Financial statements of VALIC Separate Account A are included in the Statement of Additional Information, which is available upon request. Purchase Units shown are for a Purchase Unit outstanding throughout the year under a representative contract of the type invested in each column shown. The unit value of each Division of VALIC Separate Account A will not be the same on any given day as the net asset value per share of the underlying Fund in which that Division invests. This is because each unit value consists of the underlying share's net asset value minus the charges to VALIC Separate Account A. In addition, dividends declared by the underlying Fund are reinvested by the Division in additional shares. These distributions have the effect of reducing the value of each share of the Fund and increasing the number of Fund shares outstanding. However, the total cash value in VALIC Separate Account A does not change as a result of such distributions.}General Information
About The Contracts

The Contracts were developed to help you save money for your retirement. They offer you a combination of fixed and variable investment options that you can invest in to help you reach your retirement savings goals. Your contributions to the Contracts can come from different sources, like payroll deductions or money transfers.
Your retirement savings process with the Contracts will involve two stages: the Purchase Period; and the Payout Period. The first is when you make contributions into the Contracts called "Purchase Payments." The second, is when you receive your retirement payouts. For more information, see "Purchase Period" and "Payout Period" in
this prospectus.

You may choose, depending upon your retirement savings goals, your personal risk tolerances, and your retirement plan, to invest in the Fixed Account Option and/or the Variable Account Options described in this prospectus. When you decide to retire, or otherwise withdraw your money, you can select from a wide array of payout options including both fixed and variable payments. In addition, this prospectus will describe for you all fees and charges that may apply to your participation in the Contracts.

About VALIC

We were originally organized on December 21, 1955 as The Variable Annuity Life Insurance Company of America, located in Washington, D.C. We re-organized in the State of Texas on August 20, 1968, as The Variable Annuity Life Insurance Company. Our main business is issuing and offering fixed and variable retirement annuity contracts, like UIT-981 ("Impact"). Our principal offices are located at 2929 Allen Parkway, Houston, Texas 77019. We have regional offices throughout the United States.

VALIC is a wholly-owned subsidiary of American International Group, Inc. ("AIG") and is a member of the American General Corporation ("AGC") group of companies. Members of the AGC group of companies operate in each of the 50 states, the District of Columbia, and Canada and collectively provide financial services with activities heavily weighted toward insurance.

VALIC 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. VALIC's membership in IMSA applies to VALIC only and not its products or affiliates.

About VALIC Separate Account A

When you direct money to the Contracts' Variable Account Options, you will be sending that money through VALIC's Separate Account A. You do not invest directly in the Mutual Funds made available in the Contracts. VALIC's Separate Account A invests in the Mutual Funds on behalf of your account. VALIC Separate Account A is made up of what we call "Divisions." Five Divisions are available and represent the Variable Account Options in the Contracts. Each of these Divisions invests in a different Mutual Fund made available through the Contracts. For example, Division Ten represents and invests in the Stock Index Fund. The earnings (or losses) of each Division are credited to (or charged against) the assets of that Division, and do not affect the performance of the other Divisions of VALIC Separate Account A.

VALIC established Separate Account A on July 25, 1979 under Texas insurance law. VALIC Separate Account A is registered with the SEC as a unit investment trust under the Investment Company Act of 1940 ("Act"). Units of interest in VALIC Separate Account A are registered as securities under the Securities Act of 1933.

VALIC Separate Account A is administered and accounted for as part of VALIC's business operations. However, the income, capital gains or capital losses, whether or not realized, of each Division of VALIC Separate Account A are credited to or charged against the assets held in that Division without regard to the income, capital gains or capital losses of any other Division or arising out of any other business the Company may conduct. In accordance with the terms of the Contracts, VALIC Separate Account A may not be charged with the liabilities of any other VALIC operation. As stated in the Contracts, the Texas Insurance Code requires that the assets of VALIC Separate Account A attributable to a Contract be held exclusively for the benefit of the contract owner, participants, annuitants, and beneficiaries of that Contract. The commitments under the Contracts are VALIC's, and AGC and AIG have no legal obligation to back these commitments. When we discuss performance information in this prospectus, we mean the performance of a VALIC Separate Account A Division.

Units of Interest

Your investment in a Division of VALIC Separate Account A is represented by units of interest issued by VALIC Separate Account A. On a daily basis, the units of interest issued by VALIC Separate Account A are revalued to reflect that day's performance of the underlying mutual fund minus any applicable fees and charges to VALIC Separate Account A.

Distribution of the Contracts

American General Distributors, Inc. ("the Distributor"), an affiliate of VALIC, acts as VALIC's Separate Account A distributor. The Distributor is located at 2929 Allen Parkway, Houston, Texas 77019.

VALIC will pay the licensed agents who sell the Contracts a commission. Currently, the commission paid by VALIC will range up to 6.0% of each Purchase Payment. In addition, VALIC will pay managers who supervise the agents overriding commissions ranging up to 1% of each Purchase Payment. These various commissions are paid by VALIC and do not result in any charge to Contract Owners or to the Separate Account.

Fixed Account Option

The Contracts offer one Fixed Account Option. This account is guaranteed to earn at least a minimum rate of interest, as disclosed in your Contract, and interest is paid at a declared rate. Certain limitations may also apply. See "Transfers Between Investment Options" in this prospectus.

Money allocated to the Fixed Account Option goes into VALIC's general account. The general account consists of all of VALIC's assets, other than assets attributable to a separate account. All of the assets in the general account are chargeable with the claims of any VALIC contract holders as well as all of its creditors. The general account funds are invested as permitted under state insurance laws. Purchase Payments and interest earned on such amounts in your Fixed Account Option will be paid regardless of the investment results experienced by VALIC's general assets. Thus, we bear the entire investment risk for the Fixed Account Option.

Variable Account Options

The Contracts enable you to participate in Divisions that represent five Variable Account Options. Your retirement program may limit the number of Variable Account Options in which you may invest. Certain additional limitations may also apply. See "About VALIC Separate Account A" in this prospectus.

Each individual Division represents and invests, through VALIC's Separate Account A, in a specific portfolio of VALIC Company I. VALIC Company I serves as the investment vehicle for the Contracts.

VALIC Company I is registered as a diversified open-end, management investment company and is regulated under the Act. A brief description of the investment objective and strategy of each Variable Account Option is shown below. For more detailed information about each Mutual Fund option, including investment strategy and risks, you should refer to the VALIC Company I prospectus. Copies are available online at www.aigvalic.com or you may call
1-800-428-2542 (option 3). Please read the prospectus carefully before investing.

Description of Funds Available as Variable Account Options

Asset Allocation Fund (Division 5) - seeks maximum aggregate rate of return over the long-term through controlled investment risk by adjusting its investment mix among stocks, long-term debt securities and short-term money market securities.

Capital Conservation Fund (Division 1) - seeks the highest possible total return consistent with preservation of capital through current income and capital gains on investments in intermediate and long-term debt instruments and other income producing securities.

Mid Cap Index Fund (Division 4) - seeks growth of capital through investments primarily in a diversified portfolio of common stocks that, as a group, are expected to provide investment results closely corresponding to the performance of the S&P MidCap 400^® Index.^*

Money Market I Fund (Division 2) - seeks liquidity, protection of capital and current income thorough investments in short-term money market instruments.

Stock Index Fund (Division 10) - seeks long-term capital growth through investments in common stocks that, as a group, are expected to provide investment results closely corresponding to the performance of the S&P 500^® Index.^*

The Purchase Period begins when your first Purchase Payment is made and continues until you begin your Payout Period. The Purchase Period can also end when an account is surrendered before the Payout Period. The amount, number, and frequency of your Purchase Payments is determined by the retirement plan for which your Contract was purchased.

Account Establishment

You may establish an account only through a VALIC financial advisor. Initial Purchase Payments must be received by VALIC either with, or after, a completed application. Your employer is usually responsible for remitting Purchase Payments to us. The employer is responsible for furnishing instructions to us as to the amount being applied to your account (see below).

Minimum initial and subsequent Purchase Payments are as follows:

Contract Type	Initial Payment	Subsequent Payment
Periodic Payment	$30	$30
Single Payment	$1,000 (This minimum applies to each account.)	No minimum

Purchase Payment minimums apply to each Periodic Payment made. In addition, for Periodic Payments, the amount allocated to each Variable Account Option and the Fixed Account Option must be at least $30.

Purchase Payments are received in VALIC's Home Office. When an initial Purchase Payment is accompanied by an application, within 2 business days we will:

Accept the Application and issue a contract. We will also establish your account and apply your Purchase Payment by crediting the amount to the Fixed Account Option or Variable Account Option selected;
Reject the Application and return the Purchase Payment; or
Request Additional Information to correct or complete the application. In the case of an individual variable annuity contract, we may return the Purchase Payments within 5 business days if the requested information is not provided.

If we receive Purchase Payments from your employer before we receive your completed application or enrollment form, we will not be able to establish a permanent account for you. If this occurs, we will take one of the following actions:

Return Purchase Payments - If we do not have your name, address or social security number, we will return the Purchase Payment to your employer unless this information is immediately provided to us.
Employer-Directed Account - If we have your name, address and social security number and we have an Employer-Directed Account Agreement from your employer, generally we will deposit your Purchase Payment in an "Employer-Directed" account invested in the Money Market Division of the Variable Account Options, or other investment option chosen by your employer. If your employer chooses an Option other than the Money Market Division, the value of your investment may fluctuate and you could lose money. You may not transfer these amounts until VALIC has received a completed application or enrollment form.
Starter Account - If we have your name, address and social security number, but we do not have an Employer-Directed Account Agreement from your employer, we will deposit your Purchase Payment in a "starter" account invested in the Money Market Division. We will send you follow-up letters requesting the information necessary to complete the application, including your allocation instructions. Unless a completed application or enrollment form is received by us within 105 days of establishment of your starter account, the account balance, including earnings, will be returned to your employer. We are not responsible for any adverse tax consequences that may result from the return of your employer's contributions.

When Your Account Will Be Credited

Once your account has been established, depending on your retirement plan, Purchase Payments may be made by your employer for your account or by you for an IRA or certain nonqualified contracts. It is the employer's or the individual's responsibility to ensure that the Purchase Payment can be promptly posted to the appropriate account(s).

A Purchase Payment must be "in good order" before it can be posted to your account. "In good order" means that all required information and/or documentation has been supplied and that the funds (check, wire, or ACH) are properly authorized and clearly identify the individual Social Security Number ("SSN") or Group Number to which they are to be applied. To ensure efficient posting for employer sponsored accounts, Purchase Payment information must include complete instructions, including the group name and number, each employee's name and social security number, contribution amounts (balanced to the penny for the total purchase) and the source of the funds (for example, employee voluntary, employer mandatory, employer match, transfer, rollover or a contribution for a particular tax year). Purchase Payments for individual accounts must include the name, SSN, and the source of the funds (for example, transfer, rollover, or a contribution for a particular tax year).

If the Purchase Payment is in good order as described and is received at our Home Office by 4:00 p.m. Eastern time, the appropriate account(s) will be credited the business day of receipt. Purchase Payments in good order received at our Home Office after 4:00 p.m. Eastern time will be credited the next business day.

Please note that if the Purchase Payment is not in good order, the employer or individual will be notified promptly. No amounts will be posted to any accounts until all issues with the Purchase Payment have been resolved. If a Purchase Payment is not received in good order, the purchase amounts will be posted effective the date all required information is received.

Purchase Units

A Purchase Unit is a unit of interest owned by you in your Variable Account Option. Purchase Units apply only to the Variable Account Options selected for your account. Purchase Unit values are calculated at the close of regular trading of the New York Stock Exchange (the "Exchange"), currently 4:00 p.m. Eastern Time (see Calculation of Purchase Unit Value below for more information). Once we have established your account and have applied your initial Purchase Payment as described above, any subsequent Purchase Payment that we receive at our Home Office before the close of the Exchange will be credited the same business day. If not, it will be calculated and credited the next business day. Purchase Unit values will vary depending on the net investment results of each of the Variable Account Options. This means the value of your Variable Account Option will fluctuate.

Calculation of Purchase Unit Value

The Purchase Unit value for a Division is calculated as shown below:

STEP 1: Calculate the gross investment rate:

The Gross Investment Rate

EQUALS

The Division's investment income and capital gains and losses (whether realized or unrealized) on that day from the assets attributable to the Division

DIVIDED BY

The value of the Division for the immediately preceding day on which the values are calculated.

STEP 2: Calculate the net investment rate for any day as follows:

Net Investment Rate

EQUALS

Gross Investment Rate (calculated in Step 1)

MINUS

Separate Account charges and any income tax charges.

STEP 3: Determine Purchase Unit Value for a day.

The Purchase Unit Value for a day

EQUALS

The Purchase Unit Value for the immediate preceding day

MULTIPLIED BY

The Net Investment Rate (as calculated in Step 2) plus 1.00.

For examples showing how Purchase Unit Values are calculated, see the Statement of Additional Information.

Fixed Account Option

You may allocate all or a portion of your Purchase Payments to the Fixed Account Option as permitted by your retirement program. A complete discussion of the Fixed Account Option may be found in the "Fixed Account Option" section in this prospectus. Here is how you may calculate the value of your Fixed Account Option during the Purchase Period:

The value of your Fixed Account Option

EQUALS

All Purchase Payments made to the Fixed Account Option

PLUS

Amounts transferred from the Variable Account Option to the Fixed Account Option

PLUS

All interest earned

MINUS

Amounts transferred or withdrawn from Fixed Account Option (including applicable fees and charges).

Variable Account Options

You may allocate all or a portion of your Purchase Payments to the Variable Account Options listed in this prospectus as permitted by your retirement program. As noted elsewhere in the prospectus, you will not be permitted to select from more than three investment options. A complete discussion of the Variable Account Options may be found in the "Variable Account Options" section in this prospectus. Based upon a Variable Account Option's Purchase Unit Value, your account will be credited with the applicable number of Purchase Units. The Purchase Unit Value of each Variable Account Option will change daily depending upon the investment performance of the Mutual Fund (which may be positive or negative) and the deduction of VALIC Separate Account A charges. See the "Fees and Charges" section in this prospectus. Because Purchase Unit Values for each Mutual Fund change daily, the number of Purchase Units your account will be credited with for subsequent Purchase Payments will vary. Each Variable Account Option bears its own investment risk. Therefore, the value of your account may be worth more or less at retirement or withdrawal.

Here is how to calculate the value of the Variable Account Options in your account during the Purchase Period:

The value of a Variable Account Option

EQUALS

The total number of Purchase Units

MULTIPLIED BY

The Current Purchase Unit Value.

Stopping Purchase Payments

Purchase Payments may be stopped at any time. Purchase Payments may be resumed at any time before your account has been surrendered. While no Purchase Payments are being made, the number of Purchase Units outstanding will remain the same. (This is assuming no transfers or withdrawals are made.) The value of the Purchase Units will continue to vary. Your Account Value will continue to be subject to charges.

In the case of an individual contract, if both your Account Value and Purchase Payments (less any withdrawals) falls below $300, and you do not make any Purchase Payments for two years from the date we established your account, we may close the account and pay the Account Value (less any surrender charge) to you. In the case of a group contract, if your Account Value (less any withdrawals) falls below $300, we may close the account and pay the Account Value (less any surrender charge) to you. Any such account closures will be subject to applicable distribution restrictions under the contract and/or under your employer's plan.

Transfers Between Investment Options

You may transfer all or part of your Account Value between the Fixed Account and Variable Account Options in your Contract without a charge. Transfers may be made during the Purchase Period or during the Payout Period, subject to the limitations or conditions noted below. Your employer's plan may also limit your rights to transfer.

During the Purchase Period

During the Purchase Period, transfers may be made between your Contract's Fixed Account Option and Variable Account Options.

We currently permit transfers between Variable Account Options or from Variable Account Options to the Fixed Account Option once every 30 days. We may also limit the method and manner of providing or communicating transfer and reallocation instructions.

Transfers are also permitted from the Fixed Account Option subject to a 90-day holding period for transfers previously made from the Variable Account Option.

During the Payout Period

During the Payout Period, transfers may be between your Contract's investment options, subject to the
following limitations:

Account Option	Percentage Allowed	Frequency
Variable Payout	Up to 100%	Once every 365 days
Combination Fixed and Variable Payout	Up to 100% of money in variable option payout	Once every 365 days
Fixed Payout	Not permitted	---

Communicating Transfer or Reallocation Instructions

Transfer instructions may be given by telephone, through the internet (VALIC Online), using the self service automated phone system (VALIC by Phone), or in writing. We will send a confirmation of transactions within five days from the date of the transaction. It is your responsibility to verify the information shown and notify us of any errors within one business day of receipt.

Instructions for transfers or reallocations may be made via the internet as follows:

Log on to www.aigvalic.com
Click "View Your Account Here" and log into VALIC Online
Click either "Asset Transfer" (to transfer existing funds) or "Allocation Change" (to reallocate future contributions) under the "Transactions" menu
Select the desired account, input the transaction request, then click "Continue"
Review your transaction request for accuracy and then click "Continue" to submit to VALIC

Instructions for transfers or reallocations may be made via an automated telephone system (VALIC by Phone) as follows:

Call 1-800-428-2542 and press any key to signify that you have a touch tone phone
Press 1 for "Account Inquiries and Transaction Requests"
Enter your Social Security Number and personal identification number (PIN)
Select the desired account and press 2 for an asset transfer or allocation change
Follow the scripts to complete your transaction request and to submit to VALIC

Instructions for transfer or reallocations may also be made as follows:

Call 1-800-621-7792
Enter your Social Security Number
You may use the automated telephone system or speak with a Client Service Professional

You may also send written instructions by completing a VALIC form for transfers or reallocations:

Written instructions should be sent to VALIC's Home Office
A VALIC financial change form is required
Written instructions are required if you have notified us not to accept telephone instructions

We encourage you to make transfers or reallocations using VALIC Online or VALIC by Phone for most efficient processing.

No one that we employ or that represents VALIC may give telephone instructions on your behalf without VALIC's prior written permission. This does not apply to a contract with the immediate family of an employee or representative of VALIC.

You will bear the risk of loss arising from instructions received by telephone or online. We are not responsible for the authenticity of such instructions. Any telephone or online instructions which we reasonably believe to be genuine will be your responsibility. This includes losses from errors in communication. Telephone transfer instructions may not be made during the Payout Period. Transfer instructions during the Payout Period cannot be done online. We reserve the right to stop telephone transfers at any time.

Effective Date of Transfer

The effective date of a transfer will be:

The date of receipt, if received in our Home Office before the close of regular trading of the Exchange on a day values are calculated; (Normally, this will be 4:00 P.M. New York time); otherwise
The next date values are calculated.

Market Timing

The Contracts are not designed for professional market timing organizations or other entities using programmed and/or 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 or frequent transfers that could disadvantage other Contract Owners.

Fees and Charges

By investing in the Contracts, you may be subject to six basic types of fees and charges:

Account Maintenance Fee
Surrender Charge
Premium Tax Charge
Separate Account Charges
Fund Annual Expense Charge
Other Tax Charges

These fees and charges are explained below. For additional information about these fees and charges, see the Fee Table in this prospectus.

Account Maintenance Fee

An account maintenance fee of $30.00 will be deducted on the last day of the calendar quarter following receipt of the first purchase payment and annually on that date after that. We will sell Purchase Units from your Account to pay the account maintenance fee. The fee will be assessed equally among the Variable Account Options and the Fixed Account Option that make up your Account Value.

The account maintenance fee is to reimburse the Company for our administrative expenses. This includes the expense for establishing and maintaining the record keeping for your Contract. We do not expect that the amount of fees we receive will be greater than our expenses.

The amount of the account maintenance fee may be reduced or waived if the Contracts are issued to certain types of plans which are expected to result in lower costs to VALIC. To learn more about how we determine if account maintenance fees may be reduced or waived, see the "Reduction or Waiver of Account Maintenance Fee and Surrender Charge" section in this prospectus. If you have two or more accounts established under the same group contract, we may agree to deduct an account maintenance fee from only one account.

No account maintenance fee will be assessed during the Payout Period.

Surrender Charge

When you withdraw money from your account, you may be subject to a surrender charge that will be deducted from the amount withdrawn. For information about your right to surrender, see "Surrender of Account Value" in this prospectus.

It is assumed that the most recent Purchase Payments are withdrawn first. No surrender charge will be applied unless an amount is actually withdrawn. We consider all Purchase Payments to be withdrawn before earnings are withdrawn.

Amounts exchanged from other contracts issued by the Company may or may not be subject to a surrender charge. After exchange, it is assumed that any new Purchase Payments are withdrawn before the exchanged amount. For more information, see "Exchange Privilege" in the Statement of Additional Information.

Amount of Surrender Charge

A surrender charge is equal to five percent (5%) of the amount of all Purchase Payments received during the past
36 months.

10% Free Withdrawal

In any Participant Year, the first withdrawal of up to 10% of the Account Value will not be subject to a surrender charge. The surrender charge will apply to any amount withdrawn that exceeds this 10% limit or to any subsequent withdrawals in that year. The percentage withdrawn will be determined by dividing the amount withdrawn by the Account Value just prior to the withdrawal.

These 10% withdrawals without charge do not reduce Purchase Payments for the purpose of computing the surrender charge. If a surrender charge is applied to all or part of a Purchase Payment, no surrender charge will be applied to such Purchase Payment (or portion thereof) again.

Exceptions to Surrender Charge

No surrender charge will be applied:

To money applied to provide a Payout Option;
To death benefits;
If no Purchase Payments have been received during the 36 months prior to the date of surrender; or
If you are at least 55 years old, are no longer employed by the employer that established the plan, and your account under the plan was established at least 5 years prior to the date of surrender (applicable to qualified contracts only).

The surrender charge may be reduced or waived if a Contract is issued to certain types of plans or similar arrangements which are expected to result in lower costs to VALIC. To learn more about how we determine if a surrender charge may be reduced or waived, see the "Reduction or Waiver of Account Maintenance Fee and Surrender Charge" section in this prospectus.

Premium Tax Charge

Taxes on Purchase Payments are imposed by some states, cities, and towns. The rate will range from zero to 3 1/2%.

If the law of a state, city, or town requires premium taxes to be paid when Purchase Payments are made, we will, of course, comply. Otherwise, such tax will be deducted from the Payout Value when annuity payments are to begin.

If we deduct an amount for premium taxes, but later find the tax was not due, we will:

Adjust the amount deducted in error to reflect investment experience from the date of the deduction to the date we determined the tax was not due; and
Apply the excess amount, as adjusted, to increase the number of Pay-in or Payout Units.

Separate Account Charges

There will be a mortality and expense risk fee applied to VALIC Separate Account A. This is a daily charge at an annualized rate of 1.00% on the average daily net asset value of VALIC Separate Account A. This charge is guaranteed and cannot be increased by the Company. The mortality and expense risk fee is to compensate the Company for assuming mortality and expense risks under the Contracts. The mortality risk that the Company assumes is the obligation to provide payments during the Payout Period for your life no matter how long that might be. In addition, the Company assumes the obligation to pay during the Purchase Period a death benefit which may be higher than your Account Value. For more information about the death benefit see the "Death Benefit" section of this prospectus. The expense risk is our obligation to cover the cost of issuing and administering the Contracts, no matter how large the cost may be.

The Company may make a profit on the mortality and expense risk fee. For more information about the mortality and expense risk fee, see the Fee Table in this prospectus.

Fund Annual Expense Charges

Investment management charges based on a percentage of each Fund's average daily net assets are payable by each Fund. Depending on the Variable Account Option selected, the charges will be paid by each Fund to its investment adviser. These charges indirectly cost you because they lower your return.

Other Tax Charges

We reserve the right to charge for certain taxes (other than premium taxes) that we may have to pay. This could include federal income taxes. Currently, no such charges are being made.

Reduction or Waiver of Account Maintenance Fee and Surrender Charge

We may, as described below, determine that the account maintenance fee and surrender charges for the Contracts may be reduced or waived. We may reduce or waive these fees and charges if we determine that your retirement program will allow us to reduce or eliminate administrative or sales expenses that we usually incur for such programs and arrangements. There are a number of factors we will review in determining whether your retirement program will allow us to reduce or eliminate these administrative or sales expenses:

The type of retirement program;
Certain types of retirement programs, because of their stability, can result in lower administrative costs;
The nature of your retirement program;
Certain types of retirement programs, due to the types of employees who participate, experience fewer account surrenders thus reducing administrative costs; and/or
Other factors of which we are not presently aware which could reduce administrative costs.

We review the following additional factors to determine whether we can reduce or waive account maintenance fees:

The frequency of Purchase Payments for your retirement program. Purchase Payments received no more than once a year can reduce administrative costs.
The administrative tasks performed by your employer for your retirement program. The employer sponsoring your retirement program can, through its method of remitting Purchase Payments, reduce administrative costs.

We review the following additional factors to determine whether we can reduce or waive surrender charges:

The size of your retirement program. A retirement program which involves a larger group of employees may allow us to reduce sales expenses.
The total amount of Purchase Payments to be received for your retirement program. Larger Purchase Payments can reduce sales expenses.

The use of mass enrollment or related administrative tasks performed by your employer for your retirement program. We will only do this if permitted by this Contract and by VALIC guidelines in effect at the time. In no event will the reduction or waiver of fees and charges be permitted where the reduction or waiver will unfairly discriminate against any person.

Payout Period

The Payout Period (Annuity Period) begins when you decide to retire or otherwise withdraw your money in a steady stream of payments. If your employer's plan permits, you may apply any portion of your Account Value to one of the types of Payout Options listed below. You may choose to have your Payout Option on either a fixed, a variable, or a combination payout basis. When you choose to have your Payout Option on a variable basis, you may keep the same Variable Account Options in which your Purchase Payments were made, or transfer to different ones.

Fixed Payout

Under Fixed Payout, you will receive monthly payments from the Company. These payments are fixed and guaranteed by the Company. The amount of these payments will depend on:

Type and duration of Payout Option chosen;
Your age or your age and the age of your survivor⁽¹⁾;
Your sex or your sex and the sex of your survivor⁽¹⁾ (IRAs and certain nonqualified contracts);
The portion of your Account Value being applied; and
The payout rate being applied and the frequency of the payments.

You may withdraw all or part of your Account Value at any time before the Payout Period begins if:

allowed under federal and state law; and
allowed under your employer's plan.

For an explanation of charges that may apply if you surrender your Account Value, see "Fees and Charges" in this prospectus.

Surrender Process

If you are allowed to surrender all or a portion of your Account Value as noted above, then you must complete a surrender request form and mail it to our Home Office. We will mail the Surrender Value to you within 7 calendar days after we receive your request if it is in good order. Good order means that all paperwork is complete and signed or approved by all required persons, and any necessary supporting legal documents or plan forms have been received in correct form. For example, a loan termination or loan payoff must be processed prior to surrendering an account. If you are not 100% vested, forfeited dollars must be removed prior to the Surrender transaction. Additionally, if your Plan Administrator must approve a request for Surrender, the request will not be considered in good order until the Plan Administrator approval is received. The above examples may not be all-inclusive, but are illustrations of processes that must be completed before a request is considered to be in good order.

We may be required to suspend or postpone payments if redemption of an underlying Fund's shares have been suspended or postponed. See the VALIC Company I prospectus for a discussion of the reasons why the redemption of shares may be suspended or postponed.

We may receive a surrender for a Purchase Payment which has not cleared the banking system. We may delay payment of that portion of your Surrender Value until the check clears. The rest of the Surrender Value will be processed in accordance with the procedures above.

We may defer payment of the Surrender Value in the Fixed Account Options for up to six months. Interest will be paid on such amounts if payment of Fixed Account Option Surrender Value is deferred for 30 calendar days or more.

Amount that May be Surrendered

The amount that may be surrendered at any time can be determined as follows:

The Allowed Surrender Value

EQUALS

The Account Value next computed after your properly completed request for surrender is received in our
Home Office

MINUS

Any applicable Surrender Charge

There is no guarantee that the Surrender Value in the Variable Account Option will ever equal or exceed the total amount of your Purchase Payments received by us.

Surrender Restrictions

Generally, Internal Revenue Code Section 403(b)(11) permits total or partial distributions from a 403(b) contract only on account of hardship (employee contributions only without accrued interest), attainment of age 59 1/2, separation from service, death or disability.

Under the Texas State Optional Retirement Program, no surrender or partial surrender will be allowed except attainment of age 70 1/2, retirement, or other termination of employment or death.

Under the Florida State Optional Retirement Program, no surrender or partial surrender of Purchase Payments made by the employer will be allowed except for termination of employment, retirement or death. Benefit payments based on payments from the employer may not be paid in a lump sum or for a period certain, but must be paid under a life contingency option, except for:

death benefits; and
certain small amounts approved by the State of Florida.

Under the Louisiana Optional Retirement Plan retirement benefits must be paid in the form of a lifetime income, and except for death benefits, single sum surrenders and partial surrenders out of the plan are not permitted.

Other employer-sponsored plans may also impose restrictions on the timing and form of surrenders from
the contract.

Partial Surrenders

You may request a partial surrender of your Account Value at any time, subject to any applicable surrender restrictions. A partial surrender plus any surrender charge will reduce your Account Value. Partial surrenders will be paid from the Fixed Account Options and Variable Account Options for the payment of Account Value.

The reduction in the number of Purchase Units credited to your Account Value will equal:

The amount surrendered

PLUS

Any Surrender Charge

DIVIDED BY

Your Purchase Units next computed after the written request for surrender is received at our Home Office.

Death Benefits

The Contracts will pay death benefits during either the Purchase Period or the Payout Period. How these death benefits will be paid are discussed below. The death benefit provisions in the Contracts may vary from state to state.

The Process

VALIC requires that complete and acceptable documentation and paperwork be received from the beneficiary in order to begin the death benefit payment process. First, Proof of Death is required. Additionally, the beneficiary must include an election specifying the distribution method and any other form required by VALIC or a regulator to process the claim. The account will not be valued and any payments will not be made until all paperwork is complete and in a form acceptable to VALIC. You or your beneficiary may contact your VALIC financial professional at 1-800-448-2542 with any questions about required documentation and paperwork.

Beneficiary Information

The Beneficiary may receive death benefits:

In a lump sum; or
In the form of an annuity under any of the Payout Options stated in the Payout Period section of this prospectus subject to the restrictions of that Payout Option.

Payment of any death benefits must be within the time limits set by federal tax law and by the plan, if any.

Beneficiaries Other Than Spouses

If the Beneficiary is not the spouse of the Annuitant, death benefits must be paid:

In full within 5 years after the Annuitant's death; or
By payments beginning within 1 year after the Annuitant's death under:

A life annuity;
A life annuity with payments certain; or
An annuity for a designated period not exceeding the Beneficiary's life expectancy.

If the Annuitant dies before the Annuity Date, the Beneficiary as named by you may receive the payout.

Payments certain or payments for a designated period cannot be for a greater period of time than the Beneficiary's life expectancy. After choosing a payment option, a Beneficiary may exercise many of the investment options and other rights that the Participant or Contract Owner had under the Contracts.

During the Purchase Period

Your Account Value on the date all paperwork is complete and in a form acceptable to VALIC; or

100% of Purchase Payment (to the Fixed and/ or the Variable Account Option)

MINUS

The Amount of all Prior Withdrawals and any portion of Account Value applied under a Payout Option

During the Payout Period

If death occurs during the Payout Period, your Beneficiary may receive a death benefit depending on the Payout Option selected. The amount of death benefits will also depend on the Payout Option that you selected. The Payout Options available in the Contracts are described in the "Payout Period" section of this prospectus.

If the Life Only Option or Joint and Last Survivor Life Option were chosen, there will be no death benefit.
If the Life With Guaranteed Period Option, Life with Cash or Unit Refund Option or Payment for a Designated Period Option were chosen, and the entire amount guaranteed has not been paid, the Beneficiary may choose one of the following within 60 days after death benefits are payable:

Receive the present value of any remaining payments in a lump sum; or

Receive the remaining payments under the same terms of the option chosen by the deceased Participant and be entitled to elect anytime thereafter to receive the present value of any remaining payments in a lump sum; or

Receive the present value of any remaining payments applied under the Payment for a Designated Period Option for a period equal to or shorter than the period remaining. Spouse beneficiaries may be entitled to more favorable treatment under federal tax law.

Investment Performance of Separate Account Divisions

We will advertise information about the investment performance of VALIC Separate Account A Divisions. Our advertising of past investment performance results does not mean that future performance will be the same. The performance information will not predict what your actual investment experience will be in that Division or show past performance under an actual contract. We may also show how the Divisions rank on the basis of data compiled by independent ranking services.

Types of Investment Performance Information Advertised

We may advertise a Division's Total Return Performance information and Yield Performance information. See the Statement of Additional Information for more information about performance and how it is calculated.

Total Return Performance Information

Total Return Performance Information is based on the overall dollar or percentage change in value of an assumed investment in a Division over a given period of time.

There are seven ways Total Return Performance Information may be advertised:

Standard Average Annual Total Return
Nonstandard Average Annual Total Return
Cumulative Total Return
Annual Change in Purchase Unit Value
Cumulative Change in Purchase Unit Value
Total Return Based on Different Investment Amounts
An Assumed Account Value of $10,000

Each of these is described below.

Standard Average Annual Total Return

Standard Average Annual Total Return shows the average percentage change in the value of an investment in the Division from the beginning to the end of a given historical period. The results shown are after all charges and fees have been applied against the Division. Premium taxes are not deducted. This information is calculated for the Division based on how an initial assumed payment of $1,000 performed at the end of 1, 5 and 10 year periods or since inception.

The return for periods of more than one year are annualized to obtain the average annual percentage increase (or decrease) during the period. Annualization assumes that the application of a single rate of return each year during the period will produce the ending value, taking into account the effect of compounding.

Nonstandard Average Annual Total Return

Nonstandard Average Annual Total Return is calculated in the same manner as the Standard Average Annual Total Return, except that Nonstandard Average Annual Total Return shows only the historic investment results of the Division, and account maintenance fees, surrender charges and premium taxes are not deducted.

Cumulative Total Return

Cumulative Total Return assumes the investment in the Contracts will stay in the Division beyond the time that a surrender charge would apply. It may be calculated for 1, 5 and 10 year periods. It is based on an assumed initial investment of $10,000. The Cumulative Return will be calculated without deduction of account maintenance fees, surrender charges or premium taxes.

Annual Change in Purchase Unit Value

Annual Change in Purchase Unit Value is a percentage change during a one year period. This is calculated as follows:

The Purchase Unit Value at the start of the year is subtracted from the Purchase Unit Value at the end of the year;
The difference is divided by the Purchase Unit Value at the start of the year.

Account maintenance fees, surrender charges and premium taxes are not deducted. The effect of these charges, if deducted, would reduce the Division's Annual Change in Purchase Unit Value.

Cumulative Change in Purchase Unit Value

Cumulative Change in Purchase Unit Value is a percentage change from the beginning to the end of a period usually greater than one year. Otherwise, it is calculated in the same way as the Annual Change in Purchase Unit Value.

Total Return Based on Different Investment Amounts

We may show total return information based on different investment amounts. For example, we may show $200 a month for 10 years, or $100 a month to age 65. Fees may or may not be included. Each performance illustration will explain the Contract charges and fees imposed on the Division.

An Assumed Account Value of $10,000

We may show annual values based on an initial investment of $10,000. This will not reflect any deduction for account maintenance fees, surrender charges and premium taxes.

Yield Performance Information

We may advertise Yield Performance at a given point in time. A Division's yield is one way of showing the rate of income the Division is earning as a percentage of the Division's Purchase Unit Value. We may advertise the standardized Current Yield and Effective Yield for the VALIC Company I Money Market I Division, along with standardized yield for the other Divisions.

The Current Yield refers to the income produced by an investment in the Money Market I Division over a given
7-day period. The Current Yield does not take into account surrender charges, account maintenance fees or premium taxes. The income produced over a 7 day period is then "annualized." This means we are assuming the amount of income produced during the 7-day period will continue to be produced each week for an entire year. The annualized amount is shown as a percentage of the investment. For the Money Market I Division the 7-day Current Yield for the last 7 days ended December 31, 2001 was 0.02%.

The Effective Yield is calculated in a manner similar to the Current Yield. But, when the yield is annualized the income earned is assumed to be reinvested. The compounding effect will cause the Effective Yield to be higher than the Current Yield. For the Money Market I Division the 7-day Effective Yield for the last 7 days ended December 31, 2001 was 0.02%.

For the other Divisions, the standardized yield is determined by taking the account maintenance fee from the average daily net investment income per Purchase Unit and dividing the remainder by the Purchase Unit Value on the last day of the period; and then annualizing the result.

Other Contract Features

Changes That May Not Be Made

The following terms in the Contracts may not be changed once your account has been established:

The Contract Owner;
The Participant; and
The Annuitant

Change of Beneficiary

The Beneficiary (if not irrevocable) may usually be changed at any time.

Under some retirement programs, the right to name or change a Beneficiary is subject to approval by the spouse. Also, the right to name a Beneficiary other than the spouse may be subject to certain tax laws and regulations.

If the Annuitant dies, and there is no Beneficiary, any death benefit will be payable to the Annuitant's estate.

If a Beneficiary dies while receiving payments, and there is no co-Beneficiary to continue to receive payments, any amount still due will be paid to the Beneficiary's estate.

Cancellation - The 10 day "Free Look"

The Contract Owner may cancel an individual contract by returning it to the Company within 10 days after delivery. (A longer period will be allowed if required under state law.) A refund will be made to the Contract Owner within seven days after receipt of the Contract within the required period. The amount of the refund will be equal to all Purchase Payments received or the amount required under state law, if larger.

We Reserve Certain Rights

We reserve the right to:

Amend the Contract for Fund Changes;
Amend the Contract to comply with tax or other laws;
Operate VALIC Separate Account A as a management investment company under the Act, in consideration of an investment management fee or in any other form permitted by law;
Deregister VALIC Separate Account A under the Act, if registration is no longer required;

Fund Changes

We may amend your Contract to match changes to the funds offered under your Contract. For example, we may establish new funds, delete funds, or stop accepting allocations and/or investments in a particular fund. We may move assets and re-direct future premium allocations from one fund to another if we receive shareholder approval through a proxy vote or SEC approval for a fund substitution. This would occur if a fund is no longer an appropriate investment for the Contract, for reasons such as continuing substandard performance, or for changes to the portfolio manager, investment objectives, risks and strategies, or federal or state laws. The new fund offered may have different fees and expenses. You will be notified of any upcoming proxies or substitutions that affect your fund choices.

Relationship to Employer's Plan

If the Contract is being offered as a retirement plan through your employer, you should always refer to the terms and conditions in your employer's plan when reviewing the description of the Contracts in this prospectus.

Voting Rights

As discussed in the "About VALIC Separate Account A" section of this prospectus, VALIC Separate Account A holds on your behalf shares of the Mutual Funds which comprise the Variable Account Options. From time to time the Mutual Funds may be required to hold a shareholder meeting to obtain approval from its shareholders for certain matters. As a Participant, you may be entitled to give voting instructions to us as to how VALIC Separate Account A should vote its Mutual Fund shares on these matters. Those persons entitled to give voting instructions will be determined before the shareholder meeting is held.

Who May Give Voting Instructions

In most cases during the Purchase Period, you will have the right to give voting instructions for the shareholder meetings. This will be true in most cases even if your employer is the Contract Owner. Contract Owners will instruct VALIC Separate Account A in accordance with your instructions. You will receive proxy material and a form on which voting instructions may be given before the shareholder meeting is held.

You will not have the right to give voting instructions if your Contract was issued in connection with a nonqualified and unfunded deferred compensation plan.

Determination of Fund Shares Attributable to Your Account
During Purchase Period

The number of Fund shares attributable to your account will be determined on the basis of the Purchase Units credited to your account on the record date set for the Fund shareholder meeting.

During Payout Period or After A Death Benefit Has Been Paid

The number of Fund shares attributable to your account will be based on the liability for future variable annuity payments to your payees on the record date set for the Fund shareholder meeting. At such time, the Annuitant, or the Beneficiary after the Annuitant's death, will be entitled to give voting instructions for shareholder meetings.

How Fund Shares are Voted

The Mutual Funds which comprise the Variable Account Options in the Contracts may have a number
of shareholders including VALIC Separate Account A and VALIC's other affiliated insurance company
separate accounts.

VALIC Separate Account A will vote, Fund by Fund, all of the shares of the Mutual Funds it holds based on, and in the same proportion as, the instructions given by all Participant Accounts invested in Mutual Funds entitled to give instructions at that shareholder meeting. VALIC Separate Account A will vote the shares of the Mutual Funds it holds for which it receives no voting instruction in the same proportion as the shares for which voting instructions have been received.

In the future, we may decide how to vote the shares of VALIC Separate Account A in a different manner if permitted at that time under federal securities law.

Federal Tax Matters

The Contracts provide tax-deferred accumulation over time, but are subject to federal income and excise taxes, mentioned briefly below. You should refer to the Statement of Additional Information for further details. Section references are to the Internal Revenue Code ("Code"). We do not attempt to describe any potential estate or gift tax, or any applicable state, local or foreign tax law other than possible premium taxes mentioned under "Premium Tax Charge." Remember that future legislation could modify the rules discussed below, and always consult your personal tax advisor regarding how the current rules apply to your specific situation.

Type of Plans

Tax rules vary, depending on whether the Contract is offered under your employer's tax-qualified retirement program, as a Section 408(b) Individual Retirement Annuity ("IRA"), or is instead a nonqualified Contract. The Contracts are used under the following types of retirement arrangements ("Qualified Contracts"):

Section 403(b) annuities for employees of public schools and Section 501(c)(3) tax-exempt organizations;
Section 401(a), 403(a) and 401(k) qualified plans of for-profit employers and other employers (including self-employed individuals);
Section 408(b) IRAs;
Section 457 deferred compensation plans of governmental and tax-exempt employers;
Section 408(k) SEPs and SARSEPs;
Section 408(p) SIMPLE retirement accounts.

Note that the specific terms of the governing employer plan may limit rights and options otherwise available under
a Contract.

In addition, the Contracts are also available through "Non-Qualified Contracts." Such Non-Qualified Contracts generally include unfunded, nonqualified deferred compensation plans of corporate employers, as well as individual annuity contracts issued to individuals outside of the context of any formal employer or employee retirement plan
or arrangement.

Tax Consequences in General

Purchase Payments, distributions, withdrawals, transfers and surrender of a Contract can each have a tax effect, which varies with the governing retirement arrangement. Please refer to the detailed explanation in the Statement of Additional Information, the documents (if any) controlling the retirement arrangement through which the contract is offered, and your personal tax advisor.

Purchase Payments under the Contracts can be made as contributions by employers, or as pre-tax or after-tax contributions by employees, depending on the type of retirement program. After-tax employee contributions constitute "investment in the Contract." All Qualified Contracts receive deferral of tax on the inside build-up of earnings on invested Purchase Payments, until a distribution occurs. See the Statement of Additional Information for special rules, including those applicable to taxable, non-natural owners of Non- Qualified Contracts.

Distributions are taxed differently depending on the program through which the Contracts are offered and the previous tax characterization of the contributions to which the distribution relates. Generally, the portion of a distribution which is not considered a return of investment in the Contract is subject to income tax. For annuity payments, investment in the contract is recovered ratably over the expected payout period. Special recovery rules might apply in certain situations.

Amounts subject to income tax may also incur excise or penalty taxes, under the circumstances described in the Statement of Additional Information. Generally, they would also be subject to some form of federal income tax withholding unless rolled into another tax-deferred vehicle. Required withholding will vary according to type of program, type of payment and your tax status. In addition, amounts received under all Contracts may be subject to state income tax withholding requirements.

Investment earnings on contributions to Non-Qualified Contracts which are not owned by (or, generally, for the benefit of) natural persons will be taxed currently to the owner and such contracts will not be treated as annuities for federal income tax purposes.

Effect of Tax-Deferred Accumulations

The chart below compares the results from Premium Payments made to:

A Contract issued to a tax-favored retirement program purchased with pre-tax premium payments;
A non-qualified Contract purchased with after-tax Premium Payments and;
Conventional savings vehicles such as savings accounts.

[chart appears here]

This hypothetical chart compares the results of (1) contributing $100 per month to a conventional, non-tax deferred plan, (2) contributing $100 to a nonqualified, tax-deferred annuity, and (3) contributing $100 per month ($138.89 since contributions are made before tax) to a qualified tax-deferred plan. The chart assumes a 28% tax rate and an 8% fixed rate of return. Variable options incur mortality and expense risk fee charges and may also incur account maintenance fees and surrender charges. The chart does not reflect the deduction of any such fees. An additional 10% tax penalty may apply to withdrawals before age 59 1/2. This information is for illustrative purposes only and is not a guarantee of future return.

Unlike savings accounts, Premium Payments made to tax-favored retirement programs and Non-Qualified Contracts generally provide tax deferred treatment on earnings. In addition, Premium Payments made to tax-favored retirement programs ordinarily are not subject to income tax until withdrawn. As shown above, investing in a tax-favored program increases the accumulation power of savings over time. The more taxes saved and reinvested in the program, the more the accumulation power effectively grows over the years.

To further illustrate the advantages of tax deferred savings using a 28% Federal tax bracket, an annual fixed yield (before the deduction of any fees or charges) of 8% under a tax-favored retirement program in which tax savings were reinvested has an equivalent after-tax annual fixed yield of 5.76% under a conventional savings program. The 8% yield on the tax-deferred program will be reduced by the impact of income taxes upon withdrawal. The yield will vary depending upon the timing of withdrawals. The previous chart represents (without factoring in fees and charges) after-tax amounts that would be received.

By taking into account the current deferral of taxes, contributions to tax-favored retirement programs increase the amount available for savings by decreasing the relative current out-of-pocket cost (referring to the effect on annual net take-home pay) of the investment. The chart below illustrates this principle by comparing a pre-tax contribution to a tax-favored retirement plan with an after-tax contribution to a conventional savings account:

Paycheck Comparison	Tax-Favored Retirement Program	Conventional Savings Account
Annual amount available for savings before federal taxes	$2,500	$2,500
Current federal income tax due on Purchase Payments	0	(700)
Net retirement plan Purchase Payments	$2,500	$1,800

This chart assumes a 28% federal income tax rate. The $700 which is paid toward current federal income taxes reduces the actual amount saved in the conventional savings account to $1,800 while the full $2,500 is contributed to the tax-qualified program, subject to being taxed upon withdrawal. Stated otherwise, to reach an annual retirement savings goal of $2,500, the contribution to a tax-qualified retirement program results in a current out-of-pocket expense of $1,800 while the contribution to a conventional savings account requires the full $2,500 out-of-pocket expense. The tax-qualified retirement program represented in this chart is a plan type, such as one under Section 403(b) of the Code, which allows participants to exclude contributions (within limits) from gross income.

Contents of Statement of Additional Information

General Information 3

Marketing Information 3

Types of Variable Annuity Contracts 3

Federal Tax Matters 3

General 3

Taxes Payable by Participants and Annuitants 4

Section 403(b) Annuities 4

Section 401 Qualified Pension, Profit-Sharing or Annuity Plans 5

Section 408(b) Individual Retirement Annuities (other than Roth IRAs) 6

Simplified Employee Pension Plans 7

Section 457 Eligible Deferred Compensation Plans of Public Employers 6

Private Employer Unfunded Deferred Compensation Plans 6

Fund Diversification 7

Exchange Privilege 9

Exchanges from Independence Plus Contracts 9

Exchanges from V-Plan Contracts 10

Exchanges from SA-1 and SA-2 Contracts 11

Exchanges from Compounder Contracts 14

Information which may be Applicable to any Exchange 14

Calculation of Surrender Charge 15

Illustration of Surrender Charge on Total Surrender 15

Illustration of Surrender Charge on a 10% Partial Surrender Followed by a Full Surrender 16

Purchase Unit Value 7

Illustration of Calculation of Purchase Units Value 7

Illustration of Purchase of Purchase Units 7

Performance Calculations 8

Money Market Division Yields 17

Calculation of Current Yield for Money Market Division Two 17

Illustration of Calculation of Current Yield for Money Market Division Two 17

Calculation of Effective Yield for Money Market Division Two 17

Illustration of Calculation of Effective Yield for Money Market Division Two 18

Standardized Yield for Capital Conservation Division 1 18

Calculation of Standardized Yield for Capital Conservation Division 1 18

Illustration of Calculation of Standardized Yield for Capital Conservation Division 1 18

Calculation of Average Annual Total Return 8

Performance Information 9

Payout Payments 10

Assumed Investment Rate 10

Amount of Payout Payments 10

Payout Unit Value 11

Illustration of Calculation of Payout Unit Value 11

Illustration of Payout Payments 12

Distribution of Variable Annuity Contracts 12

Experts 12

Comments on Financial Statements 13

THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

2929 ALLEN PARKWAY, HOUSTON, TEXAS 77019

1-800-448-2542

FOR ASSET TRANSFERS BY TELEPHONE CALL: 1-800-621-7792

TDD 1-800-358-2542

VALIC BY PHONE 1-800-428-2542

TDD VALIC BY PHONE 1-800-248-2542

PRINTED MATTER

PRINTED IN U.S.A.

VL 2620

REV 5/02

Independence Plus

Separate Account A

Fixed and Variable Annuity

Prospectus

May 1, 2002

The Variable Annuity Life Insurance Company

Units of Interest under Group and Individual

Fixed and Variable Annuity Contracts

Independence Plus

Separate Account A

Prospectus May 1, 2002

Independence Plus consists of flexible and single Purchase Payment group and individual fixed and variable annuity contracts (the "Contracts") that are offered by The Variable Annuity Life Insurance Company ("VALIC") to Participants in certain employer sponsored retirement plans. Independence Plus may be available to you when you participate in a retirement program that qualifies for deferral of federal income taxes. Non-qualified contracts are also available for certain other employer sponsored plans as well as for certain after-tax arrangements that are not part of an employer's plan.

Independence Plus permits you to invest in and receive retirement benefits in up to 7 out of a total of 12 Fixed and Variable Account Options (2 fixed and 10 variable) described in this prospectus. Each Variable Account Option invests in a separate portfolio of VALIC Company I, formerly, North American Funds Variable Product Series I.

This prospectus provides you with information you should know before investing in Independence Plus. Please read and retain this prospectus for future reference.

A Statement of Additional Information, dated May 1, 2002, contains additional information about Independence Plus and is part of this prospectus. For a free copy call 1-800-428-2542 (option 3). The Statement of Additional Information has been filed with the Securities and Exchange Commission ("SEC") and is available along with other related materials at the SEC's internet web site (http://www.sec.gov).

INVESTMENT IN INDEPENDENCE PLUS IS SUBJECT TO RISK THAT MAY CAUSE THE VALUE OF THE OWNER'S INVESTMENT TO FLUCTUATE, AND WHEN THE CONTRACTS ARE SURRENDERED, THE VALUE MAY BE HIGHER OR LOWER THAN THE PURCHASE PAYMENTS.

THE SEC HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Table of Contents

Page

Glossary of Terms 1

Fee Table 2

Summary 3

Selected Purchase Unit Data 5

General Information 6

About Independence Plus 8

About VALIC 8

About VALIC Separate Account A 8

Units of Interests 9

Distribution of the Contracts 9

Fixed Account Options 9

Variable Account Options 9

Purchase Period 10

Account Establishment 11

When Your Account Will be Credited 11

Purchase Units 12

Calculation of Purchase Unit Value 12

Stopping Purchase Payments 13

Transfers Between Investment Options 13

During the Purchase Period 14

During the Payout Period 14

Communicating Transfer or Reallocation Instructions 14

Effective Date of Transfer 15

Market Timing 15

Fees and Charges 15

Account Maintenance Fee 16

Surrender Charge 16

Amount of Surrender Charge 16

10% Free Withdrawal 17

Exceptions to Surrender Charge 17

Premium Tax Charge 17

Separate Account Charges 17

Fund Annual Expense Charges 18

Other Tax Charges 18

Reduction or Waiver of Account Maintenance Fee and Surrender Charge 18

Payout Period 18

Fixed Payout 18

Variable Payout 19

Combination Fixed and Variable Payout 19

Payout Date 19

Payout Options 19

Enhancements to Payout Options 20

Payout Information 20

Surrender of Account Value 20

When Surrenders Are Allowed 20

Surrender Process 21

Amount That May Be Surrendered 21

Surrender Restrictions 21

Partial Surrenders 22

Exchange Privilege 22

Restrictions on Exchange Privilege 22

Agents' and Managers' Retirement Plan Exchange Offer 22

Death Benefits 23

The Process 23

Beneficiary Information 23

During the Purchase Period 23

During the Payout Period 23

Investment Performance of Separate Account Divisions 24

Types of Investment Performance Information Advertised 24

Total Return Performance Information 24

Yield Performance Information 25

Other Contract Features 26

Changes That May Not Be Made 26

Change of Beneficiary 26

Cancellation -- The 10 Day "Free Look" 26

We Reserve Certain Rights 26

Fund Changes 26

Relationship to Employer's Plan 27

Voting Rights 27

Who May Give Voting Instructions 27

Determination of Fund Shares Attributable to Your Account 27

During Purchase Period 27

During Payout Period or after a Death Benefit Has Been Paid 27

How Fund Shares Are Voted 27

Federal Tax Matters 28

Type of Plans 28

Tax Consequences in General 28

Effect of Tax-Deferred Accumulations 29