497 1 esiilbs497.txt ES II LIVING BENEFITS SUPPLEMENT GOLDEN AMERICAN LIFE INSURANCE COMPANY SEPARATE ACCOUNT B OF GOLDEN AMERICAN LIFE INSURANCE COMPANY PROSPECTUS SUPPLEMENT DATED FEBRUARY 4, 2003 SUPPLEMENT TO THE PROSPECTUSES FOR DEFERRED COMBINATION VARIABLE AND FIXED ANNUITY CONTRACTS ISSUED BY GOLDEN AMERICAN LIFE INSURANCE COMPANY DATED MAY 1, 2002 FOR "GOLDENSELECT ESII PROSPECTUS" "GOLDENSELECT GENERATIONS PROSPECTUS" ----------------------------- The following information supplements the "Optional Riders" section of the prospectus with regard to the benefit under the Minimum Guaranteed Income Benefit ("MGIB") Rider and the charges under all three optional benefit riders. These provisions apply only to a new category of contract owners, Yr-2003 contract owners. Yr-2003 contract owners are those who purchased contracts on or after January 15, 2003, and whose contracts contain the new living benefit rider provisions described in this supplement. OPTIONAL RIDER CHARGES The section, "Optional Rider Charges" under "Charges and Fees" in the prospectus is hereby amended to provide that the quarterly charge for the Minimum Guaranteed Accumulation Benefit Rider ("MGAB") and the Minimum Guaranteed Withdrawal Benefit Rider ("MGWB") is 0.1625% of the MGAB Charge Base or original MGWB Eligible Payment Amount, as applicable (0.65% annually). The quarterly charge for the MGIB Rider for Yr-2003 contracts is 0.1875% of the MGIB Charge Base (0.75% annually). MGIB CHARGE BASE: The MGIB Charge Base is the greater of the MGIB Rollup Base and the MGIB Ratchet Base. (i) The MGIB Rollup Base is equal to the lesser of the Maximum MGIB Base and the sum of (a), (b) and (c) where: (a) is the MGIB Rollup Base for Covered Funds; (b) is the MGIB Rollup Base for Special Funds; (c) is the MGIB Rollup Base for Excluded Funds; and (ii) The MGIB Ratchet Base is equal to the sum of (a) and (b) where: (a) is the MGIB Ratchet Base for Covered and Special Funds; and (b) is the MGIB Ratchet Base for Excluded Funds. CALCULATION OF MINIMUM GUARANTEED INCOME BENEFIT The section, "Minimum Guaranteed Income Benefit (MGIB) Rider" under "Optional Riders" in the prospectus is hereby amended as follows for Yr-2003 contract owners. Other than as noted below, the provisions of the prospectus remain unchanged and continue to apply. 125127 ESII-Generations 02/04/2003 MGIB BENEFIT BASE: The MGIB Benefit Base is equal to the greater of the MGIB Rollup Benefit Base and the MGIB Ratchet Benefit Base. (i) The MGIB Rollup Benefit Base is equal to the lesser of the Maximum MGIB Base and the sum of (a), (b) and (c) where: (a) is the MGIB Rollup Base for Covered Funds; (b) is the MGIB Rollup Base for Special Funds; (c) is the contract value allocated to Excluded Funds; and (ii) The MGIB Ratchet Benefit Base is equal to the sum of (a) and (b) where: (a) is the MGIB Ratchet Base for Covered and Special Funds; and (b) is the contract value allocated to Excluded Funds. The MGIB ROLLUP BASE is calculated as described in the prospectus for the MGIB Base except that the MAXIMUM MGIB BASE equals 300% of eligible premiums adjusted pro rata for withdrawals, and the words, "MGIB Rollup Base", replace the words, or "MGIB Base". The MGIB RATCHET BASE FOR COVERED FUNDS AND SPECIAL FUNDS equals: o on the rider date, eligible premiums, or the contract value, if applicable, allocated to Covered Funds and Special Funds; o on each "quarterly anniversary date" prior to attainment of age 90, the MGIB Ratchet Base for Covered Funds and Special Funds is set equal to the greater of : (1) the current contract value allocated to Covered Funds and Special Funds (after any deductions occurring on that date); and (2) the MGIB Ratchet Base for Covered Funds and Special Funds from the most recent prior quarterly anniversary date, adjusted for any new eligible premiums and withdrawals attributable to Covered Funds or Special Funds, and transfers. o at other times, the MGIB Ratchet Base for Covered Funds and Special Funds is the MGIB Ratchet Base from the prior quarterly anniversary date, adjusted for subsequent eligible premiums and withdrawals attributable to Covered Funds or Special Funds, and transfers. The MGIB RATCHET BASE FOR EXCLUDED FUNDS is calculated the same as for Covered Funds and Special Funds, but for premiums, allocations, withdrawals or transfers attributable to Excluded Funds. EFFECT OF TRANSFERS ON MGIB RATCHET BASE: Net transfers from Covered or Special Funds to Excluded Funds will reduce the MGIB Ratchet Base allocated to Covered and Special Funds on a pro-rata basis. The resulting increase in the MGIB Ratchet Base allocated to Excluded Funds will equal the reduction in the MGIB Ratchet Base allocated to Covered and Special Funds. Net transfers from Excluded Funds to Covered or Special Funds will reduce the MGIB Ratchet Base allocated to Excluded Funds on a pro-rata basis. The resulting increase in the MGIB Ratchet Base allocated to Covered and Special Funds will equal the lesser of the net contract value transferred and the change in the MGIB Ratchet Base allocated to Excluded Funds. A "quarterly anniversary date" is the date three months from the contract date that falls on the same date in the month as the contract date. For example, if the contract date is February 12, the quarterly anniversary date is May 12. If there is no corresponding date in the month, the quarterly anniversary date will be the last date of such month. If the quarterly anniversary date falls on a weekend or holiday, we will use the value as of the subsequent business day. MGIB INCOME OPTIONS A new option is available, once during the life of the Contract, to elect to apply up to 50% of the MGIB Benefit Base to one of the MGIB Income Options available under the Rider. This option may only be exercised on a contract anniversary at or after the end of the waiting period. The portion of the MGIB Benefit Base so applied will be used to determine the MGIB income, as is otherwise described in the prospectus. The Contract Value will be reduced on a pro rata basis. Any subsequent exercise of your right to receive payments under the MGIB rider must be for 100% of the remaining value. The amount applied to the partial annuitization will be treated as a withdrawal for purposes of adjusting contract and rider values. Please note that if you elect partial annuitization, income payments received will be reported as withdrawals. Please consult your tax adviser before making this election. The following are the MGIB Income Options available under the MGIB Rider: (a) Income for Life (Single Life or Joint with 100% Survivor) and 10-20 year certain; (b) Income for a 20-30 year period certain; (c) Any other income plan offered by the Company in conjunction with the MGIB rider on the MGIB Benefit Date. You may elect to have payments under MGIB Income Options (a) and (b) increase annually at 1%, 2% or 3%. The following table replaces the expense table in the Profile to the Prospectus, and reflects the new highest optional rider charge, assumed to be 1.14%, where the rider base is equal to the initial premium and increases by 7% each year.
--------------------------------------------------------------------------------------------------------------------------- EXAMPLES: --------- TOTAL ANNUAL TOTAL ANNUAL TOTAL CHARGES AT THE END OF: INSURANCE CHARGES CHARGES 1 YEAR 10 YEARS ---------------- --------------- ----------------- ---------------- WITH W/O TOTAL ANNUAL WITH W/O WITH W/O WITH W/O THE ANY INVESTMENT THE ANY THE ANY THE ANY RIDER RIDER PORTFOLIO RIDER RIDER RIDER RIDER RIDER RIDER INVESTMENT PORTFOLIO CHARGES CHARGE CHARGES CHARGES CHARGE CHARGES CHARGE CHARGES CHARGE --------------------------------------------------------------------------------------------------------------------------- THE GCG TRUST All Cap 3.33% 1.89% 1.01% 4.34% 2.90% $124 $109 $449 $322 Capital Growth 3.33% 1.89% 1.02% 4.35% 2.91% $124 $109 $449 $323 Capital Guardian Small Cap 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Core Bond 3.33% 1.89% 1.01% 4.34% 2.90% $124 $109 $449 $322 Developing World 3.33% 1.89% 1.76% 5.09% 3.65% $131 $117 $507 $391 Diversified Mid-Cap 3.33% 1.89% 1.01% 4.34% 2.90% $124 $109 $449 $322 Equity Growth-S 3.33% 1.89% 1.01% 4.34% 2.90% $124 $109 $449 $322 Equity Income 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Equity Opportunity 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Focus Value-S 3.33% 1.89% 1.06% 4.39% 2.95% $124 $110 $453 $327 Fully Managed 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Fundamental Growth-S 3.33% 1.89% 1.06% 4.39% 2.95% $124 $110 $453 $327 Global Franchise-S 3.33% 1.89% 1.26% 4.59% 3.15% $126 $112 $469 $346 Growth 3.33% 1.89% 1.02% 4.35% 2.91% $124 $109 $449 $323 Hard Assets 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 International Enhanced EAFE-S 3.33% 1.89% 1.26% 4.59% 3.15% $126 $112 $469 $346 International Equity 3.33% 1.89% 1.26% 4.59% 3.15% $126 $112 $469 $346 Internet Tollkeeper 3.33% 1.89% 1.86% 5.19% 3.75% $132 $118 $514 $399 Investors 3.33% 1.89% 1.01% 4.34% 2.90% $124 $109 $449 $322 J.P. Morgan Fleming Small Cap Equity-S 3.33% 1.89% 1.16% 4.49% 3.05% $125 $111 $461 $336 Janus Growth and Income 3.33% 1.89% 1.11% 4.44% 3.00% $125 $110 $457 $332 Large Cap Value 3.33% 1.89% 1.01% 4.34% 2.90% $124 $109 $449 $322 Limited Maturity Bond 2.94% 1.89% 0.54% 3.48% 2.43% $115 $105 $371 $277 Liquid Asset 2.94% 1.89% 0.54% 3.48% 2.43% $115 $105 $371 $277 Managed Global 3.33% 1.89% 1.26% 4.59% 3.15% $126 $112 $469 $346 Mid-Cap Growth 3.33% 1.89% 0.89% 4.22% 2.78% $122 $108 $439 $311 Real Estate 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Research 3.33% 1.89% 0.89% 4.22% 2.78% $122 $108 $439 $311 Special Situations 3.33% 1.89% 1.11% 4.44% 3.00% $125 $110 $457 $322 Strategic Equity 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Total Return 3.33% 1.89% 0.89% 4.22% 2.78% $122 $108 $439 $311 Value Equity 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 Van Kampen Growth and Income 3.33% 1.89% 0.95% 4.28% 2.84% $123 $109 $444 $317 AIM VARIABLE INSURANCE FUND AIM V.I. Dent Demographic Trends Fund 3.33% 1.89% 1.45% 4.78% 3.34% $128 $114 $483 $363 FIDELITY VARIABLE INSURANCE PRODUCTS FUND Fidelity VIP Equity-Income Portfolio 3.33% 1.89% 0.84% 4.17% 2.73% $122 $108 $435 $306 -S2 Fidelity VIP Growth Portfolio -S2 3.33% 1.89% 0.93% 4.26% 2.82% $123 $109 $442 $315 ING GET FUND ING GET 3.83% 2.39% 1.00% 4.83% 3.39% $128 $97 N/A N/A ING VARIABLE INSURANCE TRUST ING VP Worldwide Growth 3.33% 1.89% 1.23% 4.56% 3.12% $126 $111 $466 $343 ING VP BOND PORTFOLIO ING VP Bond Portfolio -S 3.33% 1.89% 0.75% 4.08% 2.64% $121 $107 $427 $297 ING VARIABLE PRODUCTS TRUST ING VP Growth Opportunities (S) 3.33% 1.89% 1.10% 4.43% 2.99% $124 $110 $456 $331 ING VP MagnaCap (S) 3.33% 1.89% 1.10% 4.43% 2.99% $124 $110 $456 $331 ING VP SmallCap Opportunities (S) 3.33% 1.89% 1.10% 4.43% 2.99% $124 $110 $456 $331 INVESCO VARIABLE INVESTMENT FUNDS, INC. INVESCO VIF- Financial Services Fund 3.33% 1.89% 1.07% 4.40% 2.96% $124 $110 $453 $328 INVESCO VIF- Health Sciences Fund 3.33% 1.89% 1.06% 4.39% 2.95% $124 $110 $453 $327 INVESCO VIF- Leisure Fund 3.33% 1.89% 1.39% 4.72% 3.28% $127 $113 $479 $358 INVESCO VIF- Utilities Fund 3.33% 1.89% 1.37% 4.70% 3.26% $127 $113 $477 $356 THE PIMCO VARIABLE INSURANCE TRUST PIMCO High Yield 3.33% 1.89% 0.75% 4.08% 2.64% $121 $107 $427 $297 PIMCO StocksPLUS Growth 3.33% and Income 1.89% 0.65% 3.98% 2.54% $120 $106 $419 $288 PIONEER VARIABLE CONTRACTS TRUST Pioneer Fund VCT Portfolio 3.33% 1.89% 1.04% 4.37% 2.93% $124 $110 $451 $325 Pioneer Mid-Cap Value VCT Portfolio 3.33% 1.89% 1.11% 4.44% 3.00% $125 $110 $457 $332 PROFUNDS VP ProFund VP Bull 3.33% 1.89% 1.98% 5.31% 3.87% $133 $119 $523 $410 ProFund VP Europe 30 3.33% 1.89% 1.89% 5.22% 3.78% $132 $118 $516 $402 ProFund VP Small-Cap 3.33% 1.89% 2.25% 5.58% 4.14% $136 $122 $542 $432 THE PRUDENTIAL SERIES FUND, INC. Jennison 3.33% 1.89% 1.04% 4.37% 2.93% $124 $110 $451 $325 SP Jennison International Growth 3.33% 1.89% 2.26% 5.59% 4.15% $136 $122 $543 $433 ------------------------------------------------------------------------------------------------------------------------------
EXAMPLES The following two examples are designed to show you the expenses you would pay on a $1,000 investment, that earns 5% annually. These examples replace Examples 1 and 2 currently in your prospectus. Examples 3 and 4 are unchanged. Each example assumes election of the Max 7 Enhanced Death Benefit. The examples reflect the deduction of a mortality and expense risk charge, an asset-based administrative charge, and the annual contract administrative charge as an annual charge of 0.04% of assets (based on an average contract value of $68,000). These examples also assume you elected the earnings multiplier benefit rider with a charge of 0.30% of the contract value annually and that you elected an optional benefit rider with the highest cost, an assumed charge of 0.75% annually, where the rider base is equal to the initial premium and increases by 7% annually, and the rider charge is assessed each quarter on a base equal to the hypothetical $1,000 premium increasing at 7% per year. The assumed annual rider charge of 1.14% results from the assumption of a 7% annual increase in the rider base but only a 5% earnings increase in the contract value before expenses. Thus, 1.14% represents an annual charge over the 10-year period which is equivalent to a charge of 0.1875% of rider base per quarter over the same period. For Yr-2003 contract owners, the assumed annual rider charge is 0.75% for allocations to the Liquid Asset Portfolio or Limited Maturity Bond Portfolio. Each example also assumes that any applicable expense reimbursement of underlying portfolio expenses will continue for the periods shown. If another death benefit is elected instead of the Max 7 Enhanced Death Benefit used in the examples, the actual expenses will be less than those represented in the examples. Note that surrender charges may apply if you choose to annuitize your Contract. Thus, in the event you annuitize your Contract under circumstances which require a surrender charge, you should refer to Examples 1 and 3 which assume applicable surrender charges. Example 1: If you surrender your Contract at the end of the applicable time period and elected both the earnings multiplier benefit rider and another optional benefit rider with the highest charge, you would pay the following expenses for each $1,000 invested:
-------------------------------------------------------------------------------------------------------------------- 1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------------------------------------------- THE GCG TRUST All Cap $124 $191 $261 $449 Capital Growth $124 $192 $261 $449 Capital Guardian Small Cap $123 $190 $258 $444 Core Bond $124 $191 $261 $449 Developing World $131 $212 $294 $507 Diversified Mid-Cap $124 $191 $261 $449 Equity Growth-S $124 $191 $261 $449 Equity Income $123 $190 $258 $444 Equity Opportunity $123 $190 $258 $444 Focus Value-S $124 $193 $263 $453 Fully Managed $123 $190 $258 $444 Fundamental Growth-S $124 $193 $263 $453 Global Franchise-S $126 $199 $272 $469 Growth $124 $192 $261 $449 Hard Assets $123 $190 $258 $444 International Enhanced EAFE-S $126 $199 $272 $469 International Equity $126 $199 $272 $469 Internet Tollkeeper $132 $215 $298 $514 Investors $124 $191 $261 $449 J.P. Morgan Fleming Small Cap Equity-S $125 $196 $267 $461 Janus Growth and Income $125 $194 $265 $457 Large Cap Value $124 $191 $261 $449 Limited Maturity Bond $115 $167 $220 $371 Liquid Asset $115 $167 $220 $371 Managed Global $126 $199 $272 $469 Mid-Cap Growth $122 $188 $255 $439 Real Estate $123 $190 $258 $444 Research $122 $188 $255 $439 Special Situations $125 $194 $265 $457 Strategic Equity $123 $190 $258 $444 Total Return $122 $188 $255 $439 Value Equity $123 $190 $258 $444 Van Kampen Growth and Income $123 $190 $258 $444 AIM VARIABLE INSURANCE FUNDS AIM V.I. Dent Demographic Trends Fund $128 $204 $280 $483 FIDELITY VARIABLE INSURANCE PRODUCTS FUND Fidelity VIP Equity-Income Portfolio -S2 $122 $187 $253 $435 Fidelity VIP Growth Portfolio -S2 $123 $189 $257 $442 ING VARIABLE INSURANCE TRUST ING VP Worldwide Growth $126 $198 $271 $466 ING VP BOND PORTFOLIO ING VP Bond Portfolio -S $121 $184 $249 $427 ING VARIABLE PRODUCTS TRUST ING VP Growth Opportunities (S) $124 $194 $265 $456 ING VP MagnaCap (S) $124 $194 $265 $456 ING VP SmallCap Opportunities (S) $124 $194 $265 $456 INVESCO VARIABLE INVESTMENT FUNDS, INC. INVESCO VIF- Financial Services Fund $124 $193 $263 $453 INVESCO VIF- Health Sciences Fund $124 $193 $263 $453 INVESCO VIF- Leisure Fund $127 $202 $278 $479 INVESCO VIF- Utilities Fund $127 $202 $277 $477 THE PIMCO VARIABLE INSURANCE TRUST PIMCO High Yield $121 $184 $249 $427 PIMCO StocksPLUS Growth and Income $120 $181 $244 $419 PIONEER VARIABLE CONTRACTS TRUST Pioneer Fund VCT Portfolio $124 $192 $262 $451 Pioneer Mid-Cap Value VCT Portfolio $125 $194 $265 $457 PROFUNDS ProFund VP Bull $133 $219 $303 $523 ProFund VP Europe 30 $132 $216 $300 $516 ProFund VP Small-Cap $136 $226 $315 $542 THE PRUDENTIAL SERIES FUND, INC. Jennison $124 $192 $262 $451 SP Jennison International Growth $136 $226 $315 $543 ING GET FUND ING GET $128 $205 $283 N/A --------------------------------------------------------------------------------------------------------------------
Example 2: If you do not surrender your Contract at the end of the applicable time period and elected both the earnings multiplier benefit rider and another optional benefit rider with the highest charge, you would pay the following expenses for each $1,000 invested:
-------------------------------------------------------------------------------------------------------------------- 1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------------------------------------------- THE GCG TRUST All Cap $44 $131 $221 $449 Capital Growth $44 $132 $221 $449 Capital Guardian Small Cap $43 $130 $218 $444 Core Bond $44 $131 $221 $449 Developing World $51 $152 $254 $507 Diversified Mid-Cap $44 $131 $221 $449 Equity Growth-S $44 $131 $221 $449 Equity Income $43 $130 $218 $444 Equity Opportunity $43 $130 $218 $444 Focus Value-S $44 $133 $223 $453 Fully Managed $43 $130 $218 $444 Fundamental Growth-S $44 $133 $223 $453 Global Franchise-S $46 $139 $232 $469 Growth $44 $132 $221 $449 Hard Assets $43 $130 $218 $444 International Enhanced EAFE-S $46 $139 $232 $469 International Equity $46 $139 $232 $469 Internet Tollkeeper $52 $155 $258 $514 Investors $44 $131 $221 $449 J.P. Morgan Fleming Small Cap Equity-S $45 $136 $227 $461 Janus Growth and Income $45 $134 $225 $457 Large Cap Value $44 $131 $221 $449 Limited Maturity Bond $35 $107 $180 $371 Liquid Asset $35 $107 $180 $371 Managed Global $46 $139 $232 $469 Mid-Cap Growth $42 $128 $215 $439 Real Estate $43 $130 $218 $444 Research $42 $128 $215 $439 Special Situations $45 $134 $225 $457 Strategic Equity $43 $130 $218 $444 Total Return $42 $128 $215 $439 Value Equity $43 $130 $218 $444 Van Kampen Growth and Income $43 $130 $218 $444 AIM VARIABLE INSURANCE FUNDS AIM V.I. Dent Demographic Trends Fund $48 $144 $240 $483 FIDELITY VARIABLE INSURANCE PRODUCTS FUND Fidelity VIP Equity-Income Portfolio -S2 $42 $127 $213 $435 Fidelity VIP Growth Portfolio -S2 $43 $129 $217 $442 ING VARIABLE INSURANCE TRUST ING VP Worldwide Growth $46 $138 $231 $466 ING VP BOND PORTFOLIO ING VP Bond Portfolio -S $41 $124 $209 $427 ING VARIABLE PRODUCTS TRUST ING VP Growth Opportunities (S) $44 $134 $225 $456 ING VP MagnaCap (S) $44 $134 $225 $456 ING VP SmallCap Opportunities (S) $44 $134 $225 $456 INVESCO VARIABLE INVESTMENT FUNDS, INC. INVESCO VIF- Financial Services Fund $44 $133 $223 $453 INVESCO VIF- Health Sciences Fund $44 $133 $223 $453 INVESCO VIF- Leisure Fund $47 $142 $238 $479 INVESCO VIF- Utilities Fund $47 $142 $237 $477 THE PIMCO VARIABLE INSURANCE TRUST PIMCO High Yield $41 $124 $209 $427 PIMCO StocksPLUS Growth and Income $40 $121 $204 $419 PIONEER VARIABLE CONTRACTS TRUST Pioneer Fund VCT Portfolio $44 $132 $222 $451 Pioneer Mid-Cap Value VCT Portfolio $45 $134 $225 $457 PROFUNDS ProFund VP Bull $53 $159 $263 $523 ProFund VP Europe 30 $52 $156 $260 $516 ProFund VP Small-Cap $56 $166 $275 $542 THE PRUDENTIAL SERIES FUND, INC. Jennison $44 $132 $222 $451 SP Jennison International Growth $56 $166 $275 $543 ING GET FUND ING GET $48 $145 $243 N/A --------------------------------------------------------------------------------------------------------------------
GOLDEN AMERICAN LIFE INSURANCE COMPANY Golden American Life Insurance Company is a stock company domiciled in Delaware. 125127 ESII-Generations 02/04/2003 GOLDEN AMERICAN LIFE INSURANCE COMPANY SEPARATE ACCOUNT B OF GOLDEN AMERICAN LIFE INSURANCE COMPANY PROSPECTUS SUPPLEMENT DATED FEBRUARY 4, 2003 SUPPLEMENT TO THE PROSPECTUS FOR DEFERRED COMBINATION VARIABLE AND FIXED ANNUITY CONTRACTS ISSUED BY GOLDEN AMERICAN LIFE INSURANCE COMPANY DATED JULY 31, 2002 FOR "GOLDENSELECT OPPORTUNITIES PROSPECTUS" ----------------------------- The following information supplements the "Optional Riders" section of the prospectus with regard to the benefit under the Minimum Guaranteed Income Benefit ("MGIB") Rider and the charges under all three optional benefit riders. These provisions apply only to a new category of contract owners, Yr-2003 contract owners. Yr-2003 contract owners are those who purchased contracts on or after January 15, 2003, and whose contracts contain the new living benefit rider provisions described in this supplement. OPTIONAL RIDER CHARGES The section, "Optional Rider Charges" under "Charges and Fees" in the prospectus is hereby amended to provide that the quarterly charge for the Minimum Guaranteed Accumulation Benefit Rider ("MGAB") and the Minimum Guaranteed Withdrawal Benefit Rider ("MGWB") and for the MGIB Rider in states where the Yr-2003 benefit rider is not available, is 0.1625% of the MGAB is 0.1625% of the MGAB Charge Base or original MGWB Eligible Payment Amount, as applicable (0.65% annually).. The quarterly charge for the MGIB Rider for Yr-2003 contracts is 0.1875% of the MGIB Charge Base (0.75% annually). MGIB CHARGE BASE: The MGIB Charge Base is the greater of the MGIB Rollup Base and the MGIB Ratchet Base. (i) The MGIB Rollup Base is equal to the lesser of the Maximum MGIB Base and the sum of (a), (b) and (c) where: (a) is the MGIB Rollup Base for Covered Funds; (b) is the MGIB Rollup Base for Special Funds; (c) is the MGIB Rollup Base for Excluded Funds; and (ii) The MGIB Ratchet Base is equal to the sum of (a) and (b) where: (a) is the MGIB Ratchet Base for Covered and Special Funds; and (b) is the MGIB Ratchet Base for Excluded Funds. CALCULATION OF MINIMUM GUARANTEED INCOME BENEFIT The section, "Minimum Guaranteed Income Benefit (MGIB) Rider" under "Optional Riders" in the prospectus is hereby amended as follows for Yr-2003 contract owners. Other than as noted below, the provisions of the prospectus remain unchanged and continue to apply. MGIB BENEFIT BASE: The MGIB Benefit Base is equal to the greater of the MGIB Rollup Benefit Base and the MGIB Ratchet Benefit Base. (i) The MGIB Rollup Benefit Base is equal to the lesser of the Maximum MGIB Base and the sum of (a), (b) and (c) where: (a) is the MGIB Rollup Base for Covered Funds; (b) is the MGIB Rollup Base for Special Funds; (c) is the contract value allocated to Excluded Funds; and (ii) The MGIB Ratchet Benefit Base is equal to the sum of (a) and (b) where: (a) is the MGIB Ratchet Base for Covered and Special Funds; and (b) is the contract value allocated to Excluded Funds. The MGIB ROLLUP BASE is calculated as described in the prospectus for the MGIB Base except that the MAXIMUM MGIB BASE equals 300% of eligible premiums adjusted pro rata for withdrawals, and the words, "MGIB Rollup Base", replace the words, or "MGIB Base". The MGIB RATCHET BASE FOR COVERED FUNDS AND SPECIAL FUNDS equals: o on the rider date, eligible premiums, or the contract value, if applicable, allocated to Covered Funds and Special Funds; o on each "quarterly anniversary date" prior to attainment of age 90, the MGIB Ratchet Base for Covered Funds and Special Funds is set equal to the greater of : (1) the current contract value allocated to Covered Funds and Special Funds (after any deductions occurring on that date); and (2) the MGIB Ratchet Base for Covered Funds and Special Funds from the most recent prior quarterly anniversary date, adjusted for any new eligible premiums and withdrawals attributable to Covered Funds and Special Funds, and transfers. o at other times, the MGIB Ratchet Base for Covered Funds and Special Funds is the MGIB Ratchet Base from the prior quarterly anniversary date, adjusted for subsequent eligible premiums and withdrawals attributable to Covered Funds or Special Funds, and transfers. The MGIB RATCHET BASE FOR EXCLUDED FUNDS is calculated the same as for Covered Funds and Special Funds, but for premiums, allocations, withdrawals or transfers attributable to Excluded Funds. EFFECT OF TRANSFERS ON MGIB RATCHET BASE: Net transfers from Covered or Special Funds to Excluded Funds will reduce the MGIB Ratchet Base allocated to Covered and Special Funds on a pro-rata basis. The resulting increase in the MGIB Ratchet Base allocated to Excluded Funds will equal the reduction in the MGIB Ratchet Base allocated to Covered and Special Funds. Net transfers from Excluded Funds to Covered or Special Funds will reduce the MGIB Ratchet Base allocated to Excluded Funds on a pro-rata basis. The resulting increase in the MGIB Ratchet Base allocated to Covered and Special Funds will equal the lesser of the net contract value transferred and the change in the MGIB Ratchet Base allocated to Excluded Funds. A "quarterly anniversary date" is the date three months from the contract date that falls on the same date in the month as the contract date. For example, if the contract date is February 12, the quarterly anniversary date is May 12. If there is no corresponding date in the month, the quarterly anniversary date will be the last date of such month. If the quarterly anniversary date falls on a weekend or holiday, we will use the value as of the subsequent business day. MGIB INCOME OPTIONS A new option is available, once during the life of the Contract, to elect to apply up to 50% of the MGIB Benefit Base to one of the MGIB Income Options available under the Rider. This option may only be exercised on a contract anniversary at or after the end of the waiting period. The portion of the MGIB Benefit Base so applied will be used to determine the MGIB income, as is otherwise described in the prospectus. The Contract Value will be reduced on a pro rata basis. Any subsequent exercise of your right to receive payments under the MGIB rider must be for 100% of the remaining value. The amount applied to the partial annuitization will be treated as a withdrawal for purposes of adjusting contract and rider values. Please note that if you elect partial annuitization, income payments received will be reported as withdrawals. Please consult your tax adviser before making this election. The following are the MGIB Income Options available under the MGIB Rider: (a) Income for Life (Single Life or Joint with 100% Survivor) and 10-20 year certain; (b) Income for a 20-30 year period certain; (c) Any other income plan offered by the Company in conjunction with the MGIB rider on the MGIB Benefit Date. You may elect to have payments under MGIB Income Options (a) and (b) increase annually at 1%, 2% or 3%. The following table replaces the expense table in the Profile to the Prospectus, and reflects the new highest optional rider charge, assumed to be 1.14%, where the rider base is equal to the initial premium and increases by 7% each year.
--------------------------------------------------------------------------------------------------------------------------- EXAMPLES: --------- TOTAL ANNUAL TOTAL ANNUAL TOTAL CHARGES AT THE END OF: INSURANCE CHARGES CHARGES 1 YEAR 10 YEARS ---------------- --------------- ----------------- ---------------- WITH W/O TOTAL ANNUAL WITH W/O WITH W/O WITH W/O THE ANY INVESTMENT THE ANY THE ANY THE ANY RIDER RIDER PORTFOLIO RIDER RIDER RIDER RIDER RIDER RIDER INVESTMENT PORTFOLIO CHARGES CHARGE CHARGES CHARGES CHARGE CHARGES CHARGE CHARGES CHARGE --------------------------------------------------------------------------------------------------------------------------- THE GCG TRUST All Cap -A 3.33% 1.89% 1.16% 4.49% 3.05% $124 $111 $461 $336 Capital Growth -A 3.33% 1.89% 1.17% 4.50% 3.06% $124 $111 $449 $337 Capital Guardian Small Cap -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $449 $331 Core Bond -A 3.33% 1.89% 1.16% 4.49% 3.05% $124 $111 $444 $336 Developing World -A 3.33% 1.89% 1.91% 5.24% 3.80% $131 $118 $449 $404 Diversified Mid-Cap -A 3.33% 1.89% 1.16% 4.49% 3.05% $124 $111 $507 $336 Equity Growth Series -A 3.33% 1.89% 1.16% 4.49% 3.05% $124 $111 $449 $336 Equity Income -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $449 $331 Equity Opportunity -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $444 $331 Focus Value Series -A 3.33% 1.89% 1.21% 4.54% 3.10% $124 $111 $444 $341 Fully Managed -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $453 $331 Fundamental Growth Series -A 3.33% 1.89% 1.21% 4.54% 3.10% $124 $111 $444 $341 Global Franchise Series -A 3.33% 1.89% 1.41% 4.74% 3.30% $126 $113 $453 $359 Growth -A 3.33% 1.89% 1.17% 4.50% 3.06% $124 $111 $469 $337 Hard Assets -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $449 $331 International Enhanced EAFE Series -A 3.33% 1.89% 1.41% 4.74% 3.30% $126 $113 $444 $359 International Equity -A 3.33% 1.89% 1.41% 4.74% 3.30% $126 $113 $469 $359 Internet Tollkeeper -A 3.33% 1.89% 2.01% 5.34% 3.90% $132 $119 $469 $412 Investors -A 3.33% 1.89% 1.16% 4.49% 3.05% $124 $111 $514 $336 J.P. Morgan Fleming Small Cap Equity Series -A 3.33% 1.89% 1.31% 4.64% 3.20% $125 $112 $449 $350 Janus Growth and Income -A 3.33% 1.89% 1.26% 4.59% 3.15% $125 $112 $461 $346 Large Cap Value -A 3.33% 1.89% 1.16% 4.49% 3.05% $124 $111 $457 $336 Liquid Asset -A 2.94% 1.89% 0.69% 3.63% 2.58% $115 $106 $371 $291 Managed Global -A 3.33% 1.89% 1.41% 4.74% 3.30% $126 $113 $371 $359 Mid-Cap Growth -A 3.33% 1.89% 1.04% 4.37% 2.93% $122 $110 $469 $325 Real Estate -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $439 $331 Research -A 3.33% 1.89% 1.04% 4.37% 2.93% $122 $110 $444 $325 Special Situations -A 3.33% 1.89% 1.26% 4.59% 3.15% $125 $112 $439 $346 Strategic Equity -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $457 $331 Total Return -A 3.33% 1.89% 1.04% 4.37% 2.93% $122 $110 $444 $325 Value Equity -A 3.33% 1.89% 1.10% 4.43% 2.99% $123 $110 $439 $331 Van Kampen Growth and Income -A 3.33% 1.89% 1.10% 4.43% 2.99% $128 $110 $444 $331 AIM VARIABLE INSURANCE FUND AIM V.I. Dent Demographic Trends Fund 3.33% 1.89% 1.45% 4.78% 3.34% $123 $114 $444 $363 FIDELITY VARIABLE INSURANCE PRODUCTS FUND Fidelity VIP Equity-Income 3.33% 1.89% 0.84% 4.17% 2.73% $128 $108 $483 $306 Portfolio -S2 Fidelity VIP Growth Portfolio -S2 3.33% 1.89% 0.93% 4.26% 2.82% $122 $109 $435 $315 ING GET FUND ING GET Fund 3.83% 2.39% 1.00% 4.83% 3.39% $123 $109 N/A N/A ING PARTNERS, INC. ING Van Kampen Comstock 3.33% 1.89% 1.20% 4.53% 3.09% $126 $111 $466 $340 ING VARIABLE INSURANCE TRUST ING VP Worldwide Growth 3.33% 1.89% 1.23% 4.56% 3.12% $121 $111 $427 $343 ING VARIABLE PRODUCTS TRUST ING VP Growth Opportunities (S) 3.33% 1.89% 1.10% 4.43% 2.99% $124 $110 $456 $331 ING VP MagnaCap (S) 3.33% 1.89% 1.10% 4.43% 2.99% $124 $110 $456 $331 ING VP SmallCap Opportunities (S) 3.33% 1.89% 1.10% 4.43% 2.99% $124 $110 $456 $331 ING VP BOND PORTFOLIO ING VP Bond Portfolio -S 3.33% 1.89% 0.75% 4.08% 2.64% $124 $107 $453 $297 INVESCO VARIABLE INVESTMENT FUNDS, INC. INVESCO VIF- Financial Services Fund 3.33% 1.89% 1.07% 4.40% 2.96% $124 $110 $453 $328 INVESCO VIF- Health Sciences Fund 3.33% 1.89% 1.06% 4.39% 2.95% $127 $110 $479 $327 INVESCO VIF- Leisure Fund 3.33% 1.89% 1.39% 4.72% 3.28% $127 $113 $477 $358 INVESCO VIF- Utilities Fund 3.33% 1.89% 1.37% 4.70% 3.26% $121 $113 $427 $356 THE PIMCO VARIABLE INSURANCE TRUST PIMCO High Yield 3.33% 1.89% 0.75% 4.08% 2.64% $120 $107 $419 $297 PIONEER VARIABLE CONTRACTS TRUST Pioneer Fund VCT Portfolio 3.33% 1.89% 1.04% 4.37% 2.93% $124 $110 $451 $325 Pioneer Mid-Cap Value VCT Portfolio 3.33% 1.89% 1.11% 4.44% 3.00% $125 $110 $457 $332 PROFUNDS VP ProFund VP Bull 3.33% 1.89% 1.98% 5.31% 3.87% $133 $119 $523 $410 ProFund VP Europe 30 3.33% 1.89% 1.89% 5.22% 3.78% $132 $118 $516 $402 ProFund VP Small-Cap 3.33% 1.89% 2.25% 5.58% 4.14% $136 $122 $542 $432 THE PRUDENTIAL SERIES FUND, INC. Jennison 3.33% 1.89% 1.04% 4.37% 2.93% $124 $110 $451 $325 SP Jennison International Growth 3.33% 1.89% 2.26% 5.59% 4.15% $136 $122 $543 $433 ------------------------------------------------------------------------------------------------------------------------------
EXAMPLES The following two examples are designed to show you the expenses you would pay on a $1,000 investment, that earns 5% annually. These examples replace Examples 1 and 2 currently in your prospectus. Examples 3 and 4 are unchanged. Each example assumes election of the Max 7 Enhanced Death Benefit. The examples reflect the deduction of a mortality and expense risk charge, an asset-based administrative charge, and the annual contract administrative charge as an annual charge of 0.04% of assets (based on an average contract value of $68,000). Expenses for the GET Fund, if available, also reflect the asset-based GET Fund guarantee charge of 0.50% of assets in the GET Fund. Because a GET Fund series has a five year period to maturity, no GET Fund expenses are shown in the 10 year expense column for the GET Fund. These examples also assume you elected the earnings multiplier benefit rider with a charge of 0.30% of the contract value annually and that you elected an optional benefit rider with the highest cost, an assumed charge of 0.75% annually, where the rider base is equal to the initial premium and increases by 7% annually, and the rider charge is assessed each quarter on a base equal to the hypothetical $1,000 premium increasing at 7% per year. The assumed annual rider charge of 1.14% results from the assumption of a 7% annual increase in the rider base but only a 5% earnings increase in the contract value before expenses. Thus, 1.14% represents an annual charge over the 10-year period which is equivalent to a charge of 0.1875% of rider base per quarter over the same period. For Yr-2003 contract owners, the assumed annual rider charge is 0.75% for allocations to the Liquid Asset Portfolio or Limited Maturity Bond Portfolio. Each example also assumes that any applicable expense reimbursement of underlying portfolio expenses will continue for the periods shown. If another death benefit is elected instead of the Max 7 Enhanced Death Benefit used in the examples, the actual expenses will be less than those represented in the examples. Note that surrender charges may apply if you choose to annuitize your Contract. Thus, in the event you annuitize your Contract under circumstances which require a surrender charge, you should refer to Examples 1 and 3 which assume applicable surrender charges. Example 1: If you surrender your Contract at the end of the applicable time period and elected both the earnings multiplier benefit rider and another optional benefit rider with the highest charge, you would pay the following expenses for each $1,000 invested:
-------------------------------------------------------------------------------------------------------------------- 1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------------------------------------------- THE GCG TRUST All Cap -A $125 $196 $267 $461 Capital Growth -A $125 $196 $268 $461 Capital Guardian Small Cap -A $124 $194 $265 $456 Core Bond -A $125 $196 $267 $461 Developing World -A $132 $217 $300 $518 Diversified Mid-Cap -A $125 $196 $267 $461 Equity Growth Series -A $125 $196 $267 $461 Equity Income -A $124 $194 $265 $456 Equity Opportunity -A $124 $194 $265 $456 Focus Value Series -A $126 $197 $270 $465 Fully Managed -A $124 $194 $265 $456 Fundamental Growth Series -A $126 $197 $270 $465 Global Franchise Series -A $127 $203 $279 $480 Growth -A $125 $196 $268 $461 Hard Assets -A $124 $194 $265 $456 International Enhanced EAFE Series -A $127 $203 $279 $480 International Equity -A $127 $203 $279 $480 Internet Tollkeeper -A $133 $219 $305 $525 Investors -A $125 $196 $267 $461 J.P. Morgan Fleming Small Cap Equity Series -A $126 $200 $274 $472 Janus Growth and Income -A $126 $199 $272 $469 Large Cap Value -A $125 $196 $267 $461 Liquid Asset -A $117 $171 $227 $385 Managed Global -A $127 $203 $279 $480 Mid-Cap Growth -A $124 $192 $262 $451 Real Estate -A $124 $194 $265 $456 Research -A $124 $192 $262 $451 Special Situations -A $126 $199 $272 $469 Strategic Equity -A $124 $194 $265 $456 Total Return -A $124 $192 $262 $451 Value Equity -A $124 $194 $265 $456 Van Kampen Growth and Income -A $124 $194 $265 $456 AIM VARIABLE INSURANCE FUNDS AIM V.I. Dent Demographic Trends Fund $128 $204 $280 $483 FIDELITY VARIABLE INSURANCE PRODUCTS FUND Fidelity VIP Equity-Income Portfolio -S2 $122 $187 $253 $435 Fidelity VIP Growth Portfolio -S2 $123 $189 $257 $442 ING GET FUND ING GET Fund $128 $205 $283 N/A ING PARTNERS, INC. ING Van Kampen Comstock $125 $197 $269 $464 ING VARIABLE INSURANCE TRUST ING VP Worldwide Growth $126 $198 $271 $466 ING VARIABLE PRODUCTS TRUST ING VP Growth Opportunities (S) $124 $194 $265 $456 ING VP MagnaCap (S) $124 $194 $265 $456 ING VP SmallCap Opportunities (S) $124 $194 $265 $456 ING VP BOND PORTFOLIO ING VP Bond Portfolio -S $121 $184 $249 $427 INVESCO VARIABLE INVESTMENT FUNDS, INC. INVESCO VIF- Financial Services Fund $124 $193 $263 $453 INVESCO VIF- Health Sciences Fund $124 $193 $263 $453 INVESCO VIF- Leisure Fund $127 $202 $278 $479 INVESCO VIF- Utilities Fund $127 $202 $277 $477 THE PIMCO VARIABLE INSURANCE TRUST PIMCO High Yield $121 $184 $249 $427 PIONEER VARIABLE CONTRACTS TRUST Pioneer Fund VCT Portfolio $124 $192 $262 $451 Pioneer Mid-Cap Value VCT Portfolio $125 $194 $265 $457 PROFUNDS ProFund VP Bull $133 $219 $303 $523 ProFund VP Europe 30 $132 $216 $300 $516 ProFund VP Small-Cap $136 $226 $315 $542 THE PRUDENTIAL SERIES FUND, INC. Jennison $124 $192 $262 $451 SP Jennison International Growth $136 $226 $315 $543 --------------------------------------------------------------------------------------------------------------------
Example 2: If you do not surrender your Contract at the end of the applicable time period and elected both the earnings multiplier benefit rider and another optional benefit rider with the highest charge, you would pay the following expenses for each $1,000 invested:
-------------------------------------------------------------------------------------------------------------------- 1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------------------------------------------- THE GCG TRUST All Cap -A $45 $136 $227 $461 Capital Growth -A $45 $136 $228 $461 Capital Guardian Small Cap -A $44 $134 $225 $456 Core Bond -A $45 $136 $227 $461 Developing World -A $52 $157 $260 $518 Diversified Mid-Cap -A $45 $136 $227 $461 Equity Growth Series -A $45 $136 $227 $461 Equity Income -A $44 $134 $225 $456 Equity Opportunity -A $44 $134 $225 $456 Focus Value Series -A $46 $137 $230 $465 Fully Managed -A $44 $134 $225 $456 Fundamental Growth Series -A $46 $137 $230 $465 Global Franchise Series -A $47 $143 $239 $480 Growth -A $45 $136 $228 $461 Hard Assets -A $44 $134 $225 $456 International Enhanced EAFE Series -A $47 $143 $239 $480 International Equity -A $47 $143 $239 $480 Internet Tollkeeper -A $53 $159 $265 $525 Investors -A $45 $136 $227 $461 J.P. Morgan Fleming Small Cap Equity Series -A $46 $140 $234 $472 Janus Growth and Income -A $46 $139 $232 $469 Large Cap Value -A $45 $136 $227 $461 Liquid Asset -A $37 $111 $187 $385 Managed Global -A $47 $143 $239 $480 Mid-Cap Growth -A $44 $132 $222 $451 Real Estate -A $44 $134 $225 $456 Research -A $44 $132 $222 $451 Special Situations -A $46 $139 $232 $469 Strategic Equity -A $44 $134 $225 $456 Total Return -A $44 $132 $222 $451 Value Equity -A $44 $134 $225 $456 Van Kampen Growth and Income -A $44 $134 $225 $456 AIM VARIABLE INSURANCE FUNDS AIM V.I. Dent Demographic Trends Fund $48 $144 $240 $483 FIDELITY VARIABLE INSURANCE PRODUCTS FUND Fidelity VIP Equity-Income Portfolio -S2 $42 $127 $213 $435 Fidelity VIP Growth Portfolio -S2 $43 $129 $217 $442 ING GET FUND ING GET Fund $48 $145 $243 N/A ING PARTNERS, INC. ING Van Kampen Comstock $45 $137 $229 $464 ING VARIABLE INSURANCE TRUST ING VP Worldwide Growth $46 $138 $231 $466 ING VARIABLE PRODUCTS TRUST ING VP Growth Opportunities (S) $44 $134 $225 $456 ING VP MagnaCap (S) $44 $134 $225 $456 ING VP SmallCap Opportunities (S) $44 $134 $225 $456 ING VP BOND PORTFOLIO ING VP Bond Portfolio -S $41 $124 $209 $427 INVESCO VARIABLE INVESTMENT FUNDS, INC. INVESCO VIF- Financial Services Fund $44 $133 $223 $453 INVESCO VIF- Health Sciences Fund $44 $133 $223 $453 INVESCO VIF- Leisure Fund $47 $142 $238 $479 INVESCO VIF- Utilities Fund $47 $142 $237 $477 THE PIMCO VARIABLE INSURANCE TRUST PIMCO High Yield $41 $124 $209 $427 PIONEER VARIABLE CONTRACTS TRUST Pioneer Fund VCT Portfolio $44 $132 $222 $451 Pioneer Mid-Cap Value VCT Portfolio $45 $134 $225 $457 PROFUNDS ProFund VP Bull $53 $159 $263 $523 ProFund VP Europe 30 $52 $156 $260 $516 ProFund VP Small-Cap $56 $166 $275 $542 THE PRUDENTIAL SERIES FUND, INC. Jennison $44 $132 $222 $451 SP Jennison International Growth $56 $166 $275 $543 --------------------------------------------------------------------------------------------------------------------
GOLDEN AMERICAN LIFE INSURANCE COMPANY Golden American Life Insurance Company is a stock company domiciled in Delaware. 125129 Opportunities 02/04/2003