-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GZpfiyErvdK43XbRi94Xm5NV0eGHRxSOd70xqQ2Qg4VVmfMgR1tSi9oq4fkQ+tLs kVZGdDlhFlo1IKWBnnrM6g== 0001017062-02-000022.txt : 20020413 0001017062-02-000022.hdr.sgml : 20020413 ACCESSION NUMBER: 0001017062-02-000022 CONFORMED SUBMISSION TYPE: 497 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20020103 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SEPARATE ACCOUNT A OF PACIFIC LIFE INSURANCE CO CENTRAL INDEX KEY: 0000935823 STANDARD INDUSTRIAL CLASSIFICATION: [] FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 497 SEC ACT: 1933 Act SEC FILE NUMBER: 333-53040 FILM NUMBER: 2501355 BUSINESS ADDRESS: STREET 1: P O BOX 7500 CITY: NEWPORT BEACH STATE: CA ZIP: 92658-7500 BUSINESS PHONE: 7146403743 MAIL ADDRESS: STREET 1: P O BOX 7500 CITY: NEWPORT BEACH STATE: CA ZIP: 92658-7500 FORMER COMPANY: FORMER CONFORMED NAME: SEPARATE ACCOUNT A OF PACIFIC MUTUAL LIFE INS CO DATE OF NAME CHANGE: 19950119 497 1 d497.txt PACIFIC LIFE -- ODYSSEY Supplement dated January 1, 2002 to Prospectus dated July 2, 2001 for the Pacific Odyssey, a variable annuity contract issued by Pacific Life Insurance Company Capitalized terms used in this Supplement are defined in the Prospectus referred to above unless otherwise defined herein. "We," "us", or "our" refer to Pacific Life Insurance Company; "you" or "your" refer to the Contract Owner. This supplement changes the Prospectus to reflect the following, and restates information contained in a Supplement dated October 12, 2001: --------------------------------------------------------- The portfolio Effective December 1, 2001, Putnam Investment manager for the Management, Inc. became the portfolio manager of the Aggressive Equity Aggressive Equity Portfolio and the Equity Portfolio. Portfolio and the Equity Portfolio has changed. --------------------------------------------------------- The Equity Income Effective January 1, 2002, the name of the Equity variable investment Income Variable Investment Option is changed to the option has changed Large-Cap Core Variable Investment Option. its name. This reflects a change in name of the underlying Equity Income Portfolio managed by J.P. Morgan Investment Management, Inc. Any reference to the Equity Income Portfolio, Subaccount, or Variable Investment Option throughout the Prospectus and/or Supplement is revised to be the Large-Cap Core Portfolio, Subaccount, or Variable Investment Option. --------------------------------------------------------- Two new Variable Effective January 1, 2002, two new Variable Investment Investment Options Options are available and are added to the list on page are available. 1 of the Prospectus: Equity Income Research References to the 31 Variable Investment Options throughout the Prospectus are revised to be 33 Variable Investment Options. --------------------------------------------------------- An OVERVIEW OF The following is added to the Optional Riders section PACIFIC ODYSSEY is of the Prospectus: amended. Guaranteed Protection Advantage Rider The optional Guaranteed Protection Advantage Rider provides for an additional amount that may be added to your Contract Value when an asset allocation program, established and maintained by us for this Rider, is used for a 10-year period (the "Term"). The Term begins on the Effective Date of the Rider. Your entire Contract Value must be invested in an asset allocation program during the entire Term for the additional amount to be added to your Contract. Subject to certain limitations, you can buy the Guaranteed Protection Advantage Rider at any time during the Contract Year. The Guaranteed Protection Advantage Rider may not be available. Ask your registered representative about its current availability. --------------------------------------------------------- The side note to the Optional Riders section is changed to read as follows: Optional Riders are subject to availability. Ask your registered representative about their current status. --------------------------------------------------------- The Contract Expenses section of the Prospectus is amended by adding the following: Guaranteed Protection Charge, as a percentage of Contract Value 0.10%/3/ /3/ If you buy the Guaranteed Protection Advantage Rider (subject to availability), we deduct this charge from your Investment Options on each Contract Anniversary following the Effective Date of the Rider and while the Rider is in effect. If the Rider is terminated for reasons other than death or annuitization, this charge will be deducted on the effective date of termination. --------------------------------------------------------- An OVERVIEW OF The Pacific Select Fund Annual Expenses is replaced: PACIFIC ODYSSEY-- Pacific Select Fund The table below shows the advisory fee and Fund Annual Expenses is expenses as an annual percentage of each Portfolio's amended. average daily net assets, based on the year 2000 unless otherwise noted. To help limit Fund expenses, effective July 1, 2000 Pacific Life contractually agreed to waive all or part of its investment advisory fees or otherwise reimburse each Portfolio for operating expenses (including organizational expenses, but not including advisory fees, additional costs associated with foreign investing and extraordinary expenses) that exceed an annual rate of 0.10% of its average daily net assets. Such waiver or reimbursement is subject to repayment to us to the extent such expenses fall below the 0.10% expense cap. Any amounts repaid to us will have the effect of increasing such expenses of the Portfolio, but not above the 0.10% expense cap. For each Portfolio, our right to repayment of amounts waived and/or reimbursed is limited to amounts that do not cause such expenses to exceed the new 0.10% expense cap. There is no guarantee that we will continue to cap expenses after December 31, 2002. In 2000, we reimbursed approximately $13,202 to the I-Net Tollkeeper Portfolio, $36,311 to the Strategic Value Portfolio, $34,134 to the Focused 30 Portfolio and $27,505 to the Small-Cap Index Portfolio.
------------------------------------------------------------------------------------- Less Advisory Other 12b-1 Total adviser's Total net Portfolio fee expenses amounts+ expenses reimbursement expenses ------------------------------------------------------------------------------------- As an annual % of average daily net assets Blue Chip/1/ 0.95 0.06 -- 1.01 -- 1.01 Aggressive Growth/1/ 1.00 0.06 -- 1.06 -- 1.06 Emerging Markets/2/ 1.10 0.21 -- 1.31 -- 1.31 Diversified Research/2/ 0.90 0.08 0.01 0.99 -- 0.99 Small-Cap Equity/2/ 0.65 0.05 -- 0.70 -- 0.70 International Large-Cap 1.05 0.12 -- 1.17 -- 1.17 I-Net Tollkeeper/2/,/3/ 1.40 0.13 -- 1.53 (0.02) 1.51 Financial Services/1/ 1.10 0.15 -- 1.25 (0.05) 1.20 Health Sciences/1/ 1.10 0.11 -- 1.21 (0.01) 1.20 Technology/1/ 1.10 0.08 -- 1.18 -- 1.18 Telecommunications/1/ 1.10 0.08 -- 1.18 -- 1.18 Multi-Strategy 0.65 0.04 -- 0.69 -- 0.69 Large-Cap Core/2/ 0.65 0.04 0.01 0.70 -- 0.70 Strategic Value 0.95 0.49 -- 1.44 (0.39) 1.05 Growth LT 0.75 0.04 -- 0.79 -- 0.79 Focused 30 0.95 0.42 -- 1.37 (0.32) 1.05 Mid-Cap Value/2/ 0.85 0.03 0.10 0.98 -- 0.98 International Value 0.85 0.11 -- 0.96 -- 0.96 Capital Opportunities/1/ 0.80 0.06 -- 0.86 -- 0.86 Mid-Cap Growth/1/ 0.90 0.06 -- 0.96 -- 0.96 Global Growth/1/ 1.10 0.19 -- 1.29 -- 1.29 Equity Index 0.25 0.04 -- 0.29 -- 0.29 Small-Cap Index/2/ 0.50 0.13 -- 0.63 (0.02) 0.61 REIT 1.10 0.04 -- 1.14 -- 1.14 Inflation Managed/2/ 0.60 0.05 -- 0.65 -- 0.65 Managed Bond/2/ 0.60 0.05 -- 0.65 -- 0.65 Money Market 0.34 0.04 -- 0.38 -- 0.38 High Yield Bond/2/ 0.60 0.05 -- 0.65 -- 0.65 Equity Income/1/ 0.95 0.15 -- 1.10 (0.05) 1.05 Research/1/ 1.00 0.12 -- 1.12 (0.02) 1.10 Equity 0.65 0.04 -- 0.69 -- 0.69 Aggressive Equity/2/ 0.80 0.04 0.02 0.86 -- 0.86 Large-Cap Value/2/ 0.85 0.05 0.05 0.95 -- 0.95 -------------------------------------------------------------------------------------
/1/ Expenses are estimated. There were no actual advisory fees or expenses for these Portfolios in 2000 because the Portfolios started after December 31, 2000. /2/ Total adjusted net expenses for these Portfolios, after deduction of an offset for custodian credits and the 12b-1 recapture were: 1.30% for Emerging Markets Portfolio, 0.98% for Diversified Research Portfolio, 0.69% for Small-Cap Equity Portfolio, 1.50% for I-Net Tollkeeper Portfolio (adjusted for the reduced advisory fee/3/), 0.69% for Large-Cap Core Portfolio, 0.88% for Mid-Cap Value Portfolio, 0.60% for Small-Cap Index Portfolio, 0.62% for Inflation Managed Portfolio, 0.64% for Managed Bond Portfolio, 0.64% for High Yield Bond Portfolio, 0.84% for Aggressive Equity Portfolio, and 0.90% for Large-Cap Value Portfolio. /3/ Effective January 1, 2002, the advisory fee is reduced from the annual rate of 1.50% of average daily net assets to 1.40%. + The Fund has a brokerage enhancement 12b-1 plan under which brokerage transactions, subject to best price and execution, may be placed with certain broker-dealers in return for credits, cash or other compensation ("recaptured commissions"). While a Portfolio pays the cost of brokerage when it buys or sells a Portfolio security, there are no fees or charges to the Fund under the plan. Recaptured commissions may be used to promote and market Fund shares and the distributor may therefore defray expenses for distribution that it might otherwise incur. The SEC staff requires that the amount of recaptured commissions be shown as an expense in the chart above. 2 --------------------------------------------------------- An OVERVIEW OF The Examples section of the Prospectus is replaced with PACIFIC ODYSSEY-- the following: Examples is replaced. The following table shows the expenses you would pay on each $1,000 you invested if, at the end of each period, you: annuitized your Contract; surrendered your Contract and withdrew the Contract Value, or did not annuitize or surrender, but left the money in your Contract. These examples assume the following: . the Variable Investment Options have an annual return of 5%; . our current program to reimburse to Pacific Select Fund Portfolio expenses in excess of the 0.10% expense cap as described in Pacific Select Fund Annual Expenses will continue for at least 10 years. without any Rider reflects the expenses you would pay if you did not buy any of the following optional Riders: Stepped-Up Death Benefit Rider (SDBR), Premier Death Benefit Rider (PDBR), and Guaranteed Protection Advantage Rider, collectively referred to below as "Riders". Riders may be subject to availability. Ask your registered representative about their current status. with Riders reflects the maximum amount of expenses you would pay if you bought the optional combination of Riders whose cumulative expense totaled more than any other optional combination. These examples do not show past or future expenses. Your actual expenses in any year may be more or less than those shown here.
--------------------------------------------------------------------------------- Expenses if you did not annuitize or Expenses if you Expenses if you surrender, but left annuitized surrendered the money in your your Contract ($) your Contract ($) Contract ($) --------------------------------------------------------------------------------- Variable Account 1 yr 3 yr 5 yr 10 yr 1 yr 3 yr 5 yr 10 yr 1 yr 3 yr 5 yr 10 yr --------------------------------------------------------------------------------- Blue Chip without any Rider 14 45 77 169 14 45 77 169 14 45 77 169 with Riders 21 66 113 244 21 66 113 244 21 66 113 244 --------------------------------------------------------------------------------- Aggressive Growth without any Rider 15 46 80 174 15 46 80 174 15 46 80 174 with Riders 22 68 116 249 22 68 116 249 22 68 116 249 --------------------------------------------------------------------------------- Emerging Markets without any Rider 17 54 92 201 17 54 92 201 17 54 92 201 with Riders 24 75 128 274 24 75 128 274 24 75 128 274 --------------------------------------------------------------------------------- Diversified Research without any Rider 14 44 75 165 14 44 75 165 14 44 75 165 with Riders 21 65 112 241 21 65 112 241 21 65 112 241 --------------------------------------------------------------------------------- Small-Cap Equity without any Rider 11 35 60 133 11 35 60 133 11 35 60 133 with Riders 18 56 97 211 18 56 97 211 18 56 97 211 --------------------------------------------------------------------------------- International Large-Cap without any Rider 16 50 85 186 16 50 85 186 16 50 85 186 with Riders 23 71 122 260 23 71 122 260 23 71 122 260 --------------------------------------------------------------------------------- I-Net Tollkeeper without any Rider 19 60 103 223 19 60 103 223 19 60 103 223 with Riders 24 74 126 269 24 74 126 269 24 74 126 269 --------------------------------------------------------------------------------- Financial Services without any Rider 16 50 87 190 16 50 87 190 16 50 87 190 with Riders 23 72 123 263 23 72 123 263 23 72 123 263 --------------------------------------------------------------------------------- Health Sciences without any Rider 16 50 87 190 16 50 87 190 16 50 87 190 with Riders 23 72 123 263 23 72 123 263 23 72 123 263 --------------------------------------------------------------------------------- Technology without any Rider 16 50 86 188 16 50 86 188 16 50 86 188 with Riders 23 71 122 261 23 71 122 261 23 71 122 261 ---------------------------------------------------------------------------------
3
------------------------------------------------------------------------------------------------------------- Expenses if you did not annuitize or Expenses if you Expenses if you surrender, but left annuitized surrendered the money in your your Contract ($) your Contract ($) Contract ($) ------------------------------------------------------------------------------------------------------------- Variable Account 1 yr 3 yr 5 yr 10 yr 1 yr 3 yr 5 yr 10 yr 1 yr 3 yr 5 yr 10 yr ------------------------------------------------------------------------------------------------------------- Telecommunications without any Rider 16 50 86 188 16 50 86 188 16 50 86 188 with Riders 23 71 122 261 23 71 122 261 23 71 122 261 ------------------------------------------------------------------------------------------------------------- Multi-Strategy without any Rider 11 35 60 133 11 35 60 133 11 35 60 133 with Riders 18 56 97 211 18 56 97 211 18 56 97 211 ------------------------------------------------------------------------------------------------------------- Large-Cap Core (formerly called Equity Income) without any Rider 11 35 60 133 11 35 60 133 11 35 60 133 with Riders 18 56 97 211 18 56 97 211 18 56 97 211 ------------------------------------------------------------------------------------------------------------- Strategic Value without any Rider 15 46 79 173 15 46 79 173 15 46 79 173 with Riders 22 67 115 248 22 67 115 248 22 67 115 248 ------------------------------------------------------------------------------------------------------------- Growth LT without any Rider 12 38 65 144 12 38 65 144 12 38 65 144 with Riders 19 59 102 221 19 59 102 221 19 59 102 221 ------------------------------------------------------------------------------------------------------------- Focused 30 without any Rider 15 46 79 173 15 46 79 173 15 46 79 173 with Riders 22 67 115 248 22 67 115 248 22 67 115 248 ------------------------------------------------------------------------------------------------------------- Mid-Cap Value without any Rider 13 41 70 154 13 41 70 154 13 41 70 154 with Riders 20 62 107 231 20 62 107 231 20 62 107 231 ------------------------------------------------------------------------------------------------------------- International Value without any Rider 14 43 74 163 14 43 74 163 14 43 74 163 with Riders 21 65 111 239 21 65 111 239 21 65 111 239 ------------------------------------------------------------------------------------------------------------- Capital Opportunities without any Rider 13 40 69 152 13 40 69 152 13 40 69 152 with Riders 20 62 106 228 20 62 106 228 20 62 106 228 ------------------------------------------------------------------------------------------------------------- Mid-Cap Growth without any Rider 14 43 74 163 14 43 74 163 14 43 74 163 with Riders 21 65 111 239 21 65 111 239 21 65 111 239 ------------------------------------------------------------------------------------------------------------- Global Growth without any Rider 17 53 92 199 17 53 92 199 17 53 92 199 with Riders 24 75 128 273 24 75 128 273 24 75 128 273 ------------------------------------------------------------------------------------------------------------- Equity Index without any Rider 7 22 38 86 7 22 38 86 7 22 38 86 with Riders 14 44 76 167 14 44 76 167 14 44 76 167 ------------------------------------------------------------------------------------------------------------- Small-Cap Index without any Rider 10 32 55 122 10 32 55 122 10 32 55 122 with Riders 17 54 92 201 17 54 92 201 17 54 92 201 ------------------------------------------------------------------------------------------------------------- REIT without any Rider 16 49 84 183 16 49 84 183 16 49 84 183 with Riders 23 70 120 257 23 70 120 257 23 70 120 257 ------------------------------------------------------------------------------------------------------------- Inflation Managed (formerly called Government Securities) without any Rider 10 32 56 125 10 32 56 125 10 32 56 125 with Riders 18 54 93 203 18 54 93 203 18 54 93 203 ------------------------------------------------------------------------------------------------------------- Managed Bond without any Rider 11 33 57 127 11 33 57 127 11 33 57 127 with Riders 18 55 94 205 18 55 94 205 18 55 94 205 ------------------------------------------------------------------------------------------------------------- Money Market without any Rider 8 25 43 96 8 25 43 96 8 25 43 96 with Riders 15 47 81 177 15 47 81 177 15 47 81 177 ------------------------------------------------------------------------------------------------------------- High Yield Bond without any Rider 11 33 58 128 11 33 58 128 11 33 58 128 with Riders 18 55 95 206 18 55 95 206 18 55 95 206 ------------------------------------------------------------------------------------------------------------- Equity Income without any Rider 15 46 79 173 15 46 79 173 15 46 79 173 with Riders 25 77 131 279 25 77 131 279 25 77 131 279 ------------------------------------------------------------------------------------------------------------- Research without any Rider 15 47 82 179 15 47 82 179 15 47 82 179 with Riders 25 78 133 284 25 78 133 284 25 78 133 284 -------------------------------------------------------------------------------------------------------------
4
--------------------------------------------------------------------------------------- Expenses if you did not annuitize or Expenses if you Expenses if you surrender, but left annuitized surrendered the money in your your Contract ($) your Contract ($) Contract ($) --------------------------------------------------------------------------------------- Variable Account 1 yr 3 yr 5 yr 10 yr 1 yr 3 yr 5 yr 10 yr 1 yr 3 yr 5 yr 10 yr --------------------------------------------------------------------------------------- Equity without any Rider 11 35 60 133 11 35 60 133 11 35 60 133 with Riders 18 56 97 211 18 56 97 211 18 56 97 211 --------------------------------------------------------------------------------------- Aggressive Equity without any Rider 13 39 68 150 13 39 68 150 13 39 68 150 with Riders 20 61 105 226 20 61 105 226 20 61 105 226 --------------------------------------------------------------------------------------- Large-Cap Value without any Rider 13 41 71 157 13 41 71 157 13 41 71 157 with Riders 20 63 108 233 20 63 108 233 20 63 108 233 ---------------------------------------------------------------------------------------
The purpose of the preceding table is to help you understand the various costs and expenses that you may bear directly or indirectly. The table reflects expenses of the Separate Account as well as those of the underlying Portfolios. Premium taxes may also be applicable. For more information on fees and expenses, see CHARGES, FEES AND DEDUCTIONS, WITHDRAWALS, and Pacific Select Fund Annual Expenses, in the Prospectus and see the Fund's SAI. 5 --------------------------------------------------------- YOUR INVESTMENT The chart in the Your Variable Investment Options OPTIONS is amended. section is amended to include the following:
PORTFOLIO INVESTMENT GOAL THE PORTFOLIO'S PORTFOLIO MAIN INVESTMENTS MANAGER Equity Income Current income. Equity securities of Putnam Investment Management, Inc. Capital growth is of large U.S. companies secondary importance. with a focus on income-producing securities believed to be undervalued by the market. Research Long-term growth of Equity securities of Putnam Investment Management, Inc. capital. large U.S. companies with potential for capital appreciation. Equity Capital appreciation. Equity securities of Putnam Investment Management, Inc. Current income is of large U.S. growth- secondary importance. oriented companies. Aggressive Equity Capital appreciation. Equity securities of Putnam Investment Management, Inc. small and medium-sized companies.
--------------------------------------------------------- The second sentence of the sub-section The Investment Adviser is revised to read: We and the Fund have retained other portfolio managers, supervised by us, for 31 of the Portfolios. 6 --------------------------------------------------------- PURCHASING YOUR The PURCHASING YOUR CONTRACT section is amended by CONTRACT is adding the following: amended. Purchasing the Guaranteed Protection Advantage Rider (Optional) You may purchase the optional Guaranteed Protection Advantage Rider (subject to availability) on the Contract Date or on any subsequent Contract Anniversary if: . the age of each Annuitant is 80 years or younger on the date of purchase; . the date of the purchase is at least 10 years prior to your selected Annuity Date; and . if you use an asset allocation program established and maintained by us for this Rider during the entire period that the Rider is in effect. If you purchase the Guaranteed Protection Advantage Rider within 30 days after the Contract Date or a Contract Anniversary, the Effective Date of the Rider will be that Contract Date or Anniversary. If you purchase the Rider 30 days or more after the Contact Date or the Contract Anniversary, the Effective Date of the Rider will be the next Contract Anniversary. The Rider will remain in effect, unless otherwise terminated, for a 10-year period (the "Term") beginning on the Effective Date of the Rider and, subject to certain limitations, each 10-year period thereafter. On the last day of a Term, we will add an additional amount to your Contract Value if, on that day, the Contract Value is less than a specified amount (the "Guaranteed Protection Amount"). The additional amount will be equal to the difference between the Contract Value on the last day of the Term and the Guaranteed Protection Amount. The additional amount added to the Contract Value will be considered earnings and allocated to your Investment Options according to the allocations used in your most recent asset allocation program. The Guaranteed Protection Amount is equal to (a) plus (b) minus (c) as indicated below: (a) is the Contract Value at the start of a Term; (b) is a percentage of each additional Purchase Payment, as determined from the table below, paid to the Contract during a Term; (c) is a pro rata adjustment for withdrawals made from the Contract during the Term. The adjustment for each withdrawal is calculated by multiplying the Guaranteed Protection Amount prior to the withdrawal by the ratio of the amount of the withdrawal, including any applicable withdrawal charges, to the Contract Value immediately prior to the withdrawal. --------------------------------------------------------- Contract Year Since Percentage of Purchase Payment Beginning of Added to Guaranteed Protection Current Term Amount --------------------------------------------------------- 1 through 4 100% 5 90% 6 85% 7 80% 8 through 10 75% --------------------------------------------------------- For purposes of determining the Contract Value at the start of the initial Term, if the Effective Date of the Rider is the Contract Date, the Contract Value is equal to the initial Purchase Payment. If the Effective Date of the Rider is a Contract Anniversary, the Contract Value is equal to the Contract Value on that Contract Anniversary. For any subsequent Term, the Contract Value is equal to the Contract Value on the last day of the then prior Term. If, on the last day of a Term, the Contract is annuitized, the first death of an Owner or the death of the last surviving Annuitant occurs, or a full withdrawal is made, the Contract Value will reflect any additional amount owed under the Guaranteed Protection Advantage Rider before the payment of any annuity or death benefits, or full withdrawal. 7 No additional amount will be made if the Contract Value on the last day of the Term is greater than the Guaranteed Protection Amount. On or before the end of the Term, you can elect to either terminate the Rider, or renew the Rider for another Term provided: . all Annuitant(s) are 80 years or younger at the start of each renewed Term; and . the new term does not extend beyond your selected Annuity Date. We will contact you at least 30 days before the end of each Term. If we do not receive an election from you prior to the end of each Term, we will automatically renew the Rider for another Term, subject to the restrictions set forth above. If you elect to terminate the Rider, the termination will be effective the day immediately following the end of the Term. The Guaranteed Protection Advantage Rider will remain in effect until the earlier of: . the end of a Term, unless the Rider renews for another Term; or . the Contract Anniversary immediately following the date any portion of the Contract Value is no longer invested in an asset allocation program established and maintained by us for this Rider; or . the Contract Anniversary immediately following the date we receive notification from the Owner to terminate this Rider; or . the date a full withdrawal of the amount available for withdrawal is made under the Contract; or . the date of first death of an Owner or the date of death of the last surviving Annuitant; or . the date the Contract is terminated in accordance with the provisions of the Contract; or . the Annuity Date. If the Owner dies during a Term and the surviving spouse of the deceased Owner elects to continue the Contract in accordance with its terms, then the provisions of this Rider will continue until the end of the Term. Subject to the terms of the Rider, the surviving spouse may renew the Rider for another Term, provided the surviving spouse is age 80 or younger at the start of the new Term and the new Term does not extend beyond the selected Annuity Date. 8 --------------------------------------------------------- The PURCHASING YOUR CONTRACT section is amended by adding the following: Information About Optional Riders and IRAs There are special considerations for purchases of any optional death benefit rider. As of the date of this Prospectus Supplement, IRS regulations state that Individual Retirement Accounts (IRAs) may generally not invest in life insurance contracts. We believe that these regulations do not prohibit the optional death benefit riders from being added to your Contract if it is issued as a Traditional IRA, Roth IRA, or SIMPLE IRA. However, the law is unclear and it is possible that a Contract that has an optional death benefit rider and is issued as a Traditional IRA, Roth IRA, or SIMPLE IRA could be disqualified and may result in increased taxes to the Owner. It is our understanding that the charges relating to the optional death benefit riders are not subject to current taxation and we will not report them as such. However, the IRS may determine that these charges should be treated as partial withdrawals subject to current taxation to the extent of any gain and, if applicable, the 10% tax penalty. We reserve the right to report the rider charges as partial withdrawals if we believe that we would be expected to report them in accordance with IRS regulations. --------------------------------------------------------- PURCHASING YOUR The sub-section Forms of Payment is replaced with the CONTRACT--Making following: Your Investments ("Purchase Forms of Payment Payments") is amended. Your initial and additional Investments may be sent by personal or bank check or by wire transfer. You may also make additional PAC Investments via electronic funds transfer. All checks must be drawn on U.S. funds. We reserve the right to reject: . cash; . credit card or checks drawn against a credit card account; . cashier's check, money orders or travelers checks in single denominations of less than $10,000; . cashier's checks, money orders, traveler's checks or personal checks drawn on non-U.S. banks (even if payment may be effected through a U.S. bank); . third party checks when there is not a clear connection of the third party to the underlying transaction; and . wires that originate from foreign banks. If you make Investments by check other than a cashier's check, your payment of any withdrawal proceeds and any refund during the "Right to Cancel" period may be delayed until your check has cleared. --------------------------------------------------------- CHARGES, FEES AND The CHARGES, FEES AND DEDUCTIONS section is amended by DEDUCTIONS is adding the following: amended. Annual Guaranteed Protection Charge (Optional Rider) If you purchase the Guaranteed Protection Advantage Rider, we will deduct a Guaranteed Protection Charge from your Investment Options on a proportionate basis on each Contract Anniversary that the Rider remains in effect following the Effective Date of the Rider, and if you terminate the Rider. The Guaranteed Protection Charge is equal to 0.10% multiplied by your Contract Value on the date the Charge is deducted. Any portion of the Guaranteed Protection Charge we deduct from the Fixed Option will not be greater than the annual interest credited in excess of 3%. If you make a full withdrawal during a Contract Year, we will deduct the entire Guaranteed Protection Charge for the Contract Year from the final payment made to you. 9 --------------------------------------------------------- FEDERAL TAX The following sub-section is added to the FEDERAL TAX STATUS--Taxes STATUS--Taxes Payable by Contract Owners: General Rules Payable by Contract section of the Prospectus: Owners: General Rules is amended. Taxes Payable on Optional Riders It is our understanding that the charges relating to any optional death benefit rider (SDBR, or PDBR) are not subject to current taxation and we will not report them as such. However, the IRS may determine that these charges should be treated as partial withdrawals subject to current taxation to the extent of any gain and, if applicable, the 10% tax penalty. We reserve the right to report any optional death benefit rider charges as partial withdrawals if we believe that we would be expected to report them in accordance with IRS regulations. Additionally, as of the date of this Prospectus Supplement, IRS regulations state that Individual Retirement Accounts (IRAs) may not invest in life insurance contracts. However, a Contract that is used as an IRA may provide for a death benefit that equals the greater of the Purchase Payments made and the Contract Value. The Contract offers various optional death benefits riders that, when combined with the Contract, may exceed the death benefit allowable under IRS Regulations. Although, we believe that these regulations do not prohibit the optional death benefit riders from being added to your Contract if it is issued as a Traditional IRA, Roth IRA, or SIMPLE IRA, the law is unclear. It is possible that the IRS may disqualify the Contract if it is issued with an optional death benefit rider, which may result in certain deemed distributions, increases in taxes, or, possibly, tax penalties. You should consult with a qualified tax advisor before deciding to purchase any optional death benefit rider in connection with any IRA Contract. --------------------------------------------------------- THE GENERAL The sub-section Fixed Option is amended to include the ACCOUNT-- following: Withdrawals and Transfers is We have waived the restrictions that limits transfers amended. from the Fixed Option to one transfer within the 30 days after the end of each Contract Anniversary. We also have waived the limitations on the maximum amount you may transfer from the Fixed Option in any given Contract year. Our current procedure is to process requests for transfers from the Fixed Option that are within the maximum number of allowable transfers among the Investment Options each calendar year; i.e. beginning January 1, 2002, transfers are limited to 25 for each calendar year. Transfers from the Fixed Option under the DCA program are also subject to a minimum duration of six months. 10 -----END PRIVACY-ENHANCED MESSAGE-----